<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 26, 1999
REG. NO. 333-86943
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 1
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
MAIN STREET BANCORP, INC.
(Exact name of registrant as specified in its charter)
PENNSYLVANIA
(State or other jurisdiction of incorporation or organization)
23-2960905
(I.R.S. Employer Identification No.)
601 PENN STREET READING, PENNSYLVANIA 19601
(610)685-1400
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
------------------------------
MBNK CAPITAL TRUST I
(Exact name of the registrant as specified in its Trust Agreement)
DELAWARE
(State or other jurisdiction of incorporation or organization of registrant)
APPLIED FOR
(I.R.S. Employer Identification No.)
WHITE CLAY CENTER,
ROUTE 271,
NEWARK, DELAWARE 19711
(610) 685-1400
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
------------------------------
ROBERT D. MCHUGH, JR.
Executive Vice President and Chief Financial Officer
MAIN STREET BANCORP, INC.
601 PENN STREET
READING, PENNSYLVANIA 19601
(Name, address, including zip code, and telephone number, including area code,
of agent for service of each registrant)
------------------------------
WITH COPIES TO:
JEFFREY P. WALDRON
STEVENS & LEE
ONE GLENHARDIE CORPORATE CENTER SUITE 202
1275 DRUMMERS LANE, WAYNE, PENNSYLVANIA 19087
(610) 293-4961
JONATHAN H. TALCOTT
ALSTON & BIRD LLP
601 PENNSYLVANIA AVENUE, N.W., NORTH BUILDING 11TH FLOOR
WASHINGTON, D.C. 20004
(202) 756-3304
Approximate Date of Commencement of Proposed Sale to the Public: As soon as
practicable after the Registration Statement becomes effective
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933 other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. / /
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration number of the earlier effective registration statement for the same
offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
------------------------------
The Registrants hereby amend this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrants
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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<PAGE>
SUBJECT TO COMPLETION
DATED , 1999
INFORMATION IN THIS PROSPECTUS IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR THE
SOLICITATION OF AN OFFER TO BUY, ANY OF THE SECURITIES TO ANY PERSON IN ANY
JURISDICTION IN WHICH THE OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL.
<PAGE>
[LOGO]
MBNK CAPITAL TRUST I
$40,000,000
% PREFERRED SECURITIES
FULLY AND UNCONDITIONALLY GUARANTEED
BY
MAIN STREET BANCORP, INC.
MBNK CAPITAL TRUST I:
MBNK Capital Trust I is a Delaware business trust. MBNK Capital Trust will:
- sell preferred securities representing interests in MBNK Capital Trust to
the public;
- sell common securities representing interests in MBNK Capital Trust to
Main Street Bancorp, Inc;
- use the proceeds from these sales to buy an equal principal amount of
junior subordinated debentures due December 31, 2029 of Main Street; and
- distribute the interest and principal payments it receives on Main
Street's junior subordinated debentures it owns to the holders of the
preferred and common securities.
QUARTERLY DISTRIBUTIONS:
- For each preferred security that you own, MBNK Capital Trust will pay you
cumulative cash distributions at an annual rate equal to % on the
liquidation amount of $10 per preferred security MBNK Capital Trust will
pay distributions on March 31, June 30, September 30 and December 31 of
each year beginning December 31, 1999.
- Main Street can defer interest payments on the junior subordinated
debentures at any time for up to 20 consecutive quarterly periods. If Main
Street does defer interest payments, MBNK Capital Trust will also defer
distribution.
REDEMPTION:
- Payments on the preferred and common securities.
MBNK Capital Trust may redeem all or a portion the preferred securities at a
redemption price of $10 per preferred security, plus accumulated distributions,
at any time on or after December 31, 2004. MBNK Capital Trust may redeem all but
a portion of the trust preferred securities before December 31, 2004 if there is
a change in existing laws or regulations that would have the negative tax or
regulatory consequences on MBNK Capital Trust described on page 20.
The preferred securities have been approved for listing, subject to official
notice of issuance, on the American Stock Exchange, Inc. under the trading
symbol "MST."
WE URGE YOU TO CAREFULLY READ THE "RISK FACTORS" SECTION BEGINNING ON
PAGE 10, BEFORE YOU MAKE YOUR INVESTMENT DECISION.
THESE SECURITIES ARE NOT SAVINGS ACCOUNTS, DEPOSITS OR OBLIGATIONS OF ANY
BANK AND ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY
OTHER GOVERNMENTAL AGENCY.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
<TABLE>
<CAPTION>
PER PREFERRED SECURITY
----------------------
<S> <C>
Public Offering Price....................................... $
Underwriting commission to be paid by Main
Street Bancorp, Inc. .......................................
Proceeds to MBNK Capital Trust.............................. $
</TABLE>
The underwriters are offering the preferred securities to you. The
underwriters will only sell the preferred securities after they have purchased
the preferred securities from MBNK Capital Trust. The underwriters entirely or
partially may reject any order for preferred securities and they may withdraw,
cancel or modify the offering without giving you any notice.
------------------------
WHEAT FIRST SECURITIES JANNEY MONTGOMERY SCOTT LLC
THE DATE OF THIS PROSPECTUS IS , 1999
<PAGE>
[LOGO]
[Map of the locations of the banking facilities of Main Street Bank superimposed
over a diagram of the Commonwealth of Pennsylvania indicating the locations of
the banking facilities.]
2
<PAGE>
PROSPECTUS SUMMARY
This summary highlights information contained elsewhere in this prospectus.
Because this is a summary, it may not contain all of the information that is
important to you. To understand the offering fully, you should read the entire
prospectus, including the financial statements and related notes, before making
a decision to invest in the preferred securities.
MAIN STREET BANCORP, INC.
We are a bank holding company headquartered in Reading, Pennsylvania. We
were formed on May 1, 1998, through the consolidation of BCB Financial Services
Corporation and Heritage Bancorp, Inc. BCB Financial Services Corporation was
the holding company for Berks County Bank, which was formed in 1987 and was
headquartered in Reading, Pennsylvania. Heritage Bancorp, Inc. was the holding
company for Heritage National Bank, which was formed in 1828 and was
headquartered in Pottsville, Pennsylvania. Effective on January 1, 1999, Berks
County Bank and Heritage National Bank merged and changed the name of the
resulting entity to Main Street Bank. Our bank operates under the names Berks
County Bank, Heritage Bank and Main Street Bank.
At January 1, 1999, Main Street Bank operated twenty-two full service
branches in Berks, Dauphin, Montgomery and Schuylkill Counties in Pennsylvania
as well as eight loan production offices in Berks, Bucks, Chester, Lancaster,
Lehigh, Montgomery, and Schuylkill Counties. In December 1998, we announced
plans to open 23 new branch offices during 1999, more than doubling the number
of full-service community banking offices from 22 to 45. As of August 31, 1999,
we have opened 17 of the new branches. We anticipate opening the six remaining
new branches by the end of 1999. The majority of these new branches are located
in Chester, Lehigh and Montgomery counties. According to the United States
Census Bureau, these counties are three of the fastest growing counties in
Pennsylvania. Based on data from SNL Securities LC these counties have some of
the highest average household incomes in the state. SNL Securities LC is a
research firm that collects and distributes data about the financial services
industry.
To finance our branch expansion program, we have borrowed funds from the
Federal Home Loan Bank and other sources. We have invested these funds in
corporate and government securities, which yield a higher return than the cost
of the borrowed funds. As our new branches mature, we plan to repay the borrowed
funds and replace the securities with the new deposits and loans that these new
branches attract. By using this leverage as part of our expansion strategy, we
hope to provide ourselves with greater flexibility and mitigate the costs
related to the strategy.
Main Street Bank offers a range of commercial and retail banking services to
our customers, including personal and business checking and savings accounts,
certificates of deposit, residential mortgage, consumer and commercial loans,
and private banking services. We also perform personal, corporate, pension, and
other fiduciary services. In addition, we provide safe deposit boxes, traveler's
checks, credit cards, wire transfer of funds, Automated Clearing House
origination and other typical banking services. We are a member of the MAC/Plus
network.
To expand our product offerings, in 1999 we began to offer title insurance.
We intend to offer discount brokerage services, on-line home banking, 401(k) and
employee benefit plans, alternate investments services and general insurance
products in the next six to twelve months.
We are committed to building a strong, customer-friendly community bank. As
a community bank, we believe we respond quickly to our customers through local
decision-making and to tailor products and services to meet their needs. We
believe this customer-friendly approach provides us with a competitive advantage
over many of the larger financial institutions in our market area. In addition,
we believe that we have benefitted from recent acquisitions of locally
headquartered financial institutions by larger regional or national out-of-town
financial institutions.
Our management team possesses extensive banking experience and has worked
together for many years. Our Chief Executive Officer and Chief Financial Officer
have been with Main Street Bank and its predecessor since 1987.
3
<PAGE>
As of June 30, 1999, we had, on a consolidated basis, total assets of
$1.3 billion, deposits of $905.9 million, loans of $580.0 million, and
stockholders' equity of $87.5 million.
Our principal executive offices are located at 601 Penn Street, Reading,
Pennsylvania 19601, and our telephone number at that address is (610) 685-1400.
MBNK CAPITAL TRUST I
MBNK Capital Trust I is a Delaware statutory business trust. A statutory
business trust is a legal entity that is a grantor trust that generally does not
pay federal income tax. We created MBNK Capital Trust for the limited purposes
of:
- issuing the preferred securities and the common securities; and
- investing the proceeds that MBNK Capital Trust receives from the issuance
of the preferred securities and the common securities in an equal
principal amount of junior subordinated debentures issued by us.
The purchasers of the preferred securities MBNK Capital Trust issues in the
offering will own all of MBNK Capital Trust's preferred securities. We will own
all of the common securities. The common securities will represent an aggregate
liquidation amount equal to 3.00% of MBNK Capital Trust's total capital.
The junior subordinated debentures and the interest we pay to MBNK Capital
Trust on the junior subordinated debentures will be MBNK Capital Trust's only
assets and the interest we pay to MBNK Capital Trust on the junior subordinated
debentures will be the only revenue of MBNK Capital Trust.
MBNK Capital Trust will be governed by the trust agreement among us, as
depositor, The Bank of New York (Delaware), as Delaware trustee, and the
administrators, who are selected by us.
The principal executive offices of MBNK Capital Trust are c/o The Bank of
New York, Corporate Trust Department, White Clay Center, Route 271, Newark,
Delaware 19711 and its telephone number is (610) 685-1400.
4
<PAGE>
THE OFFERING
<TABLE>
<S> <C>
The Securities Being Offered........... 4,000,000 preferred securities having a liquidation amount
of $10.00 per preferred security.
The Offering Price..................... $10.00 per preferred security.
Quarterly Distributions Payable to
You.................................. MBNK Capital Trust will make cash distributions to you on
each preferred security you own at an annual rate of %.
The distributions will be cumulative, will accumulate from
, 1999, and will be payable on March 31, June 30,
September 30, and December 31 of each year. The first
distribution will be made on December 31, 1999.
We Have the Option to Defer Interest
Payments............................. If we are not in default under the junior subordinated
debentures, we may defer interest payments on the junior
subordinated debentures for up to 20 consecutive quarters.
We cannot defer interest payments beyond the stated
maturity date of December 31, 2029. MBNK Capital Trust
will defer quarterly distributions on the preferred
securities during any time that we defer interest payments
on the junior subordinated debentures. If MBNK Capital
Trust defers any quarterly distributions on the preferred
securities, the unpaid distributions will accumulate and
MBNK Capital Trust will be required to pay you additional
amounts on the unpaid distributions at an annual rate of
%, compounded quarterly. After the end of any period
when we have deferred interest payments, if we pay all
deferred and current interest on the junior subordinated
debentures, we may defer interest payments again for up to
another 20 consecutive quarters, as long as we don't defer
the interest payments beyond the junior subordinated
debentures stated maturity date.
You Will Have Taxable Income Even if We
Defer Interest Payments.............. If we defer interest payments on the junior subordinated
debentures and MBNK Capital Trust defers distributions on
the preferred securities, you will be required to include
the amount of the deferred distributions in your gross
income for federal income tax purposes and pay taxes on
the amount of the deferred distributions before you
receive any cash distributions. In addition, if you
dispose of your preferred securities before we pay the
deferred interest and MBNK Capital Trust pays the deferred
distributions, you will incur a tax liability even though
you will never receive the cash distributions. See
"Description of the Preferred Securities--Distributions"
on page 18.
</TABLE>
5
<PAGE>
<TABLE>
<S> <C>
The Junior Subordinated Debentures and
the Preferred Securities Mature on
December 31, 2029 but May Be Redeemed
Earlier.............................. When we pay or redeem the junior subordinated debentures,
MBNK Capital Trust will redeem the preferred securities and
will pay you the liquidation amount of $10.00 per
preferred security plus any accumulated and unpaid
distributions. See "Description of Preferred Securities--
Redemption" on page 20. We must repay the junior
subordinated debentures on their stated maturity date of
December 31, 2029. In addition, subject to any regulatory
approvals that may then be required, we may redeem the
junior subordinated debentures prior to their stated
maturity date:
- all or a portion of the junior subordinated debentures
on or after December 31, 2004, or
- all but not a portion of the junior subordinated
debentures at any time, within 90 days after:
- certain tax events occur or become likely to occur;
- MBNK Capital Trust is deemed to be an investment
company; or
- there is an adverse change in the treatment of the
preferred securities as Tier 1 capital for bank
regulatory purposes.
See "Description of Preferred Securities--Redemption" on
page 20.
The Junior Subordinated Debentures Will
Be Unsecured and Subordinate in Right
of Payment to All Our Other
Indebtedness......................... MBNK Capital Trust has received no security or collateral to
assure that we will pay the interest and principal due on
the junior subordinated debentures. In addition, MBNK
Capital Trust has agreed that before we make payments on
the senior subordinated debentures we will make payments
on:
- our existing and future senior and other
subordinated indebtedness; and
- all existing and future liabilities of our
subsidiaries, including Main Street Bank's deposit
liabilities.
Similarly, MBNK Capital Trust has received no security or
collateral to assure that we will perform our obligations
under the guarantee and has agreed that we may make
interest and principal payments on all of our other senior
and subordinated indebtedness before performing our
obligations under the guarantee. See "Description of
Junior Subordinated Debentures--General" on page 31 and
"Description of Junior Subordinated
Debentures--Subordination" on page 39. See "Description of
Guarantee--Status of the Guarantee" on page 42.
</TABLE>
6
<PAGE>
<TABLE>
<S> <C>
You May Be Required to
Exchange Your Preferred Securities
for Junior Subordinated Debentures... We may dissolve MBNK Capital Trust at anytime. If we
dissolve MBNK Capital Trust, we will give you, in exchange
for your preferred securities, junior subordinated
debentures of the same principal amount. See "Description
of Preferred Securities--Liquidation Distribution upon
Dissolution" on page 23.
Our Full and Unconditional Guarantee of
Payment.............................. We will fully, irrevocably and unconditionally guarantee
that MBNK Capital Trust will pay you:
- quarterly distributions on the preferred securities,
if we have not deferred interest payments on the
junior subordinated debentures; and
- the liquidation amount of the preferred securities
if MBNK Capital Trust is liquidated and we do not
distribute junior subordinated debentures to you in
the liquidation.
This guarantee only applies if MBNK Capital Trust has the
funds necessary to make the payments on the preferred
securities, but has failed to do so.
If we do not make payments on the junior subordinated
debentures, MBNK Capital Trust will not have sufficient
funds to make payments on the preferred securities. If we
do not make principal and interest payments on the junior
subordinated debentures, you may institute a legal
proceeding directly against us to force us to make
distributions directly to you. See "Relationship Among the
Preferred Securities, the Junior Subordinated Debentures
and the Guarantee" on page 44.
Limited Voting Rights.................. As holders of the preferred securities, you will have no
voting rights, except in limited circumstances. See
"Description of Preferred Securities--Voting Rights;
Amendment of Trust Agreement" on page 27.
Use of Proceeds........................ MBNK Capital Trust will invest all of the proceeds from the
sale of the preferred securities and the common securities
in our junior subordinated debentures. We will use the net
proceeds from our sale of the junior subordinated
debentures:
- to infuse approximately $32 million of capital into
Main Street Bank; and
- for general corporate purposes, including possible
repurchases of our common stock. See "Use of Proceeds"
on page 15.
Lack of Rating......................... The preferred securities will not be rated by any rating
service and are not anticipated to be rated in the future.
No other security we have issued has been rated.
American Stock Exchange Symbol......... The preferred securities have been approved for listing on
the American Stock Exchange subject to official notice of
issuance under the symbol "MST". We can not assure you
that an active public market in the preferred securities
will develop or, if one does develop, that it will be
maintained. See "Underwriting" on page 52.
ERISA Considerations................... You should carefully consider the information set forth
under "Certain ERISA Considerations" on page 50.
</TABLE>
7
<PAGE>
SELECTED CONSOLIDATED FINANCIAL DATA
The following is our selected consolidated financial information. The
balance sheet and income statement data as of and for the five years ended
December 31, 1998 are taken from our audited consolidated financial statements
as of the end of and for each such year. The balance sheet and income statement
data as of and for the six months ended June 30, 1999 and 1998 are taken from
our unaudited condensed consolidated financial statements as of the end of and
for each such six-month period. The unaudited interim data include all
adjustments which are, in our opinion, necessary to present a fair statement of
these periods and are of a normal recurring nature. Results for the six months
ended June 30, 1999 are not necessarily indicative of results for the entire
year. You should read this selected consolidated financial information in
conjunction with our consolidated financial statements and notes that are
contained in our Annual Report on Form 10-K and are incorporated by reference
into this prospectus.
MAIN STREET BANCORP, INC. SELECTED FINANCIAL DATA
<TABLE>
<CAPTION>
AS OF OR FOR THE AS OF OR FOR THE
YEAR ENDED SIX MONTHS ENDED
DECEMBER 31, JUNE 30,
--------------------------------------------------------------- -------------------------
1994 1995 1996 1997 1998 1998 1999
---------- ---------- ---------- ---------- ----------- ----------- -----------
(DOLLARS IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Total interest income............. $ 31,861 $ 36,413 $ 41,809 $ 54,463 $ 65,719 $ 30,505 $ 40,810
Total interest expense............ 12,519 15,803 18,654 25,978 33,264 14,762 22,912
---------- ---------- ---------- ---------- ----------- ----------- -----------
Net interest income............... 19,342 20,610 23,155 28,485 32,455 15,743 17,898
Provision for loan losses......... 644 828 867 1,140 2,210 485 600
Other income...................... 2,724 2,769 3,559 4,535 10,301 4,779 2,888
Other expenses.................... 14,331 16,350 16,536 19,234 25,092 12,991 16,468
Federal income taxes (benefit).... 2,013 1,890 2,428 3,317 3,711 1,951 (665)
---------- ---------- ---------- ---------- ----------- ----------- -----------
Net income........................ $ 5,078 $ 4,311 $ 6,883 $ 9,329 $ 11,743 $ 5,095 $ 4,383
========== ========== ========== ========== =========== =========== ===========
PER SHARE DATA:
Earnings per share(1)(2)
Basic........................... $ 0.63 $ 0.51 $ 0.82 $ 1.02 $ 1.13 $ 0.49 $ 0.42
Diluted......................... 0.63 0.50 0.82 1.00 1.12 0.48 0.42
Cash dividends declared per
share(2)........................ 0.22 0.25 0.30 0.36 0.49 0.22 0.28
Book value per share(2)(3)........ $ 6.22 $ 6.71 $ 7.16 $ 8.60 $ 9.14 $ 9.03 $ 8.41
Average shares outstanding(2)..... 8,048,922 8,482,808 8,345,300 9,184,980 10,357,974 10,340,160 10,399,650
BALANCE SHEET DATA:
Total assets...................... $ 468,187 $ 509,917 $ 666,476 $ 813,863 $ 1,158,541 $ 864,357 $ 1,306,896
Total loans, net.................. 305,356 318,449 397,790 477,838 533,395 512,246 579,882
Total securities.................. 125,796 138,388 203,236 280,020 534,551 286,127 616,915
Total deposits.................... 381,837 432,988 518,567 626,760 818,550 698,552 905,909
Borrowings........................ 28,776 16,275 81,120 84,758 221,072 60,006 303,712
Total stockholders' equity........ $ 52,565 $ 56,311 $ 59,785 $ 88,720 $ 94,912 $ 93,642 $ 87,536
PERFORMANCE RATIOS:
Return on average assets.......... 1.06% 0.90% 1.22% 1.28% 1.28% 1.22% 0.70%
Return on average stockholders'
equity.......................... 10.24 7.95 12.05 13.16 12.34 11.21 9.42
Net interest margin(4)............ 4.64 4.73 4.54 4.30 4.03 4.21 3.53
Total other expenses as a
percentage of average assets.... 2.99 3.42 2.93 2.63 2.73 3.11 2.64
</TABLE>
8
<PAGE>
<TABLE>
<CAPTION>
AS OF OR FOR THE AS OF OR FOR THE
YEAR ENDED SIX MONTHS ENDED
DECEMBER 31, JUNE 30,
--------------------------------------------------------------- -------------------------
1994 1995 1996 1997 1998 1998 1999
---------- ---------- ---------- ---------- ----------- ----------- -----------
(DOLLARS IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
ASSET QUALITY RATIOS:
Allowance for loan losses as a
percentage of loans............. 1.44% 1.51% 1.26% 1.19% 1.34% 1.14% 1.18%
Allowance for loan losses as a
percentage of non-performing
loans(5)........................ 83.19 103.54 125.70 91.90 86.67 75.25 122.99
Non-performing loans as a
percentage of total loans,
net(5).......................... 1.73 1.46 1.00 1.29 1.54 1.51 0.96
Non-performing assets as a
percentage of total assets(5)... 1.16 1.19 0.78 0.82 0.75 0.97 0.48
Net charge-offs as a percentage of
average loans, net.............. 0.03 0.13 0.19 0.11 0.14 0.06 0.15
LIQUIDITY AND CAPITAL RATIOS:
Equity to assets(6)............... 10.95% 11.34% 10.14% 9.71% 10.34% 10.88% 7.47%
Tier 1 capital to risk-weighted
assets (7)...................... 18.48 17.04 14.81 17.56 14.83 16.59 13.12
Leverage ratio(7)(8).............. 11.99 11.60 9.81 10.93 8.70 10.55 7.42
Total capital to risk-weighted
assets(7)....................... 19.74 18.24 16.06 18.72 15.97 17.68 14.08
Dividend payout ratio............. 35.09 48.67 36.25 35.13 43.57 45.22 66.44
</TABLE>
- ------------------------------
(1) Earnings per share amounts have been computed in accordance with the
provisions of FASB Statement No. 128, Earnings Per Share.
(2) Average shares outstanding and per common share data are adjusted for all
stock dividends and stock splits effected through June 30, 1999.
(3) Based upon total shares issued and outstanding at the end of each respective
period.
(4) Represents net interest income as a percentage of average total interest
earning assets, calculated on a tax-equivalent basis.
(5) Non-performing loans are comprised of (a) loans which are on a nonaccrual
basis, (b) accruing loans that are 90 days or more past due which are
insured for credit loss, and (c) restructured loans. Non-performing assets
are comprised of non-performing loans and foreclosed real estate (assets
acquired in foreclosure).
(6) Based upon average daily balances for the respective periods.
(7) Based on Federal Reserve Board risk-based capital guidelines, as applicable
to the Company.
(8) The leverage ratio is defined as Tier 1 capital to average total assets.
9
<PAGE>
RISK FACTORS
Your investment in the preferred securities will involve some risks. Below
is a summary of the material risk factors that you should be aware of in
arriving at an investment decision. You should carefully consider the following
risk factors and other information in this prospectus before purchasing the
preferred securities.
RISK FACTORS RELATING TO THE PREFERRED SECURITIES
IF MAIN STREET BANK IS UNABLE TO PAY US DIVIDENDS AND WE DO NOT MAKE PAYMENTS ON
THE JUNIOR SUBORDINATED DEBENTURES, MBNK CAPITAL TRUST WILL NOT HAVE FUNDS TO
MAKE PAYMENTS TO YOU.
MBNK Capital Trust will depend solely on our payments on the junior
subordinated debentures to pay amounts due to you on the preferred securities.
Similarly, to make payments to MBNK Capital Trust on the junior subordinated
debentures we will depend primarily on any dividends we receive from Main Street
Bank, which may be limited by regulations, and our cash and liquid investments.
We are a separate legal entity from our subsidiaries, including Main Street
Bank, and do not have significant operations of our own.
BECAUSE OUR OBLIGATIONS UNDER THE GUARANTEE AND THE JUNIOR SUBORDINATED
DEBENTURES ARE SUBORDINATED TO MOST OF OUR OTHER CREDITORS AND ALL OF THE
CREDITORS OF MAIN STREET BANK, WE WILL NOT MAKE PAYMENTS TO MBNK CAPITAL TRUST
BEFORE WE PAY OUR OTHER OBLIGATIONS.
Our obligations under the guarantee and the junior subordinated debentures
are unsecured and generally are subordinated to all of our existing and future
senior debt, subordinated debt and additional senior obligations. Our
obligations falling into one of these categories totaled $303.7 million at
June 30, 1999. We will not make payments to MBNK Capital Trust on the junior
subordinated debentures before we pay our other obligations.
Because we are a holding company, the creditors of our subsidiaries also
will have priority over you in any distribution of our subsidiaries' assets in a
liquidation, reorganization or otherwise. Therefore, the junior subordinated
debentures will be effectively subordinated to all existing and future
liabilities of our subsidiaries, and you should look only to our assets for
payments on the junior subordinated debentures. The junior subordinated
debentures do not limit our ability or the ability of our subsidiaries to incur
additional debt. See "Description of Junior Subordinated
Debentures--Subordination" on page 39.
IF WE DEFER INTEREST PAYMENTS ON THE JUNIOR SUBORDINATED DEBENTURES, MBNK
CAPITAL TRUST WILL NOT HAVE FUNDS TO MAKE PAYMENTS TO YOU ON THE PREFERRED
SECURITIES AND THE PRICE OF THE PREFERRED SECURITIES MAY DECLINE.
If we are not in default under the junior subordinated debentures, we may
defer the payment of interest on the junior subordinated debentures for up to 20
consecutive quarters. During any period in which we defer interest payments on
the junior subordinated debentures, MBNK Capital Trust will defer quarterly
distributions on the preferred securities. If we defer interest payments on the
junior subordinated debentures, the market price for the preferred securities
would probably decline. If you dispose of preferred securities during a deferral
period, you might not recover the same return on your investment as someone who
continues to hold the preferred securities. Due to our right to defer interest
payments, the market price of the preferred securities may be more volatile than
the market prices of other securities without the deferral feature.
YOU WILL STILL HAVE TAXABLE INCOME EVEN IF WE DEFER DISTRIBUTIONS ON THE
PREFERRED SECURITIES.
If we defer interest payments on the junior subordinated debentures you
still will be required to include deferred distributions on the preferred
securities in your taxable income, even though you have not received any cash
attributable to that income. In addition, during a deferral period, your tax
basis in the preferred securities will increase by the amount of accumulated but
unpaid distributions. If you sell the preferred securities during a deferral
period, your increased tax basis will decrease the amount of any capital gain or
increase the amount of any capital loss that you may have otherwise recognized
on the sale. A capital loss, except in certain limited circumstances, cannot be
applied to offset ordinary income. As a result, deferral of distributions could
result in
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<PAGE>
your recognition of ordinary income, with a related tax liability, and you only
may use a capital loss to offset a capital gain. See "Description of Junior
Subordinated Debentures--Option to Extend Interest Payment Period" on page 32
and "Material United States Federal Income Tax Consequences" on page 45.
BECAUSE THE GUARANTEE COVERS PAYMENTS ONLY IF MBNK CAPITAL TRUST HAS FUNDS
AVAILABLE, YOU CAN NOT RELY ON THE GUARANTEE IF WE DO NOT MAKE PAYMENTS ON THE
JUNIOR SUBORDINATED DEBENTURES.
If we do not make payments on the junior subordinated debentures, MBNK
Capital Trust will not have sufficient funds to pay distributions on the
preferred securities or the liquidation amount. Because the guarantee does not
cover payments when MBNK Capital Trust does not have sufficient funds, you will
not be able to rely on the guarantee for payment of these amounts. Instead, you
or the property trustee must enforce the rights of MBNK Capital Trust under the
junior subordinated debentures directly against us to recover amounts owed to
you. See "Description of Guarantee" on page 41.
IN CERTAIN CIRCUMSTANCES MBNK CAPITAL TRUST MAY REDEEM THE PREFERRED SECURITIES,
WHICH MAY REQUIRE YOU TO REINVEST YOUR PRINCIPAL SOONER THAN YOU EXPECT.
Under the following circumstances and, subject to regulatory approvals, we
may redeem the junior subordinated debentures before the stated maturity of the
junior subordinated debentures:
- We also may redeem all or a portion of the junior subordinated debentures
to a date on or before December 31, 2004, for any reason.
- We may redeem all but not a portion the junior subordinated debentures at
any time before December 31, 2004 within 90 days after certain occurrences
at any time during the life of MBNK Capital Trust. These occurrences
include certain adverse tax, Investment Company Act or bank regulatory
developments.
If we redeem some but not all the junior subordinated debentures, MBNK
Capital Trust will redeem a proportionate amount of the preferred and common
securities, and you may be required to reinvest your principal at a time when
you may not be able to earn a return that is as high as you were earning on the
preferred securities. See "Description of Preferred Securities--Redemption" on
page 20.
BECAUSE HOLDERS OF PREFERRED SECURITIES WILL HAVE VOTING RIGHTS ONLY IN LIMITED
CIRCUMSTANCES WE CAN AMEND THE TRUST AGREEMENT WITHOUT YOUR CONSENT.
Holders of preferred securities will not have voting rights except in
limited circumstances. You will only have voting rights in the following
circumstances for:
- removal of a trustee at a time when there is a default under the trust
agreement;
- changes in the amount or the timing of distributions on the preferred
securities; and
- changes to the guarantee that would affect your rights.
You will not usually be able to appoint, remove or replace the property trustee
or the Delaware trustee because these rights generally reside with us as the
holder of the common securities. Because you will have only limited voting
rights, we will be able to amend the trust agreement without your consent.
WE CAN DISTRIBUTE THE JUNIOR SUBORDINATED DEBENTURES TO YOU, WHICH MAY AFFECT
THE MARKET PRICE OF THE PREFERRED SECURITIES.
We may dissolve MBNK Capital Trust at any time before the maturity of the
junior subordinated debentures. If we dissolve MBNK Capital Trust, generally the
trustees will be able to distribute the junior subordinated debentures to the
holders of the preferred securities. See "Description of Preferred
Securities--Liquidation Distribution Upon Dissolution" on page 23.
We cannot predict the market price for the junior subordinated debentures
that may be distributed. The junior subordinated debentures that you receive in
a distribution may trade at a price that is less than you paid to purchase the
preferred securities. Because you may become a holder of the junior subordinated
debentures, you
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<PAGE>
must also make an investment decision with regard to the junior subordinated
debentures. You should carefully review all of the information regarding the
junior subordinated debentures contained in this prospectus.
If the trustee distributes junior subordinated debentures in exchange for
the preferred securities, we will use our best efforts to list the junior
subordinated debentures for trading on the American Stock Exchange, however, we
may not be able to achieve that listing and a market for the junior subordinated
debentures may not develop.
THE INDENTURE AND THE TRUST AGREEMENT DO NOT CONTAIN RESTRICTIVE COVENANTS THAT
COULD PROTECT YOU.
The indenture and the trust agreement, do not contain any restrictions on
our activities or other financial covenants that could protect holders of junior
subordinated debentures or the preferred securities if our financial condition
or results of operations significantly deteriorate.
YOU MAY NOT BE ABLE TO SELL YOUR PREFERRED SECURITIES FOR AS MUCH AS YOU PAID
FOR THEM.
There is no current public market for the preferred securities. Although the
preferred securities have been approved for listing, subject to official notice
of issuance, on the American Stock Exchange, there is no guarantee that an
active or liquid public trading market will develop for the preferred securities
or that listing of the preferred securities will continue on the American Stock
Exchange. If an active trading market does not develop, the market price and
liquidity of the preferred securities will be adversely affected. Even if an
active public market does develop, there is no guarantee that the market price
for the preferred securities will equal or exceed the price you pay for the
preferred securities. Future trading prices of the preferred securities may be
subject to significant fluctuations in response to prevailing interest rates,
our future operating results and financial condition, the market for similar
securities and general economic and market conditions.
RISK FACTORS RELATING TO US AND OUR INDUSTRY
IF WE EXPERIENCE DIFFICULTIES IN MANAGING OUR GROWTH WE MAY BE UNABLE TO MAKE
OUR PAYMENTS ON THE JUNIOR SUBORDINATED DEBENTURES.
As part of our general strategy, we are significantly expanding our branch
network. We plan to expand our branch network by building new branches and by
acquiring banks and related businesses that we believe provide a strategic fit
with our business. We will incur significant costs in connection with this
expansion program including start up costs associated with building, remodeling
and equipping new branch sites and hiring new employees. It will take some time
before we can recoup these costs by earning money from these new branches. If it
takes too long to recoup theses costs or if the costs are higher than we expect,
we may not have enough cash to make payments on the junior subordinated
debentures. Some factors that may affect the profitability of our new branches
are:
- we may have difficulty in attracting deposits at our new branch sites and
generating loan volume in our new markets;
- we may experience disruption to our business; and
- we may experience diversion of our management's time and attention.
Our expansion strategy also has made us vulnerable to dramatic changes in
interest rates that could adversely affect our income and our ability to make
our payments on the junior subordinated debentures. This is because we are
funding our expansion by borrowing funds from the Federal Home Loan Bank and
investing them, pending their use in our expansion strategy, in government and
corporate fixed income securities with longer maturities. Federal Home Loan Bank
borrowings are more expensive than deposits and fixed income securities do not
give us as high of a return on investment as loans. As our branch expansion
strategy provides us with a larger deposit base, we will pay down our borrowings
and will decrease our costs of funds. As we establish our new branches, we will
replace our investment in securities with loans.
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<PAGE>
IF WE EXPERIENCE LOSSES ON OUR LOAN PORTFOLIO THAT EXCEED OUR RESERVES FOR THESE
LOSSES WE MAY NOT BE ABLE TO MAKE PAYMENTS ON THE JUNIOR SUBORDINATED
DEBENTURES.
As a lender, we are exposed to the risk that our customers will be unable to
repay their loans according to their terms and that any collateral securing the
payment of their loans may not be sufficient to assure repayment. Credit losses
are inherent in the lending business and could have a material adverse effect on
our operating results. Our credit risk with respect to our real estate and
construction loan portfolio relates principally to the general creditworthiness
of our borrowers and the value of real estate serving as security for the
repayment of loans. Our credit risk with respect to our commercial and consumer
installment loan portfolio relates principally to the general creditworthiness
of businesses and individuals within our local market. Our entire loan portfolio
may be affected by local economic conditions.
We make various assumptions and judgments about the collectibility of our
loan portfolio and create a reserve for potential losses based on a number of
factors. If our assumptions are wrong, we may need to add more funds to this
reserve to cover our loan losses. This would reduce our net income which may
result in our not having sufficient funds to make our payments on the junior
subordinated debentures.
WE MAY BE UNABLE TO MANAGE INTEREST RATE RISKS THAT COULD REDUCE OUR NET
INTEREST INCOME.
Like other financial institutions, we make money principally on the
difference between interest earned on loans and investments and interest paid on
deposits and other borrowings. Our liabilities are generally more short term
than our assets and will reprice more quickly in response to changes in interest
rates. Therefore we may be less profitable in periods when interests rates are
rising. We cannot predict or control changes in interest rates. We continually
take measures intended to manage the risks from changes in market interest rates
but if we are unable to manage our interest rate risk, changes in interest rates
could have a significant negative effect on our profitability, and we may not
have sufficient funds to make our payments on the junior subordinated
debentures.
OUR OPERATIONS MAY BE ADVERSELY AFFECTED IF WE, OR CERTAIN PERSONS WITH WHOM WE
DO BUSINESS, FAIL TO ADEQUATELY ADDRESS THE YEAR 2000 ISSUE.
A critical issue has emerged in the banking industry and for the economy
overall regarding how existing application software programs and operating
systems can accommodate the date value for the year 2000. The "year 2000 issue"
arose because many of these existing programs and systems use only the last two
digits in referring to a year. Therefore, these computer programs do not
properly recognize a year beginning with "20" instead of the familiar "19." If
not corrected, many computer applications and other technology-based systems
could fail or create erroneous results. The effects of this problem will vary
from system to system, and the extent of the potential impact of the year 2000
issue is not yet known. The year 2000 issue may adversely affect Main Street
Bank's operations. We could experience interruptions in our business and suffer
significant losses if we, or a supplier or vendor with whom we contract, are
unable to achieve year 2000 readiness before January 1, 2000. We are in the
process of working with our third party service providers and software vendors
to assure that we and our subsidiaries are prepared for the year 2000.
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<PAGE>
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This prospectus includes forward-looking statements. We have based these
forward-looking statements on our current expectations and projections about
future events. These forward-looking statements are subject to risks,
uncertainties and assumptions, including, among other things the factors
discussed in "Risk Factors on page 10."
We undertake no obligation to publicly update or otherwise revise any
forward-looking statements, whether as a result of new information, future
events or otherwise. In light of these risks, uncertainties and assumptions, the
events discussed in any forward-looking statements in this prospectus might not
occur.
------------------------
You should rely on the information contained or incorporated by reference in
this prospectus only. We have not, and our underwriters have not, authorized any
person to provide you with different information. If anyone provides you with
different or inconsistent information, you should not rely on it. We are not,
and our underwriters are not, making an offer to sell the preferred securities
in any jurisdiction where the offer or sale is not permitted.
You should assume that the information appearing in this prospectus is
accurate as of the date on the front cover of this prospectus only.
Certain persons participating in this offering may engage in transactions
that stabilize, maintain, or otherwise affect the price of the preferred
securities being offered, including over-allotting the preferred securities and
bidding for and purchasing preferred securities at a price above that which
otherwise might prevail in the open market. For a description of these
activities, see "Underwriting" on page 52. Such transactions, if commenced, may
be discontinued at any time. In connection with this offering certain
underwriters may engage in passive market making transactions in the preferred
securities on the American Stock Exchange or otherwise in accordance with
Rule 103 of Regulation M. See "Underwriting" on page 52.
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<PAGE>
USE OF PROCEEDS
MBNK Capital Trust will invest all the proceeds from the sale of the
preferred securities in the junior subordinated debentures. We will use the net
proceeds we receive from the sale of the junior subordinated debentures as
follows:
- to infuse approximately $32 million into Main Street Bank which will
constitute regulatory capital under the guidelines of the Federal Reserve
Board. It is necessary for Main Street Bank to increase its regulatory
capital to support the growth that we anticipate will occur as a result of
our branch expansion strategy; and
- for general corporate purposes, including possible repurchases of our
common stock.
The cash proceeds infused into Main Street Bank to increase regulatory capital
also will be used to fund loan growth or will be invested in investment
securities. Funds retained by us for general corporate purposes also will be
invested in short-term investment securities.
CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHARGES
The following table sets forth our consolidated ratios of earnings to fixed
charges for each of the periods indicated:
<TABLE>
<CAPTION>
SIX MONTHS
YEARS ENDED ENDED
DECEMBER 31, JUNE 30,
---------------------------------------------------------------- ----------------------
1994 1995 1996 1997 1998 1998 1999
-------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Earnings to Fixed Charges:
Excluding interest on deposits... 5.30% 5.52% 5.45% 3.51% 3.50% 3.90% 1.50%
Including interest on deposits... 1.56 1.39 1.49 1.48 1.46 1.47 1.16
</TABLE>
For purposes of calculating the ratio of earnings to fixed charges, earnings
consist of earnings before income taxes plus interest and one-half of rental
expense. Fixed charges, excluding interest on deposits, consist of interest on
indebtedness and one-half of rental expense which is deemed representative of
the interest factor. Fixed charges, including interest on deposits, consists of
the foregoing items plus interest on deposits.
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<PAGE>
CAPITALIZATION
The following tables set forth:
- our consolidated capitalization at June 30, 1999;
- our consolidated capitalization giving effect to the issuance of the
preferred securities;
- our actual consolidated regulatory capital ratios as of June 30, 1999;
and
- our capital ratios after giving effect to the issuance of the
preferred securities.
The table assumes application of the net proceeds from the corresponding
sale of the junior subordinated debentures to MBNK Capital Trust as if the sale
of the preferred securities had been completed on June 30, 1999.
<TABLE>
<CAPTION>
JUNE 30, 1999
----------------------
ACTUAL AS ADJUSTED
-------- -----------
(DOLLARS IN THOUSANDS,
EXCEPT SHARE AND
PER SHARE AMOUNTS)
<S> <C> <C>
Other borrowed funds........................................ $218,712 $218,712
Long-term debt.............................................. 85,000 85,000
Guaranteed preferred beneficial interests in corporation's
junior subordinated deferrable interest debentures, series
A......................................................... -- 40,000
-------- --------
Total debt.................................................. 303,712 343,712
-------- --------
Stockholders' equity
common stock.............................................. 10,408 10,408
surplus................................................... 64,259 64,259
retained earnings......................................... 20,698 20,698
accumulated other comprehensive income.................... (7,829) (7,829)
-------- --------
Total stockholders' equity.............................. 87,536 87,536
-------- --------
Total capitalization........................................ $391,248 $431,248
======== ========
Leverage ratio.............................................. 7.42% 8.95%(1)
Tier 1 capital to risk-weighted assets...................... 13.12% 17.30%(1)
Total capital to risk-weighted assets....................... 14.08% 19.37%(1)
</TABLE>
- ------------------------
(1) Assumes $40,000,000 from the proceeds of the offering of the preferred
securities are invested in assets with a 20% risk weighting under the
risk-based capital rules.
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ACCOUNTING TREATMENT
For financial reporting purposes, MBNK Capital Trust will be treated as our
subsidiary and, accordingly, the accounts of MBNK Capital Trust will be included
in our consolidated financial statements. The preferred securities will be
included in our consolidated balance sheets under the caption "Company Obligated
Mandatorily Redeemable Preferred Securities of Subsidiary Trust Holding Solely
Subordinated Debentures" and appropriate disclosures about the preferred
securities, the guarantee and the junior subordinated debentures will be
included in the notes to our consolidated financial statements. For financial
reporting purposes, we will record distributions on the preferred securities in
our consolidated statements of income.
Our future reports filed under the Securities Exchange Act of 1934 will
include a footnote to the consolidated financial statements stating that:
- MBNK Capital Trust is wholly-owned;
- the sole assets of MBNK Capital Trust are the junior subordinated
debentures and specifying their principal amount, interest rate and
maturity date; and
- our obligations described in this prospectus, in the aggregate,
constitute a full, irrevocable and unconditional guarantee on a
subordinated basis by us of the obligations of MBNK Capital Trust under
the preferred securities.
Because MBNK Capital Trust will have no material assets or liabilities until
we complete this offering, we do not believe that separate financial statements
for MBNK Capital Trust would be material to you in deciding whether to invest in
the preferred securities. Therefore, separate financial statements of MBNK
Capital Trust are not included in this prospectus.
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<PAGE>
MBNK CAPITAL TRUST I
MBNK Capital Trust is a statutory business trust created under Delaware law
by filing of a Certificate of Trust with the Delaware Secretary of State on
September 1, 1999 and the execution of the trust agreement. A statutory business
trust is a legal entity that does not pay federal income tax. MBNK Capital Trust
will be governed by the trust agreement among us, as depositor, The Bank of New
York (Delaware), as Delaware trustee, The Bank of New York, as property trustee
and three individuals selected by us to act as administrators with respect to
MBNK Capital Trust. While we hold the common securities, we intend to select
three individuals who are our employees or officers or are affiliated with us to
serve as the administrators. See "Description of Preferred Securities--
Miscellaneous" on page 30. MBNK Capital Trust exists for the exclusive purposes
of:
- issuing and selling the preferred securities and the common securities;
- using the proceeds from the sale of the preferred securities and the
common securities to acquire the junior subordinated debentures; and
- engaging in only those other activities necessary, convenient or
incidental thereto, such as registering the transfer of the preferred
securities and the common securities.
Accordingly, the junior subordinated debentures will be the sole assets of MBNK
Capital Trust, and payments under the junior subordinated debentures will be the
sole source of revenue of MBNK Capital Trust.
We will own all of the common securities. The common securities will rank
equally, and payments on them will be made pro rata, with the preferred
securities, except that during a period when there is a default under the
indenture, our rights as the holder of the common securities to distributions
and payments upon liquidation, redemption or otherwise will be subordinated to
the rights of the holders of the preferred securities. See "Description of
Preferred Securities--Subordination of Common Securities" on page 23. We will
acquire common securities in an aggregate liquidation amount equal to $1.2
million or 3.00% of the total capital of MBNK Capital Trust. MBNK Capital Trust
has a term of 30 years, but may terminate earlier as provided in the trust
agreement.
The address of the Delaware trustee is The Bank of New York (Delaware),
Corporate Trust Department, White Clay Center, Route 271, Newark, Delaware
19711, and the telephone number is (212) 815-6286.
The address of the property trustee, the guarantee trustee and the debenture
trustee is The Bank of New York, 101 Barclay Street, Floor 21, West, Corporate
Trust Trustee Administration, New York, New York 10286, and the telephone number
is (212) 815-6286.
DESCRIPTION OF PREFERRED SECURITIES
MBNK Capital Trust will issue the preferred securities and the common
securities under the trust agreement. The preferred securities will represent
preferred interests in the assets of MBNK Capital Trust. You, as holders of the
preferred securities, will be entitled to a preference over the common
securities in certain circumstances with respect to distributions and amounts
payable on liquidation or redemption, as well as other benefits described in the
trust agreement. We believe this summary of the terms and provisions of the
preferred securities and the trust agreement describes all the provisions that
would be important to you. However, the form of the trust agreement, including
the definitions, is filed as an exhibit to the registration statement that
contains this prospectus and you may read it in its entirety. You can also
request a copy of the form of the trust agreement's from the trustee. We have
referred to some of the trust agreement's defined terms in this prospectus.
In addition, the trust agreement will be qualified as an indenture under the
Trust Indenture Act of 1939. The terms of the preferred securities include those
made a part of the trust agreement by the Trust Indenture Act.
GENERAL
MBNK Capital Trust will only issue $40 million aggregate liquidation amount
of preferred securities. MBNK Capital Trust will issue $ 1.2 million aggregate
liquidation amount of common securities. The preferred securities will rank
equally, and payments will be made pro rata, with the common securities except
as described under "--Subordination of Common Securities" on page 23. We will
purchase and hold all of the common securities. The MBNK Capital Trust will use
the proceeds from selling the preferred securities and the common securities to
purchase $41.2 million of junior subordinated debentures from us. The junior
subordinated debentures will be registered in the name of MBNK Capital Trust and
held by the property trustee in trust for your benefit as holders of the
preferred securities and for our benefit as the holder of the common securities.
The guarantee that we will
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<PAGE>
execute for the benefit of the holders of the preferred securities, will be a
guarantee of payment that is subordinate to our other obligations. We will not
guarantee payment when MBNK Capital Trust does not have funds available to make
the payments. See "Description of Guarantee" on page 41.
DISTRIBUTIONS
You will receive distributions on each preferred security at the annual rate
of % of the stated liquidation amount of $10.00, payable quarterly on
March 31, June 30, September 30 and December 31 of each year. To be entitled to
receive distributions the preferred security must be registered in your name at
the close of business on the 15th day of the month of the relevant distribution
date, even if the day is not a business day. Each date on which distributions
will be paid is referred to as a distribution date in this prospectus.
Distributions on the preferred securities will be cumulative. Distributions will
accumulate from , 1999. The first distribution date for the
preferred securities will be December 31, 1999.
The total distributions MBNK Capital Trust will pay for any full
distribution period will be computed by dividing the annual rate of % by
four. We will compute the amount of distributions payable for any period less
than a full distribution period on the basis of a 360-day year of twelve 30-day
months and the actual days elapsed in the partial month during that period. If
any date on which MBNK Capital Trust is supposed to pay distributions on the
preferred securities is not a business day, then MBNK Capital Trust will pay the
distributions payable on that date on the next succeeding day that is a business
day, without making any additional distributions or other payments because of
the delay. However, if the next business day falls in the next calendar year,
MBNK Capital Trust will make the payment on the immediately preceding business
day.
The term distributions includes quarterly payments made on the preferred and
common securities, payments that accumulate on distributions not paid on the
applicable distribution date and, if applicable, any additional sums we pay
during a tax event, all as further described below.
OPTION TO EXTEND INTEREST PAYMENT DATE
If we are not in default under the indenture, we can defer the payment of
interest on the junior subordinated debentures for an extension period.
Quarterly distributions on the preferred securities will be deferred during the
extension period. We cannot defer distribution payments for a period of time:
- that exceeds 20 consecutive quarterly periods with respect to each
extension period;
- that extends beyond the maturity date of the junior subordinated
debentures; or
- that ends on a date that is not a distribution date.
During an extension period, distributions to which you are entitled will
accumulate additional amounts at an annual rate of %. There may be more
than one extension period prior to the maturity of the junior subordinate
debentures.
During any extension period, we may not:
(1) declare or pay any dividends or distributions on, or redeem, purchase,
acquire or make a liquidation payment with respect to, any of our capital
stock; or
(2) make any principal, interest or premium payments on, or repay,
repurchase or redeem any of our debt securities that rank equally with in
all respects or junior in interest to the junior subordinated debentures,
except that we may:
(a) repurchase, redeem or make other acquisitions of shares of our
capital stock in connection with:
- any employment contract, benefit plan or other similar arrangement
with or for the benefit of any one or more of our employees,
officers, directors or consultants,
- a dividend reinvestment or shareholder stock purchase plan, or
- the issuance of our capital stock or securities convertible into or
exercisable for our capital stock as consideration in any
acquisition transactions entered into prior to the applicable
extension period;
(b) take any necessary action in connection with any reclassification,
exchange or conversion of any of our capital stock, any capital stock of a
subsidiary or any of our debt;
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<PAGE>
(c) purchase fractional interests in shares of our capital stock in
connection with the conversion or exchange provisions of any of our capital
stock or the security being converted or exchanged;
(d) declare a dividend in connection with any shareholders' rights plan,
or issue rights, stock or other property under any shareholders' rights
plan, or redeem or repurchase rights under any shareholders rights plan; or
(e) declare a dividend in the form of stock, warrants, options or other
rights where the dividend stock or the stock issuable upon exercise of the
warrants, options or other rights is the same stock as that on which the
dividend is being paid or ranks equally with or junior to that stock.
If we are not in default under the indenture, before the end of an extension
period, we may extend the extension period, further deferring the payment of
interest. Upon the termination of an extension period and the payment of all
amounts then due, we may elect to begin a new extension period as long as we
comply with the above conditions. We will not pay additional interest on the
junior subordinated debentures during an extension period until the extension
period ends and all additional interest becomes due. We must give you and the
property trustee notice of our election to defer interest payments at least one
business day before the next interest payment date on which interest on the
junior subordinated debentures would be payable, or at least one business day
before:
(1) the next date distributions would have been payable on the preferred
securities but for the election to defer interest payments; and
(2) the date the property trustee is required to give you notice of the
record date or the date the distributions are payable, but in any event
not less than one business day prior to the record date.
The property trustee will give you notice of our election to defer interest
payments. Except as described above, there is no limitation on the number of
times that we may elect to defer interest payments and begin an extension
period. Because distributions will continue to accumulate on the unpaid
distributions during an extension period, you will be required to accrue and
recognize income on the unpaid distributions, for United States federal income
tax purposes. See "Description of Junior Subordinated Debentures--Option To
Extend Interest Payment Period" on page 32 and "Material United States Federal
Income Tax Consequences--Interest Income and Original Issue Discount" on page
47. We currently do not intend to exercise our right to defer payments of
interest by extending the interest payment period on the junior subordinated
debentures.
The only source of revenue for MBNK Capital Trust is the payments we will
make on the junior subordinated debentures. Under the terms of the trust
agreement, MBNK Capital Trust cannot: (1) issue any securities other than the
preferred securities and the common securities, (2) incur any indebtedness, or
(3) pledge any of its assets. If we do not make payments on the junior
subordinated debentures, MBNK Capital Trust may not have funds available to pay
distributions or other amounts payable on the preferred securities. While we
guarantee payment of distributions on the preferred securities under the
guarantee agreement, we are only obligated to make payments under the guarantee
agreement if MBNK Capital Trust has the funds available to make the
distribution.
REDEMPTION
The junior subordinated debentures mature on December 31, 2029. We may
redeem the junior subordinated debentures under certain circumstances. A
redemption or repurchase of the junior subordinated debentures would cause a
mandatory redemption of a proportionate amount of the preferred securities and
common securities at the redemption price. The redemption price for each
preferred security will equal $10.00 plus accumulated but unpaid distributions
including any additional amounts to, but not including, the redemption date.
(1) We may redeem all or a portion of the junior subordinated debentures on
or after December 31, 2004 in whole or in part, or
(2) We may redeem all but not a portion of the junior subordinated
debentures, at any time before December 31, 2004 within 90 days following
the occurrence and during the continuation of a tax event, investment
company event or capital treatment event each as defined below, and in
each case subject to prior regulatory approval if it is then required.
See "--Liquidation Distribution Upon Dissolution" on page 23.
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We also may repurchase the junior subordinated debentures, in whole or in part,
from MBNK Capital Trust any time after December 31, 2004.
Tax event means the receipt by us and MBNK Capital Trust of an opinion of
counsel to the effect that, as a result of:
(1) any amendment to, or change, including an announced prospective change,
in the laws or any regulations of the United States or any political
subdivision or taxing authority, or
(2) any official or administrative pronouncement or action or judicial
decision interpreting or applying United States laws or regulations, that
is adopted, effective or announced on or after the date of issuance of
the preferred securities, that causes there to be more than an
insubstantial risk that:
- MBNK Capital Trust is, or will be within 90 days of the delivery of the
opinion, subject to United States federal income tax with respect to
income received or accrued on the junior subordinated debentures;
- interest payable by us on the junior subordinated debentures is not, or
within 90 days of the delivery of the opinion will not be, deductible
by us, in whole or in part, for United States federal income tax
purposes; or
- MBNK Capital Trust is, or will be within 90 days of the delivery of the
opinion, subject to more than an insignificant amount of other taxes,
duties or other governmental charges.
If a tax event described in the first or third circumstances above has
occurred and is continuing and MBNK Capital Trust holds all of the junior
subordinated debentures, we will pay on the junior subordinated debentures any
additional amounts as may be necessary in order that the amount of distributions
then due and payable by MBNK Capital Trust on the outstanding preferred
securities and common securities will not be reduced as a result of any
additional taxes, duties and other governmental charges to which MBNK Capital
Trust has become subject.
Investment company event means the receipt by us and MBNK Capital Trust of
an opinion of counsel to the effect that, as a result of the occurrence of a
change in law or regulation or a written change, including any announced
prospective change, in interpretation or application of law or regulation by any
legislative body, court, governmental agency or regulatory authority, there is
more than an insubstantial risk that MBNK Capital Trust is or will be considered
an investment company that is required to be registered under the Investment
Company Act of 1940, and this change becomes effective or would become effective
on or after the date of the issuance of the preferred securities.
Capital treatment event means the reasonable determination by us that, as a
result of:
(1) the occurrence of any amendment to, or change, including any announced
prospective change, in the laws or regulations of the United States or
any political subdivision, or
(2) any official or administrative pronouncement or action or judicial
decision interpreting or applying United States laws or regulations, that
is effective or is announced on or after the date of issuance of the
preferred securities,
there is more than an insubstantial risk that we will not be entitled to treat
an amount equal to the liquidation amount of the preferred securities as Tier 1
capital under the risk-based capital adequacy guidelines of the Federal Reserve
Board.
The Federal Reserve Board has determined that the proceeds of certain
qualifying securities like the preferred securities will qualify as Tier 1
capital for us but only up to an amount not to exceed, when taken together with
all of our cumulative preferred stock, if any, 25% of our Tier 1 capital.
We or MBNK Capital Trust must request an opinion of counsel with regard to
any matter deemed to be a tax, investment company or capital treatment event
within a reasonable period of time after we or MBNK Capital Trust, as
appropriate, become aware of the possible occurrence of the event.
REDEMPTION PROCEDURES
If we repay or redeem the junior subordinated debentures, we must give the
property trustee not less than 30 nor more than 60 days' notice in order that it
can redeem a proportionate amount of the preferred and common securities.
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Redemptions of the preferred securities will be made and the redemption
price will be payable on each redemption date only to the extent that MBNK
Capital Trust has funds available for the payment of the redemption price. See
also "--Subordination of Common Securities" on page 23.
If MBNK Capital Trust gives notice of redemption of any of the preferred
securities, then, by 12:00 noon, Eastern time, on the redemption date, to the
extent funds are available, in the case of preferred securities held in
book-entry form, the property trustee will deposit irrevocably with the
Depository Trust Company funds sufficient to pay the applicable redemption price
and will give the Depository Trust Company irrevocable instructions and
authority to pay the redemption price to you. With respect to preferred
securities not held in book-entry form, the property trustee, to the extent
funds are available, will irrevocably deposit with the paying agent for the
preferred securities funds sufficient to pay the applicable redemption price and
will give the paying agent irrevocable instructions and authority to pay the
redemption price to you once you surrender your certificates evidencing the
preferred securities. Distributions payable on or prior to the redemption date
for any preferred securities called for redemption will be payable on the
distribution dates to holders of preferred securities on the relevant record
dates.
If MBNK Capital Trust gives notice of redemption and deposits the required
funds, then on the date of that deposit all of your rights with respect to your
preferred securities called for redemption will cease, except your right to
receive the redemption price and any distributions payable in respect of the
preferred securities on or prior to the redemption date, but without interest.
Preferred securities that MBNK Capital Trust redeems will cease to be
outstanding. If any date fixed for redemption of preferred securities is not a
business day, then the paying agent will pay the redemption price on the next
succeeding day which is a business day, without any interest or other payment
due to the delay. However, if the next business day falls in the next calendar
year, the paying agent will make the payment on the immediately preceding
business day. In the event that payment of the redemption price for the
preferred securities called for redemption is improperly withheld or refused and
not paid either by MBNK Capital Trust or by us pursuant to the guarantee,
distributions on the preferred securities will continue to accumulate at the
then applicable rate, from the redemption date originally established by MBNK
Capital Trust until the redemption price is actually paid. In that case, the
actual payment date will be the date fixed for redemption for purposes of
calculating the redemption price.
Subject to applicable law, we or our affiliates may from time to time
purchase outstanding preferred securities by tender, in the open market or by
private agreement. We may resell these securities at any time that interest on
the junior subordinated debentures is not being deferred, and there is no event
of default or an event that could cause an event of default under the indenture
or an event of default under the guarantee.
If less than all the preferred securities and common securities are to be
redeemed on a redemption date, then the aggregate liquidation amount of
preferred securities and common securities to be redeemed shall be allocated pro
rata to the preferred securities and the common securities based upon the
relative liquidation amounts of those classes. The particular preferred
securities to be redeemed shall be selected by the property trustee in a manner
that the property trustee deems fair, not more than 60 days prior to the
redemption date or in accordance with the Depository Trust Company's customary
procedures if the preferred securities are then held in book-entry form. The
property trustee shall promptly notify the securities registrar for the
preferred securities in writing of the preferred securities selected for
redemption and, in the case of any preferred securities selected for partial
redemption, the liquidation amount of the preferred securities to be redeemed.
For all purposes of the trust agreement, unless the context otherwise requires,
all provisions relating to the redemption of preferred securities relate, in the
case of any preferred securities redeemed or to be redeemed only in part, to the
portion of the aggregate liquidation amount of preferred securities which has
been or is to be redeemed.
If your preferred securities will be redeemed, the property trustee will
mail to you a notice of redemption at your address as it appears on the
securities register for MBNK Capital Trust at least 30 days but not more than
60 days before the redemption date. Unless we default in payment of the
redemption price on the junior subordinated debentures, on and after the
redemption date interest will cease to accrue on the junior subordinated
debentures.
Unless payment of the redemption price in respect of the preferred
securities is withheld or refused and not paid either by MBNK Capital Trust or
us pursuant to the guarantee, distributions will cease to accumulate on the
preferred securities called for redemption.
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SUBORDINATION OF COMMON SECURITIES
MBNK Capital Trust will pay all distributions, any redemption price, and any
liquidation distribution to holders of the preferred securities and common
securities pro rata based on the liquidation amount of the preferred securities
and common securities held. However, if on any distribution date, redemption
date or liquidation date we are in default under the indenture because we have
not paid amounts due on the junior subordinated debentures, we will not pay any
distribution, redemption price, or liquidation distribution to holders of the
common securities. MBNK Capital Trust will make payments on the common
securities only after making payment in full and in cash of all accumulated and
unpaid distributions to holders of the outstanding preferred securities for all
distribution periods, or in the case of payment of the redemption price or a
liquidation distribution, the full amount of the redemption price or liquidation
distribution to holders of the outstanding preferred securities then called for
redemption or liquidation. All funds immediately available to the property
trustee shall first be applied to the payment in full in cash of all
distributions on, or redemption price of, the preferred securities then due and
payable. The existence of a default does not entitle you to accelerate the
maturity of the preferred securities.
If an event of default occurs with respect to the preferred securities
because of an event of default with respect to the junior subordinated
debentures, we, as the holder of the common securities, will have no right to
take action under the trust agreement, until all events of default with respect
to the preferred securities have been cured, waived or otherwise eliminated. See
"-- Events of Default; Notice" on page 24 and "Description of Junior
Subordinated Debentures -- Debenture Events of Default" on page 37. Until all
events of default under the trust agreement have been cured, waived or otherwise
eliminated, the property trustee will act solely on your behalf and not on our
behalf as the holder of the common securities, and only you will have the right
to direct the property trustee to act on your behalf.
LIQUIDATION DISTRIBUTION UPON DISSOLUTION
If MBNK Capital Trust is liquidated, each holder of a preferred security
will receive $10.00 per preferred security plus accumulated and unpaid
distributions. Payments will be made only from the assets of MBNK Capital Trust
and may be in the form of a distribution of junior subordinated debentures
having an equal aggregate principal amount.
We, as the holder of all the outstanding common securities, have the right
at any time to dissolve and liquidate MBNK Capital Trust and cause the junior
subordinated debentures to be distributed to you, as holders of the preferred
securities, and to us, as the holder of the common securities.
The Federal Reserve Board's risk-based capital guidelines currently provide
that redemptions of permanent equity or other capital instruments before stated
maturity could have a significant impact on a bank holding company's overall
capital structure. Therefore, any organization considering a redemption of
securities which make up a part of the organization's regulatory capital should
consult with the Federal Reserve Board if the redemption could have a material
effect on the level or composition of the organization's capital base. This
consultation may not be necessary if the equity or capital instrument is
redeemed with the proceeds of, or replaced by, a like amount of a similar or
higher quality capital instrument and the Federal Reserve Board considers the
organization's capital position to be fully adequate after the redemption. If we
dissolve MBNK Capital Trust prior to the maturity date of the preferred
securities and the Federal Reserve Board believes that the dissolution
constitutes the redemption of capital instruments under its risk-based capital
guidelines or policies, our dissolution of MBNK Capital Trust may be subject to
the prior approval of the Federal Reserve Board.
Pursuant to the trust agreement, MBNK Capital Trust will automatically
dissolve upon the first to occur of:
(1) the termination date of MBNK Capital Trust;
(2) certain events of bankruptcy, dissolution or liquidation of us or
another holder of the common securities;
(3) we, as the holder of common securities, have given written direction to
the property trustee to dissolve MBNK Capital Trust;
(4) the repayment of all the preferred securities in connection with the
redemption of all of the junior subordinated debentures and common
securities as described under "-- Redemption" on page 20; and
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(5) the entry of an order for the dissolution of MBNK Capital Trust by a
court of competent jurisdiction.
If MBNK Capital Trust is dissolved as described in any of the second, third and
fifth circumstances described above, MBNK Capital Trust will be wound-up and
liquidated by the property trustee as expeditiously as possible. This means that
the property trustee will pay, or make reasonable provision to pay, all claims
and obligations of MBNK Capital Trust in accordance with The Delaware Business
Trust Act, and then distribute to you, as holders of the preferred securities,
and to us, as holder of the common securities, a proportionate amount of the
junior subordinated debentures, unless such distribution is not practical.
If distribution of the junior subordinated debentures is not practical, you,
as holders of the preferred securities, and we, as holder of the common
securities, will be entitled to receive an amount equal to the aggregate of the
liquidation amount plus accumulated and unpaid distributions to the date of
payment. However, the property trustee must first pay or make reasonable
provision to pay all claims and obligations of MBNK Capital Trust in accordance
with the Delaware Business Trust Act. If a liquidation distribution can be paid
only in part because MBNK Capital Trust has insufficient assets available to pay
in full the aggregate liquidation distribution, then MBNK Capital Trust will
make a partial payment to holders of the preferred and common securities on a
pro rata basis.
We, as the holder of the common securities, will be entitled to receive
distributions upon any liquidation pro rata with you. However, if we are in
default under the junior subordinated debentures because we have not paid
amounts due on the junior subordinated debentures, the preferred securities will
have a priority over the common securities. See "-- Subordination of Common
Securities" on page 23.
After the liquidation date is fixed for any distribution of junior
subordinated debentures:
(1) the preferred securities will no longer be deemed to be outstanding;
(2) the Depository Trust Company or its nominee, as the registered holder of
preferred securities, will receive a registered global certificate or
certificates representing the junior subordinated debentures to be
distributed with respect to preferred securities held by the Depository
Trust Company or its nominee; and
(3) any certificates representing the preferred securities not held by the
Depository Trust Company or its nominee will be deemed to represent the
junior subordinated debentures having a principal amount equal to the
stated liquidation amount of the preferred securities and bearing accrued
and unpaid interest in an amount equal to the accumulated and unpaid
distributions on the preferred securities until the certificates are
presented to the security registrar for the preferred securities and
common securities for transfer or reissuance.
If we do not redeem the junior subordinated debentures prior to maturity, or
if MBNK Capital Trust is not liquidated and the junior subordinated debentures
are not distributed to you, then the preferred securities will remain
outstanding until we repay the junior subordinated debentures at their stated
maturity. At that time, MBNK Capital Trust will be dissolved and a liquidation
distribution will be paid to you.
Under current United States federal income tax law and interpretations and
assuming, as expected, that MBNK Capital Trust is treated as a grantor trust, a
distribution of the junior subordinated debentures should not be a taxable event
to you. If there is a change in law, a change in legal interpretation, a tax
event or other circumstances, however, the distribution could be a taxable event
to you. See "Material United States Federal Income Tax Consequences" on page 45.
We cannot make any guarantees about the market prices for the preferred
securities or the junior subordinated debentures that may be distributed in
exchange for preferred securities if a dissolution and liquidation of MBNK
Capital Trust occurs. Accordingly, the preferred securities that you may
purchase, or the junior subordinated debentures that you may receive on
dissolution and liquidation of MBNK Capital Trust, may trade at a price less
than you paid to purchase the preferred securities.
EVENTS OF DEFAULT; NOTICE
Any one of the following events constitutes an event of default under the
trust agreement. Each of these events are defaults regardless of the reason for
the event and whether it is voluntary or involuntary or effected by
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operation of law or pursuant to a judgment, decree or order of any court or any
order, rule or regulation of any administrative or governmental body:
(1) the occurrence of an event of default with respect to the junior
subordinated debentures. See "Description of Junior Subordinated
Debentures -- Debenture Events of Default" on page 37;
(2) MBNK Capital Trust's failure to pay any distribution when it becomes due
and payable, and it does not make the payment in the next 30 days;
(3) MBNK Capital Trust's failure to pay the redemption price of any
preferred security or common security when it becomes due and payable;
(4) any default in the performance, or breach, in any material respect, of
any of MBNK Capital Trust's covenants or warranties in the trust
agreement, except for the failures to make payments described in the
second or third bulleted clauses above, and continuation of this default
or breach for a period of 60 days after there has been given, by
registered or certified mail, to the trustees and us by the holders of at
least 25% in aggregate liquidation amount of the outstanding preferred
securities, a written notice specifying the default or breach and
requiring it to be remedied and stating that such notice is a "Notice of
Default" under the trust agreement; or
(5) the occurrence of certain events of bankruptcy or insolvency with
respect to the property trustee if a successor property trustee has not
been appointed within 90 days of the event.
Unless the event of default is cured or waived, within five business days
after the occurrence of any event of default actually known to the property
trustee, the property trustee will transmit notice of the event of default to
you, as holders of the preferred securities, to us, as the holder of the common
securities, and to the administrators. We, as depositor, and the administrators
are required to file annually with the property trustee a certificate as to
whether or not we are in compliance with all the conditions and covenants
applicable to us under the trust agreement.
If we are in default under the indenture because we have not paid amounts
due on the junior subordinated debentures, the preferred securities will have a
preference over the common securities with respect to payments of any amounts as
described above. See "-- Subordination of Common Securities" on page 23,
"-- Liquidation Distribution Upon Dissolution" on page 23 and "Description of
Junior Subordinated Debentures -- Debenture Events of Default" on page 37.
REMOVAL OF TRUSTEES; APPOINTMENT OF SUCCESSORS
The holders of a majority in aggregate liquidation amount of the outstanding
preferred securities may remove the property trustee or the Delaware trustee for
cause at any time, or, if we are in default under the indenture because we have
not paid amounts due under junior subordinated debentures. If a trustee is
removed by the holders of the outstanding preferred securities, the successor
may be appointed by the holders of at least 25% in aggregate liquidation amount
of preferred securities. If a trustee resigns, that trustee will appoint its
successor. If a trustee fails to appoint a successor, the holders of at least
25% in aggregate liquidation amount of the outstanding preferred securities may
appoint a successor. If a successor has not been appointed by the holders, any
holder of preferred securities or common securities or the other trustee may
petition a court in the State of Delaware to appoint a successor. Any Delaware
trustee must meet the applicable requirements of Delaware law. Any property
trustee must be a national or state-chartered bank and have a combined capital
and surplus of at least $50,000,000. No resignation or removal of a trustee and
no appointment of a successor trustee shall be effective until the acceptance of
appointment by the successor trustee in accordance with the provisions of the
trust agreement. You do not have any right to appoint, remove or replace the
administrators of MBNK Capital Trust. Only we, as holder of the common
securities, have those rights.
MERGER OR CONSOLIDATION OF TRUSTEES
If the property trustee or the Delaware trustee merges, converts or
consolidates with or into another entity, or another entity results from any
merger, conversion or consolidation with or into the trustee, the entity
succeeding to all or substantially all the corporate trust business of the
trustee, will be the successor trustee under the trust agreement, provided that
entity is otherwise qualified and eligible under the trust agreement. The
succession will
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occur without the execution or filing of any paper or any further act on the
part of the parties to the trust agreement.
MERGERS, REPLACEMENTS OR SIMILAR TRANSACTIONS OF MBNK CAPITAL TRUST
The trust agreement severely restricts MBNK Capital Trust's ability to merge
or consolidate with any other entity. MBNK Capital Trust may do so only if the
transaction occurs at our request as the holder of the common securities, and
with the consent of the holders of a majority in aggregate liquidation amount of
the outstanding preferred securities, but without the consent of the property
trustee or the Delaware trustee. In addition, MBNK Capital Trust may only merge
with or into, consolidate, amalgamate, or be replaced by, or convey, transfer or
lease its properties and assets substantially as an entirety to a trust
organized under the laws of any state, if:
(1) the successor entity expressly assumes all the obligations of MBNK
Capital Trust with respect to the preferred securities. or substitutes
for the preferred securities other securities having substantially the
same terms as the preferred securities, including the same priority as
the preferred securities with respect to distributions and payments upon
liquidation, redemption and otherwise;
(2) a trustee of the successor entity, possessing the same powers and duties
as the property trustee, is appointed to hold the junior subordinated
debentures;
(3) the merger, consolidation, amalgamation, replacement, conveyance,
transfer or lease does not cause the preferred securities, including any
substitute securities, to be downgraded by any nationally recognized
statistical rating organization, if then rated;
(4) the merger, consolidation, amalgamation, replacement conveyance transfer
or lease does not adversely affect the rights, preferences and privileges
of the holders of the preferred securities, including any substitute
securities, in any material respect;
(5) the successor entity has a purpose substantially identical to that of
MBNK Capital Trust;
(6) prior to the merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease, MBNK Capital Trust has received an opinion
from independent counsel to the effect that the merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease does not
adversely affect the rights, preferences and privileges of holders of
preferred securities, or substitute securities, in any material respect,
and following the merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease, neither MBNK Capital Trust nor the
successor entity will be required to register as an investment company
under the Investment Company Act; and
(7) we or any permitted transferee to whom we have transferred the common
securities, owns all the common securities of the successor entity and
guarantees the obligations of the successor entity at least to the extent
provided by the guarantee.
Except with the consent of holders of 100% in aggregate liquidation amount of
the preferred securities, MBNK Capital Trust may not merge with or into,
consolidate, amalgamate, or be replaced by, or convey, transfer or lease its
properties or assets substantially as an entirety to any other entity or permit
any other entity to consolidate, amalgamate, merge with or into or replace it,
if that event would cause MBNK Capital Trust or the successor entity not to be
classified as a grantor trust for United States federal income tax purposes.
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VOTING RIGHTS; AMENDMENT OF TRUST AGREEMENT
You will have no voting rights except as described above under
" -- Removal of Trustees; Appointment of Successors" on page 25 and "Description
of Guarantee -- Amendments and Assignment" on page 42 as described below and as
otherwise required by law and the trust agreement.
As the holder of the common securities we do not need your consent to amend
the trust agreement and we and the property trustee may amend the trust
agreement without your consent, to:
(1) cure any ambiguity in the trust agreement, correct or supplement any
provisions that may be inconsistent within the trust agreement, or to
address other matters or questions arising under the trust agreement,
provided that the amendment does not adversely affect in any material
respect your interests; or
(2) modify, eliminate or add to any provisions of the trust agreement to
such extent as may be necessary to ensure that:
(a) MBNK Capital Trust will not be taxable other than as a grantor trust
for United States federal income tax purposes at any time that any
preferred securities or common securities are outstanding; or
(b) MBNK Capital Trust will not be required to register as an investment
company under the Investment Company Act.
Any amendments of the trust agreement will become effective when notice of the
amendment is given to you, as the holders of preferred securities, and us, as
the holder of the common securities.
We, as the holder of the common securities, the property trustee and the
administrators may amend the trust agreement if:
(1) we have the consent of holders representing at least a majority in
aggregate liquidation amount of the preferred securities; and
(2) the trustees receive an opinion of counsel to the effect that the
amendment or the exercise of any power granted to the trustees in
accordance with the amendment will not affect MBNK Capital Trust's status
as a grantor trust for United States federal income tax purposes or MBNK
Capital Trust's exemption from status as an investment company under the
Investment Company Act.
However, every holder of preferred securities or common securities must consent
in order to amend the trust agreement to:
(1) change the amount or timing of any distribution on the preferred
securities or common securities or otherwise adversely affect the amount
of any distribution required to be made on the preferred securities or
common securities as of a specified date; or
(2) restrict your right, as holders of preferred securities, or our right,
as the holder of the common securities, to institute suit for the
enforcement of any payment on or after such date.
Without obtaining the prior approval of the holders of at least a majority
in aggregate liquidation amount of the preferred securities, or, if a consent
under the indenture would require the consent of each holder of junior
subordinated debentures affected, the property trustee will not:
(1) direct when, where how how any proceeding for any remedy available to
the debenture trustee will be conducted, or execute any trust or power
conferred on the property trustee with respect to the junior subordinated
debentures;
(2) waive any past default that is waivable pursuant to the terms of the
indenture;
(3) exercise any right to rescind or annul a declaration that the principal
of all the junior subordinated debentures shall be due and payable; or
(4) consent to any amendment, modification or termination of the indenture
or the junior subordinated debentures, where consent is required.
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The property trustee may not revoke any action previously authorized or
approved by a vote of the holders of the preferred securities unless the holders
of the preferred securities vote again on the same issue. The property trustee
will notify you of any notice of default with respect to the junior subordinated
debentures. In addition to obtaining your approval as described above, before
taking any of the actions listed above, the property trustee will, at our
expense, obtain an opinion of counsel to the effect that the action will not
cause MBNK Capital Trust to be taxable other than as a grantor trust for United
States federal income tax purposes on account of such action.
As a holder of preferred securities, your vote or consent will not be
required to redeem and cancel preferred securities in accordance with the trust
agreement. If holders of preferred securities are entitled to vote or consent,
any preferred securities that are owned by us, the trustees or any of our
respective affiliates will be treated as if they were not outstanding for
purposes of that vote or consent.
EXPENSES AND TAXES
We have agreed to pay all debts and other obligations other than
distributions on the preferred securities of MBNK Capital Trust. We have also
agreed to pay all costs and expenses of MBNK Capital Trust. These costs and
expenses include costs and expenses relating to the organization of MBNK Capital
Trust and the fees and expenses of the trustees and their counsel. Further, we
have also agreed to pay any and all taxes, other than United States withholding
taxes, to which MBNK Capital Trust might become subject. These obligations of
ours are for the benefit of, and will be enforceable by, any creditor of MBNK
Capital Trust to whom any of these debts, obligations, costs, expenses and taxes
are owed whether or not that creditor has received notice. Any creditor may
enforce these obligations directly against us. We have irrevocably waived any
right or remedy to require that any creditor take any action against MBNK
Capital Trust or any other person before proceeding against us.
BOOK ENTRY, DELIVERY AND FORM
The preferred securities will be issued in the form of one or more fully
registered global securities, which will be deposited with, or on behalf of, the
Depository Trust Company and registered in the name of a Depository Trust
Company nominee. Unless and until it is exchangeable in whole or in part for the
preferred securities in definitive form, a global security may not be
transferred except as a whole by:
(1) the Depository Trust Company to a nominee of the Depository Trust
Company;
(2) a nominee of the Depository Trust Company to the Depository Trust
Company;
(3) a nominee of the Depository Trust Company to another nominee of the
Depository Trust Company; or
(4) the Depository Trust Company or any nominee to a successor of the
Depository Trust Company or to a nominee of that successor.
Ownership of beneficial interests in a global security will be limited to
participants that have accounts with the Depository Trust Company or its nominee
or persons that may hold interests through those participants. We expect that
upon the issuance of a global security the Depository Trust Company will credit,
on its book-entry registration and transfer system, the participants' accounts
with their respective principal amounts of preferred securities represented by
the global security. Ownership of beneficial interests in this global security
will be shown on, and the transfer of such ownership interests will be effected
only through, records maintained by the Depository Trust Company with respect to
the interests of participants. Ownership of beneficial interests in this global
security will be shown on the records of participants with respect to your
interests. You will not receive written confirmation from the Depository Trust
Company of your purchase, but you are expected to receive written confirmations
from participants through which you entered into the transaction. Transfers of
ownership interests will be accomplished by entries on the books of participants
acting on your behalf.
If the Depository Trust Company, or its nominee, is the registered owner of
a global security, the Depository Trust Company or its nominee, as the case may
be, will be considered the sole owner or holder of the preferred securities
represented by the global security for all purposes under the trust agreement.
Except as provided below, you are the owner of beneficial interests in a global
security and will not be entitled to receive physical delivery of the preferred
securities in definitive form. You will not be considered an owner or holder
under the trust
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agreement. Accordingly, you must rely on the procedures of the Depository Trust
Company and, if you are not a participant, on the procedures of the participant
through which you own your interest to exercise any rights as a holder of
preferred securities under the trust agreement. We understand that under the
Depository Trust Company's existing practices, in the event that we request any
action of you, or if you desire to take any action which a holder of preferred
securities is entitled to take under the trust agreement, the Depository Trust
Company would authorize the participants holding your interests to take that
action, and those participants would authorize you to take that action or would
otherwise act upon your instructions. Redemption and other notices also will be
sent to the Depository Trust Company. If less than all of the preferred
securities are being redeemed, we understand that it is the Depository Trust
Company's existing practice to determine by lot the amount of the interest of
each participant to be redeemed. Therefore, as long as the preferred securities
are held in book-entry form, references in this prospectus to your rights and
benefits mean your indirect interest held through the Depository Trust Company.
You should consider the procedures of the Depository Trust Company with respect
to distributions, redemptions, notice, voting and similar rights and benefits,
as well as those described in this prospectus.
Distributions on the preferred securities registered in the name of the
Depository Trust Company or its nominee will be made to the Depository Trust
Company or its nominee, as the case may be, as the registered owner of the
global security representing the preferred securities. Neither the trustees, nor
the administrators, any paying agent or any other agent of ours or the trustees
will have any responsibility or liability for any aspect of the records relating
to or payments made on account of beneficial ownership interests in the global
security for the preferred securities or for maintaining, supervising or
reviewing any records relating to beneficial ownership interests. Disbursements
of distributions to participants will be the responsibility of the Depository
Trust Company. The Depository Trust Company's practice is to credit
participants' accounts on a payable date in accordance with their respective
holdings shown on the Depository Trust Company's records unless the Depository
Trust Company has reason to believe that it will not receive payment on the
payable date. Payments by participants to you will be governed by standing
instructions and customary practices, as is the case with securities held for
the accounts of customers in bearer form or registered in "street name." If you
hold your preferred securities in "street name," distributions to you will be
the responsibility of the participant and not of the Depository Trust Company,
us, the trustees, the paying agent or any other agent of ours, subject to any
statutory or regulatory requirements as may be in effect. The laws of some
states require that certain purchasers of securities take physical delivery of
their purchased securities in definitive form. These laws may impair your
ability to transfer beneficial interests in the global security.
The Depository Trust Company may discontinue providing its services as
securities depository with respect to the preferred securities at any time by
giving reasonable notice to us or the trustees. If the Depository Trust Company
notifies us that it is unwilling to continue, or if it is unable to continue or
ceases to be a clearing agency registered under the Exchange Act, and a
successor depository is not appointed by us within 90 days after receiving such
notice or becoming aware that the Depository Trust Company is no longer so
registered, we will issue the preferred securities in definitive form upon
registration of, transfer of, or in exchange for, the global security. In
addition, we may at any time and in our sole discretion determine not to have
the preferred securities represented by one or more global securities and, in
such event, will issue preferred securities in definitive form in exchange for
all of the global securities representing the preferred securities. Finally,
holders of a majority in liquidation amount of preferred securities may
determine to discontinue the system of book-entry transfers through the
Depository Trust Company following an event of default with respect to the
preferred securities.
The Depository Trust Company has advised MBNK Capital Trust and us as
follows:
(1) The Depository Trust Company is a limited purpose trust company
organized under the laws of the State of New York, a "banking
organization" within the meaning of New York banking law, a member of the
Federal Reserve Board, a "clearing corporation" within the meaning of the
Uniform Commercial Code and a "clearing agency" registered pursuant to
the provisions of Section 17A of the Exchange Act;
(2) The Depository Trust Company was created to hold securities for its
participants and to facilitate the clearance and settlement of securities
transactions between participants through electronic book entry changes
to accounts of its participants, thereby eliminating the need for
physical movement of certificates;
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(3) its participants include securities brokers and dealers, such as the
underwriters, banks, trust companies and clearing corporations and may
include certain other organizations;
(4) certain participants, or their representatives, together with other
entities, own the Depository Trust Company; and
(5) indirect access to the Depository Trust Company system is available to
others such as banks, brokers, dealers and trust companies that clear
through, or maintain a custodial relationship with, a participant, either
directly or indirectly.
PAYMENT AND PAYING AGENCY
MBNK Capital Trust will make payments on the preferred securities to the
Depository Trust Company, which will credit the relevant accounts at the
Depository Trust Company on the applicable distribution dates. If the preferred
securities are not held by the Depository Trust Company, payments will be made
by check mailed to the address of the holder entitled thereto to the address
that appears on the securities register for the preferred securities. The paying
agent that will make the payments on behalf of MBNK Capital Trust will initially
be the property trustee. The paying agent will be permitted to resign as paying
agent upon 30 days' written notice to the property trustee and the
administrators. If the property trustee is no longer the paying agent, the
property trustee will appoint a successor to act as paying agent. The successor
must be a bank or trust company reasonably acceptable to the administrators.
REGISTRAR AND TRANSFER AGENT
The property trustee will act as registrar and transfer agent for the
preferred securities.
Registration of transfers of preferred securities will be effected without
charge by or on behalf of MBNK Capital Trust, but only upon payment of any tax
or other governmental charges that may be imposed in connection with any
transfer or exchange. MBNK Capital Trust will not be required to register or
cause to be registered the transfer of the preferred securities after the
preferred securities have been called for redemption.
OBLIGATIONS AND DUTIES OF THE PROPERTY TRUSTEE
Other than during the occurrence and continuance of an event of default, the
property trustee has promised to perform only the duties specifically contained
in the trust agreement. If there is a default under the trust agreement, the
property trustee must enforce the trust agreement for your benefit and must
exercise the powers vested in it by the trust agreement and use the same degree
of care and skill as a prudent person would exercise or use under the
circumstances in the conduct of his or her own affairs. The property trustee is
not required to exercise any of the powers vested in it by the trust agreement
at your request, unless you offer reasonable indemnity against the costs,
expenses and liabilities that the trustee may incur by the exercise of these
powers. The property trustee is not required to expend or risk its own funds or
otherwise incur any financial liability in the performance of its duties if it
has reasonable grounds to believe that repayment or adequate indemnity is not
assured to it.
The property trustee may rely upon any certificates or opinions furnished to
it and conforming to the requirements of the trust agreement.
For information concerning the relationships between us and The Bank of New
York as the property trustee, See "Description of Junior Subordinated
Debentures -- Information Concerning the Debenture Trustee" on page 40.
MISCELLANEOUS
The administrators and the property trustee are authorized and directed to
conduct the affairs of and to operate MBNK Capital Trust in such a way that:
(1) MBNK Capital Trust will not be deemed to be an investment company
required to be registered under the Investment Company Act or be taxable
as other than a grantor trust taxable as a corporation for United States
federal income tax purposes; and
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(2) the junior subordinated debentures will be treated as our indebtedness
for United States federal income tax purposes.
The property trustee, we, as the holder of the common securities, and the
administrators are authorized to take any action not inconsistent with
applicable law, the certificate of trust of MBNK Capital Trust or the trust
agreement that the property trustee, we, and the administrators, determine in
our discretion to be necessary or desirable for these purposes, as long as this
action does not materially adversely affect your interests.
You will not have preemptive or similar rights.
MBNK Capital Trust may not borrow money or issue debt or mortgage or pledge
its assets.
GOVERNING LAW
The trust agreement will be governed by and construed in accordance with the
laws of the State of Delaware.
DESCRIPTION OF JUNIOR SUBORDINATED DEBENTURES
We will issue the junior subordinated debentures under the indenture between
The Bank of New York, the debenture trustee, and us. We believe this summary of
the terms and provisions of the junior subordinated debentures and the indenture
describes all their provisions which would be important to you. However, the
form of the indenture is filed as an exhibit to the registration statement that
contains this prospectus and you should read it in its entirety. You can also
request a copy of the form of indenture from the debenture trustee. We have
referred to some of the indenture's defined terms in this prospectus. The
indenture will be qualified under the Trust Indenture Act of 1939. The terms of
the junior subordinated debentures include those made a part of the indenture by
the Trust Indenture Act.
GENERAL
As soon as MBNK Capital Trust has sold the preferred securities to you and
the common securities to us, it will invest the proceeds of these sales in the
junior subordinated debentures. The total principal amount of the junior
subordinated debentures will be equal to the total liquidation amount of the
preferred securities and common securities. The junior subordinated debentures
will be junior and subordinate in right of payment to all of our senior
indebtedness and other subordinated indebtedness. The junior subordinated
debentures will not be subject to a sinking fund. The indenture does not limit
our ability to incur or issue other secured or unsecured debt, including senior
indebtedness and other subordinated indebtedness, whether under any existing or
future indenture. See "-- Subordination" on page 39. Because we are a holding
company, our obligations under the junior subordinated debentures are also
effectively subordinated to all existing and future liabilities of our
subsidiaries. We rely primarily on dividends from our subsidiaries to meet debt
service obligations and pay operating expenses. If our direct or indirect
subsidiaries could not pay us dividends in an amount sufficient to meet our debt
service obligations and pay our operating expenses we would not have sufficient
funds to make payments on the junior subordinated debentures. In addition,
because we are a holding company, if there is any distribution of assets by any
of our subsidiaries because of a subsidiary's liquidation or similar event, we
will not receive funds until the claims of creditors of that subsidiary have
been satisfied, except to the extent we are recognized as a creditor of that
subsidiary.
The junior subordinated debentures will bear interest, accruing from
, 1999, at the annual rate of % of the principal amount of the
junior subordinated debentures. We will pay interest quarterly on March 31,
June 30, September 30 and December 31 of each year, beginning on December 31,
1999, to the person in whose name each junior subordinated debenture is
registered at the close of business on the 15th day of the month of the interest
payment date, even if the day is not a business day. We anticipate that, unless
MBNK Capital Trust is liquidated, each junior subordinated debenture will be
registered in the name of MBNK Capital Trust and held by the property trustee in
trust for you, as holders of the preferred securities, and us, as holder of the
common securities.
The amount of interest we pay for any full interest period will be computed
by dividing the annual rate of % by four. We will compute the amount of
interest payable for any period less than a full interest period on the basis
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of a 360-day year of twelve 30-day months and the actual days elapsed in a
partial month. If any date on which we are supposed to pay interest on the
junior subordinated debentures is not a business day, then we will pay the
interest payable on that date on the next business day, without paying any
interest or making any additional interest payments because of the delay.
However, if that business day falls in the next calendar year, we will make the
payment on the immediately preceding business day.
If we do not make an interest payment on the applicable interest payment
date, the junior subordinated debentures will bear additional interest on the
unpaid amount, to the extent permitted by law, at the annual rate of %,
compounded quarterly.
The term interest includes quarterly interest payments, interest on
quarterly interest payments not paid on the applicable interest payment date
and, if applicable, any other additional sums we pay on the junior subordinated
debentures. We may need to pay additional interest if there are changes in the
law that have negative tax consequences on the preferred securities. See
"Description of Preferred Securities -- Redemption" on page 20.
The junior subordinated debentures will mature on December 31, 2029, if we
don't shorten the maturity date. We can shorten the maturity date to any date
not earlier than December 31, 2004, although we may need the prior approval of
the Federal Reserve Board to do so. If we do shorten the maturity of the junior
subordinated debentures, we will give notice to the registered holders of the
junior subordinated debentures, the debenture trustee and MBNK Capital Trust no
less than 90 days before the shortened maturity date.
OPTION TO EXTEND INTEREST PAYMENT PERIOD
If we are not in default under the indenture, we can at any time defer
interest payments on the junior subordinate debentures. But we cannot defer
interest payments for a period of time:
(1) that exceeds 20 consecutive quarterly periods;
(2) that extends beyond the stated maturity of the junior subordinated
debentures; or
(3) that ends on a date other than an interest payment date.
During any extension period we can make partial payments of interest on any
interest payment date. At the end of an extension period we must pay all
interest then accrued and unpaid. During an extension period interest will
continue to accrue and holders of junior subordinated debentures, and holders of
preferred securities while outstanding, will be required to recognize original
issue discount income for United States federal income tax purposes. See
"Material United States Federal Income Tax Consequences -- Interest Income and
Original Issue Discount" on page 47.
During any extension period, we may not:
(1) declare or pay any dividends or distributions on, or redeem, purchase,
acquire or make any liquidation payments with respect to, any of our
capital stock; or
(2) make any payments of principal of or interest or premium on, or repay,
repurchase or redeem any of our debt securities that rank equally with in
all respects or junior in interest to the junior subordinated debentures;
except that we may:
(a) repurchase, redeem or make other acquisitions of shares of our
capital stock in connection with:
- any employment contract, benefit plan or other similar arrangement
with or for the benefit of any one or more of our employees,
officers, directors or consultants,
- a dividend reinvestment or shareholder stock purchase plan, or
- the issuance of our capital stock, or securities convertible into
or exercisable for our capital stock, as consideration in any
acquisition transactions entered into prior to the applicable
extension period;
(b) take any necessary action in connection with any reclassification,
exchange or conversion of any of our capital stock, any capital stock of a
subsidiary or any of our debt;
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(c) purchase fractional interests in shares of our capital stock in
connection with the conversion or exchange provisions of any of our capital
stock or the security being converted or exchanged;
(d) declare a dividend in connection with any shareholders' rights plan,
or issue rights, stock or other property under any shareholders' rights
plan, or redeem or repurchase rights under any shareholders rights plan; or
(e) declare a dividend in the form of stock, warrants, options or other
rights where the dividend stock or the stock issuable upon exercise of the
warrants, options or other rights is the same stock as that on which the
dividend is being paid or ranks equally with or junior to that stock.
If we are not in default under the indenture, before the end of any
extension period we may extend the extension period, further deferring the
payment of interest. Upon the termination of any extension period and the
payment of all amounts then due, we may elect to begin a new extension period as
long as we comply with the above conditions. We will not pay additional interest
on the junior subordinated debentures during an extension period, until the
extension period ends and all additional interest becomes due. We must give you
and the debenture trustee notice of our election to defer interest payments at
least one business day before the next interest payment date on which interest
on the junior subordinated debentures would be payable, or at least one business
day before:
(1) the next date distributions would have been payable on the preferred
securities but for the election to defer interest payments; and
(2) the date the property trustee is required to give you notice of the
record date or the distribution date, not less than one business day
prior to such record date.
The debenture trustee will give you prompt notice of our election to defer
interest payments. Except as described above, there is no limitation on the
number of times that we may elect to defer interest payments and begin an
extension period.
REDEMPTION
(1) We may redeem all or a portion the junior subordinated debentures prior
to maturity on or after December 31, 2004:
(2) We may redeem all but not only a portion of the junior subordinated
debentures, at any time before December 31, 2004 or within 90 days
following the occurrence and during the continuation of a tax event,
investment company event or capital treatment event. These events are
defined under "Description of Preferred Securities -- Redemption" on
page 20. The redemption price will be equal to the outstanding principal
amount of the junior subordinated debentures plus accrued interest,
including any additional interest, to the redemption date. MBNK Capital
Trust will use the proceeds of any redemption to redeem the preferred
securities.
The Federal Reserve Board's risk-based capital guidelines, which are subject
to change, currently provide that redemptions of permanent equity or other
capital instruments before stated maturity could have a significant impact on a
bank holding company's overall capital structure. Therefore, any organization
considering a redemption should consult with the Federal Reserve Board if the
redemption could significantly effect the level or composition of the
organization's capital base. If we redeem the junior subordinated debentures
prior to their stated maturity, and the Federal Reserve Board believes the
redemption would constitute the redemption of capital instruments under its
current risk-based capital guidelines, our redemption of the junior subordinated
debentures may be subject to the prior approval of the Federal Reserve Board.
ADDITIONAL SUMS
We have promised that, if we are not in default under the indenture and
except as otherwise specified in the indenture, if and for so long as MBNK
Capital Trust is the holder of all junior subordinated debentures and MBNK
Capital Trust is required to pay any additional taxes, duties or other
governmental charges as a result of a tax event,
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we will pay additional amounts on the junior subordinated debentures, so that
the distributions payable by MBNK Capital Trust will not be reduced as a result
of any additional taxes, duties or other governmental charges. See "Description
of Preferred Securities -- Redemption" on page 20.
REGISTRATION, DENOMINATION AND TRANSFER
The junior subordinated debentures will initially be registered in the name
of the property trustee on behalf of MBNK Capital Trust. If the junior
subordinated debentures are distributed to you, it is anticipated that the
depositary arrangements for the junior subordinated debentures will be
substantially identical to those in effect for the preferred securities. See
"Description of Preferred Securities -- Book Entry, Delivery and Form" on
page 28.
Although the Depository Trust Company has agreed to the procedures described
in "Description of Preferred Securities -- Book Entry, Delivery and Form" on
page 28, it is under no obligation to continue to perform these procedures, and
it may discontinue or change these procedures at any time. If the Depository
Trust Company is at any time unwilling or unable to continue as depositary and
we do not appoint a successor depositary within 90 days of receipt of notice
from the Depository Trust Company to that effect, we will cause the junior
subordinated debentures to be issued in certificate form.
If we issue junior subordinated debentures in certificated form, we will
make principal and interest payments at the New York office of the debenture
trustee or the transfer or paying agent we choose. However, at our option we may
make interest payments by check mailed to the address of the persons entitled
thereto. However, a holder of $1 million or more in aggregate principal amount
of junior subordinated debentures may receive payments of interest, other than
interest payable at the stated maturity, by wire transfer of immediately
available funds upon written request to the debenture trustee not later than 15
calendar days prior to the date on which the interest is payable.
Junior subordinated debentures are issuable only in registered form without
coupons in integral multiples of $10.00. Junior subordinated debentures will be
exchangeable for other junior subordinated debentures of like tenor, of any
authorized denominations, and of a like aggregate principal amount.
Junior subordinated debentures may be presented for exchange as provided
above, and may be presented for registration of transfer, at the office of the
securities registrar appointed under the indenture or at the office of any
transfer agent we designate for that purpose without service charge and upon
payment of any taxes and other governmental charges as described in the
indenture. We will appoint the debenture trustee as securities registrar under
the indenture.
In the event of any redemption, we will not, nor will the debenture trustee
be required to:
(1) issue, register the transfer of or exchange junior subordinated
debentures during a period beginning at the opening of business 15 days
before the day of selection for redemption of the junior subordinated
debentures to be redeemed and ending at the close of business on the day
of mailing of the relevant notice of redemption; or
(2) register the transfer of or exchange any junior subordinated debentures
selected for redemption, except, in the case of any junior subordinated
debentures being redeemed in part, any portion of the debenture not to be
redeemed.
Any amount deposited with the debenture trustee or any paying agent, or held
by us in trust, for the payment of principal or interest on any junior
subordinated debenture that is unclaimed for two years will be repaid to us at
our request. Thereafter, the holder of that unpaid junior subordinated debenture
must look, as a general unsecured creditor, only to us for payment.
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RESTRICTIONS ON CERTAIN PAYMENTS; CERTAIN COVENANTS
We have promised that at any time:
(1) if we have actual knowledge that an event of default has occurred, or
with notice or lapse of time an event of default would occur, under the
indenture and we have not taken reasonable steps to remedy the situation;
(2) if the junior subordinated debentures are held by MBNK Capital Trust, we
are in default with respect to our payment of any obligations under the
guarantee; or
(3) we have given notice of our election of an extension period as provided
in the indenture and have not rescinded such notice, or an extension
period, or any extension of an extension period, is continuing
We will not:
(1) make any payment of principal of or interest or premium on, or repay,
repurchase or redeem any of our debt securities that rank equally in all
respects with, or junior in interest to, the junior subordinated
debentures; or
(2) declare or pay any dividends or distributions on, or redeem, purchase,
acquire or make a liquidation payment with respect to, any of our capital
stock, except that we may:
(a) repurchase, redeem or make other acquisitions of shares of our
capital stock in connection with:
- any employment contract, benefit plan or other similar arrangement
with or for the benefit of any one or more employees, officers,
directors or consultants;
- a dividend reinvestment or shareholder stock purchase plan; or
- the issuance of our capital stock, or securities convertible into
or exercisable for our capital stock, as consideration in any
acquisition transactions entered into prior to any extension
period;
(b) take any necessary action in connection with any reclassification,
exchange or conversion of any of our capital stock, any capital stock
of any subsidiary of ours or of our debt;
(c) purchase fractional interests in shares of our capital stock relating
to the conversion or exchange provisions of the capital stock or the
security being converted or exchanged;
(d) declare a dividend in connection with any shareholders' rights plan,
or issue rights, stock or other property under any shareholders'
rights plan, or redeem or repurchase rights under any shareholder
rights plan; or
(e) declare a dividend in the form of stock, warrants, options or other
rights where the dividend stock or the stock issuable upon exercise of
the warrants, options or other rights is the same stock as that on
which the dividend is being paid or ranks equally with or junior to
that stock.
We have promised in the indenture:
(1) to continue to hold, directly or indirectly, 100% of the common
securities, except that certain successors that are permitted pursuant to
the indenture may succeed to our ownership of the common securities;
(2) as holder of the common securities, not to voluntarily terminate,
wind-up or liquidate MBNK Capital Trust, other than:
(a) in connection with a distribution of junior subordinated debentures
to the holders of the preferred securities in a liquidation of MBNK
Capital Trust; or
(b) in connection with certain mergers, consolidations or amalgamation
transactions permitted by the trust agreement; and
(3) to use our reasonable efforts, consistent with the terms and provisions
of the trust agreement, to cause MBNK Capital Trust to continue to be
classified as a grantor trust for United States federal income tax
purposes.
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MODIFICATION OF INDENTURE
We and the debenture trustee can, without the consent of any of the holders
of the outstanding junior subordinated debentures, amend, waive or supplement
the provisions of the indenture in the following ways:
(1) if we are acquired by someone, to have that person assume our
obligations under the indenture and the junior subordinated debentures;
(2) to convey, transfer, assign, mortgage, pledge any property to or with
the debenture trustee or to surrender any right or power conferred upon
us by the indenture;
(3) to add further covenants, restrictions or conditions that would protect
the holders of the junior subordinated debentures or to surrender any
right or power conferred upon us under the indenture;
(4) to change or eliminate any of the provisions of the indenture, if at the
time of the change or elimination there are no outstanding junior
subordinated debentures entitled to the benefit of the provision or the
change or elimination does not apply to any outstanding securities;
(5) to add events of default that would benefit the holders of the junior
subordinated debentures;
(6) to add additional events of default that would benefit the holders of
the preferred securities and the common securities;
(7) to cure any ambiguity, to correct or supplement any provision in the
indenture that may be defective or inconsistent with any other provision
in the indenture, if that action does not negatively affect the interest
of the holders of the junior subordinated debentures, or, if they are
outstanding, the preferred securities in any material respect;
(8) to change the terms of the junior subordinated debentures to facilitate
the issuance of the junior subordinated debentures in certificated or
other definitive form;
(9) to evidence or provide for the appointment of a successor debenture
trustee;
(10) to qualify, or maintain the qualification of, the indenture under the
Trust Indenture Act; or
(11) to establish the form or terms of any series of the junior subordinated
debentures as permitted by the indenture.
If we have the consent of a majority in principal amount of junior
subordinated debentures that would be affected, the debenture trustee and we can
modify the indenture in the following ways:
(1) change the stated maturity of the principal of, or affect the interest
payment date on, any of the junior subordinated debentures, or reduce the
principal amount, the rate of interest or any premium we would owe if we
redeemed the junior subordinated debentures, or change the place of
payment where, or the currency in which, these amount are payable, or
impair the right to institute suit for the enforcement of any payment on
the junior subordinated debentures;
(2) lower the percentage of principal amount of junior subordinated
debentures needed to approve any modification of, or waiver of rights
under, the indenture; or
(3) modify any other provisions of the indenture, except to increase any
percentage or to provide that certain other provisions of the indenture
cannot be modified or waived without the consent of the holder of each
junior subordinated debenture affected.
Furthermore, so long as any of the preferred securities remain outstanding:
(1) we cannot:
- change the indenture in a way that would adversely affect you in any
material respect,
- terminate the indenture,
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- waive default, without the prior consent of the holders of at least a
majority of the aggregate liquidation amount of the outstanding
preferred securities,
unless and until we have paid principal of, and premium, if any, on, the
junior subordinated debentures, including all accrued and unpaid
interest, and certain other conditions are satisfied; and
(2) we cannot amend the indenture in a way that would impair the rights of
the holders of the preferred securities without the prior consent of the
holders of each preferred security then outstanding unless and until we
have paid the principal of, and premium, if any, on, the junior
subordinated debentures including all accrued and unpaid interest.
DEBENTURE EVENTS OF DEFAULT
The indenture provides that any one or more of the following described
events with respect to the junior subordinated debentures that has occurred and
is continuing constitute an "event of default" with respect to the junior
subordinated debentures:
(1) if we fail to pay any interest on the junior subordinated debentures
when due and payable and do not make the payment in the next 30 days,
unless we have deferred the due date by declaring an extension period;
(2) if we fail to pay any principal of or premium, if any, on the junior
subordinated debentures when due and payable whether at the stated
maturity, upon redemption, by declaration of acceleration or otherwise;
(3) if we fail to observe or perform in any material respect certain of the
other covenants in the indenture for 90 days after written notice of the
failure to us from the debenture trustee or the holders of at least 25%
in aggregate outstanding principal amount of the outstanding junior
subordinated debentures; or
(4) the appointment of a receiver or other similar official in any
liquidation, insolvency or similar proceeding with respect to us or all
or substantially all of our property; or a court or other governmental
agency enters a decree or order appointing a receiver or similar official
and the decree or order remains unstayed and undischarged for a period of
60 days.
As described in "Description of Preferred Securities -- Events of Default;
Notice" on page 24, the occurrence of an event of default on the junior
subordinated debentures also will constitute an event of default in respect of
the preferred securities and common securities.
With some limitations, the holders of at least a majority in aggregate
principal amount of outstanding junior subordinated debentures can direct how,
when and where any proceeding for any remedy available to the debenture trustee
is conducted. The debenture trustee or the holders of not less than 25% in
aggregate principal amount of outstanding junior subordinated debentures can
declare the principal due and payable immediately during a continuing event of
default and, if the debenture trustee or the holders of junior subordinated
debentures do not make this declaration, the holders of at least 25% in
aggregate liquidation amount of the outstanding preferred securities can do so.
The holders of a majority in aggregate principal amount of outstanding junior
subordinated debentures also can annul a default declaration and waive the
default if:
(1) we have cured all defaults, other than the non-payment of the principal
of junior subordinated debentures which has become due because of the
default; and
(2) we have cured all matured installments of interest and principal due on
the junior subordinated debentures other than those amounts that were due
because of the default, and all sums paid or advanced by the debenture
trustee and the reasonable compensation, expenses, disbursements and
advances of the debenture trustee, its agent and its counsel.
If the holders of junior subordinated debentures do not annul a default
declaration or waive a default, the holders of a majority in aggregate
liquidation amount of the outstanding preferred securities can do so.
We are required to certify annually to the debenture trustee as to whether
or not we are in compliance with all the conditions and covenants applicable to
us under the indenture.
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During a continuing event of default the debenture trustee can declare the
principal of and the interest on the junior subordinated debentures, and any
other amounts payable under the indenture, to be due and payable and can enforce
its other rights as a creditor of ours with respect to the junior subordinated
debentures.
ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF PREFERRED SECURITIES
During a continuing event of default that is caused by our failure to pay
any amounts payable on the junior subordinated debentures on the date those
amounts are due, you may institute a legal action against us to enforce the
payment to you of an amount equal to the amount payable on the junior
subordinated debentures having a principal amount equal to the aggregate
liquidation amount of the preferred securities you hold. We may not amend the
indenture to remove this right to bring a legal action without your prior
written consent. We have the right under the indenture to set-off against the
amount owed to MBNK Capital Trust any payment we make to you in connection with
a legal action.
With certain exceptions, as a holder of preferred securities, you will not
be able to exercise directly any remedies available to the holders of the junior
subordinated debentures except under the circumstances described in the
preceding paragraph unless there has been an event of default under the trust
agreement. See "Description of Preferred Securities -- Events of Default;
Notice" on page 24.
CONSOLIDATION, MERGER, SALE OF ASSETS AND OTHER TRANSACTIONS
The indenture provides that we may not consolidate with or merge into any
other entity or convey, transfer or lease substantially all of our assets to any
entity, and no entity may consolidate with or merge into us, or convey, transfer
or lease its properties and assets substantially as an entirety to us, unless:
- immediately after giving effect to the transactions there is no continuing
event of default with respect to the junior subordinated debentures, and
no event which, after notice or lapse of time or both, would constitute an
event of default with respect to the junior subordinated debentures; and
- certain other conditions as prescribed in the indenture are satisfied.
Nothing in the indenture prohibits us from acquiring other banks.
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SATISFACTION AND DISCHARGE
We will be deemed to have satisfied and discharged the indenture, which
means you will have no legal rights under the indenture, when:
(1) all junior subordinated debentures have been delivered to the debenture
trustee for cancellation, or all junior subordinated debentures not
previously delivered to the debenture trustee for cancellation:
- have become due and payable,
- will become due and payable at the stated maturity date within one
year, or
- are to be called for redemption within one year under arrangements
satisfactory to the debenture trustee;
(2) we deposit funds with the debenture trustee for the purpose and in an
amount sufficient to pay all of our obligations on the junior
subordinated debentures not previously delivered to the debenture trustee
for cancellation, for the principal, and premium, if any, and interest to
the date of the deposit or to the stated maturity or redemption date; and
(3) we have paid all other sums payable by us under the indenture and we
have delivered applicable certificates and opinions of counsel that
indicate we have complied with all of our obligations.
SUBORDINATION
The junior subordinated debentures generally will be subordinate and junior
in right of payment to all of our senior indebtedness or other subordinated
indebtedness, as described below. If we default in the payment of any principal,
premium, if any, or interest, if any, or any other amount payable on any senior
or other subordinated indebtedness when the same becomes due and payable whether
at maturity or at a date fixed for redemption or by declaration of acceleration
or otherwise, then unless and until we have cured the default or it has been
waived or all senior indebtedness has been paid, we cannot make any payments on
the junior subordinated debentures.
As used in this prospectus, "senior indebtedness or other subordinated
indebtedness" means, whether recourse exists as to all or a portion of our
assets and whether or not contingent:
(1) every obligation of ours for money borrowed;
(2) every obligation of ours evidenced by bonds, debentures, notes or other
similar instruments, including obligations incurred in connection with
the acquisition of property, assets or businesses;
(3) every reimbursement obligation of ours with respect to letters of
credit, bankers' acceptances or similar facilities issued for our
account;
(4) every obligation of ours issued or assumed as the deferred purchase
price of property or services, but excluding trade accounts payable or
accrued liabilities arising in the ordinary course of business;
(5) every capital lease obligation of ours;
(6) every obligation of ours for claims, as defined in Section 101(4) of the
United States Bankruptcy Code of 1978, in respect of derivative products
such as interest, foreign exchange rate contracts, commodity contracts
and similar arrangements; and
(7) every obligation of the type referred to above of another person and all
dividends of another person the payment of which, in either case, we have
guaranteed or for which we are responsible or liable, directly or
indirectly, as obligor or otherwise.
However, senior indebtedness and other subordinated indebtedness does not
include any of the following:
(1) any obligations which, by their terms, are expressly stated to rank
equally in right of payment with, or subordinate in right of payment to,
the junior subordinated debentures;
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(2) any of our indebtedness and other subordinated indebtedness which when
incurred and without respect to any election under Section 1111(b) of the
United States Bankruptcy Code of 1978, was without recourse to us;
(3) any indebtedness of ours to any of our subsidiaries;
(4) indebtedness for wages or bank deposits, other than those payable to
executive officers, directors or employees; and
(5) any indebtedness in respect of debt securities issued to any trust, or a
trustee of such trust, partnership or other entity affiliated with us
that is a financing entity of ours in connection with the issuance by
such financing entity of securities that are similar to the preferred
securities.
As of June 30, 1999, we had senior indebtedness and other subordinated
indebtedness of approximately $303.7 million. We must pay in full our
obligations under all senior indebtedness, before we can make any payments or
distributions, whether in cash, securities or other property, on the junior
subordinated debentures if we experience:
(1) any insolvency, bankruptcy, receivership, liquidation, reorganization,
readjustment, imposition or other similar proceedings relating to us, our
creditors or our property;
(2) any proceeding for our liquidation, dissolution or other winding up,
voluntary or involuntary, whether or not involving insolvency or
bankruptcy proceedings;
(3) any assignment by us for the benefit of creditors; or
(4) any other marshaling of our assets.
If payment or distribution on account of the junior subordinated debentures
of any character or security, whether in cash, securities or other property, is
received by any holder of any junior subordinated debentures in contravention of
any of the terms of the indenture and before all our senior indebtedness has
been paid in full, that payment or distribution or security will be received in
trust for the benefit of, and must be paid over or delivered and transferred to,
the holders of our senior indebtedness at the time outstanding in accordance
with the priorities then existing among those holders for application to the
payment of all senior indebtedness remaining unpaid to the extent necessary to
pay all senior indebtedness in full.
If during any proceeding described above, after we have paid in full all
sums we owe on our senior indebtedness and other subordinated indebtedness, the
holders of junior subordinated debentures, together with the holders of our
obligations ranking on a parity with the junior subordinated debentures, will be
entitled to be paid from our remaining assets the amounts at the time due and
owing on the junior subordinated debentures and the other obligations. We will
make payment on the junior subordinated debentures before we make any payment or
other distribution, whether in cash, property or otherwise, on account of any
capital stock or obligations ranking junior to the junior subordinated
debentures.
By reason of this subordination, if we become insolvent, holders of senior
indebtedness and other subordinated indebtedness may receive more, and holders
of the junior subordinated debentures may receive less, than our other
creditors. This subordination will not prevent the occurrence of any event of
default on the junior subordinated debentures.
The indenture places no limitation on the amount of additional senior
indebtedness and other subordinated indebtedness that we may incur. We expect
from time to time to incur additional senior indebtedness and other subordinated
indebtedness.
INFORMATION CONCERNING THE DEBENTURE TRUSTEE
Other than during the occurrence and continuance of a default, the debenture
trustee has promised to perform only the duties specifically contained in the
indenture. If we are in default under the indenture, the debenture trustee must
exercise the same degree of care and skill as a prudent person would in the
conduct of his or her own affairs. The debenture trustee is not required to
expend or risk its own funds or otherwise incur
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personal financial liability in the performance of its duties if it has
reasonable grounds to believe that repayment or adequate indemnity is not
reasonably assured to it.
The debenture trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
security or other paper or document believed by it to be genuine and to have
been signed or presented by the proper party or parties. The debenture trustee
may consult with counsel of its choice and the advice of counsel or any opinion
of counsel shall be full and complete authorization and protection in respect of
any action taken in reliance on that advice or opinion.
The Bank of New York, the debenture trustee, may serve from time to time as
trustee under other indentures or trust agreements with us or our subsidiaries
relating to other issues of our securities. In addition, we as well as certain
of our affiliates may have other banking relationships with The Bank of New York
and its affiliates.
GOVERNING LAW
The indenture and the junior subordinated debentures will be governed by and
construed in accordance with the laws of the State of New York.
DESCRIPTION OF GUARANTEE
We will execute and deliver the guarantee at the same time MBNK Capital
Trust issues the preferred securities. The Bank of New York will act as
guarantee trustee under the guarantee and will hold the guarantee for your
benefit. We believe this summary of the provisions of the guarantee describes
all its provisions that would be important to you. However, the form of the
guarantee is filed as an exhibit to the registration statement which contains
this prospectus and you should read it in its entirety. A copy of the form of
guarantee is available upon request from the guarantee trustee. Whenever
particular defined terms of the guarantee are referred to in this prospectus,
those terms are incorporated herein by reference. The guarantee will be
qualified as an indenture under the Trust Indenture Act.
GENERAL
We will irrevocably agree to pay in full on a subordinated basis, to the
extent set forth in the guarantee, the payments described below to you, as and
when due, regardless of any defense, right of set-off or counterclaim which MBNK
Capital Trust may have or assert other than the defense of payment. The
following payments with respect to the preferred securities, to the extent not
paid or made by or on behalf of MBNK Capital Trust, will be subject to the
guarantee without duplication:
(1) any accumulated and unpaid distributions MBNK Capital Trust is required
to pay on the preferred securities, to the extent that MBNK Capital Trust
has the funds to make the distributions at such time;
(2) the redemption price with respect to any preferred securities called for
redemption by MBNK Capital Trust, to the extent that MBNK Capital Trust
has the funds to pay the redemption at such time; and
(3) upon a voluntary or involuntary termination, winding up or liquidation
of MBNK Capital Trust, unless the junior subordinated debentures are
distributed to you, as holders of the preferred securities, the lesser
of:
- (a) the total liquidation amount and all accumulated and unpaid
distributions to the date of payment, to the extent that MBNK
Capital Trust has sufficient funds available for their payment; and
- (b) the amount of assets of MBNK Capital Trust remaining available
for distribution to you on liquidation of MBNK Capital Trust.
Our obligation to make a guarantee payment may be satisfied by directly
paying you or by causing MBNK Capital Trust to pay you.
The guarantee will be an irrevocable, subordinated guarantee of payment of
MBNK Capital Trust's obligations under the preferred securities. The guarantee
will apply only to the extent that MBNK Capital Trust has funds
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sufficient to make payments. If we do not make payments on the junior
subordinated debentures held by MBNK Capital Trust, MBNK Capital Trust will not
have funds to pay any amounts payable in respect of the preferred securities.
STATUS OF THE GUARANTEE
The guarantee will constitute our unsecured obligation and will rank
subordinate and junior in right of payment to all of our senior indebtedness and
subordinated indebtedness in the same manner as the junior subordinated
debentures. The guarantee does not limit our ability to incur or issue other
secured or unsecured senior or subordinated indebtedness and we expect to incur,
from time to time, additional senior and subordinated indebtedness. Our
obligations under the guarantee are effectively subordinated to all existing and
future liabilities of any of our subsidiaries and their respective subsidiaries.
The guarantee will constitute a guarantee of payment and not of collection.
A guarantee of payment entitles the guarantee trustee or you to institute a
legal proceeding directly against us as the guarantor to enforce your rights
under the guarantee without first instituting a legal proceeding against MBNK
Capital Trust or any other person or entity. The guarantee will be held by the
guarantee trustee for your benefit. The guarantee will not be discharged except
by paying the amounts required under the guarantee in full to the extent not
paid by MBNK Capital Trust or distributing the junior subordinated debentures to
you.
AMENDMENTS AND ASSIGNMENT
Except with respect to any changes that do not materially adversely affect
your rights, in which case no consent will be required, the guarantee may not be
amended without the prior approval of the holders of a majority of the aggregate
liquidation amount of the outstanding preferred securities. The manner of
obtaining any such approval is set forth under "Description of Preferred
Securities -- Voting Rights; Amendment of Trust Agreement" on page 27. All
guarantees and agreements contained in the guarantee will bind our successors,
assigns, receivers, trustees and representatives and will be for your benefit
and the benefit of all of the holders of the preferred securities then
outstanding. Except in connection with a consolidation, merger or sale involving
us that is permitted under the indenture and pursuant to which the assignee
agrees in writing to perform our obligations under the guarantee, we may not
assign our obligations under the guarantee.
EVENTS OF DEFAULT
An event of default under the guarantee will occur if we do not perform any
of our payment or other obligations under the guarantee, and do not perform the
obligation for 30 days. The holders of a majority in aggregate liquidation
amount of the outstanding preferred securities have the right to direct when,
how and where any proceeding for any remedy available to the guarantee trustee
under the guarantee is conducted or to direct the guarantee trustee to exercise
any trust or power conferred upon the guarantee trustee under the guarantee.
In addition to acts taken by the guarantee trustee, you may institute a
legal proceeding directly against us to enforce your rights under the guarantee
without first instituting a legal proceeding against MBNK Capital Trust, the
guarantee trustee or any other person or entity. Since you will not be the
record holder of the preferred securities while they are in book-entry form, you
will have to observe the procedures of the Depository Trust Company to take such
action. See "Description of Preferred Securities -- Book Entry, Delivery and
Form" on page 28.
We are required, as guarantor, to certify annually to the guarantee trustee
whether or not we are in compliance with all the conditions and covenants
applicable to us under the guarantee.
INFORMATION CONCERNING THE GUARANTEE TRUSTEE
The guarantee trustee, other than during a default by us in performance of
the guarantee, has only promised to perform the duties specifically contained in
the guarantee. If there is a default under the guarantee, the guarantee trustee
must exercise the rights and powers vested in it by the guarantee and must
exercise the same degree of care and skill as a prudent person would exercise or
use under the circumstances in the conduct of his or
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her own affairs. The guarantee trustee is under no obligation to expend or risk
its own funds or otherwise incur any personal financial liability in the
performance of its duties or in the exercise of any of its rights or powers if
it has reasonable grounds to believe that repayment or adequate indemnity is not
assured.
TERMINATION OF THE GUARANTEE
The guarantee will terminate and be of no further force and effect upon:
(1) full payment of the redemption price of the preferred securities;
(2) full payment of the amounts payable with respect to the preferred
securities;
(3) liquidation of the MBNK Capital Trust; or
(4) distribution of junior subordinated debentures to you and the other
holders of the preferred securities in exchange for all of the preferred
securities.
The guarantee will continue to be effective or will be reinstated, as the case
may be, if at any time you must return payment of any sums paid to you under the
preferred securities or the guarantee.
GOVERNING LAW
The guarantee will be governed by and construed in accordance with the laws
of the State of New York.
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RELATIONSHIP AMONG THE PREFERRED SECURITIES, THE JUNIOR SUBORDINATED
DEBENTURES AND THE GUARANTEE
FULL AND UNCONDITIONAL GUARANTEE
We have irrevocably guaranteed, on a subordinate basis, payments of
distributions and other amounts due on the preferred securities to the extent
that MBNK Capital Trust has funds available to make these payments. Taken
together, our obligations under the junior subordinated debentures, the
indenture, the trust agreement and the guarantee provide a full, irrevocable and
unconditional guarantee of payments of distributions and other amounts due on
the preferred securities. No single document standing alone or operating in
conjunction with fewer than all the other documents gives you a full guarantee.
It is only the combined operation of these documents that has the effect of
providing a full, irrevocable and unconditional guarantee of MBNK Capital
Trust's obligations in respect of the preferred securities.
If we do not make payments on the junior subordinated debentures, MBNK
Capital Trust will not have sufficient funds to pay distributions or other
amounts due on the preferred securities. The guarantee does not cover payment of
amounts payable with respect to the preferred securities when MBNK Capital Trust
does not have sufficient funds to pay these amounts. In that event, your remedy
is to institute a legal proceeding directly against us for enforcement of our
payment obligations under the junior subordinated debentures having a principal
amount equal to the liquidation amount of the preferred securities you hold.
Our obligations under the junior subordinated debentures and the guarantee
are subordinate and junior in right of payment to all of our senior indebtedness
and other subordinated indebtedness. An event of default under any of our senior
indebtedness or other subordinated indebtedness would not constitute an event of
default in respect of the preferred securities. However, in the event of payment
defaults under, or acceleration of, our senior indebtedness or other
subordinated indebtedness, the subordination provisions of the indenture provide
that we will not make any payments on the junior subordinated debentures until
we have paid in full the senior indebtedness or other subordinated indebtedness
and all of our defaults on our senior indebtedness have been cured or waived.
See "Description of Junior Subordinated Debentures -- Subordination" on
page 39. Failure to make required payments on the junior subordinated debentures
would constitute an event of default in respect of the preferred securities.
SUFFICIENCY OF PAYMENTS
If we make the payments on the junior subordinated debentures when they are
due, those payments will be sufficient to cover distributions and other payments
distributable on the preferred securities, primarily because:
(1) the total principal amount of the junior subordinated debentures will be
equal to the sum of the total stated liquidation amount of the preferred
securities and common securities;
(2) the interest rate and interest and other payment dates on the junior
subordinated debentures will match the distribution rate, distribution
dates and other payment dates for the preferred securities;
(3) we will pay for any and all costs, expenses and liabilities of MBNK
Capital Trust except MBNK Capital Trust's obligations to you and to us,
as the holder of the common securities, to pay amounts due under the
preferred securities and the common securities, respectively; and
(4) the trust agreement provides that MBNK Capital Trust will not engage in
any activity that is not consistent with the limited purposes of MBNK
Capital Trust.
If we make a payment under the guarantee, our obligations under the
indenture will be reduced by the amount of that payment.
ENFORCEMENT RIGHTS OF HOLDERS OF PREFERRED SECURITIE
You may institute a legal proceeding directly against us to enforce your
rights under the guarantee without first instituting a legal proceeding against
the guarantee trustee, MBNK Capital Trust or any other person or entity. See
"Description of Guarantee" on page 41.
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RIGHTS TO DISTRIBUTIONS
The preferred securities represent preferred beneficial interests in the
assets of MBNK Capital Trust, and MBNK Capital Trust exists for the sole
purposes of issuing the preferred securities and common securities and investing
the proceeds in the junior subordinated debentures and engaging in other
activities necessary, convenient or incidental to those activities. A principal
difference between your rights as a holder of preferred securities and a holder
of a junior subordinated debenture is that a holder of a junior subordinated
debenture is entitled to receive from us payments on the junior subordinated
debentures held, while you are entitled to receive distributions or other
amounts distributable with respect to the preferred securities from MBNK Capital
Trust, or from us under the guarantee, only if MBNK Capital Trust has funds
available for the payment of those distributions.
RIGHTS UPON DISSOLUTION
Upon any voluntary or involuntary dissolution of MBNK Capital Trust, other
than any dissolution involving the distribution of the junior subordinated
debentures to you, as holders of the preferred securities, and after
satisfaction of liabilities to creditors of MBNK Capital Trust as required by
applicable law, you will be entitled to receive, out of assets held by MBNK
Capital Trust, the liquidation distribution in cash. See "Description of
Preferred Securities -- Liquidation Distribution Upon Dissolution" on page 23.
If we are voluntarily or involuntarily liquidated or declare bankruptcy, MBNK
Capital Trust, as registered holder of the junior subordinated debentures, will
be our subordinated creditor, subordinated and junior in right of payment to all
our senior indebtedness or other subordinated indebtedness. However, MBNK
Capital Trust will be entitled to receive payment in full of all amounts payable
with respect to the junior subordinated debentures before any of our
shareholders receive payments or distributions. Because we are the guarantor
under the guarantee and have agreed under the indenture to pay for all costs,
expenses and liabilities of MBNK Capital Trust, other than MBNK Capital Trust's
obligations to you and the holder of the common securities, your position as
holders of the preferred securities and the position of holders of junior
subordinated debentures compared to other creditors and to our shareholders in
the event of our liquidation or bankruptcy are expected to be substantially the
same.
MATERIAL UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
GENERAL
Except where expressly stated, the following discussion is the opinion of
Stevens & Lee, P.C., Reading, Pennsylvania, our counsel, as to the material
United States federal income tax consequences of the purchase, ownership and
disposition of the preferred securities.
Except where we state otherwise, this discussion deals only with preferred
securities held as capital assets within the meaning of the Internal Revenue
Code of 1986 by a holder who:
- is a United States Person (as defined below), and
- purchases the preferred securities upon original issuance at their
original issue price.
"United States Person" means a beneficial owner of preferred securities
that, for United States federal income tax purposes, is:
- a citizen or resident of the United States;
- a corporation or partnership created or organized in or under the laws of
the United States or any political subdivision thereof;
- an estate the income of which is subject to United States federal income
taxation without regard to its source; or
- a trust that (y) is subject to the supervision of a court within the
United States and the control of one or more United States Persons or
(z) has a valid election in effect under the applicable United States
Treasury regulations to be treated as a United States Person.
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This discussion does not discuss all of the tax consequences that may be
relevant to beneficial owners who are subject to special rules, such as:
- banks,
- thrift institutions,
- real estate investment trusts,
- regulated investment companies,
- insurance companies,
- dealers in securities or currencies,
- securities traders that elect to mark to market,
- tax-exempt organizations,
- individual retirement and certain tax-deferred accounts,
- persons holding a preferred security as a position in a straddle, or as
part of a hedging, conversion or other integrated investment; and
- except with respect to the discussion under the caption "Non-United States
Holders," persons who are not United States Persons.
In addition, this discussion does not address:
- the income tax consequences to stockholders in, or partners or
beneficiaries of, a holder of preferred securities;
- the United States alternative minimum tax consequences of purchasing,
owning and disposing of preferred securities; or
- any state, local or foreign tax consequences of purchasing, owning and
disposing of preferred securities.
This discussion is based on United States federal income tax laws in effect
as of the date of this prospectus, including applicable regulations and
administrative and judicial interpretations. Changes to any of these laws,
regulations or interpretations after this date may affect the tax consequences
described below, possibly on a retroactive basis.
The authorities on which this discussion is based are subject to various
interpretations, and the opinions of Stevens & Lee, P.C., are not binding on the
Internal Revenue Service, or the courts, either of which could take a contrary
position. Moreover, no rulings have been or will be sought from the IRS with
respect to the transactions described in this prospectus. Accordingly, we cannot
assure you that the IRS will not challenge the opinions expressed or that a
court would not sustain such a challenge.
If you would be a beneficial owner identified above that would be subject to
special rules or otherwise believe that your particular tax situation is not
addressed in this discussion, we advise you to consult your tax advisor
regarding the tax consequences of purchasing, owning and disposing of the
preferred securities based on your particular circumstances and the relevant
taxing jurisdictions.
CLASSIFICATION OF THE TRUST
Stevens & Lee is of the opinion that MBNK Capital Trust will be classified
for United States federal income tax purposes as a grantor trust and not an
association taxable as a corporation based on:
- current law and our factual representations and other facts and
assumptions set forth in this prospectus;
- the assumption that there will be full compliance with the terms of the
trust agreement; and
- other assumptions and qualifications stated in the opinion which is filed
as an exhibit to the registration statement of which this prospectus is a
part.
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Accordingly, for United States federal income tax purposes, you generally will
be considered the owner of an undivided interest in the junior subordinated
debentures owned by MBNK Capital Trust, and you will be required to include all
income or gain recognized for United States federal income tax purposes with
respect to your share of the junior subordinated debentures on your United
States federal income tax return
CLASSIFICATION OF THE JUNIOR SUBORDINATED DEBENTURES
Stevens & Lee has not delivered a legal opinion that the junior subordinated
debentures constitute indebtedness because whether a security is classified as
debt or equity involves substantial questions of fact. However, based on the
facts contained in this prospectus and the terms of the indenture and the junior
subordinated debentures, we intend to take the position that the junior
subordinated debentures will be classified for United States federal income tax
purposes as our indebtedness. By acceptance of preferred securities, each holder
covenants to treat the junior subordinated debentures as indebtedness and the
preferred securities as evidence of an indirect beneficial ownership interest in
the junior subordinated debentures. We cannot assure you that the IRS will not
challenge this position. The remainder of this discussion assumes that the
junior subordinated debentures will be treated as our indebtedness for United
States federal income tax purposes.
If the junior subordinated debentures are classified as indebtedness for
United States federal income tax purposes, a corporate holder of the preferred
securities will not be entitled to claim a dividends-received deduction for any
income recognized with respect to such securities.
INTEREST INCOME AND ORIGINAL ISSUE DISCOUNT
Under Treasury Regulations, a "remote" contingency that stated interest will
not be timely paid will be ignored in determining whether a debt instrument is
issued with original issue discount. We believe that the likelihood of our
exercising our option to defer payments is remote, based in part on the fact
that exercising that option would prevent us from declaring dividends on our
common stock and would prevent us from making any payments with respect to debt
securities that rank equally with or junior to the junior subordinated
debentures. The Treasury regulations dealing with original issue discount and
the deferral of interest have not yet been addressed in any rulings or other
interpretations by the IRS. Because of this lack of guidance from the IRS and
the fact that whether the junior subordinated debentures are issued with
original issue discount involves substantial questions of fact, Stevens & Lee
has not provided a legal opinion on this issue. However, based on the foregoing,
we intend to take the position that the junior subordinated debentures will not
be considered to be initially issued with original issue discount. Accordingly,
you will be taxed on stated interest on the junior subordinated debentures when
such interest is paid or accrued in accordance with your regular method of tax
accounting.
In the event that we exercise our option to defer the payment of stated
interest on the junior subordinated debentures, the junior subordinated
debentures would be treated, solely for purpose of the original issue discount
rules, as being "re-issued" at such time with original issue discount. Under
these rules, a holder of the junior subordinated debentures or preferred
securities would be required to include original issue discount in ordinary
income, on a current basis, over the period that the instrument is held even
though there would be no actual cash payments during the extended interest
payment period. The amount of original issue discount income includible in the
taxable income of a holder of the junior subordinated debentures or preferred
securities would be determined on the basis of a constant yield method over the
remaining term of the instrument and the actual receipt of future payments on
the junior subordinated debentures or preferred securities would no longer be
separately reported as taxable income. The amount of original issue discount
that would accrue, in the aggregate, during the extended interest payment period
would be approximately equal to the amount of the cash payment due at the end of
extension period. Any original issue discount included in income would increase
the holder's adjusted tax basis in the junior subordinated debentures or
preferred securities and the holder's actual receipt of payments would reduce
such basis.
If our power to defer payments of interest is not treated by the IRS as
remote, the junior subordinated debentures would be treated as initially issued
with original issue discount. In that event, you would be required to include
original issue discount in your taxable income over the term of the junior
subordinated debentures on a daily accrual basis, as described above.
47
<PAGE>
RECEIPT OF JUNIOR SUBORDINATED DEBENTURES OR CASH UPON LIQUIDATION OF THE TRUST
Under certain circumstances described above, MBNK Capital Trust may
distribute the junior subordinated debentures to you in exchange for your
preferred securities in liquidation of MBNK Capital Trust. See "Description of
Preferred Securities -- Liquidation Distribution Upon Dissolution" on page 23.
Except as discussed below, a distribution of the junior subordinated debentures
would not be a taxable event for United States federal income tax purposes, and
you would have an aggregate adjusted basis in the junior subordinated debentures
you receive for United States federal income tax purposes equal to your
aggregate adjusted basis in your preferred securities. For United States federal
income tax purposes, your holding period in the junior subordinated debentures
you receive in a liquidation of the Trust would include the period during which
you held the preferred securities. If, however, the relevant event is a tax
event as described in "Description of Preferred Securities -- Redemption" on
page 20, which results in MBNK Capital Trust being treated as an association
taxable as a corporation, the distribution would likely constitute a taxable
event to you for United States federal income tax purposes.
Under certain circumstances described above, we may redeem junior
subordinated debentures for cash and distribute the proceeds of this redemption
to you in exchange for your preferred securities. See "Description of Preferred
Securities" on page 18. This redemption would be taxable for United States
federal income tax purposes, and you would recognize gain or loss as if you had
sold the preferred securities for cash. See " -- Sales of Preferred Securities"
below.
SALES OF PREFERRED SECURITIES
If you sell or exchange your preferred securities, including a redemption
for cash, you will recognize gain or loss equal to the difference between your
adjusted tax basis in the preferred securities and the amount realized on the
sale of the preferred securities. If you dispose of a preferred security prior
to an extended interest payment period, any portion of the amount you receive
that is attributable to accrued interest will be treated as interest income and
will not be treated as part of the amount realized for purposes of determining
your gain or loss on the disposition of preferred securities. Your adjusted tax
basis in the preferred securities generally will be the initial purchase price,
increased by original issue discount previously included, or currently
includible, in your gross income to the date of disposition, and decreased by
payments received on the preferred securities other than any interest received
with respect to the period prior to the date that preferred securities are
treated as issued with original issue discount. Any gain or loss generally will
be capital gain or loss, and generally will be a long-term capital gain or loss
if you have held the preferred securities as a capital asset for more than one
year prior to the date of disposition. In the case of individuals, trusts and
estates, long-term capital gains generally are taxed at reduced rates. Subject
to certain limited exceptions, capital losses generally cannot be applied to
offset ordinary income for United States federal income tax purposes.
NON-UNITED STATES HOLDERS
The following discussion applies to you only if you would be a beneficial
owner of preferred securities and are not a United States Person as defined
above. Under present United States federal income tax law:
(a) No withholding of United States federal income tax will be required
with respect to the payment by us, the MBNK Capital Trust or any paying
agent of principal or interest, including any original issue discount, on
the preferred securities or the junior subordinated debentures provided
that:
- you do not actually or constructively own 10% or more of the total
combined voting power of all classes of our stock entitled to vote within
the meaning of Section 871(h)(3) of the tax code and the regulations
thereunder;
- you are not a controlled foreign corporation that is related to us through
stock ownership;
- you are not a bank whose receipt of interest on a junior subordinated
debenture or preferred security is described in Section 881(c)(3)(A) of
the tax code; and
- either (a) you provide your name and address on IRS Form W-8 and certify,
under penalties of perjury, that you are not a United States Person, or
(b) a financial institution holding the preferred security (or the junior
48
<PAGE>
subordinated debenture) on your behalf certifies, under penalties of
perjury, that it has received an IRS Form W-8 from you and provides us
with a copy.
(b) No withholding of United States federal income tax will be required
with respect to any gain realized by you upon the sale or other disposition
of the preferred securities or the junior subordinated debentures.
If you cannot satisfy the requirements of the "portfolio interest" exception
described in (a) above, payments of interest made to you will be subject to a
30% United States federal withholding tax unless you provide us or our paying
agent with a properly executed:
- IRS Form W-8BEN claiming an exemption from, or a reduction of, this
withholding tax under the benefit of a tax treaty or
- IRS Form W-8ECI stating that interest paid on the preferred securities or
the junior subordinated debentures is not subject to withholding tax
because it is effectively connected with your conduct of a trade or
business in the United States.
If you are engaged in a trade or business in the United States and interest
or original issue discount on the preferred securities or the junior
subordinated debentures is effectively connected with the conduct of that trade
or business, you will be subject to United States federal income tax on the
interest and original issue discount on a net income basis in the same manner as
if you were a United States Person. In addition, if you are a foreign
corporation, you may be subject to a 30% branch profits tax.
Any gain realized upon the sale or other disposition of the preferred
securities or the junior subordinated debentures generally will not be subject
to United States federal income tax unless:
- such gain is effectively connected with a United States trade or business
conducted by you;
- in the case of a Non-United States Holder who is an individual, the
individual is present in the United States for 183 days or more in the
taxable year of the sale, exchange or retirement, and certain other
conditions are met; or
- in the case of any gain representing accrued interest or original issue
discount on the junior subordinated debentures, the requirements described
for exemption for withholding above are not satisfied.
Your estate will not be subject to U.S. federal estate tax on the preferred
securities or the junior subordinated debentures beneficially owned by you at
the time of your death, provided that:
- you do not own, within the meaning of the tax code and Treasury
regulations, 10% or more of the total combined voting power of all classes
of our voting stock; and
- interest on the preferred securities or junior subordinated debentures
would not have been, if received at the time of your death, effectively
connected with the conduct by you of a trade or business in the United
States.
NON-UNITED STATES HOLDERS SHOULD CONSULT THEIR TAX ADVISORS ABOUT THE NEW RULES
CONCERNING WITHHOLDING ON NON-UNITED STATES HOLDERS AND THE RELATED TRANSITION
RULES.
BACKUP WITHHOLDING TAX AND INFORMATION REPORTING
The amount of interest paid and original issue discount accrued on the
preferred securities to United States Persons, other than corporations and other
exempt recipients, will be reported to the IRS. Income on the preferred
securities will be reported to holders on Form 1099 and mailed to holders of the
preferred securities by January 31 following each calendar year.
"Backup" withholding at a rate of 31% will apply to payments of interest and
payments of disposition, including redemption, proceeds to you if you are a
non-exempt United States Person unless you furnish your taxpayer identification
number in the manner prescribed in applicable Treasury regulations, certify that
this number is correct, certify as to no loss of exemption from backup
withholding, and meet certain other conditions. Any amounts withheld under the
backup withholding rules will be allowed as a refund or a credit against your
United States federal income tax liability, provided the required information is
furnished to the IRS.
49
<PAGE>
ERISA CONSIDERATIONS
Before authorizing an investment in the preferred securities, fiduciaries of
pension, profit sharing or other employee benefit plans subject to the Employee
Retirement Income Security Act of 1974 or ERISA should consider, among other
matters:
- ERISA's fiduciary standards, including its prudence and diversification
requirements;
- whether the fiduciaries have authority to make an investment in the
preferred securities under the applicable plan investment policies and
governing instruments; and
- rules under ERISA and the Code that prohibit plan fiduciaries from causing
a plan to engage in a "prohibited transaction."
Section 406 of ERISA and Section 4975 of the Code prohibit plans, as well as
individual retirement accounts and Keogh plans subject to Section 4975 of the
Code, from engaging in certain transactions involving plan assets with persons
who are "parties in interest" under ERISA or "disqualified persons" under the
Code with respect to the plan. A violation of these "prohibited transaction"
rules may result in an excise tax or other liabilities under ERISA and/or
Section 4975 of the Code, unless exemptive relief is available under an
applicable statutory or administrative exemption. Employee benefit plans that
are governmental plans (as defined in Section 3(32) of ERISA), certain church
plans (as defined in Section 3(33) of ERISA) and foreign plans (as described in
Section 4(b)(4) of ERISA) are not subject to the requirements of ERISA or
Section 4975 of the Code.
The Department of Labor has issued a regulation, the plan assets regulation,
concerning the definition of what constitutes the assets of a plan. The plan
assets regulation provides that, for purposes of ERISA, as a general rule, the
underlying assets and properties of corporations, partnerships, trusts and
certain other entities in which a plan makes an equity investment will be deemed
to be assets of the investing plan unless certain exceptions apply.
Pursuant to an exception in the plan assets regulation, the assets of MBNK
Capital Trust would not be deemed to be plan assets of investing plans if,
immediately after the most recent acquisition of any equity interest in MBNK
Capital Trust, less than 25% of the value of each class of equity interests in
MBNK Capital Trust were held by plans, other employee benefit plans not subject
to ERISA or Section 4975 of the Code such as governmental, church and foreign
plans, and entities holding assets deemed to be plan assets, or benefit plan
investors. We cannot assure you that the value of the preferred securities held
by benefit plan investors will be less than 25% of the total value of the
preferred securities at the completion of the offering or thereafter, and no
monitoring or other measures will be taken to satisfy the conditions to this
exception. We will purchase and hold all of the common securities.
We cannot assure you that any of the exceptions set forth in the plan assets
regulation will apply to the purchase of preferred securities and, as a result,
an investing plan's assets could be considered to include an undivided interest
in the junior subordinated debentures held by MBNK Capital Trust. In the event
that assets of MBNK Capital Trust are considered assets of an investing plan,
the property trustee, we and/or others, in providing services with respect to
the junior subordinated debentures, could be considered fiduciaries to the plan
and subject to the fiduciary responsibility provisions of Title I of ERISA. In
addition, certain transactions involving MBNK Capital Trust and/or the preferred
securities could be deemed to constitute direct or indirect prohibited
transactions under ERISA and Section 4975 of the Code with respect to a plan.
For example, if we are a party in interest with respect to an investing plan,
extensions of credit between us and MBNK Capital Trust, as represented by the
junior subordinated debentures and the guarantee, would likely be prohibited by
Section 406(a)(1)(B) of ERISA and Section 4975(c)(1)(B) of the Code.
The Department of Labor has issued five prohibited transaction class
exemptions, or PTCEs, that may provide exemptive relief for direct or indirect
prohibited transactions resulting from the purchase or holding of the preferred
securities, assuming that assets of MBNK Capital Trust were deemed to be plan
assets of plans investing in MBNK Capital Trust. Those class exemptions are:
- PTCE 96-23 which pertains to certain transactions by an in-house asset
manager;
- PTCE 91-38 which pertains to certain transactions involving bank
collective investment funds;
50
<PAGE>
- PTCE 95-60 which pertains to certain transactions involving insurance
company general accounts;
- PTCE 90-1 which pertains to certain transactions involving insurance
company pooled separate accounts; and
- PTCE 84-14 which pertains to certain transactions by independent qualified
asset managers.
Because of ERISA's prohibitions and those of Section 4975 of the Code, the
preferred securities may not be purchased or held by any plan, any entity whose
underlying assets include plan assets by reason of any plan's investment in the
entity, or a plan asset entity, or any other person investing plan assets of any
plan, unless the purchase or holding is covered by the exemptive relief provided
by PTCE 96-23, 95-60, 91-38, 90-1 or 84-14 or another applicable exemption. If a
purchaser or holder of the preferred securities that is a plan or a plan asset
entity elects to rely on an exemption other than PTCE 96-23, 95-60, 91-38, 90-1
or 84-14, we and MBNK Capital Trust may require a satisfactory opinion of
counsel or other evidence with respect to the availability of such exemption.
Any purchaser or holder of the preferred securities that is a plan or a plan
asset entity or is purchasing such securities on behalf of or with plan assets
will be deemed to have represented by its purchase that:
- the purchase and holding of the preferred securities is covered by the
exemptive relief provided by PTCE 96-23, 95-60, 91-38, 90-1 or 84-14 or
another applicable exemption;
- we and the administrators are not "fiduciaries," within the meaning of
Section 3(21) of ERISA and the regulations thereunder, with respect to
that person's interest in the preferred securities or the junior
subordinated debentures; and
- in purchasing the preferred securities, that person approves the purchase
of the junior subordinated debentures and the appointment of the Trustee.
Insurance companies considering an investment in the preferred securities
should note that the Small Business Job Protection Act of 1996 added new
Section 401(c) of ERISA relating to the status of the assets of insurance
company general accounts under ERISA and Section 4975 of the Code. Pursuant to
Section 401(c) of ERISA, the Department of Labor issued the proposed general
account regulations in December 1997 with respect to insurance policies that are
supported by an insurer's general account. The proposed general account
regulations are intended to provide guidance on which assets held by the insurer
constitute plan assets of a plan for purposes of the fiduciary responsibility
provisions of ERISA and Section 4975 of the Code.
Any plans or other entities whose assets include plan assets subject to
ERISA or Section 4975 of the Code proposing to acquire preferred securities
should consult with their own counsel.
Governmental plans and certain church plans are not subject to ERISA, and
are also not subject to the prohibited transaction provisions of Section 4975 of
the Code. However, state laws or regulations governing the investment and
management of the assets of these types of plans may contain fiduciary and
prohibited transaction provisions similar to those under ERISA and the Code
discussed above. Accordingly, fiduciaries of governmental and church plans, in
consultation with advisers, should consider the impact of their respective state
laws on investments in the preferred securities and the considerations discussed
above to the extent applicable.
51
<PAGE>
UNDERWRITING
Under the terms and conditions of the underwriting agreement that set forth
representations and covenants by us to the underwriters and conditions to the
underwriters obligations under the agreement, the underwriters named below, for
whom Wheat First Securities, a division of First Union Capital Markets Corp.,
and Janney Montgomery Scott LLC, are acting as representatives, have severally
agreed to purchase from us, and we have agreed to sell to them, the respective
number of preferred securities set forth opposite each underwriter's name below:
<TABLE>
<CAPTION>
AMOUNT OF
PRINCIPAL AMOUNT OF UNDERWRITING
UNDERWRITER PREFERRED SECURITIES COMPENSATION
- ----------- -------------------- ------------
<S> <C> <C>
Wheat First Securities................................ $ $
Janney Montgomery Scott LLC........................... $ $
</TABLE>
The underwriting agreement provides that the obligations of the several
underwriters to purchase the preferred securities are subject to approval of
legal matters by their counsel and to various conditions including the
effectiveness with the SEC of the registration statement which contains this
prospectus, receipt of legal opinions from our lawyers, and receipt of a letter
from our independent public accountants regarding our financial statements and
the statistical data contained in this prospectus and in our filings under the
Securities Exchange Act of 1934. The underwriters' are committed to purchase and
pay for all the preferred securities if any are purchased.
The underwriters will initially offer the preferred securities to the public
at the price stated on the cover page. The underwriters may offer preferred
securities to selected dealers at the public offering price less a concession of
up to $ per preferred security. Those dealers may reallow a discount not in
excess of $ per preferred security to other brokers and dealers. After the
initial offering of the preferred securities, the underwriters may change the
offering price, concession, discount and other selling terms.
In connection with the offering of the preferred securities, the
underwriters and any selling group members and their respective affiliates may
engage in transactions effected in accordance with Rule 104 of the SEC's
Regulation M that are intended to stabilize, maintain or otherwise affect the
market price of the preferred securities. Such transactions may include
transactions in which the underwriters create a short position for their own
account by selling more preferred securities than they are committed to purchase
from the MBNK Capital Trust. In such a case, to cover all or part of the short
position, the underwriters may purchase preferred securities in the open market
following completion of the initial offering of preferred securities. The
underwriters also may engage in stabilizing transactions in which it bids for,
and purchases, the preferred securities at a level above that which might
otherwise prevail in the open market for the purpose of preventing or retarding
a decline in the market price of the preferred securities. The underwriters also
may reclaim any selling concessions allowed to a dealer if the underwriters
repurchase preferred securities distributed by that dealer. Any of the foregoing
transactions may result in the maintenance of a price for the preferred
securities at a level above that which might otherwise prevail in the open
market. Neither we nor any of the underwriters make any representation or
prediction as to the direction or magnitude of any effect that the transactions
described above may have on the price of the preferred securities. The
underwriters are not required to engage in any of the foregoing transactions
and, if commenced, such transactions may be discontinued at any time without
notice.
The underwriters agreed to purchase the preferred securities at the price
stated on the cover page of this prospectus which is the price of the preferred
securities in the offering minus the underwriters' fee. Because the MBNK Capital
Trust will use the proceeds from the sale of the preferred securities to
purchase the junior subordinated debentures from us, we have agreed to pay the
underwriters a fee in the amount of $ per preferred security. The
underwriters will receive no other items of value that could be considered
underwriting compensation by the National Association of Securities Dealers.
We estimate that we will spend approximately $200,000 for printing,
depository and trustees' fees, legal and accounting fees, and other expenses of
the offering in addition to underwriting compensation.
We and MBNK Capital Trust have agreed that, during the period beginning from
the date of the underwriting agreement and continuing to and including the
earlier of (1) the termination of trading restrictions on the preferred
securities, as communicated to us by the underwriters, and (2) 180 days
following the closing of the
52
<PAGE>
offering, we will not offer, sell, contract to sell or otherwise dispose of any
additional securities of the MBNK Capital Trust or of ours substantially similar
to the preferred securities or any securities convertible into or exchangeable
for or that represent the right to receive any such similar securities, without
the consent of the underwriters, which consent shall not be unreasonably
withheld.
Prior to this offering, there has been no public market for the preferred
securities. An application has been approved subject to official notice of
issuance to list the preferred securities on the American Stock Exchange under
the symbol "MST." Trading of the preferred securities on the American Stock
Exchange is expected to commence at the time of the initial delivery of the
preferred securities. No assurance can be given as to the liquidity of or the
existence of the trading market for the preferred securities.
We and MBNK Capital Trust have agreed to indemnify the underwriters against
liabilities arising from the offering of the preferred securities, including
civil liabilities under the Securities Act of 1933, or to contribute to payments
that the underwriters may be required to make in connection with those
liabilities.
The underwriters and their affiliates may provide investment banking
services for us or our affiliates in the future for which they would expect to
receive customary fees and commissions.
VALIDITY OF SECURITIES
The validity of the guarantee and the junior subordinated debentures and
certain tax matters will be passed upon for us by Stevens & Lee, P.C., our
counsel, and certain legal matters will be passed upon for the underwriters by
Alston & Bird. Certain matters of Delaware law relating to the validity of the
preferred securities, the enforceability of the trust agreement and the creation
of MBNK Capital Trust will be passed upon by Richards, Layton & Finger, P.A. as
special Delaware counsel to us and MBNK Capital Trust. Stevens & Lee will rely
as to certain matters of Delaware law on the opinion of Richards, Layton &
Finger, P.A.
EXPERTS
Beard & Company, Inc., independent auditors, have audited our consolidated
financial statements included in our Annual Report on Form 10-K for the year
ended December 31, 1998 as set forth in their report, which is included and
incorporated by reference in this prospectus and elsewhere in the registration
statement. Our financial statements are included and incorporated by reference
in reliance on Beard & Company, Inc.'s report, given on their authority as
experts in accounting and auditing.
WHERE YOU CAN FIND ADDITIONAL INFORMATION
We are subject to the informational requirements of the Securities Exchange
Act of 1934. Accordingly, we file annual, quarterly and special reports, proxy
statements and other information with the Securities and Exchange Commission.
You may read and copy any document we file with the Securities and Exchange
Commission at the public reference facilities maintained by the Securities and
Exchange Commission at 450 Fifth Street, N.W., Washington, D.C. 20549. Our
Securities and Exchange Commission file number is 0-24145. Our filings with the
Securities and Exchange Commission also are available to the public from the
Securities and Exchange Commission's website at http://www.sec.gov. Please call
the Securities and Exchange Commission at 1-800-SEC-0330 for further
information. Our common stock is listed on the Nasdaq National Market under the
symbol "MBNK".
This prospectus is part of a registration statement we filed with the
Securities and Exchange Commission and does not contain all of the information
set forth in the registration statement. You should consult the registration
statement for further information with respect to our company and these
securities.
The Securities and Exchange Commission allows us to "incorporate by
reference" the information we file with them, which means that we can disclose
important information to you by referring you to those documents. The
information incorporated by reference is considered to be part of this
prospectus, and later information that we file with the Securities and Exchange
Commission will automatically update and supersede this information and
information in this prospectus. We incorporate by reference the documents listed
below and any future filings made with the Securities and Exchange Commission
under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934
until all of the securities are sold.
53
<PAGE>
- Annual Report on Form 10-K for the year ended December 31, 1998;
- Quarterly Report on Form 10-Q for the quarter ended March 31, 1999; and
- Quarterly Report on Form 10-Q for the quarter ended June 30, 1999, as
amended on Form 10-Q/A on September 20, 1999.
You may request a copy of these filings, at no cost, by writing or calling
us at the following address: Secretary, Main Street Bancorp, Inc., 601 Penn
Street, Box 1097, Reading, Pennsylvania 19603, telephone (610) 685-1400.
No separate financial statements of MBNK Capital Trust have been included or
incorporated by reference in this document. We do not, nor does MBNK Capital
Trust, consider that such financial statements would be material to holders of
the preferred securities because MBNK Capital Trust is a newly formed special
purpose entity, has no operating history or independent operations and is not
engaged in and does not propose to engage in any activity other than holding as
trust assets the junior subordinated debentures and issuing the preferred
securities and common securities. See "MBNK Capital Trust I" on page 18,
"Description of Preferred Securities" on page 18, "Description of Junior
Subordinated Debentures" on page 31, and "Description of Guarantee" on page 41.
In addition, we do not expect that MBNK Capital Trust will be filing reports
under the Securities Exchange Act of 1934 with the SEC.
54
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- -------------------------------------------
- -------------------------------------------
UNTIL , 1999, ALL DEALERS EFFECTING TRANSACTIONS IN THE PREFERRED
SECURITIES, WHETHER OR NOT PARTICIPATING IN THIS DISTRIBUTION, MAY BE REQUIRED
TO DELIVER A PROSPECTUS. THIS DELIVERY REQUIREMENT IS IN ADDITION TO THE
OBLIGATION OF DEALERS TO DELIVER A PROSPECTUS WHEN ACTING AS UNDERWRITERS AND
WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS.
------------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
--------
<S> <C>
Prospectus Summary.................... 3
Selected Consolidated Financial
Data................................ 8
Risk Factors.......................... 10
Cautionary Statement Regarding
Forward-Looking Statements.......... 14
Use of Proceeds....................... 15
Consolidated Ratios of Earnings to
Fixed Charges....................... 15
Capitalization........................ 16
Accounting Treatment.................. 19
MBNK Capital Trust I.................. 18
Description of Trust Preferred
Securities.......................... 18
Description of Junior Subordinated
Debentures.......................... 31
Description of Guarantee.............. 41
Relationship Among the MBNK Capital
Trust Preferred Securities, the
Junior Subordinated Debentures and
the Guarantee....................... 44
Material United States Federal Income
Tax Consequences.................... 45
Certain ERISA Considerations.......... 50
Underwriting.......................... 52
Validity of Securities................ 53
Experts............................... 53
Where You Can Find Additional
Information......................... 53
</TABLE>
- -------------------------------------------
- -------------------------------------------
4,000,000 PREFERRED SECURITIES
MBNK CAPITAL TRUST I
% CUMULATIVE PREFERRED SECURITIES
(LIQUIDATION AMOUNT
$10.00 PER PREFERRED SECURITY)
FULLY AND UNCONDITIONALLY
GUARANTEED AS DESCRIBED HEREIN BY
MAIN STREET BANCORP, INC.
[LOGO]
---------------------
PROSPECTUS
---------------------
WHEAT FIRST SECURITIES
JANNEY MONTGOMERY SCOTT LLC
, 1999
- -------------------------------------------
- -------------------------------------------
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following expenses, other than the SEC registration fee, are estimated.
All expenses of this offering will be paid by the Company.
<TABLE>
<S> <C>
SEC registration fee........................................ $ 11,120
Trustee's fees.............................................. $ 6,000
Blue Sky fees and expenses.................................. 5,000
Transfer agent's and registrar's fees and expenses.......... 0
Printing and engraving expenses............................. 20,000
Accounting fees and expenses................................ 50,000
Legal fees and expenses (other than Blue Sky fees and
expenses)................................................. 75,000
Miscellaneous............................................... 32,880
--------
Total....................................................... $200,000
========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Pennsylvania law provides that a Pennsylvania corporation may indemnify
directors, officers, employees, and agents of the corporation against
liabilities they may incur in such capacities for any action taken or any
failure to act, whether or not the corporation would have the power to indemnify
the person under any provision of law, unless such action or failure to act is
determined by a court to have constituted recklessness or willful misconduct.
Pennsylvania law also permits the adoption of a bylaw amendment, approved by
shareholders, providing for the elimination of a director's liability for
monetary damages for any action taken or any failure to take action unless
(1) the director has breached or failed to perform the duties of his office and
(2) the breach or failure to perform constitutes self-dealing, willful
misconduct or recklessness.
The Bylaws of the Corporation provide for (1) indemnification of directors,
officers, employees, and agents of the Corporation and its subsidiaries and
(2) the elimination of a director's liability for monetary damages to the
fullest extent permitted by Pennsylvania law.
Directors and officers are also insured against certain liabilities for
their actions, as such, by an insurance policy obtained by the Corporation.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
<TABLE>
<CAPTION>
EXHIBIT
NO.
- ---------------------
<C> <S>
1. Underwriting Agreement
4.1 Indenture of Main Street Bancorp, Inc. relating to the
Junior Subordinated Debentures
4.2 Form of Certificate of Junior Subordinated Debentures
4.3 Certificate of Trust of MBNK Capital Trust I
4.4 Declaration of Trust of MBNK Capital Trust I
4.5 Amended and Restated Trust Agreement for MBNK Capital Trust
I
4.6 Form of Preferred Security Certificate for MBNK Capital
Trust I
4.7 Form of Guarantee Agreement of Main Street Bancorp, Inc.
relating to the MBNK Capital Trust Securities
5.1 Opinion and consent of Stevens & Lee, P.C. to Main Street
Bancorp, Inc. as to legality of the Junior Subordinated
Debentures and the Guarantee to be issued by Main Street
Bancorp, Inc.
</TABLE>
II-1
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NO.
- ---------------------
<C> <S>
5.2 Opinion of Richards, Layton & Finger, special Delaware
counsel, as to legality of the Preferred Securities to be
issued by MBNK Capital Trust I
8 Opinion of Stevens & Lee, P.C., special tax counsel, as to
certain federal income tax matters
12 Computation of ratio of earnings to fixed charges (excluding
interest on deposits)
23.1 Consent of Beard & Company, Inc.
23.2 Consent of Stevens & Lee, P.C. (included in Exhibit 5.1)
23.3 Consent of Richards, Layton & Finger (included in Exhibit
5.2)
24 Power of Attorney of certain officers and directors of Main
Street Bancorp, Inc.*
25.1 Form T-1 Statement of Eligibility of Bank of New York to act
as trustee under the Amended and Restated Declaration of
Trust of MBNK Capital Trust I
25.2 Form T-1 Statement of Eligibility of Bank of New York to act
as trustee under the Indenture
25.3 Form T-1 Statement of Eligibility of Bank of New York to act
as trustee under the Guarantee for the benefit of the
holders of Preferred Securities of MBNK Capital Trust I
27.1 Financial Data Schedule*
</TABLE>
- ------------------------
* Previously filed
ITEM 17. UNDERTAKINGS.
Each of the undersigned registrants hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, as amended, each
filing of a registrant's annual report pursuant to Section 13(a) or
Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable,
each filing of an employee benefit plan's annual report pursuant to
Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by
reference in this registration statement shall be deemed to be a new
registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of each
undersigned registrant pursuant to the foregoing provisions, or otherwise, each
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by each undersigned registrant
of expenses incurred or paid by a director, officer of controlling person of
each registrant in the successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in connection with the
securities being registered, each registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
Each of the undersigned registrants hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
II-2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Main Street
Bancorp, Inc. certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
amendment no. 1 to this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Reading, in the
Commonwealth of Pennsylvania, on the 25th day of October, 1999.
<TABLE>
<S> <C> <C>
MAIN STREET BANCORP, INC.
By: /s/ NELSON R. OSWALD
------------------------------------------------
Nelson R. Oswald
Chairman, President and Chief Executive Officer
MBNK CAPITAL TRUST I
By: /s/ DONNA L. RICKERT
------------------------------------------------
Donna L. Rickert
as Administrator
By: /s/ NELSON R. OSWALD
------------------------------------------------
Nelson R. Oswald
as Administrator
By: /s/ ROBERT D. MCHUGH, JR.
------------------------------------------------
Robert D. McHugh, Jr.
as Administrator
</TABLE>
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated on October 25, 1999.
II-3
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
/s/ NELSON R. OSWALD
------------------------------------------- Chairman, President and Chief October 25, 1999
Nelson R. Oswald Executive Officer
/s/ ROBERT D. MCHUGH, JR Executive Vice President and
------------------------------------------- Treasurer (Chief Financial October 25, 1999
Robert D. McHugh, Jr. Officer)
/s/ DONNA L. RICKERT Senior Vice President and
------------------------------------------- Controller (Principal Accounting October 25, 1999
Donna L. Rickert Officer)
*
------------------------------------------- Director October 25, 1999
Richard D. Biever
*
------------------------------------------- Director October 25, 1999
Edward J. Edwards
*
------------------------------------------- Director October 25, 1999
Albert L. Evans
*
------------------------------------------- Director October 25, 1999
Richard T. Fenstermacher
*
------------------------------------------- Director October 25, 1999
Ivan H. Gordon
*
------------------------------------------- Director October 25, 1999
Frederick A. Gosch
*
------------------------------------------- Director October 25, 1999
Jeffrey W. Hayes
*
------------------------------------------- Director October 25, 1999
Allen E. Kiefer
*
------------------------------------------- Director October 25, 1999
Alfred B. Mast
*
------------------------------------------- Director October 25, 1999
Wesley R. Pace
*
------------------------------------------- Director October 25, 1999
Joseph P. Schlitzer
*
------------------------------------------- Director October 25, 1999
Floyd S. Weber
*By: /s/ NELSON R. OSWALD
------------------------------------------- Attorney-in-Fact October 25, 1999
Nelson R. Oswald
</TABLE>
II-4
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NO.
- ---------------------
<C> <S>
1. Underwriting Agreement
4.1 Indenture of Main Street Bancorp, Inc. relating to the
Junior Subordinated Debentures
4.2 Form of Certificate of Junior Subordinated Debentures
4.3 Certificate of Trust of MBNK Capital Trust I
4.4 Declaration of Trust of MBNK Capital Trust I
4.5 Amended and Restated Trust Agreement for MBNK Capital Trust
I
4.6 Form of Preferred Security Certificate for MBNK Capital
Trust I
4.7 Form of Guarantee Agreement of Main Street Bancorp, Inc.
relating to the MBNK Capital Trust Securities
5.1 Opinion and consent of Stevens & Lee, P.C. to Main Street
Bancorp, Inc. as to legality of the Junior Subordinated
Debentures and the Guarantee to be issued by Main Street
Bancorp, Inc.
5.2 Opinion of Richards, Layton & Finger, special Delaware
counsel, as to legality of the Preferred Securities to be
issued by MBNK Capital Trust I
8 Opinion of Stevens & Lee, P.C., special tax counsel, as to
certain federal income tax matters
12 Computation of ratio of earnings to fixed charges (excluding
interest on deposits)
23.1 Consent of Beard & Company, Inc.
23.2 Consent of Stevens & Lee, P.C. (included in Exhibit 5.1)
23.3 Consent of Richards, Layton & Finger (included in Exhibit
5.2)
24 Power of Attorney of certain officers and directors of Main
Street Bancorp, Inc.*
25.1 Form T-1 Statement of Eligibility of Bank of New York to act
as trustee under the Amended and Restated Declaration of
Trust of MBNK Capital Trust I
25.2 Form T-1 Statement of Eligibility of Bank of New York to act
as trustee under the Indenture
25.3 Form T-1 Statement of Eligibility of Bank of New York to act
as trustee under the Guarantee for the benefit of the
holders of Preferred Securities of MBNK Capital Trust I
27.1 Financial Data Schedule*
</TABLE>
- ------------------------
* Previously filed
II-5
<PAGE>
4,000,000
Preferred Securities
MBNK Capital Trust I
UNDERWRITING AGREEMENT
November __, 1999
Wheat First Securities,
a division of First Union Capital Markets Corp.
Janney Montgomery Scott LLC
as Representatives of the Several Underwriters
c/o Wheat First Securities,
a division of First Union Capital Markets Corp.
901 East Byrd Street
Richmond, Virginia 23219
Ladies and Gentlemen:
MBNK Capital Trust I (the "Trust"), a statutory business trust created
under the Business Trust Act (the "Delaware Act") of the State of Delaware
(Chapter 38, Title 12, of the Delaware Code, 12 Del. (Sections 3801, ET SEQ.))
and Main Street Bancorp, Inc., a Pennsylvania corporation (the "Company" and
together with the Trust, the "Offerors"), confirm their agreement (the
"Agreement") with Wheat First Securities, a Division of First Union Capital
Markets Corp. ("Wheat First") and Janney Montgomery Scott LLC ("Janney"), and
each of the other Underwriters named in Schedule A hereto (collectively, the
"Underwriters," which term shall also include any underwriter substituted as
hereinafter provided in Section 10 hereof) for whom Wheat First and Janney are
acting as Representatives (in such capacity, Wheat First and Janney will be
referred to as the "Representatives"), with respect to the issue and sale by the
Trust and the purchase by the Underwriters, acting severally and not jointly, of
the respective number set forth in Schedule A of 4,000,000 ____% Preferred
Securities (liquidation amount of $10.00 per security) of the Trust (the
"Preferred Securities"). The Preferred Securities will be guaranteed by the
Company, to the extent described in the Prospectus, with respect to
distributions and payments upon liquidation, redemption and otherwise pursuant
to the Guarantee Agreement (the "Guarantee"), to be dated as of November __,
1999, between the Company and The Bank of New York, as Trustee (the "Guarantee
Trustee"). The Preferred Securities issued in book-entry form will be issued to
Cede & Co. as nominee of The Depository Trust Company ("DTC") pursuant to a
letter agreement, to be dated as
<PAGE>
of the Closing Date (as defined herein) (the "DTC Agreement"), among the Trust,
the Property Trustee (as defined below) and DTC.
The entire proceeds from the sale of the Preferred Securities in the
Offering will be combined with the entire proceeds from the sale by the Trust to
the Company of its common securities (the "Common Securities") to purchase
$_______ aggregate principal amount of ____% Subordinated Debentures due
_______, 2029 (the "Subordinated Debentures") issued by the Company. The
Preferred Securities and the Common Securities will be issued pursuant to the
amended and restated trust agreement, to be dated as of November __, 1999 (the
"Trust Agreement"), among the Company, as depositor, and Nelson R. Oswald,
Robert D. McHugh, Jr. and Donna Rickert as administrators (the
"Administrators"), The Bank of New York, as property trustee (the "Property
Trustee"), and The Bank of New York (Delaware), as Delaware trustee (the
"Delaware Trustee," and, together with the Property Trustee, the "Trustees"),
and the holders, from time to time, of undivided beneficial interests in the
assets of the Trust. The Subordinated Debentures will be issued pursuant to an
indenture, to be dated as of November __, 1999 (the "Indenture"), between the
Company and The Bank of New York, as trustee (the "Debenture Trustee").
The Preferred Securities, the Guarantee and the Subordinated Debentures
are hereinafter collectively referred to as the "Securities."
The Indenture, the Trust Agreement, the Guarantee, the DTC Agreement,
and this Agreement are hereinafter referred to collectively as the "Operative
Documents."
The Offerors have filed with the Securities and Exchange Commission
(the "Commission") a registration statement on Form S-3 (File No. 333-_____)
containing a preliminary prospectus relating to the Offering under the
Securities Act of 1933, as amended (the "1933 Act"), and have filed such
amendments thereto and such amended preliminary prospectuses as may have been
required by the Commission on or prior to the date hereof and will file such
additional amendments to the registration statement and such amended
prospectuses relating to the Offering (pursuant to the Securities Exchange Act
of 1934, as amended (the "1934 Act"), the rules and regulations of the
Commission thereunder (the "1934 Act Regulations"), the 1933 Act, the rules and
regulations of the Commission under the 1933 Act (the "1933 Act Regulations") or
otherwise) as may hereafter be required by the Commission or pursuant to the
terms of this Agreement. Such registration statement, as amended, at the time
such registration statement becomes effective and, in the event any
post-effective amendment thereto becomes effective prior to the First Closing
Date (as hereinafter defined), at the time such post-effective amendment becomes
effective, and the prospectus relating to the Offering constituting a part
thereof (including, in the case of such registration statement, as amended, and
in the case of such prospectus, all financial statements, schedules and exhibits
thereto and the information, if any, deemed to be a part thereof pursuant to
Rule 430A(b) of the 1933 Act Regulations), as from time to time amended or
supplemented pursuant to the 1934 Act, the 1934 Act Regulations, the 1933 Act,
the 1933 Act Regulations or otherwise, are
-2-
<PAGE>
referred to herein as the "Registration Statement" and the "Prospectus,"
respectively, except that if any revised prospectus relating to the Offering
shall be provided to the Underwriters by the Offerors for use in the Offering
which differs from the prospectus relating to the Offering on file at the
Commission at the time of such use (whether or not such revised prospectus is
required to be filed by the Offerors pursuant to Rule 424(b) of the 1933 Act
Regulations), the term "Prospectus" shall refer to such revised prospectus from
and after the time it is first provided to the Underwriters for such use. The
term "Preliminary Prospectus" means the preliminary prospectus dated November
__, 1999 distributed by the Underwriters prior to the date hereof.
The Offerors understand that the Underwriters propose to make the
Offering of the Securities as soon as the Representatives deems advisable after
the Registration Statement becomes effective and after the Trust Agreement, the
Indenture and the Guarantee have been qualified under the Trust Indenture Act of
1939, as amended (the "1939 Act").
SECTION 1. REPRESENTATIONS AND WARRANTIES.
(a) The Offerors jointly and severally represent and warrant to
each Underwriter as of the date hereof and as of the Closing Date, and agree
with each Underwriter as follows:
(i) The Registration Statement and any Rule 462(b)
Registration Statement have been declared effective by the Commission
under the Securities Act. The Company has complied with the
Commission's satisfaction with all requests of the Commission for
additional and supplemental information. No stop order suspending the
effectiveness of the Registration Statement, or any other amendment
thereto and no cease and desist order or temporary order under Section
8A of the 1933 Act has been issued, and no proceeding for such purpose
has been instituted or is pending or threatened by the Commission. No
order preventing or suspending the use of any Prospectus or any
Preliminary Prospectus has been issued by the Commission, and each
Preliminary Prospectus, at the time of filing thereof, conformed in all
material respects to the requirements of the 1933 Act and the 1933 Act
Regulations and did 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, in the light of the
circumstances under which they were made, not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
the "Underwriter Information" (as defined in Section 6(a) hereof)
relating to the Underwriters furnished in writing to the Company by or
on behalf of the Underwriters expressly for use therein.
(ii) At the time the Registration Statement and any amendment
thereto becomes effective, the Registration Statement and any amendment
thereto, and the Prospectus and any further amendment or supplement
thereto, will conform in
-3-
<PAGE>
all material respects to the requirements of the 1933 Act and the 1933
Act Regulations and will not, as of the effective date of each of the
Registration Statement, and any amendment thereto, and as of the
applicable filing date of the Prospectus and any amendment or
supplement thereto, 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, in the light of the
circumstances under which they were made, not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
the Underwriter Information.
(iii) Beard & Company, Inc., which has audited certain
financial statements of the Company, are independent public accountants
with respect to the Company and its subsidiaries, as required by the
1933 Act, the 1933 Regulations, the 1934 Regulations and Commission
Regulation S-X.
(iv) The consolidated financial statements, together with the
related schedules and notes, included in the Registration Statement and
the Prospectus present fairly the consolidated financial position of
the Company and its subsidiaries at the dates indicated and the
consolidated results of operations and cash flows of the Company and
its subsidiaries for the periods specified; said financial statements
have been prepared in conformity with generally accepted accounting
principles ("GAAP") applied on a consistent basis throughout the
periods involved, except as disclosed in the notes to such financial
statements. The supporting schedules, if any, included in the
Registration Statement and the Prospectus present fairly, in all
material respects, the information required to be stated therein. The
summary financial data included in the Registration Statement and the
Prospectus present fairly, in all material respects, the information
shown therein and have been compiled on a basis consistent with that of
the audited financial statements included in the Registration Statement
and the Prospectus.
(v) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, except as
otherwise stated therein or contemplated thereby and, except for normal
recurring dividends on the capital stock of the Company, there has not
been (A) any material adverse change in the condition (financial or
otherwise), earnings, business affairs or business prospects of the
Trust, or the Company and its subsidiaries, considered as one
enterprise, whether or not arising in the ordinary course of business,
(B) any transaction entered into by the Trust, the Company or any
subsidiary, other than in the ordinary course of business, that is
material to the Trust, or the Company and its subsidiaries, considered
as one enterprise, or (C) any dividend or distribution of any kind
declared, paid or made by the Company on its capital stock.
(vi) The Company is a corporation duly organized, validly
existing and in good standing under the laws of the Commonwealth of
Pennsylvania and has
-4-
<PAGE>
the corporate power and authority under such laws to own, lease and
operate its properties and to conduct its business as described in the
Registration Statement and the Prospectus; and the Company is duly
qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which it owns or leases property of a
nature, or transacts business of a type, that would make such
qualification necessary, except to the extent that the failure to so
qualify or be in good standing would not have a material adverse effect
on the condition (financial or otherwise), earnings, business affairs
or business prospects of the Company and its subsidiaries, considered
as one enterprise.
(vii) Main Street Bank is a duly organized and validly
existing state-chartered bank under the laws of the Commonwealth of
Pennsylvania and continues to hold a valid certificate to do business
as such and has full power and authority to conduct its business as
such. Main Street Bank is referred to herein as the "Significant
Subsidiary." The Significant Subsidiary has the authority under its
jurisdiction of organization to own, lease and operate its properties
and to conduct its business and is duly authorized to transact business
and is in good standing in each jurisdiction in which it owns or leases
property of a nature, or transacts business of a type, that would make
such qualification necessary, except to the extent that the failure to
so qualify or to be in good standing would not have a material adverse
effect on the condition (financial or otherwise), earnings, business
affairs or business prospects of the Company and its subsidiaries,
considered as one enterprise.
(viii) The Company does not have any subsidiaries which are
material to its business, except to the extent that the Significant
Subsidiary may be deemed to be so material.
(ix) (a) The Company had at the date indicated a duly
authorized and outstanding capitalization as set forth in the
Registration Statement and the Prospectus, (b) all of the outstanding
shares of capital stock of the Company have been duly authorized and
validly issued and are fully paid and non-assessable, and (c) none of
the outstanding shares of capital stock of the Company was issued in
violation of the preemptive rights of any stockholder of the Company.
(x) The Trust has been duly created and is validly existing in
good standing as a business trust under the Delaware Act with the power
and authority to own property and to conduct its business as described
in the Registration Statement and the Prospectus and to enter into and
perform its obligations under the Operative Documents, as applicable,
and the Preferred Securities; the Trust is not a party to or otherwise
bound by any material agreement other than those described in the
Registration Statement and the Prospectus; and based on an opinion of
counsel, the company believes the Trust is and will, under current law,
be classified for United States federal income tax purposes as a
grantor trust and not as an association taxable as a corporation.
-5-
<PAGE>
(xi) The Common Securities have been duly authorized by the
Trust Agreement and, when issued and delivered by the Trust to the
Company against payment therefor as described in the Registration
Statement and the Prospectus, will be validly issued and will represent
undivided beneficial interests in the assets of the Trust; the issuance
of the Common Securities is not subject to preemptive or other similar
rights; and at the Closing Date, all of the issued and outstanding
Common Securities of the Trust will be directly owned by the Company
free and clear of any security interest, mortgage, pledge, lien,
encumbrance, claim or equitable right.
(xii) As of the Closing Date, the Preferred Securities will
have been duly authorized by the Trust Agreement and, when issued and
delivered against payment therefor in accordance with the Trust
Agreement, as provided herein, will be validly issued and fully paid
and non-assessable undivided beneficial interests in the assets of the
Trust and will conform in all material respects to the description
thereof contained in the Prospectus and the issuance of the Preferred
Securities will not be subject to preemptive or other similar rights.
(xiii) This Agreement has been duly authorized, executed and
delivered by the Offerors.
(xiv) The Trust Agreement has been duly authorized by the
Company and, at the Closing Date, will have been duly executed and
delivered by the Company and the Trustees, and assuming due
authorization, execution and delivery of the Trust Agreement by the
Trustees, the Trust Agreement will, at the Closing Date, be a valid and
binding obligation of the Company, enforceable against the Company in
accordance with its terms, except to the extent that enforcement
thereof may be limited by the receivership, conservatorship and
supervisory powers of bank regulatory agencies generally as well as to
bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting creditors' rights generally or by general principles of
equity (regardless of whether enforcement is considered in a proceeding
at law or in equity) and the availability of equitable remedies
(collectively, the "Enforceability Exceptions").
(xv) The Guarantee has been duly authorized by the Company
and, at the Closing Date, the Guarantee will have been duly executed
and delivered by the Company, and will constitute a valid and binding
agreement of the Company, enforceable against the Company in accordance
with its terms, except to the extent that enforcement thereof may be
limited by the Enforceability Exceptions.
(xvi) The Indenture has been duly authorized by the Company
and, at the Closing Date, will have been duly executed and delivered by
the Company and will constitute a valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms,
except to the extent that
-6-
<PAGE>
enforcement thereof may be limited by the Enforceability Exceptions,
and will have been duly qualified under the 1939 Act.
(xvii) The Subordinated Debentures have been duly authorized
by the Company and, at the Closing Date, will have been duly executed
by the Company and, when authenticated in the manner provided for in
the Indenture and delivered against payment therefor as described in
the Registration Statement and the Prospectus, will constitute valid
and binding obligations of the Company, enforceable against the Company
in accordance with their terms, except as enforcement thereof may be
limited by the Enforceability Exceptions; and the Subordinated
Debentures will be in the form contemplated by, and entitled to the
benefits of, the Indenture and will conform in all material respects to
the description thereof in the Prospectus.
(xix) Each of the Administrators of the Trust is an officer of
the Company and has been duly authorized by the Company to execute and
deliver the Trust Agreement.
(xx) The Trust is not, and following consummation of the
transactions contemplated hereby will not be, an "investment company"
or a company "controlled" by an "investment company" which is required
to be registered under the Investment Company Act of 1940, as amended
(the "1940 Act").
(xxi) The Operative Documents described in the Registration
Statement and the Prospectus conform in all material respects to the
summary descriptions thereof contained in the Registration Statement
and the Prospectus.
(xxii) None of the Trust, the Company nor the Significant
Subsidiary is in default in the performance or observance of any
obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other agreement or
instrument to which it is a party or by which it may be bound or to
which any of its properties may be subject, except for such defaults
that would not have a material adverse effect on the condition
(financial or otherwise), earnings, business affairs or business
prospects of the Company and its subsidiaries, considered as one
enterprise; the execution and delivery of the Operative Documents by
the Trust or the Company, as the case may be, the issuance and delivery
of the Securities, the consummation by the Offerors of the transactions
contemplated in the Operative Documents, and compliance by the Offerors
with the terms of the Operative Documents to which they are a party
have been duly authorized by all necessary corporate action on the part
of the Company, and do not and will not result in any violation of the
charter or by-laws of the Company or of the Significant Subsidiary or
the Trust Agreement or the certificate of trust of the Trust filed with
the State of Delaware on September __, 1999 (the "Trust Certificate"),
and do not and will not conflict with, or result in a breach of any of
the terms or provisions of, or constitute a
-7-
<PAGE>
default under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Trust, the
Company or any of the Significant Subsidiary under (A) any indenture,
mortgage, loan agreement, note, lease or other agreement or instrument
to which the Trust, the Company or the Significant Subsidiary is a
party or by which it may be bound or to which any of its properties may
be subject, except for such conflicts, breaches or defaults or liens,
charges or encumbrances that would not have a material adverse effect
on the condition (financial or otherwise), earnings, business affairs
or business prospects of the Trust, or the Company and its subsidiaries
considered as one enterprise or (B) any existing applicable law, rule,
regulation, judgment, order or decree of any government, governmental
instrumentality or court, domestic or foreign, having jurisdiction over
the Trust, the Company or the Significant Subsidiary or any of its
properties, except for such defaults that would not have a material
adverse effect on the condition (financial or otherwise), earnings,
business affairs or business prospects of the Company and its
subsidiaries, considered as one enterprise.
(xxiii) No filing with, or authorization, approval, consent,
license, order, registration, qualification or decree of, any court or
governmental authority or agency, other than those that have been made
or obtained, is necessary or required for the performance by the
Company or the Trust of their obligations hereunder, in connection with
the issuance and sale of the Preferred Securities or the consummation
of the transactions contemplated by the Operative Documents, except
such as may be required by the securities as "Blue Sky" laws of the
various states in connection with the offer and sale of the Preferred
Securities.
(xxiv) Except as disclosed in the Registration Statement and
the Prospectus, there is no action, suit or proceeding before or by any
government, governmental instrumentality or court, domestic or foreign,
now pending or, to the knowledge of the Company or the Trust,
threatened against or affecting the Trust, or the Company or the
Significant Subsidiary that is required to be disclosed in the
Registration Statement and the Prospectus or that, in the final
outcome, could, in the judgment of the Company, result in any material
adverse effect on the condition (financial or otherwise), earnings or
business of the Trust, or the Company and its subsidiaries considered
as one enterprise, or that could materially and adversely affect the
properties or assets of the Trust, or the Company and its subsidiaries
considered as one enterprise, or that could adversely affect the
consummation of the transactions contemplated in the Operative
Documents; the aggregate liability or loss, if any, resulting from the
final outcome of all pending legal or governmental proceedings to which
the Trust, the Company or any of the Significant Subsidiaries is a
party or which affect any of its properties that are not described in
the Registration Statement and the Prospectus, including ordinary
routine litigation incidental to its business, would not have a
material adverse effect on the condition (financial or otherwise),
-8-
<PAGE>
earnings or business affairs of the Trust, or the Company and its
subsidiaries considered as one enterprise.
(xxv) There are no contracts or documents of a character
required to be described in the Registration Statement and the
Prospectus that are not described as required.
(xxvi) The Offerors and the Significant Subsidiary each owns
or possesses, or can acquire on reasonable terms, adequate patents,
patent licenses, trademarks, service marks and trade names necessary to
carry on their businesses as presently conducted, except where the
failure to own, procure or obtain any of the foregoing would not have a
material adverse effect on the condition (financial or otherwise),
earnings, business affairs or business prospects of the Company and its
subsidiaries, considered as one enterprise, and none of the Offerors
nor the Significant Subsidiary has received any notice of infringement
of or conflict with asserted rights of others with respect to any
patents, patent licenses, trademarks, service marks or trade names
that, in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would have a material adverse effect on the
condition (financial or otherwise), earnings or business of the Trust,
or the Company and its subsidiaries considered as one enterprise.
(xxvii) The Offerors and the Significant Subsidiary each owns,
possesses or has obtained all material governmental licenses, permits,
certificates, consents, orders, approvals and other authorizations
necessary to own or lease, as the case may be, and to operate its
properties and to carry on its business as presently conducted, and
neither the Offerors nor any of the Significant Subsidiary has received
any notice of proceedings relating to revocation or modification of any
such licenses, permits, certificates, consents, orders, approvals or
authorizations that, in the aggregate, if the subject of an unfavorable
decision, ruling or finding, could materially adversely affect the
condition (financial or otherwise), earnings or business of the Trust,
or the Company and its subsidiaries considered as one enterprise.
(xxix) The Offerors and the Significant Subsidiary each has
good and marketable title to all properties and assets described in the
Registration Statement and the Prospectus as owned by it, free and
clear of all liens, charges, encumbrances or restrictions, except such
as (A) are described in the Registration Statement and the Prospectus
or (B) are neither material in amount nor materially significant in
relation to the business of the Trust, or the Company and its
subsidiaries considered as one enterprise; and all of the leases and
subleases material to the business of the Trust, and the Company and
its subsidiaries considered as one enterprise, and under which the
Offerors or the Significant Subsidiary holds properties described in
the Registration Statement and the Prospectus, are in full force and
effect, and neither the Offerors nor the Significant Subsidiary has any
notice of any material claim of any sort that has been asserted
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by anyone adverse to the rights of the Offerors or such Significant
Subsidiary under any of the leases or subleases mentioned above, or
affecting or questioning the rights of such corporation to the
continued possession of the leased or subleased premises under any such
lease or sublease.
(xxx) The Company has not taken and will not take, directly or
indirectly, any action designed to, or that might be reasonably
expected to, cause or result in stabilization or manipulation of the
price of the Preferred Securities or the Common Stock.
(xxxi) None of the Trust, the Company, or any of their
affiliates, as such term is defined in Rule 501(b) under the 1933 Act
("Affiliates"), or any person acting on its or any of their behalf
(other than the Underwriters, as to whom the Offerors make no
representation) has engaged or will engage, in connection with the
offering of the Preferred Securities, in any form of general
solicitation or general advertising within the meaning of Rule 502(c)
under the 1933 Act.
(xxxii) There are no persons with registration or other
similar rights to have any securities registered pursuant to the
Registration Statement or otherwise registered by the Company under the
1933 Act.
(b) Any certificate signed by any Trustee of the Trust or any duly
authorized officer of the Company or the Significant Subsidiary and delivered to
the Representatives or to counsel for the Underwriters shall be deemed only a
representation and warranty by the Trust or the Company, as the case may be, to
each Underwriter as to the matters covered thereby.
SECTION 2. SALE AND DELIVERY TO UNDERWRITERS; CLOSING.
(a) On the basis of the representations and warranties herein contained
and subject to the terms and conditions herein set forth, the Trust agrees to
sell to each Underwriter, severally and not jointly, and each Underwriter,
severally and not jointly, agrees to purchase from the Trust, at a price of
$10.00 per Security, the number of Preferred Securities set forth in Schedule A
opposite the name of such Underwriter, plus any additional Preferred Securities
which such Underwriter may become obligated to purchase pursuant to the
provisions of Section 10 hereof.
(b) Deliveries of certificates for the Preferred Securities shall be
made at the office of Wheat First in Richmond, Virginia, and payment of the
purchase price for the Firm Preferred Securities shall be made by Wheat First,
on behalf of the several Underwriters, to the Trust by wire transfer of
immediately available funds contemporaneous with closing at such place as shall
be agreed upon by Wheat First and the Offerors, at 10:00 A.M. on November __,
1999 (unless postponed in accordance with the provisions of Section 10), or such
other time not later than ten business days after
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such date as shall be agreed upon by Wheat First and the Offerors (such time and
date of payment and delivery being herein called the "Closing Date").
(c) Payment for the Preferred Securities purchased by the Underwriters
shall be made to the Trust by wire transfer of immediately available funds,
against delivery for the respective accounts of the Underwriters of certificates
for the Firm Preferred Securities. Certificates for the Preferred Securities
shall be in such denominations and registered in such names as the Underwriters
may request in writing at least one business day before the Closing Date. It is
understood that each Underwriter has authorized the Representatives, for their
accounts, to accept delivery of, receipt for, and make payment of the purchase
price for, the Preferred Securities which it has agreed to purchase. Wheat First
and Janney, individually and not as Representatives of the Underwriters, may
(but shall not be obligated to) make payment of the purchase price for the
Preferred Securities, if any, to be purchased by any Underwriter whose funds
have not been received by the Closing Date, but such payment shall not relieve
such Underwriter from its obligations hereunder. The certificates representing
the Preferred Securities shall be made available for examination and packaging
by the Underwriters in Richmond, Virginia not later than 10:00 A.M. on the last
business day prior to the Closing Date.
(d) As compensation to the Underwriters for their commitments hereunder
and in view of the fact that the proceeds of the sale of the Preferred
Securities will be used to purchase Subordinated Debentures of the Company, the
Company hereby agrees to pay at the Closing Date, to the Representatives in
immediately available funds, for the accounts of the several Underwriters, $____
per Preferred Security to be delivered by the Trust hereunder at the Closing
Date, as the case may be.
(e) The Underwriters will comply with all material applicable laws and
rules in connection with the sale of the Securities and the Underwriters are not
acting as an agent for the Company.
SECTION 3. COVENANTS OF THE OFFERORS. The Offerors covenant with each
Underwriter as follows:
(a) The Company will use its best efforts to cause the Registration
Statement and any post-effective amendments to the Registration Statement to be
declared effective by the Commission (as and when specified in the reasonable
request of the Representatives) and will prepare the Prospectus in a form
reasonably approved by the Representatives and file such Prospectus pursuant to
Rule 424(b) under the 1933 Act not later than the Commission's close of business
on the second business day following the execution and delivery of this
Agreement or, if applicable, such earlier time as may be required by Rule
430A(a)(3) under the 1933 Act. The Company will make no further amendment or any
supplement to the Registration Statement or the Prospectus prior to any First
Closing Date which shall be reasonably disapproved by the Representatives after
reasonable notice thereof. The Company will notify the Representatives
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immediately and confirm the notice in writing (i) when the Registration
Statement or any post-effective amendment thereto (and any other amendment
thereto) has been declared effective by the Commission, (ii) of the transmittal
to the Commission for filing of any amendment or supplement to the Prospectus,
(iii) of the receipt by the Company of any comments from the Commission or any
state securities commission with respect to the transactions contemplated by
this Agreement, (iv) of any request by the Commission or any state securities
commission for any amendment or supplement to the Registration Statement or the
Prospectus, or for additional information, (v) of the issuance by the
Commissioner or any state securities commission or court of competent
jurisdiction of any order suspending either the Offering or the use of either
the Preliminary Prospectus or the Prospectus or of the threat of any such action
by any such entity, (vi) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or any amendment
thereto or of the receipt by the Company of any notification with respect to the
suspension of the registration, qualification or exemption of the Preferred
Securities for offering or sale in any jurisdiction, or the initiation or
threatening of any proceeding for such purpose. In the event of the issuance of
any stop order or of any order preventing or suspending the use of any
Preliminary Prospectus or Prospectus or suspending any such registration,
qualification or exemption, the Company promptly will use its best efforts to
obtain its withdrawal.
(b) The Company will give the Representatives notice of its intention
to file or prepare any amendment or supplement to the Registration Statement or
any amendment or supplement to the Prospectus (whether, in the case of the
Registration Statement and the Prospectus, by the filing of documents pursuant
to the 1934 Act, the 1933 Act or otherwise and, in the case of the Prospectus,
by amending or supplementing the Prospectus then being used by the
Underwriters).
(c) The Company has furnished or will deliver to the Representatives
and counsel for the Underwriters, without charge, signed copies of the
Registration Statement as originally filed and of each amendment thereto
(including exhibits filed therewith) and signed copies of all consents and
certificates of experts, and will also deliver to the Representatives a
conformed copy of the Registration Statement as originally filed and of each
amendment thereto (without exhibits) for each of the Underwriters.
(d) The Company will deliver to each Underwriter, without charge, from
time to time until the effective date of the Registration Statement, as many
copies of each Preliminary Prospectus as such Underwriter may reasonably
request, and the Company hereby consents to the use of such copies for purposes
permitted by the 1933 Act. The Company will furnish to each Underwriter, without
charge, from time to time during the period when the Prospectus is required to
be delivered under the 1933 Act or the 1934 Act, such number of copies of the
Prospectus (as amended or supplemented) as such Underwriter may reasonably
request for the purposes contemplated by the 1933 Act or the 1934 Act or the
respective applicable rules and regulations of the Commission thereunder.
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(e) If 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 the Prospectus in order that the
Prospectus 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 not
misleading in the light of the circumstances existing at the time it is
delivered to a purchaser, or if it shall be necessary, in the opinion of such
counsel, at any such time to amend the Registration Statement or the Prospectus
in order to comply with the requirements of the 1933 Act or the 1933 Act
Regulations, the Company will promptly prepare and file with the Commission,
subject to Section 3(b), 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 copies of such amendment or supplement as the
Underwriters may reasonably request.
(f) If, at the time that the Registration Statement or a post-effective
amendment thereto becomes effective, any information shall have been omitted
therefrom in reliance upon Rule 430A of the 1933 Act Regulations, then
immediately following effectiveness, the Company will prepare, and file or
transmit for filing with the Commission in accordance with such Rule 430A and
Rule 424(b) of the 1933 Act Regulations, copies of an amended Prospectus, or, if
required by such Rule 430A, a post-effective amendment to the Registration
Statement (including an amended Prospectus), containing all information so
omitted and will use its best efforts to cause any such post-effective amendment
to be declared effective as promptly as practicable.
(g) The Company will use its best efforts, in cooperation with the
Underwriters, to qualify the Preferred Securities for offering and sale under
the applicable securities laws of such states and other jurisdictions of the
United States as the Representatives may designate and to maintain such
qualifications in effect for a period of not less than one year from the
effective date of the Registration Statement; 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. In each jurisdiction in which the Preferred Securities have been so
qualified the Company will file such statements and reports as may be required
by the laws of such jurisdiction to continue such qualification in effect for a
period of not less than one year from the effective date of the Registration
Statement.
(h) The Company will make generally available to its security holders
as soon as practicable, but not later than 90 days after the close of the period
covered thereby, an earnings statement (in form complying with the provisions of
Rule 158 of the 1933 Act Regulations) covering a 12-month period beginning not
later than the first day of the Company's fiscal quarter next following the
"effective date" (as defined in said Rule 158) of the Registration Statement.
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(i) The Offerors will cooperate with the Underwriters and use their
best efforts to permit the Preferred Securities to be eligible for clearance and
settlement through the facilities of DTC.
(j) The Trust will use the net proceeds received by it from the sale of
the Preferred Securities, and the Company will use the proceeds received by it
from the sale of the Subordinated Debentures, in the manners specified in the
Prospectus under "Use of Proceeds."
(k) Prior to March __, 2000, neither the Trust nor the Company will,
without the prior written consent of the Representatives, directly or
indirectly, issue, sell, offer or agree to sell, grant any option for the sale
of, or otherwise dispose of, any securities that are substantially similar to
the Preferred Securities, any security convertible into exchangeable or
exercisable for Preferred Securities or any equity security substantially
similar to the Preferred Securities (except for the Securities issued pursuant
to this Agreement or with the prior written consent of the Representatives).
SECTION 4. PAYMENT OF EXPENSES.
The Company will pay all costs and expenses incident to the performance
of its obligations under this Agreement, whether or not the transactions
contemplated herein are consummated or this Agreement is terminated pursuant to
Section 9 hereof, including all costs and expenses incident to (i) the printing
or other production of documents, including the Operative Documents, with
respect to the transactions, including any costs of printing the Registration
Statement originally filed with respect to the Preferred Securities and any
amendment thereto, any Rule 462(b) Registration Statement, and the Prospectus
and any amendment or supplement thereto, this Agreement and any blue sky
memoranda, (ii) all arrangements relating to the delivery to the Underwriters of
copies of the foregoing documents, (iii) the fees and disbursements of the
counsel, the accountants and any other experts or advisors retained by the
Company, (iv) preparation, issuance and delivery to the Underwriters of any
certificates evidencing the Preferred Securities, including transfer agent's and
registrar's fees, (v) the qualification of the Preferred Securities under state
securities and blue sky laws, including filing fees and fees and disbursements
of counsel for the Underwriters relating thereto, (vi) the filing fees of the
Commission and the National Association of Securities Dealers, Inc. relating to
the Preferred Securities, and (vii) the fees and expenses of any trustee
appointed under any of the Operative Documents, including the fees and
disbursements of counsel for such trustees in connection with the Operative
Document. If the sale of the Preferred Securities provided for herein is not
consummated because any condition to the obligations of the Underwriters set
forth in Section 5 hereof is not satisfied, because this Agreement is terminated
pursuant to Section 9 hereof or because of any failure, refusal or inability on
the part of the Company to perform all obligations and satisfy all conditions on
its part to be performed or satisfied hereunder other than by reason of a
default by any of the Underwriters, the Company will reimburse the
Representatives upon demand for all reasonable out-of-pocket expenses (including
counsel fees and disbursements) that
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shall have been incurred by it in connection with the proposed purchase and sale
of the Preferred Securities. The Company shall not in any event be liable to any
of the Underwriters for the loss of anticipated profits from the transactions
covered by this Agreement.
SECTION 5. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The obligations of
the several Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Offerors contained in Section 1 hereof or
in certificates of any Trustee of the Trust, officer of the Company or any of
its subsidiaries delivered pursuant to the provisions hereof, to the performance
by the Offerors of their obligations hereunder, and to the following further
conditions:
(a) EFFECTIVENESS OF THE REGISTRATION STATEMENT. If the Registration
Statement or any post-effective amendment to the Registration Statement filed
prior to the Closing Date has not been declared effective as of the time of
execution hereof, the Registration Statement or any such post-effective
amendment, and, if the Company has elected to rely upon Rule 462(b), the Rule
462(b) Registration Statement, shall have been declared effective not later than
the earlier of (i) 11:00 A.M., Eastern Standard Time, on the first business day
following the date on which this Agreement is executed, and (ii) the time
confirmations are sent or given as specified by Rule 462(b) or, with respect to
the Registration Statement, such later time and date as shall have been
consented to by the Representatives; if required, the Prospectus or any term
sheet that constitutes a part thereof and any amendment or supplement thereto
shall have been filed with the Commission in the manner and within the time
period required by Rules 434 and 424(b) under the Act; no stop order suspending
the effectiveness of the Registration Statement or any amendment thereto shall
have been issued, and no proceedings for that purpose shall have been instituted
or threatened or, to the knowledge of the Company or the Representatives, shall
be contemplated by the Commission; and the Company shall have complied with any
request of the Commission for additional information (to be included in the
Registration Statement or the Prospectus or otherwise).
(b) OPINION OF OUTSIDE COUNSEL FOR OFFERORS. At the Closing Date, the
Underwriters shall have received the favorable opinion, dated as of the Closing
Date, of Stevens & Lee, P.C., counsel for the Company, to the effect set forth
in Exhibit A hereto. Such counsel may also state that, insofar as such opinion
involves factual matters, they have relied, to the extent they deem proper, upon
certificates of Trustees of the Trust, officers of the Company and its
subsidiaries and certificates of public officials.
(c) OPINION OF SPECIAL DELAWARE COUNSEL FOR OFFERORS. If the opinion
referred to in Section 5(b) does not cover applicable matters of Delaware law,
at the Closing Date, the Underwriters shall have received the favorable opinion,
dated as of the Closing Date, of special Delaware counsel to the Offerors, to
the effect set forth in Exhibit B hereto.
(d) OPINION OF COUNSEL FOR THE BANK OF NEW YORK. At the Closing Date,
the Underwriters shall have received the favorable opinion, dated as of the
Closing Date, of
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Emmet, Marvin & Martin, LLP counsel to The Bank of New York, as
Property Trustee under the Trust Agreement, and Guarantee Trustee under the
Guarantee Agreement, to the effect set forth in Exhibit C hereto.
(e) OPINION OF SPECIAL TAX COUNSEL FOR THE OFFERORS. At the Closing
Date, the Underwriters shall have received an opinion, dated as of the Closing
Date, of Stevens & Lee, P.C., special tax counsel to the Offerors, that (i) the
Trust will be classified for United States federal income tax purposes as a
grantor trust and not as an association taxable as a corporation and (ii)
although the discussion set forth in the Prospectus under the heading "Certain
United States Federal Income Tax Consequences" does not purport to discuss all
possible United States federal income tax consequences of the purchase,
ownership and disposition of the Preferred Securities, such discussion
constitutes, in all material respects, a fair and accurate summary of the United
States federal income tax consequences of the purchase, ownership and
disposition of the Preferred Securities under current law. Such opinion may be
conditioned on, among other things, the initial and continuing accuracy of the
facts, financial and other information, covenants and representations set forth
in certificates of officers of the Company and other documents deemed necessary
for such opinion.
(f) OPINION OF COUNSEL FOR UNDERWRITERS. At the Closing Date, the
Underwriters shall have received the favorable opinion, dated as of the Closing
Date, of Alston & Bird LLP, counsel for the Underwriters, with respect to the
incorporation and legal existence of the Company, the Preferred Securities, the
Indenture, the Guarantee, this Agreement, and the Prospectus and other related
matters as the Underwriters may require. Such counsel may also state that,
insofar as such opinion involves factual matters, they have relied, to the
extent they deem proper, upon certificates of Trustees of the Trust, officers of
the Company and its subsidiaries and certificates of public officials. Such
counsel may rely as to matters of Delaware law on the opinions of counsel
furnished pursuant to subsection (c) of this Section.
(g) CERTIFICATES. At the Closing Date, there shall not have been, since
the date hereof or since the respective dates as of which information is given
in the Prospectus, any material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the
Trust, or the Company and its subsidiaries considered as one enterprise, whether
or not arising in the ordinary course of business, and the Underwriters shall
have received a certificate of the Chairman, any Vice Chairman, the Chief
Executive Officer, the President or any Vice President of the Company and of the
chief financial officer or the chief accounting officer of the Company and a
certificate of an Administrative Trustee of the Trust, dated as of the Closing
Date, to the effect that (i) there has been no such material adverse change,
(ii) the representations and warranties in Section 1 hereof were true and
correct, in all material respects, when made and are true and correct, in all
material respects, with the same force and effect as though expressly made at
and as of the Closing Date, and (iii) the Offerors have complied with all
agreements and satisfied all conditions on their part to be performed or
satisfied at or prior to the Closing Date.
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(h) ACCOUNTANT'S COMFORT LETTER. At the time of the execution of this
Agreement, the Underwriters shall have received from Beard & Company, Inc. a
letter, dated such date, in form and substance reasonably satisfactory to the
Underwriters, containing statements and information of the type ordinarily
included in accountants' "comfort letters" to Underwriters with respect to the
financial statements and certain financial information contained in the
Prospectus.
(i) BRING-DOWN COMFORT LETTER. At the Closing Date, the Underwriters
shall have received from Beard & Company, Inc. a letter, dated as of the Closing
Date, to the effect that they reaffirm the statements made in the letter
furnished pursuant to subsection (h) of this Section, except that the specified
date referred to shall be a date not more than three business days prior to the
Closing Date.
(j) OTHER INFORMATION. On or before the Closing Date, the
Representatives and counsel for the Underwriters shall have received such
further certificates, documents or other information as they may have reasonably
requested from the Company.
(k) TERMINATION OF AGREEMENT. If any condition specified in this
Section shall not have been fulfilled when and as required to be fulfilled, this
Agreement may be terminated by the Underwriters by notice to the Offerors 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 4 and
except that Sections 6, 7 and 8 and this Section 5(k) shall survive any such
termination and remain in full force and effect.
All opinions, certificates, letters and documents delivered pursuant to
this Agreement will comply with the provisions hereof only if they are
reasonably satisfactory in all material respects to the Representatives and
counsel for the Underwriters. The Company shall furnish to the Representatives
such conformed copies of such opinions, certificates, letters and documents in
such quantities as the Representatives and counsel for the Underwriters shall
reasonably request.
SECTION 6. INDEMNIFICATION.
(a) INDEMNIFICATION OF UNDERWRITERS. The Offerors agree to jointly and
severally indemnify and hold harmless each Underwriter and each person, if any,
who controls any Underwriter within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact included in the
Registration Statement or any amendment to the Registration Statement,
including the information deemed to be part of the Registration
Statement pursuant to Rule 430A(b) of the 1933 Act
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Regulations, if applicable, or the omission or alleged omission
therefrom of a material fact required to be stated therein or necessary
to make the statements therein not misleading or arising out of any
untrue statement or alleged untrue statement of a material fact
contained in any preliminary prospectus or prospectus, including the
Prospectus (or any amendment or supplement thereto), or the omission or
alleged omission therefrom of a material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened,
or of any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission; provided
that (subject to Section 6(c) below) any such settlement is effected
with the written consent of the Offerors; and
(iii) against any and all expense whatsoever, as incurred
(including the reasonable fees and disbursements of counsel chosen by
the Representatives), reasonably incurred in investigating, preparing
or defending against any litigation, or any investigation or proceeding
by any governmental agency or body, commenced or threatened, or any
claim whatsoever based upon any such untrue statement or omission, or
any such alleged untrue statement or omission, to the extent that any
such expense is not paid under (i) or (ii) above; PROVIDED, HOWEVER,
that this Section 6(a) shall not apply to any loss, liability, claim,
damage or expense to the extent arising out of any untrue statement or
omission or alleged untrue statement or omission made in reliance upon
and in conformity with written information furnished to the Offerors by
any Underwriter through the Representatives expressly for use in the
Registration Statement or any amendment to the Registration Statement
or any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto). Such written information provided by the
Underwriters is referred to as "Underwriter Information."
The foregoing indemnification with respect to any preliminary
prospectus shall not inure to the benefit of any Underwriter from whom
the person asserting any such losses, claims, damages or liabilities
purchased Preferred Securities, or any person controlling such
Underwriter, if a copy of the Prospectus (as then amended or
supplemented if the Offerors shall have furnished any amendments or
supplements thereto) was not sent or given by or on behalf of such
Underwriter to such person, if such is required by law, at or prior to
the written confirmation of the sale of such shares to such person and
if the Prospectus (as so amended or supplemented) would have cured the
defect giving rise to such loss, claim, damage or liability.
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(b) INDEMNIFICATION OF OFFERORS, DIRECTORS AND OFFICERS. Each
Underwriter severally agrees to indemnify and hold harmless the Company, its
directors and officers, the Trust, each of the Trustees and each person, if any,
who controls the Company within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act against any and all loss, liability, claim, damage
and expense described in the indemnity contained in subsection (a) of this
Section, as incurred, but only with respect to untrue statements or omissions,
or alleged untrue statements or omissions, made in the Registration Statement
(or any amendment thereto) or any preliminary prospectus or the Prospectus (or
any amendment or supplement thereto) in reliance upon and in conformity with
written information furnished to the Offerors by such Underwriter through the
Representatives expressly for use in the Registration Statement (or any
amendment thereto) or such preliminary prospectus or the Prospectus (or any
amendment or supplement thereto).
(c) ACTIONS AGAINST PARTIES; NOTIFICATION. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a) above,
counsel to the indemnified parties shall be selected by the Representatives,
and, in the case of parties indemnified pursuant to Section 6(b) above, counsel
to the indemnified parties shall be selected by the Offerors. An indemnifying
party may participate at its own expense in the defense of any such action;
provided, however, that counsel to the indemnifying party shall not (except with
the consent of the indemnified party) also be counsel to the indemnified party.
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. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 6 or Section
7 hereof (whether or not the indemnified parties are actual or potential parties
thereto), unless such settlement, compromise or consent (i) includes an
unconditional release of each indemnified party from all liability arising out
of such litigation, investigation, proceeding 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.
SECTION 7. CONTRIBUTION. In order to provide for just and equitable
contribution in circumstances under which the indemnification provided for in
Section 6 hereof is for any reason held to be unenforceable by an indemnified
party in respect of any losses, liabilities, claims, damages or expenses
referred to therein, then each
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indemnifying party shall contribute to the aggregate amount of such losses,
liabilities, claims, damages and expenses incurred by such indemnified party, as
incurred, (i) in such proportion as is appropriate to reflect the relative
benefits received by the Offerors on the one hand and the Underwriters on the
other hand from the offering of the Preferred Securities pursuant to this
Agreement or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Company, on the one hand, and the Underwriters, on the other hand,
in connection with the statements or omissions which resulted in such losses,
liabilities, claims, damages or expenses, as well as any other relevant
considerations.
The relative benefits received by the Offerors on the one hand and the
Underwriters on the other hand in connection with the offering of the Preferred
Securities pursuant to this Agreement shall be deemed to be in the same
respective proportions as the total net proceeds from the offering of the
Preferred Securities pursuant to this Agreement (before deducting expenses)
received by the Offerors and the total commission received by the Underwriters
in the Preferred Offering, bear to the aggregate initial offering price of the
Preferred Securities. The relative fault of the Company, on the one hand, and
the Underwriters, on the other hand, shall be determined by reference to, among
other things, whether any such untrue or alleged untrue statement of a material
fact or 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 hand, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Offerors and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Section 7. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 7 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter shall
be required to contribute any amount in excess of the amount by which the total
price at which the Preferred Securities purchased by it and distributed to the
public were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission.
-20-
<PAGE>
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter, and
each officer and director of the Company, and each person, if any, who controls
the Company within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as the Company. The
Underwriters' respective obligations to contribute pursuant to this Section 7
are several in proportion to the number of Securities set forth opposite their
respective names in Schedule A hereto and not joint.
SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE
DELIVERY. All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or trustees of the Trust
submitted pursuant hereto, shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of any Underwriter or
controlling person, or by or on behalf of the Trust or the Company, and shall
survive delivery of the Preferred Securities to the Underwriters.
SECTION 9. TERMINATION OF AGREEMENT.
(a) TERMINATION; GENERAL. The Underwriters may terminate this Agreement
with respect to the Preferred Securities, by notice to the Offerors, at any time
at or prior to the Closing Date (i) if there has been, since the time of
execution of this Agreement or since the respective dates as of which
information is given in the Prospectus, any material adverse change in the
condition, financial or otherwise, or in the earnings, business affairs or
business prospects of the Trust or the Company and its subsidiaries considered
as one enterprise, whether or not arising in the ordinary course of business, or
(ii) if there has occurred any material adverse change in the financial markets
in the United States or any outbreak of hostilities or escalation thereof or
other calamity or crisis, in each case the effect of which is such as to make
it, in the reasonable judgment of the Underwriters, impracticable to market the
Preferred Securities or to enforce contracts for the sale of the Preferred
Securities, or (iii) if trading in any securities of the Company has been
suspended or limited by the Commission, or if trading generally on the American
Stock Exchange or the New York Stock Exchange or in the Nasdaq National Market
System has been suspended or limited, or minimum or maximum prices for trading
have been fixed, or maximum ranges for prices have been required, by any of said
exchanges or by such system or by order of the Commission, the National
Association of Securities Dealers, Inc. or any other governmental authority, or
(iv) if a banking moratorium has been declared by either Federal or Pennsylvania
authorities.
(b) LIABILITIES. If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any party to any other
party except as provided in
-21-
<PAGE>
Section 4 hereof, and provided further that Sections 6, 7, and 8 and this
Section 9 shall survive such termination and remain in full force and effect.
SECTION 10. DEFAULT BY ONE OR MORE OF THE UNDERWRITERS. If one or more
of the Underwriters shall fail at the Closing Date to purchase the Preferred
Securities which it or they are obligated to purchase under this Agreement (the
"Defaulted Preferred Securities"), the Underwriters shall have the right, within
24 hours thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other Underwriters, to purchase all, but not less than all,
of the Defaulted Preferred Securities in such amounts as may be agreed upon and
upon the terms herein set forth; if, however, the Underwriters shall not have
completed such arrangements within such 24-hour period, then:
(a) if the number of Defaulted Preferred Securities does not exceed 10%
of the total number of Preferred Securities to be purchased hereunder, each of
the non-defaulting Underwriters shall be obligated, severally and not jointly,
to purchase the full amount thereof in the proportions that their respective
purchasing obligations hereunder bear to the purchasing obligations of all
non-defaulting Underwriters, or
(b) if the number of Defaulted Preferred Securities exceeds 10% of the
Preferred Securities to be purchased hereunder, this Agreement shall terminate
without liability on the part of any non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any defaulting
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination
of this Agreement, either the Underwriters or the Company shall have the right
to postpone the Closing Date for a period not exceeding seven days in order to
effect any required changes in the Prospectus or in any other documents or
arrangements. As used herein, the term "Underwriter" includes any person
substituted for an Underwriter under this Section 10.
SECTION 11. NOTICES. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to the Underwriters c/o Wheat First at 901 East
Byrd Street, Richmond, Virginia 23219, attention of Scott R. Anderson with a
copy to Alston & Bird LLP, 601 Pennsylvania Avenue, N.W., North Building, 11th
Floor, Washington, D.C. 20004, attention of Frank M. Conner III; notices to the
Offerors shall be directed to Main Street Bancorp, Inc., 601 Penn Street,
Reading Pennsylvania 19601, attention of Nelson R. Oswald, Chairman, President
and Chief Executive Officer, with a copy to Stevens & Lee, P.C., One Glenhardie
Corporate Center, 1275 Drummers Lane, Post Office Box 236, Wayne, Pennsylvania
19087-0236, attention of Jeffrey P. Waldron.
-22-
<PAGE>
SECTION 12. PARTIES. This Agreement shall inure to the benefit of and
be binding upon the Underwriters and the Offerors and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the
Underwriters and the Offerors and their respective successors and the
controlling persons and officers and directors referred to in Sections 6 and 7
and their heirs and legal Representatives, any legal or equitable right, remedy
or claim under or in respect of this Agreement or any provision herein
contained. This Agreement and all conditions and provisions hereof are intended
to be for the sole and exclusive benefit of the Underwriters and the Offerors
and their respective successors, and said controlling persons and officers and
directors and their heirs and legal Representatives, and for the benefit of no
other person, firm or corporation. No purchaser of Preferred Securities from any
Underwriter shall be deemed to be a successor by reason merely of such purchase.
SECTION 13. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE COMMONWEALTH OF VIRGINIA.
SECTION 14. EFFECT OF HEADINGS. The Article and Section headings herein
and the Table of Contents are for convenience only and shall not affect the
construction hereof.
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, along with all counterparts, will become a binding agreement
between the Underwriters and the Offerors in accordance with its terms.
Very truly yours,
MAIN STREET BANCORP, INC.
By:
--------------------------------------
Title:
-----------------------------------
MBNK CAPITAL TRUST I
By: Main Street Bancorp, Inc.
By: By:
--------------------------------------
Title:
-----------------------------------
-23-
<PAGE>
CONFIRMED AND ACCEPTED,
as of the date first above written:
WHEAT FIRST SECURITIES,
A DIVISION OF FIRST UNION
CAPITAL MARKETS CORP.
By:
-------------------------------------
Scott R. Anderson
Managing Director
JANNEY MONTGOMERY SCOTT LLC
By:
-------------------------------------
Jay L. Junior
Vice President
-24-
<PAGE>
SCHEDULE A
<TABLE>
<CAPTION>
Number of
Name of Underwriters Preferred Securities
- -------------------- --------------------
<S> <C>
Wheat First Securities, Inc.
Janney Montgomery Scott LLC
--------------------
Total 4,000,000
--------------------
--------------------
</TABLE>
<PAGE>
EXHIBIT A
Form of Opinion of Stevens & Lee, P.C., Counsel for the Company, to be
delivered pursuant to Section 5(b) of this Agreement:
1. The Company is validly existing as a corporation under the laws of
the Commonwealth of Pennsylvania and has full corporate power and authority to
own, lease and operate its properties and to conduct its business as described
in the Registration Statement and in the Prospectus. The Company is duly
authorized to transact business and is in good standing in each jurisdiction in
which it owns or leases property of a nature, or transacts business of a type,
that would make such qualification necessary, except to the extent that the
failure to so qualify or to be in good standing would not have a material
adverse effect on the financial conditionor earnings of the Company and its
subsidiaries, considered as one enterprise.
2. Based solely on a letter dated ____________ from ______________ of
the Federal Reserve, the Company is registered as a bank holding company under
the Bank Holding Company Act of 1956, as amended.
3. Main Street Bank is validly existing as a state-chartered bank under
the laws of the Commonwealth of Pennsylvania and has full corporate power and
authority to own, lease and operate its properties and to conduct its business
as described in the Registration Statement and in the Prospectus Main Street
Bank being referred to herein as the "Significant Subsidiary." The Significant
Subsidiary is duly authorized to transact business and is in good standing in
each jurisdiction in which it owns or leases property of a nature, or transacts
business of a type, that would make such qualification necessary, except to the
extent that the failure to so qualify or to be in good standing would not have a
material adverse effect on the financial condition)or earnings of the Company
and its subsidiaries, considered as one enterprise.
4. All of the outstanding shares of capital stock of the Company have
been duly authorized and validly issued, are fully paid and non-assessable and
have not been issued in violation of the preemptive rights of any shareholder of
the Company.
5. Under the laws of the Commonwealth of Pennsylvania, its Articles of
Incorporation and its Bylaws, the Company has the corporate power and authority
to execute and deliver, and to perform its obligations under, the Operative
Documents to which it is a party and to issue and perform its obligations under
the Subordinated Debentures.
6. This Agreement has been duly and validly authorized, executed and
delivered by the Company and constitutes a valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms, except to
the extent that enforcement thereof may be limited by the Enforceability
Exceptions.
A-1
<PAGE>
7. The Trust Agreement has been duly authorized, executed and delivered
by the Company.
8. The Guarantee has been duly and validly authorized, executed and
delivered by the Company, and constitutes a valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms, except to
the extent that enforcement thereof may be limited by the Enforceability
Exceptions; and the Guarantee has been duly qualified under the 1939 Act.
9. The Indenture has been duly and validly authorized, executed and
delivered by the Company and constitutes a valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms, except to
the extent that enforcement thereof may be limited by the Enforceability
Exceptions; and the Indenture has been duly qualified under the 1939 Act.
10. The Subordinated Debentures have been duly and validly authorized
for issuance by the Company, and when executed, authenticated and delivered in
the manner provided for in the Indenture and paid for in accordance with the
Subordinated Debenture Purchase Agreement, will constitute valid and binding
obligations of the Company entitled to the benefits of the Indenture and
enforceable against the Company in accordance with their terms, except to the
extent that enforcement thereof may be limited by the Enforceability Exceptions;
and the issuance of the Subordinated Debentures is not subject to preemptive or
other similar rights arising under the Articles of Incorporation or Bylaws of
the Company, under the laws of the Commonwealth of Pennsylvania or, to our
knowledge of such counsel, pursuant to any other instrument.
11. Such counsel has reviewed the statements in the Prospectus under
the captions "Capitalization," "Description of the Preferred Securities,"
"Description of the Junior Subordinated Debentures," "Description of the
Guarantee," and "Relationship Among the Preferred Securities, the Junior
Subordinated Debentures and the Guarantee" to the extent that such statements
purport to summarize certain provisions of the Preferred Securities, the
Subordinated Debentures, the Guarantee, and the Indenture such statements fairly
summarize such provisions in all material respects and conform in all material
respects to the instruments defining the same.
12. Neither the Company nor the Trust is or, immediately following
consummation of the transactions contemplated by the Agreement, will be required
to be registered under the Investment Company Act of 1940, as amended.
13. Except as disclosed in the Registration Statement or the
Prospectus, to the knowledge of such counsel, there is no action, suit or
proceeding before or by any government, governmental instrumentality or court,
domestic or foreign, now pending or threatened against or affecting the Company
or any subsidiary that in the final outcome would in our judgment result in any
material adverse change in the financial condition or earnings of the Company
and its subsidiaries considered as one enterprise, or that could
A-2
<PAGE>
materially and adversely affect the properties or assets of the Company and its
subsidiaries considered as one enterprise, or that would adversely affect the
consummation of the transactions contemplated in the Operative Documents. To the
knowledge of such counsel, the aggregate liability or loss, if any, resulting
from the final outcome of all pending legal or governmental proceedings to which
the Company or any subsidiary is a party or which affect any of its properties
that are not described in the Registration Statement or the Prospectus,
including ordinary routine litigation incidental to its business, would not have
a material adverse effect on the condition, financial or otherwise, earnings,
business affairs or business prospects of the Company and its subsidiaries
considered as one enterprise.
14. The execution and delivery by the Company of the Operative
Documents to which it is a party, the issuance and delivery of the Preferred
Securities and the Common Securities and the consummation by the Company of the
transactions contemplated by the Operative Documents do not and will not violate
or conflict with the Certificate of Incorporation or the Bylaws of the Company.
15. The execution and delivery by the Company of the Operative
Documents to which it is a party, the issuance and delivery of the Preferred
Securities and the Common Securities and the consummation by the Company of the
transactions contemplated by the Operative Documents do not and will not
conflict with or result in a breach of any of the terms or provisions of, or
constitute a default under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any
subsidiary under (a) any indenture, mortgage, loan agreement, note, lease or
other agreement or instrument to which the Company or any subsidiary is a party
or by which it may be bound or to which any of its properties may be subject and
which has been filed as an exhibit to the Company's Annual Report on Form 10-K
for the year ended December 31, 1999, or (b) to the knowledge of such counsel,
any existing applicable law, rule, regulation, qualification, judgment, order or
decree of any governmental instrumentality or court, domestic or foreign, having
jurisdiction over the Company or any subsidiary or any of its properties, except
for such conflicts, breaches or defaults or liens, charges or encumbrances that
would not have a material adverse effect on the condition (financial or
otherwise), earnings, business affairs or business prospects of the Company or
its subsidiaries considered as one enterprise.
16. No Governmental Approval which has not been made or obtained is
required for the execution or delivery by the Company of the Operative Documents
to which it is a party, or the consummation by the Company of the transactions
contemplated thereby, except approvals issued by the NASD and pursuant to the
securities or "blue sky" laws of any jurisdiction, as to which such counsel need
express no opinions.
17. The Registration Statement and any post-effective amendments
thereto have become effective under the 1933 Act and, to the knowledge of such
counsel, no
A-3
<PAGE>
stop order suspending the effectiveness of the Registration Statement or such
amendments thereto has been issued under the 1933 Act, and no proceeding
therefor has been instituted or is pending or threatened by the Commission.
18. The Registration Statement and the Prospectus and any further
amendments and supplements thereto made by the Company prior to the Closing Date
(other than the financial statements and related notes thereto, related
schedules and financial and statistical data, and descriptions of accounting
treatment included therein, as to which such counsel need express no opinion)
comply as to form in all material respects with the requirements of the 1933 Act
and the 1933 Act Regulations.
19. In addition, such counsel shall state (and may do so under separate
cover) that they have participated in the preparation of the Registration
Statement and the Prospectus and, while they are not passing upon and do not
assume any responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement or the Prospectus (except as
specified above), or the basis of the foregoing, no facts have come to the
attention of such counsel to lead them to believe that, as of the effective date
of the Registration Statement or any post-effective amendment thereto or the
date of the Prospectus or as of the Closing Date, either the Registration
Statement, any post-effective amendment thereto, or the Prospectus (or, as of
its date, any further amendment or supplement thereto made by the Company prior
to the Closing Date) contained an untrue statement of a material fact or omitted
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 (except for the financial statements and related notes
thereto, related schedules and financial and statistical data, and descriptions
of accounting treatment included therein, as to which such counsel need express
no belief).
20. Such counsel does not know of any amendment or supplement to the
Registration Statement or any post-effective amendment thereto required to be
filed or of any contract, agreement, instrument, lease, license, arrangement or
understanding of a character required to be filed as an exhibit to, described
in, the Registration Statement, post-effective amendment thereto, or the
Prospectus, as amended or supplemented, which is not filed or described as
required.
A-4
<PAGE>
EXHIBIT B
Form of Opinion of Richards, Layton & Finger, Special Delaware Counsel
to the Offerors, to be delivered pursuant to Section 5(c) of this Agreement:
1. The Trust has been duly created and is validly existing in good
standing as a statutory business trust under the Delaware Business Trust Act.
2. Under the Delaware Business Trust Act and the Trust Agreement, the
Trust has the trust power and authority to (a) execute and deliver, and to
perform its obligations under, the Operative Documents to which it is a party,
(b) issue and perform its obligations under the Preferred Securities and the
Common Securities, and (c) conduct its business as described in the Registration
Statement, or the Prospectus.
3. The Trust Agreement constitutes a valid and binding obligation of the
Company and the Administrators, and is enforceable against the Company and the
Administrators, in accordance with its terms, except to the extent that
enforcement thereof may be limited by (i) bankruptcy, insolvency, moratorium,
receivership, reorganization, liquidation, fraudulent conveyance or transfer and
other similar laws relating to or affecting the rights and remedies of creditors
generally, (ii) principles of equity, including applicable law relating to
fiduciary duties (regardless of whether considered and applied in a proceeding
in equity or at law), and (iii) the effect of applicable public policy on the
enforceability of provisions relating to indemnification or contribution.
4. The Preferred Securities have been duly authorized by the Trust
Agreement, and the Preferred Securities, when duly issued, executed and
authenticated in accordance with the Trust Agreement and delivered and paid for
in accordance with the Agreement, will be, subject to the qualifications set
forth in paragraph 6 below, fully paid and nonassessable undivided beneficial
interests in the assets of the Trust and will be entitled to the benefits of the
Trust Agreement, except to the extent that enforcement thereof may be limited by
(i) bankruptcy, insolvency, moratorium, receivership, reorganization,
liquidation, fraudulent conveyance or transfer and other similar laws relating
to or affecting the rights and remedies of creditors generally, (ii) principles
of equity, including applicable law relating to fiduciary duties (regardless of
whether considered and applied in a proceeding in equity or at law), and (iii)
the effect of applicable public policy on the enforceability of provisions
relating to indemnification or contribution.
5. The Common Securities have been duly authorized for issuance by the
Trust Agreement and, when issued, executed and authenticated in accordance with
the Trust Agreement and delivered and paid for in accordance with the Common
Security Purchase Agreement, will be validly issued undivided beneficial
interests in the assets of
B-1
<PAGE>
the Trust. The issuance of the Common Securities is not subject to preemptive
rights under the Delaware Business Trust Act or the Trust Agreement.
6. The holders of the Preferred Securities will be entitled to the same
limitation of personal liability extended to stockholders of private
corporations for profit organized under the Delaware General Corporation Law. We
bring to your attention, however, that the holders of the Preferred Securities
may be obligated, pursuant to the Trust Agreement, to (a) provide indemnity
and/or security in connection with, and pay taxes or governmental charges
arising from, transfers or exchange of Preferred Securities and the issuance of
replacement Preferred Securities Certificates and (b) provide security or
indemnity in connection with requests of or directions to the Property Trustee
to exercise its rights and powers under the Trust Agreement.
7. No authorization, approval, consent or order of any Delaware court
or any Delaware governmental authority or Delaware agency is required to be
obtained by the Trust solely in connection with the execution, delivery or
performance by the Trust of the Operative Documents to which it is a party, or
the consummation by the Trust of the transactions contemplated thereby or the
issuance and sale of the Preferred Securities. We express no opinion in this
paragraph 7, however, as to any governmental approvals which may be required
under state securities or "blue sky" laws.
8. None of the execution and delivery by the Trust of the Operative
Documents, or the issuance and sale of the Preferred Securities by the Trust in
accordance with the terms of the Agreement or the consummation by the Trust of
the other transactions contemplated thereby, (a) violate any applicable Delaware
laws, or (b) conflict with the Certificate of Trust or the Trust Agreement,
except that we express no opinion in this paragraph 8 with respect to (i) the
rights to indemnity and contribution contained in the Trust Agreement which may
be limited by state securities laws or the public policy underlying such laws or
(ii) any state securities or "blue sky" laws.
B-2
<PAGE>
EXHIBIT C
Form of Opinion of _________, Special Counsel for the Property Trustee,
Guarantee Trustee, and Debenture Trustee to be delivered pursuant to Section
5(d) of this Agreement:
1. The Bank of New York is a New York banking corporation validly
existing under the laws of the State of New York.
2. The Indenture Trustee has the requisite power and authority to
execute, deliver and perform its obligations under the Indenture and has taken
all necessary action to authorize the execution, delivery and performance by it
of the Indenture.
3. The Guarantee Trustee has the requisite power and authority to
execute, deliver and perform its obligations under the Guarantee, and has taken
all necessary action to authorize the execution, delivery and performance by it
of the Guarantee.
4. The Property Trustee has the requisite power and authority to
execute and deliver the Trustee Agreement, and has taken all necessary action to
authorize the execution and delivery of the Trust Agreement.
5. Each of the Indenture and the Guarantee has been duly executed and
delivered by the Indenture Trustee and the Guarantee Trustee, respectively, and
constitutes a legal, valid and binding obligation of the Indenture Trustee and
the Guarantee Trustee, respectively, enforceable against the Indenture Trustee
and the Guarantee Trustee, respectively, in accordance with its respective
terms, except that certain payment obligations may be enforceable solely against
the assets of the Trust and except that such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium, liquidation, or other
similar laws affecting the enforcement of creditors' rights generally, and by
general principles of equity, including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing (regardless of whether
such enforceability is considered in a proceeding in equity or at law).
6. The Securities delivered on the date hereof have been duly
authenticated by the Indenture Trustee in accordance with the terms of the
Indenture.
C-1
<PAGE>
EXHIBIT 4.1
JUNIOR SUBORDINATED INDENTURE
BETWEEN
MAIN STREET BANCORP, INC
AND
THE BANK OF NEW YORK
(AS TRUSTEE)
DATED AS OF SEPTEMBER__, 1999
<PAGE>
MBNK CAPITAL TRUST I
Certain Sections of this Junior Subordinated Indenture relating
to Sections 310 through 318 of the
Trust Indenture Act of 1939:
<TABLE>
<CAPTION>
Trust Indenture Junior Subordinated
Act Section Indenture Section
----------- -----------------
<S> <C> <C>
Section 310 (a)(1)...................................................................6.9
(a)(2)...................................................................6.9
(a)(3)...................................................................Not Applicable
(a)(4)...................................................................Not Applicable
(a)(5)...................................................................6.9
(b)......................................................................6.8, 6.10
Section 311 (a)......................................................................6.13
(b)......................................................................6.13
(b)(2)...................................................................7.3(a)
Section 312 (a)......................................................................7.1, 7.2(a)
(b)......................................................................7.2(b)
(c)......................................................................7.2(c)
Section 313 (a)......................................................................7.3(a)
(a)(4)...................................................................7.3(a)
(b)......................................................................7.3(b)
(c)......................................................................7.3(a)
(d)......................................................................7.3(c)
Section 314 (a)......................................................................7.4
(b)......................................................................7.4
(c)(1)...................................................................1.2
(c)(2)...................................................................1.2
(c)(3)...................................................................Not Applicable
(e)......................................................................1.2
Section 315 (a)......................................................................6.1(a)
(b)......................................................................6.2, 7.3
(c)......................................................................6.1(b)
(d)......................................................................6.1(c)
(e)......................................................................5.14
Section 316 (a)......................................................................5.12
(a)(1)(A)................................................................5.12
(a)(1)(B)................................................................5.13
(a)(2)...................................................................Not Applicable
(b)......................................................................5.8
(c)......................................................................1.4(f)
Section 317 (a)(1)...................................................................5.3
(a)(2)...................................................................5.4
(b)......................................................................10.3
Section 318 (a)......................................................................1.7
</TABLE>
a
<PAGE>
Note: This reconciliation and tie shall not, for any
purpose, be deemed to be a part of the Indenture.
b
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C> <C>
ARTICLE I DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION.................................2
SECTION 1.1. DEFINITIONS..................................................................................2
SECTION 1.2. COMPLIANCE CERTIFICATE AND OPINIONS.........................................................10
SECTION 1.3. FORMS OF DOCUMENTS DELIVERED TO TRUSTEE.....................................................11
SECTION 1.4. ACTS OF HOLDERS.............................................................................11
SECTION 1.5. NOTICES, ETC. TO TRUSTEE AND COMPANY........................................................13
SECTION 1.6. NOTICE TO HOLDERS; WAIVER...................................................................14
SECTION 1.7. CONFLICT WITH TRUST INDENTURE ACT...........................................................14
SECTION 1.8. EFFECT OF HEADINGS AND TABLE OF CONTENTS....................................................14
SECTION 1.9. SUCCESSORS AND ASSIGNS......................................................................14
SECTION 1.10. SEPARABILITY CLAUSE.........................................................................15
SECTION 1.11. BENEFITS OF INDENTURE.......................................................................15
SECTION 1.12. GOVERNING LAW...............................................................................15
SECTION 1.13. NON-BUSINESS DAYS...........................................................................15
ARTICLE II SECURITY FORMS.........................................................................16
SECTION 2.1. FORMS GENERALLY.............................................................................16
SECTION 2.2. FORM OF FACE OF SECURITY....................................................................17
SECTION 2.3. FORM OF REVERSE OF SECURITY.................................................................20
SECTION 2.4. ADDITIONAL PROVISIONS REQUIRED IN GLOBAL SECURITY...........................................23
SECTION 2.5. FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION.............................................24
ARTICLE III THE SECURITIES.........................................................................24
SECTION 3.1. TITLE AND TERMS.............................................................................24
SECTION 3.2. DENOMINATIONS...............................................................................27
SECTION 3.3. EXECUTION, AUTHENTICATION, DELIVERY AND DATING..............................................27
SECTION 3.4. TEMPORARY SECURITIES........................................................................28
SECTION 3.5. GLOBAL SECURITIES...........................................................................29
SECTION 3.6. REGISTRATION, TRANSFER AND EXCHANGE GENERALLY; CERTAIN TRANSFERS AND EXCHANGES..............30
SECTION 3.7. MUTILATED, LOST AND STOLEN SECURITIES.......................................................31
SECTION 3.8. PAYMENT OF INTEREST AND ADDITIONAL INTEREST; INTEREST RIGHTS PRESERVED......................32
SECTION 3.9. PERSONS DEEMED OWNERS.......................................................................33
SECTION 3.10. CANCELLATION................................................................................34
SECTION 3.11. COMPUTATION OF INTEREST.....................................................................34
SECTION 3.12. DEFERRALS OF INTEREST PAYMENT DATES.........................................................34
SECTION 3.13. RIGHT OF SET-OFF............................................................................36
SECTION 3.14. AGREED TAX TREATMENT........................................................................36
SECTION 3.15. SHORTENING OR EXTENSION OF STATED MATURITY..................................................36
SECTION 3.16. CUSIP NUMBERS...............................................................................36
ARTICLE IV SATISFACTION AND DISCHARGE.............................................................36
</TABLE>
i
<PAGE>
<TABLE>
<S> <C> <C>
SECTION 4.1. SATISFACTION AND DISCHARGE OF INDENTURE.....................................................36
SECTION 4.2 APPLICATION OF TRUST MONEY..................................................................38
ARTICLE V REMEDIES...............................................................................38
SECTION 5.1. EVENTS OF DEFAULT...........................................................................38
SECTION 5.2. ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT.........................................39
SECTION 5.3. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY TRUSTEE.............................40
SECTION 5.4. TRUSTEE MAY FILE PROOFS OF CLAIM............................................................41
SECTION 5.5. TRUSTEE MAY ENFORCE CLAIM WITHOUT POSSESSION OF SECURITIES..................................42
SECTION 5.6 APPLICATION OF MONEY COLLECTED..............................................................42
SECTION 5.7 LIMITATION ON SUITS.........................................................................42
SECTION 5.8. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL, PREMIUM AND INTEREST; DIRECT ACTION BY
HOLDERS OF CAPITAL SECURITIES...............................................................43
SECTION 5.9. RESTORATION OF RIGHTS AND REMEDIES..........................................................43
SECTION 5.10. RIGHTS AND REMEDIES CUMULATIVE..............................................................44
SECTION 5.11. DELAY OR OMISSION NOT WAIVER................................................................44
SECTION 5.12. CONTROL BY HOLDERS..........................................................................44
SECTION 5.13. WAIVER OF PAST DEFAULTS.....................................................................45
SECTION 5.14. UNDERTAKING FOR COSTS.......................................................................45
SECTION 5.15. WAIVER OF USURY, STAY OR EXTENSION LAWS.....................................................46
ARTICLE VI THE TRUSTEE............................................................................46
SECTION 6.1. CERTAIN DUTIES AND RESPONSIBILITIES.........................................................46
SECTION 6.2. NOTICE OF DEFAULTS..........................................................................47
SECTION 6.3. CERTAIN RIGHTS OF TRUSTEE...................................................................47
SECTION 6.4. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES......................................49
SECTION 6.5. MAY HOLD SECURITIES.........................................................................49
SECTION 6.6. MONEY HELD IN TRUST.........................................................................49
SECTION 6.7. COMPENSATION AND REIMBURSEMENT..............................................................49
SECTION 6.8. DISQUALIFICATION; CONFLICTING INTERESTS.....................................................50
SECTION 6.9. CORPORATE TRUSTEE REQUIRED; ELIGIBILITY.....................................................50
SECTION 6.10. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR...........................................51
SECTION 6.11. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR......................................................52
SECTION 6.12. MERGER, CONVERSI7ON, CONSOLIDATION OR SUCCESSION TO BUSINESS................................53
SECTION 6.13. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY...........................................53
SECTION 6.14. APPOINTMENT OF AUTHENTICATING AGENT.........................................................54
ARTICLE VII HOLDER'S LISTS AND REPORTS BY TRUSTEE, PAYING AGENT AND COMPANY........................56
SECTION 7.1. COMPANY TO FURNISH TRUSTEE NAMES AND ADDRESSES OF HOLDERS...................................56
SECTION 7.2. PRESERVATION OF INFORMATION; COMMUNICATIONS TO HOLDERS......................................57
SECTION 7.3. REPORTS BY TRUSTEE AND PAYING AGENT.........................................................57
SECTION 7.4. REPORTS BY COMPANY..........................................................................57
ARTICLE VIII CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR
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LEASE...................................58
SECTION 8.1. COMPANY MAY CONSOLIDATE, ETC., ONLY ON CERTAIN TERMS........................................58
SECTION 8.2. SUCCESSOR COMPANY SUBSTITUTED...............................................................59
ARTICLE IX SUPPLEMENTAL INDENTURES................................................................60
SECTION 9.1. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS..........................................60
SECTION 9.2. SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS.............................................61
SECTION 9.3. EXECUTION OF SUPPLEMENTAL INDENTURES........................................................62
SECTION 9.4. EFFECT OF SUPPLEMENTAL INDENTURES...........................................................62
SECTION 9.5. CONFORMITY WITH TRUST INDENTURE ACT.........................................................63
SECTION 9.6. REFERENCE IN SECURITIES TO SUPPLEMENTAL INDENTURES..........................................63
ARTICLE X COVENANTS..............................................................................63
SECTION 10.1. PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST...............................................63
SECTION 10.2. MAINTENANCE OF OFFICE OR AGENCY..........................................................63
SECTION 10.3. MONEY FOR SECURITY PAYMENTS TO BE HELD IN TRUST..........................................64
SECTION 10.4. STATEMENT AS TO COMPLIANCE...............................................................65
SECTION 10.5. WAIVER OF CERTAIN COVENANTS..............................................................65
SECTION 10.6. ADDITIONAL SUMS..........................................................................65
SECTION 10.7. ADDITIONAL COVENANTS.....................................................................66
SECTION 10.8. FURNISHING ANNUAL INFORMATION............................................................67
ARTICLE XI REDEMPTION OF SECURITIES...............................................................67
SECTION 11.1. APPLICABILITY OF THIS ARTICLE............................................................67
SECTION 11.2. ELECTION TO REDEEM; NOTICE TO TRUSTEE....................................................67
SECTION 11.3. SELECTION OF SECURITIES TO BE REDEEMED...................................................68
SECTION 11.4. NOTICE OF REDEMPTION.....................................................................68
SECTION 11.5. DEPOSIT OF REDEMPTION PRICE..............................................................69
SECTION 11.6. PAYMENT OF SECURITIES CALLED FOR REDEMPTION..............................................69
SECTION 11.7. RIGHT OF REDEMPTION OF SECURITIES INITIALLY ISSUED TO AN ISSUER TRUST....................70
ARTICLE XII SINKING FUNDS..........................................................................70
ARTICLE XIII SUBORDINATION OF SECURITIES............................................................70
SECTION 13.1. SECURITIES SUBORDINATE TO SENIOR INDEBTEDNESS............................................70
SECTION 13.2. NO PAYMENT WHEN SENIOR INDEBTEDNESS IN DEFAULT; PAYMENT OVER OF PROCEEDS UPON
DISSOLUTION, ETC. .......................................................................71
SECTION 13.3. PAYMENT PERMITTED IF NO DEFAULT..........................................................72
SECTION 13.4. SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR INDEBTEDNESS..................................72
SECTION 13.5. PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS..............................................73
SECTION 13.6. TRUSTEE TO EFFECTUATE SUBORDINATION......................................................73
SECTION 13.7. NO WAIVER OF SUBORDINATION PROVISIONS....................................................73
SECTION 13.8. NOTICE TO TRUSTEE........................................................................74
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SECTION 13.9. RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF LIQUIDATING AGENT...........................75
SECTION 13.10. TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR INDEBTEDNESS.................................75
SECTION 13.11. RIGHTS OF TRUSTEE AS HOLDER OF SENIOR INDEBTEDNESS; PRESERVATION OF TRUSTEE'S RIGHTS.....75
SECTION 13.12. ARTICLE APPLICABLE TO PAYING AGENTS......................................................75
SECTION 13.13. Certain Conversions or Exchanges Deemed Payment..........................................75
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JUNIOR SUBORDINATED INDENTURE
THIS JUNIOR SUBORDINATED INDENTURE, dated as of September __, 1999, is
between MAIN STREET BANCORP, INC., a Pennsylvania corporation (the "Company"),
having its principal office at 601 Penn Street, Reading, Pennsylvania 19601 and
THE BANK OF NEW YORK, as Trustee, a New York banking corporation having its
principal office at 101 Barclay Street, 21 West, New York, New York 10286 (the
"Trustee").
RECITALS OF THE COMPANY
WHEREAS, the Company has duly authorized the execution and delivery of
this Indenture to provide for the issuance from time to time of its unsecured
junior subordinated debt securities in series (hereinafter called the
"SECURITIES") of substantially the tenor hereinafter provided, including
Securities issued to evidence loans made to the Company from the proceeds from
the issuance from time to time by one or more business trusts (each an "ISSUER
TRUST") of undivided preferred beneficial interests in the assets of such Issuer
Trusts (the "CAPITAL SECURITIES") and common undivided interests in the assets
of such Issuer Trusts (the "COMMON SECURITIES" and, collectively with the
Capital Securities, the "TRUST SECURITIES"), and to provide the terms and
conditions upon which the Securities are to be authenticated, issued and
delivered; and
WHEREAS, all things necessary to make this Indenture a valid agreement
of the Company, in accordance with its terms, have been done.
NOW THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders (as such term is defined in Section 1.1 hereof)
thereof, it is mutually covenanted and agreed, for the equal and proportionate
benefit of all Holders of the Securities or of any series thereof, and intending
to be legally bound hereby, as follows:
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ARTICLE I
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 1.1. DEFINITIONS.
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(1) The terms defined in this Article have the meanings assigned to
them in this Article, and include the plural as well as the singular;
(2) All other terms used herein that are defined in the Trust Indenture
Act, either directly or by reference therein, have the meanings assigned to them
therein;
(3) The words "include", "includes" and "including" shall be deemed to
be followed by the phrase "without limitation";
(4) All accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles as
in effect at the time of computation;
(5) Whenever the context may require, any gender shall be deemed to
include the other;
(6) Unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the case may be,
of this Indenture; and
(7) The words "hereby", "herein", "hereof" and "hereunder" and other
words of similar import refer to this Indenture as a whole and not to any
particular Article, Section or other subdivision.
"ACT" when used with respect to any Holder has the meaning specified in
Section 1.4(a).
"ADDITIONAL INTEREST" means the interest, if any, that shall accrue on
any interest on the Securities of any series the payment of which has not been
made on the applicable Interest Payment Date and which shall accrue at the rate
per annum specified or determined as specified in such Security.
"ADDITIONAL SUMS" has the meaning specified in Section 10.6.
"ADDITIONAL TAXES" means any additional taxes, duties and other
governmental charges to which an Issuer Trust has become subject from time to
time as a result of a Tax Event.
"ADMINISTRATOR" means, in respect of any Issuer Trust, each Person
appointed in accordance with the related Trust Agreement, solely in such
Person's capacity as Administrator of such Issuer Trust and not in such Person's
individual capacity, or any successor Administrator appointed as therein
provided.
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"AFFILIATE" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"AGENT MEMBER" means any member of, or participant in, the Depositary.
"APPLICABLE PROCEDURES" means, with respect to any transfer or
transaction involving a Global Security or beneficial interest therein, the
rules and procedures of the Depositary for such Global Security, in each case to
the extent applicable to such transaction and as in effect from time to time.
"AUTHENTICATING AGENT" means any Person authorized by the Trustee
pursuant to Section 6.14 to act on behalf of the Trustee to authenticate
Securities of one or more series.
"BOARD OF DIRECTORS" means the board of directors of the Company or the
Executive Committee of the board of directors of the Company (or any other
committee of the board of directors of the Company performing similar functions)
or, for purposes of this Indenture, a committee designated by the board of
directors of the Company (or such committee), comprised of two or more members
of the board of directors of the Company or officers of the Company, or both.
"BOARD RESOLUTION" means a copy of a resolution certified by the
Secretary or any Assistant Secretary of the Company to have been duly adopted by
the Board of Directors, or such committee of the Board of Directors or officers
of the Company to which authority to act on behalf of the Board of Directors has
been delegated, and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"BUSINESS DAY" means any day other than (i) a Saturday or Sunday, (ii)
a day on which banking institutions in The City of New York, New York are
authorized or required by law or executive order to remain closed, or (iii) a
day on which the Corporate Trust Office of the Trustee, or, with respect to the
Securities of a series initially issued to an Issuer Trust, the "Corporate Trust
Office" (as defined in the related Trust Agreement) of the Property Trustee or
the Delaware Trustee under the related Trust Agreement, is closed for business.
"CAPITAL SECURITIES" has the meaning specified in the first recital of
this Indenture.
"CAPITAL TREATMENT EVENT" means, in respect of any Issuer Trust, the
reasonable determination by the Company that, as a result of the occurrence of
any amendment to, or change (including any announced prospective change) in, the
laws (or any rules or regulations thereunder) of the United States or any
political subdivision thereof or therein, or as a result of any official or
administrative pronouncement or action or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
such pronouncement, action or decision is announced on or after the date of the
issuance of the Capital Securities of such Issuer Trust, there is more than an
insubstantial risk that the Company
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will not be entitled to treat an amount equal to the Liquidation Amount of such
Capital Securities as "Tier 1 Capital" (or the then equivalent thereof) for
purposes of the risk-based capital adequacy guidelines of the Board of Governors
of the Federal Reserve System, as then in effect and applicable to the Company.
"COMMISSION" means the Securities and Exchange Commission, as from time
to time constituted, created under the Exchange Act, or, if at any time after
the execution of this instrument such Commission is not existing and performing
the duties now assigned to it under the Trust Indenture Act, then the body
performing such duties on such date.
"COMMON SECURITIES" has the meaning specified in the first recital of
this Indenture.
"COMMON STOCK" means the common stock, $1.00 par value per share, of
the Company.
"COMPANY" means the Person named as the "COMPANY" in the first
paragraph of this instrument until a successor entity shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"COMPANY" shall mean such successor entity.
"COMPANY REQUEST" and "COMPANY ORDER" mean, respectively, the written
request or order signed in the name of the Company by its Chairman of the Board
of Directors, any Vice Chairman of the Board of Directors, its President or a
Senior Vice President or Vice President, and by its Chief Financial Officer, its
Treasurer or an Assistant Treasurer, or its Secretary or an Assistant Secretary,
and delivered to the Trustee.
"CORPORATE TRUST OFFICE" means the principal office of the Trustee at
which at any particular time its corporate trust business shall be administered.
"CREDITOR" has the meaning specified in Section 6.7(c).
"DEFAULTED INTEREST" has the meaning specified in Section 3.8.
"DELAWARE TRUSTEE" means, with respect to any Issuer Trust, the Person
identified as the "Delaware Trustee" in the related Trust Agreement, solely in
its capacity as Delaware Trustee of such Issuer Trust under such Trust Agreement
and not in its individual capacity, or its successor in interest in such
capacity, or any successor Delaware trustee appointed as therein provided.
"DEPOSITARY" means, with respect to the Securities of any series
issuable or issued in whole or in part in the form of one or more Global
Securities, the Person designated as Depositary by the Company pursuant to
Section 3.1 with respect to such series (or any successor thereto).
"DISCOUNT SECURITY" means any security that provides for an amount less
than the principal amount thereof to be due and payable upon a declaration of
acceleration of the Maturity thereof pursuant to Section 5.2.
"DOLLAR" or "$" means the currency of the United States of America
that, as at the time of payment, is legal tender for the payment of public and
private debts.
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The term "ENTITY" includes a bank, corporation, association, company,
limited liability company, joint-stock company or business trust.
"EVENT OF DEFAULT," unless otherwise specified in the supplemental
indenture creating a series of Securities, has the meaning specified in
Article V.
"EXCHANGE ACT" means the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time.
"EXPIRATION DATE" has the meaning specified in Section 1.4(f).
"EXTENSION PERIOD" has the meaning specified in Section 3.12.
"GLOBAL SECURITY" means a Security in the form prescribed in Section
2.4 evidencing all or part of a series of Securities, issued to the Depositary
or its nominee for such series, and registered in the name of such Depositary or
its nominee.
"GUARANTEE" means, with respect to any Issuer Trust, the Guarantee
Agreement executed by the Company for the benefit of the Holders of the Capital
Securities issued by such Issuer Trust, as modified, amended or supplemented
from time to time.
"HOLDER" means a Person in whose name a Security is registered in the
Securities Register.
"INDENTURE" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof
and shall include the terms of each particular series of Securities established
as contemplated by Section 3.1.
"INTEREST PAYMENT DATE" means, as to each series of Securities, the
Stated Maturity of an installment of interest on such Securities.
"INVESTMENT COMPANY ACT" means the Investment Company Act of 1940 and
any statute successor thereto, in each case as amended from time to time.
"INVESTMENT COMPANY EVENT" means the receipt by an Issuer Trust of an
Opinion of Counsel (as defined in the relevant Trust Agreement) experienced in
such matters to the effect that, as a result of the occurrence of a change in
law or regulation or a written change (including any announced prospective
change) in interpretation or application of law or regulation by any legislative
body, court, governmental agency or regulatory authority, there is more than an
insubstantial risk that such Issuer Trust is or will be considered an
"investment company" that is required to be registered under the Investment
Company Act, which change or prospective change becomes effective or would
become effective, as the case may be, on or after the date of the issuance of
the Capital Securities of such Issuer Trust.
"ISSUER TRUST" has the meaning specified in the first recital of this
Indenture.
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"LIQUIDATION AMOUNT" shall have the meaning assigned in the applicable
related Trust Agreement.
"MATURITY" when used with respect to any Security means the date on
which the principal of such Security becomes due and payable as therein or
herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption or otherwise.
"NOTICE OF DEFAULT" means a written notice of the kind specified in
Section 5.1(3).
"OFFICERS' CERTIFICATE" means a certificate signed by the Chairman of
the Board of Directors, Vice Chairman of the Board of Directors, Chief
Executive Officer, the President or a Vice President, and by the Chief Financial
Officer, the Treasurer, an Assistant Treasurer, the Secretary or an Assistant
Secretary, of the Company, and delivered to the party provided herein. Any
Officers' Certificate delivered with respect to compliance with a condition or
covenant provided for in this Indenture shall include:
(a) a statement by each officer signing the Officers' Certificate that
such officer has read the covenant or condition and the definitions relating
thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by such officer in rendering the Officers' Certificate;
(c) a statement that such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such officer
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(d) a statement as to whether, in the opinion of each such officer,
such condition or covenant has been complied with.
"OPINION OF COUNSEL" means a written opinion of counsel, who may be
counsel for or an employee of the Company or any Affiliate of the Company.
"ORIGINAL ISSUE DATE" means the date of issuance specified as such in
each Security.
"OUTSTANDING" means, when used in reference to any Securities, as of
the date of determination, all Securities theretofore authenticated and
delivered under this Indenture, except:
(i) Securities theretofore canceled by the Trustee or delivered to
the Trustee for cancellation;
(ii) Securities for whose payment money in the necessary amount has
been theretofore deposited with the Trustee or any Paying Agent in trust for the
Holders of such Securities; and
(iii) Securities in substitution for or in lieu of which other
Securities have been authenticated and delivered or that have been paid pursuant
to Section 3.6, unless proof satisfactory to the Trustee is presented that any
such Securities are held by Holders in whose hands such Securities are valid,
binding and legal obligations of the Company;
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PROVIDED, HOWEVER, that in determining whether the Holders of the requisite
principal amount of Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Securities owned
by the Company or any other obligor upon the Securities or any Affiliate of the
Company or such other obligor (other than, for the avoidance of doubt, the
Issuer Trust to which Securities of the applicable series were initially issued)
shall be disregarded and deemed not to be Outstanding, except that, in
determining whether the Trustee shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent or waiver, only
Securities that the Trustee knows to be so owned shall be so disregarded.
Securities so owned that have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Trustee the
pledgee's right so to act with respect to such Securities and that the pledgee
is not the Company or any other obligor upon the Securities or any Affiliate of
the Company or such other obligor (other than, for the avoidance of doubt, such
Issuer Trust). Upon the written request of the Trustee, the Company shall
furnish to the Trustee promptly an Officers' Certificate listing and identifying
all Securities, if any, known by the Company to be owned or held by or for the
account of the Company, or any other obligor on the Securities or any Affiliate
of the Company or such obligor (other than, for the avoidance of doubt, such
Issuer Trust), and, subject to the provisions of Section 6.1, the Trustee shall
be entitled to accept such Officers' Certificate as conclusive evidence of the
facts therein set forth and of the fact that all Securities not listed therein
are Outstanding for the purpose of any such determination.
"PAYING AGENT" means the Trustee or any Person authorized by the
Company to pay the principal of (or premium, if any) or interest on, or other
amounts in respect of any Securities on behalf of the Company.
"PERSON" means any individual, corporation, partnership, joint venture,
trust, unincorporated organization or government or any agency or political
subdivision thereof.
"PLACE OF PAYMENT" means, with respect to the Securities of any series,
the place or places where the principal of (and premium, if any) and interest on
the Securities of such series are payable pursuant to Section 3.1.
"PREDECESSOR SECURITY" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security. For the purposes of this definition, any security
authenticated and delivered under Section 3.7 in lieu of a mutilated, destroyed,
lost or stolen Security shall be deemed to evidence the same debt as the
mutilated, destroyed, lost or stolen Security.
"PRINCIPAL SUBSIDIARY BANK" means each of (i) Main Street Bank, a
Pennsylvania banking corporation, (ii) any other banking subsidiary of the
Company the consolidated assets of which constitute 20% or more of the
consolidated assets of the Company and its consolidated subsidiaries, (iii) any
other banking subsidiary designated as a Principal Subsidiary Bank pursuant to a
Board Resolution and set forth in an Officers' Certificate delivered to the
Trustee, and (iv) any subsidiary of the Company that owns, directly or
indirectly, any voting securities, or options, warrants or rights to subscribe
for or purchase voting securities, of any Principal Subsidiary Bank under clause
(i), (ii) or (iii), and in the case of clause (i), (ii), (iii) or (iv), their
respective successors (whether by consolidation, merger, conversion, transfer of
substantially all
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their assets and business or otherwise) so long as any such successor is a
banking subsidiary (in the case of clause (i), (ii) or (iii) or a subsidiary (in
the case of clause (iv)) of the Company.
"PROCEEDING" has the meaning specified in Section 13.2.
"PROPERTY TRUSTEE" means, with respect to any Issuer Trust, the Person
identified as the "Property Trustee" in the related Trust Agreement, solely in
its capacity as Property Trustee of such Issuer Trust under such Trust Agreement
and not in its individual capacity, or its successor in interest in such
capacity, or any successor property trustee appointed as therein provided.
"REDEMPTION DATE", when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture or the terms of such Security.
"REDEMPTION PRICE", when used with respect to any Security to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"REGULAR RECORD DATE" for the interest payable on any Interest Payment
Date with respect to the Securities of a series means, unless otherwise provided
pursuant to Section 3.1 with respect to Securities of such series, the close of
business on the fifteenth day next preceding such Interest Payment Date (whether
or not a Business Day).
"RESPONSIBLE OFFICER", when used with respect to the Property Trustee
means any officer assigned to the Corporate Trust Office, including any managing
director, vice president, principal, assistant vice president, assistant
treasurer, assistant secretary or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and having direct responsibility for the administration of this
Indenture, and also, with respect to a particular matter, any other officer to
whom such matter is referred because of such officer's knowledge of and
familiarity with the particular subject.
"RIGHTS PLAN" means any plan of the Company providing for the issuance
by the Company to all holders of its Common Stock, of rights entitling the
holders thereof to subscribe for or purchase shares of any class or series of
capital stock of the Company which rights (i) are deemed to be transferred with
such shares of such Common Stock, (ii) are not exercisable, and (iii) are also
issued in respect of future issuances of such Common Stock, in each case until
the occurrence of a specified event or events.
"SECURITIES" or "SECURITY" means any debt securities or debt security,
as the case may be, authenticated and delivered under this Indenture.
"SECURITIES ACT" means the Securities Act of 1933, as modified, amended
or supplemented from time to time.
"SECURITIES REGISTER" and "SECURITIES REGISTRAR" have the respective
meanings specified in Section 3.6(a).
"SENIOR INDEBTEDNESS" means, whether recourse is to all or a portion of
the assets of the Company and whether or not contingent: (i) every obligation of
the Company for money borrowed; (ii) every obligation of the Company evidenced
by bonds, debentures, notes or other
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similar instruments, including obligations incurred in connection with the
acquisition of property, assets or businesses; (iii) every reimbursement
obligation of the Company with respect to letters of credit, bankers'
acceptances or similar facilities issued for the account of the Company; (iv)
every obligation of the Company issued or assumed as the deferred purchase price
of property or services (but excluding trade accounts payable or accrued
liabilities arising in the ordinary course of business); (v) every capital lease
obligation of the Company; (vi) every obligation of the Company for claims (as
defined in Section 101(4) of the United States Bankruptcy Code of 1978, as
amended) in respect of derivative products such as interest and foreign exchange
rate contracts, commodity contracts and similar arrangements; and (vii) every
obligation of the type referred to in clauses (i) through (vi) of another Person
the payment of which, the Company has guaranteed or is responsible or liable,
directly or indirectly, as obligor or otherwise. "Senior Indebtedness" shall not
include (i) any obligations which, by their terms, are expressly stated to rank
pari passu in right of payment with, or to not be superior in right of payment
to, the Junior Subordinated Debentures, (ii) any Senior Indebtedness of the
Company which when incurred and without respect to any election under Section
1111(b) of the United States Bankruptcy Code of 1978, as amended, was without
recourse to the Company, (iii) any indebtedness of the Company to any of its
subsidiaries, (iv) indebtedness to any executive officer or director of the
Company, or (v) any indebtedness in respect of debt securities issued to any
trust, or a trustee of such trust, partnership or other entity affiliated with
the Company that is a financing entity of the Company in connection with the
issuance of such financing entity of securities that are similar to the Capital
Securities.
"SPECIAL RECORD DATE" for the payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 3.8.
"STATED MATURITY", when used with respect to any Security or any
installment of principal thereof or interest thereon, means the date specified
pursuant to the terms of such Security as the fixed date on which the principal
of such Security or such installment of principal or interest is due and
payable, as such date may, in the case of such principal, be shortened or
extended as provided pursuant to the terms of such Security and this Indenture.
"SUBSIDIARY" means an entity more than 50% of the outstanding voting
stock of which is owned, directly or indirectly, by the Company or by one or
more other Subsidiaries, or by the Company and one or more other Subsidiaries.
For purposes of this definition, "voting stock" means stock that ordinarily has
voting power for the election of directors, whether at all times or only so long
as no senior class of stock has such voting power by reason of any contingency.
"SUCCESSOR SECURITY" of any particular Security means every Security
issued after, and evidencing all or a portion of the same debt as that evidenced
by, such particular Security; and, for the purposes of this definition, any
Security authenticated and delivered under Section 3.7 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Security.
"TAX EVENT" means the receipt by an Issuer Trust of an Opinion of
Counsel (as defined in the relevant Trust Agreement) experienced in such matters
to the effect that, as a result of any amendment to, or change (including any
announced prospective change) in, the laws (or any regulations thereunder) of
the United States or any political subdivision or taxing authority thereof or
therein, or as a result of any official or administrative pronouncement or
action or
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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 date of issuance of the Capital Securities of such Issuer Trust
(including, without limitation, any of the foregoing arising with respect to, or
resulting from, any proposal, proceeding or other action commencing on or before
such date), there is more than an insubstantial risk that (i) such Issuer Trust
is, or will be within 90 days of the delivery of such Opinion of Counsel,
subject to United States Federal income tax with respect to income received or
accrued on the corresponding series of Securities issued by the Company to such
Issuer Trust, (ii) interest payable by the Company on such corresponding series
of Securities is not, or within 90 days of the delivery of such Opinion of
Counsel will not be, deductible by the Company, in whole or in part, for United
States Federal income tax purposes, or (iii) such Issuer Trust is, or will be
within 90 days of the delivery of such Opinion of Counsel, subject to more than
a de minimis amount of other taxes, duties or other governmental charges.
"TRUST AGREEMENT" means, with respect to any Issuer Trust, the trust
agreement or other governing instrument of such Issuer Trust.
"TRUSTEE" means the Person named as the "Trustee" in the first
paragraph of this Indenture, solely in its capacity as such and not in its
individual capacity, until a successor Trustee shall have become such pursuant
to the applicable provisions of this Indenture, and thereafter "Trustee" shall
mean or include each Person who is then a Trustee hereunder 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.
"TRUST INDENTURE ACT" means the Trust Indenture Act of 1939, as
modified, amended or supplemented from time to time, except as provided in
Section 9.5.
"TRUST SECURITIES" has the meaning specified in the first recital of
this Indenture.
"VICE PRESIDENT," when used with respect to the Company, means any duly
appointed vice president, whether or not designated by a number or a word or
words added before or after the title "vice president."
SECTION 1.2. COMPLIANCE CERTIFICATE AND OPINIONS.
Upon any application or request by the Company to the Trustee to take
any action under any provision of this Indenture, the Company shall furnish to
the Trustee an Officers' Certificate stating that all conditions precedent
(including covenants compliance with which constitutes a condition precedent),
if any, provided for in this Indenture relating to the proposed action have been
complied with and an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent (including covenants compliance with
which constitutes a condition precedent), if any, have been complied with,
except that in the case of any such application or request as to which the
furnishing of such documents is specifically required by any provision of this
Indenture relating to such particular application or request, no additional
certificate or opinion need be furnished.
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Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than the
certificates provided pursuant to Section 10.4) shall include:
(1) a statement by each individual signing such certificate or opinion
that such individual has read such covenant or condition and the definitions
herein relating thereto;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions of such individual contained
in such certificate or opinion are based;
(3) a statement that, in the opinion of such individual, he or she has
made such examination or investigation as is necessary to enable him or her to
express an informed opinion as to whether or not such covenant or condition has
been complied with; and
(4) a statement as to whether, in the opinion of such individual, such
condition or covenant has been complied with.
SECTION 1.3. FORMS OF DOCUMENTS DELIVERED TO TRUSTEE.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to matters upon which his or her certificate or opinion is based
are erroneous. Any such certificate or Opinion of Counsel may be based, insofar
as it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions, or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
SECTION 1.4. ACTS OF HOLDERS.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given to or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by an agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments is or are
delivered to the
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Trustee, and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "ACT" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Indenture and (subject to Section 6.1) conclusive in favor of the Trustee and
the Company, if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by the certificate of any notary public or other officer authorized
by law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him or her the execution thereof.
Where such execution is by a Person acting in other than his or her individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his or her authority.
(c) The fact and date of the execution by any Person of any such
instrument or writing, or the authority of the Person executing the same, may
also be provided in any other manner that the Trustee deems sufficient and in
accordance with such reasonable rules as the Trustee may determine.
(d) The ownership of Securities shall be proved by the Securities
Register.
(e) Any request, demand, authorization, direction, notice, consent,
waiver or other action by the Holder of any Security shall bind every future
Holder of the same Security and the Holder of every Security issued upon the
transfer thereof or in exchange therefor or in lieu thereof in respect of
anything done or suffered to be done by the Trustee or the Company in reliance
thereon, whether or not notation of such action is made upon such Security.
(f) The Company may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities of any series entitled to
give, make or take any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Indenture to be
given, made or taken by Holders of Securities of such series, provided that the
Company may not set a record date for, and the provisions of this paragraph
shall not apply with respect to, the giving or making of any notice,
declaration, request or direction referred to in the next succeeding paragraph.
If any record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of the relevant series on such record date, and no other Holders,
shall be entitled to take the relevant action, whether or not such Holders
remain Holders after such record date, provided that no such action shall be
effective hereunder unless taken on or prior to the applicable Expiration Date
(as defined below) by Holders of the requisite principal amount of Outstanding
Securities of such series on such record date. Nothing in this paragraph shall
be construed to prevent the Company from setting a new record date for any
action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically and with
no action by any Person be cancelled and of no effect), and nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite principal amount of Outstanding Securities of the relevant
series on the date such action is taken. Promptly after any record date is set
pursuant to this paragraph, the Company, at its own expense, shall cause notice
of such record date, the proposed action by Holders and the applicable
Expiration Date to be given to the Trustee in writing and to each Holder of
Securities of the relevant series in the manner set forth in Section 1.6.
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The Trustee may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities of any series entitled to join
in the giving or making of (i) any Notice of Default, (ii) any declaration of
acceleration referred to in Section 5.2, (iii) any request to institute
proceedings referred to in Section 5.7(2), or (iv) any direction referred to in
Section 5.12, in each case with respect to Securities of such series. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of such series on such record date, and no other Holders, shall be
entitled to join in such notice, declaration, request or direction, whether or
not such Holders remain Holders after such record date, provided that no such
action shall be effective hereunder unless taken on or prior to the applicable
Expiration Date by Holders of the requisite principal amount of Outstanding
Securities of such series on such record date. Nothing in this paragraph shall
be construed to prevent the Trustee from setting a new record date for any
action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically and with
no action by any Person be cancelled and of no effect) and nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite principal amount of Outstanding Securities of the relevant
series on the date such action is taken. Promptly after any record date is set
pursuant to this paragraph, the Trustee, at the Company's expense, shall cause
notice of such record date, the proposed action by Holders and the applicable
Expiration Date to be given to the Company in writing and to each Holder of
Securities of the relevant series in the manner set forth in Section 1.6.
With respect to any record date set pursuant to this Section, the party
hereto that sets such record date may designate any day as the "Expiration Date"
and from time to time may change the Expiration Date to any earlier or later
day, provided that no such change shall be effective unless notice of the
proposed new Expiration Date is given to the other party hereto in writing, and
to each Holder of Securities of the relevant series in the manner set forth in
Section 1.6 on or prior to the existing Expiration Date. If an Expiration Date
is not designated with respect to any record date set pursuant to this Section,
the party hereto that set such record date shall be deemed to have initially
designated the 180th day after such record date as the Expiration Date with
respect thereto, subject to its right to change the Expiration Date as provided
in this paragraph. Notwithstanding the foregoing, no Expiration Date shall be
later than the 180th day after the applicable record date.
(g) Without limiting the foregoing, a Holder entitled hereunder to take
any action hereunder with regard to any particular Security may do so with
regard to all or any part of the principal amount of such Security or by one or
more duly appointed agents each of which may do so pursuant to such appointment
with regard to all or any part of such principal amount.
SECTION 1.5. NOTICES, ETC. TO TRUSTEE AND COMPANY.
Any request, demand, authorization, direction, notice, consent, waiver
or Act of Holders or other document provided or permitted by this Indenture to
be made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder, any holder of Capital Securities or the
Company shall be sufficient for every purpose hereunder if made, given,
furnished or filed in writing to or with the Trustee at its Corporate Trust
Office, or
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(2) the Company by the Trustee, any Holder or any holder of Capital
Securities shall be sufficient for every purpose (except as otherwise provided
in Section 5.1) hereunder if in writing and mailed, first class, postage
prepaid, to the Company addressed to it at the address of its principal office
specified in the first paragraph of this instrument or at any other address
previously furnished in writing to the Trustee by the Company.
SECTION 1.6. NOTICE TO HOLDERS; WAIVER.
Where this Indenture provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first class postage prepaid, to each Holder affected
by such event, at the address of such Holder as it appears in the Securities
Register, not later than the latest date, and not earlier than the earliest
date, prescribed for the giving of such notice. If, by reason of the suspension
of or irregularities in regular mail services or for any other reason, it shall
be impossible or impracticable to mail notice of any event to Holders when said
notice is required to be given pursuant to any provision of this Indenture or of
the relevant Securities, then any manner of giving such notice as shall be
satisfactory to the Trustee shall be deemed to be a sufficient giving of such
notice. In any case where notice to Holders is given by mail, neither the
failure to mail such notice, nor any defect in any notice so mailed, to any
particular Holder shall affect the sufficiency of such notice with respect to
other Holders. Where this Indenture provides for notice in any manner, such
notice may be waived in writing by the Person entitled to receive such notice,
either before or after the event, and such waiver shall be the equivalent of
such notice. Waivers of notice by Holders shall be filed with the Trustee, but
such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.
SECTION 1.7. CONFLICT WITH TRUST INDENTURE ACT.
If any provision hereof limits, qualifies or conflicts with a provision
of the Trust Indenture Act that is required under such Act to be a part of and
govern this Indenture, the provision of the Trust Indenture Act shall control.
If any provision of this Indenture modifies or excludes any provision of the
Trust Indenture Act that may be so modified or excluded, the latter provision
shall be deemed to apply to this Indenture as so modified or to be excluded, as
the case may be.
SECTION 1.8. EFFECT OF HEADINGS AND TABLE OF CONTENTS.
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
SECTION 1.9. SUCCESSORS AND ASSIGNS.
All covenants and agreements in this Indenture by the Company shall
bind its successors and assigns, whether so expressed or not.
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SECTION 1.10. SEPARABILITY CLAUSE.
If any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
SECTION 1.11. BENEFITS OF INDENTURE.
Nothing in this Indenture or in the Securities, express or implied,
shall give to any Person, other than the parties hereto and their successors and
assigns, the holders of Senior Indebtedness, the Holders of the Securities and,
to the extent expressly provided in Sections 5.2, 5.8, 5.9, 5.11, 5.13, 9.1 and
9.2, the holders of Capital Securities, any benefit or any legal or equitable
right, remedy or claim under this Indenture.
SECTION 1.12. GOVERNING LAW.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES
OF CONFLICTS OF LAWS.
SECTION 1.13. NON-BUSINESS DAYS.
If any Interest Payment Date, Redemption Date or Stated Maturity of any
Security shall not be a Business Day, then (notwithstanding any other provision
of this Indenture or the Securities) payment of interest or principal (and
premium, if any) or other amounts in respect of such Security need not be made
on such date, but may be made on the next succeeding Business Day (and no
interest shall accrue in respect of the amounts whose payment is so delayed for
the period from and after such Interest Payment Date, Redemption Date or Stated
Maturity, as the case may be, until such next succeeding Business Day) except
that, if such Business Day is in the next succeeding calendar year, such payment
shall be made on the immediately preceding Business Day (in each case with the
same force and effect as if made on the Interest Payment Date or Redemption Date
or at the Stated Maturity).
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ARTICLE II
SECURITY FORMS
SECTION 2.1. FORMS GENERALLY.
The Securities of each series and the Trustee's certificate of
authentication shall be in substantially the forms set forth in this Article, or
in such other form or forms as shall be established by or pursuant to a Board
Resolution or in one or more indentures supplemental hereto, in each case with
such appropriate insertions, omissions, substitutions and other variations as
are required or permitted by this Indenture and may have such letters, numbers
or other marks of identification and such legends or endorsements placed thereon
as may be required to comply with applicable tax laws or the rules of any
securities exchange or as may, consistently herewith, be determined by the
officers executing such securities, as evidenced by their execution of the
Securities. If the form of Securities of any series is established by action
taken pursuant to a Board Resolution, a copy of an appropriate record of such
action shall be certified by the Secretary or an Assistant Secretary of the
Company and delivered to the Trustee at or prior to the delivery of the Company
Order contemplated by Section 3.3 with respect to the authentication and
delivery of such Securities.
The Trustee's certificates of authentication shall be substantially in
the form set forth in this Article.
The definitive Securities shall be printed, lithographed or engraved or
produced by any combination of these methods, if required by any securities
exchange on which the Securities may be listed, on a steel engraved border or
steel engraved borders or may be produced in any other manner permitted by the
rules of any securities exchange on which the Securities may be listed, all as
determined by the officers executing such Securities, as evidenced by their
execution of such Securities.
Securities distributed to holders of Global Capital Securities (as
defined in the applicable Trust Agreement) upon the dissolution of an Issuer
Trust shall be distributed in the form of one or more Global Securities
registered in the name of a Depositary or its nominee, and deposited with the
Securities Registrar, as custodian for such Depositary, or with such Depositary,
for credit by the Depositary to the respective accounts of the beneficial owners
of the Securities represented thereby (or such other accounts as they may
direct). Securities distributed to holders of Capital Securities other than
Global Capital Securities upon the dissolution of an Issuer Trust shall not be
issued in the form of a Global Security or any other form intended to facilitate
book-entry trading in beneficial interests in such Securities.
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SECTION 2.2. FORM OF FACE OF SECURITY.
MAIN STREET BANCORP, INC.
[Title of Security]
CUSIP NO.
No. $
MAIN STREET BANCORP, INC., a Pennsylvania corporation (hereinafter
called the "Company", which term includes any successor Person under the
Indenture hereinafter referred to), for value received, hereby promises to
pay to_______, or registered assigns, the principal sum of ________Dollars
on_______, [IF THE SECURITY IS A GLOBAL SECURITY, THEN INSERT, IF APPLICABLE--,
or such other principal amount represented hereby as may be set forth in the
records of the Securities Registrar hereinafter referred to in accordance with
the Indenture,] [; PROVIDED that the Company may (i) shorten the Stated
Maturity of the principal of this Security to a date not earlier than________,
and (ii) extend the Stated Maturity of the principal of this Security at any
time on one or more occasions, subject to certain conditions specified in
Section 3.15 of the Indenture, but in no event to a date later than_______].
The Company further promises to pay interest on said principal from
________, or from the most recent Interest Payment Date to which interest has
been paid or duly provided for, [monthly] [quarterly] [semi-annually]
[IF APPLICABLE, INSERT--(subject to deferral as set forth herein)] in arrears
on [INSERT APPLICABLE INTEREST PAYMENT DATES] of each year, commencing
______________ at the [variable rate equal to [INSERT APPLICABLE INTEREST
RATE FORMULA]] [rate of ____%] per annum, [if applicable insert--together with
Additional Sums, if any, as provided in Section 10.6 of the Indenture,] until
the principal hereof is paid or duly provided for or made available for payment
[if applicable, insert--; provided that any overdue principal, premium or
Additional Sums and any overdue installment of interest shall bear Additional
Interest at the [variable rate equal to [INSERT APPLICABLE INTEREST RATE
FORMULA]] [rate of ____%] per annum (to the extent that the payment of such
interest shall be legally enforceable), compounded [monthly] [quarterly]
[semi-annually], from the dates such amounts are due until they are paid or
made available for payment, and such interest shall be payable on demand]. The
amount of interest payable for any period less than a full interest period
shall be computed on the basis of a 360-day year of twelve 30-day months and
the actual days elapsed in a partial month in such period. The amount of
interest payable for any full interest period shall be computed by dividing the
applicable rate per annum by [twelve/four/two]. The interest so payable, and
punctually paid or duly provided for, on any Interest Payment Date will, as
provided in the Indenture, be paid to the Person in whose name this Security
(or one or more Predecessor Securities) is registered at the close of
business on the Regular Record Date for such interest installment [IF
APPLICABLE, INSERT--, which shall be the [______or______] (whether or not
a Business Day), as the case may be, next preceding such Interest Payment
Date]. Any such interest not so punctually paid or duly provided for shall
forthwith cease to be payable to the Holder on such Regular Record Date and
may either be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee (notice whereof shall be given to Holders of Securities of this
series not less than 10 days prior to such Special Record Date) or be paid at
any time in any other lawful manner not inconsistent with the requirements of
any securities exchange on which the Securities of this series may be listed,
and
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upon such notice as may be required by such exchange, all as more fully
provided in said Indenture.
[IF APPLICABLE, INSERT--So long as no Event of Default has occurred and is
continuing, the Company shall have the right, at any time during the term of
this Security, from time to time to defer the payment of interest on this
Security for up to________consecutive [monthly] [quarterly] [semi-annual]
interest payment periods with respect to each deferral period (each an
"Extension Period") [IF APPLICABLE, INSERT--, during which Extension Periods
the Company shall have the right to make partial payments of interest on any
Interest Payment Date, and] at the end of which the Company shall pay all
interest then accrued and unpaid including Additional Interest, as provided
below; PROVIDED, HOWEVER, that no Extension Period shall extend beyond the
Stated Maturity of the principal of this Security [IF STATED MATURITY CAN BE
SHORTENED OR EXTENDED, INSERT--, as then in effect,] and no such Extension
Period may end on a date other than an Interest Payment Date; and PROVIDED,
FURTHER, however, that during any such Extension Period, the Company shall not
(i) declare or pay any dividends or distributions on, or redeem, purchase,
acquire or make a liquidation payment with respect to, any of the Company's
capital stock, or (ii) make any payment of principal of or interest or premium,
if any, on or repay, repurchase or redeem any debt securities of the Company
that rank PARI PASSU in all respects with or junior in interest to this
Security (other than (a) repurchases, redemptions or other acquisitions of
shares of capital stock of the Company in connection with any employment
contract, benefit plan or other similar arrangement with or for the benefit of
any one or more employees, officers, directors or consultants, in connection
with a dividend reinvestment or shareholder stock purchase plan or in
connection with the issuance of capital stock of the Company (or securities
convertible into or exercisable for such capital stock) as consideration
in an acquisition transaction entered into prior to the applicable Extension
Period, (b) as a result of an exchange or conversion of any class or series
of the Company's capital stock (or any capital stock of a Subsidiary of the
Company) for any class or series of the Company's capital stock or of any class
or series of the Company's indebtedness for any class or series of the
Company's capital stock, (c) the purchase of fractional interests in shares of
the Company's capital stock pursuant to the conversion or exchange provisions
of such capital stock or the security being converted or exchanged, (d) any
declaration of a dividend in connection with any Rights Plan, or the issuance
of rights, stock or other property under any Rights Plan, or the redemption
or repurchase of rights pursuant thereto, or (e) any dividend in the form of
stock, warrants, options or other rights where the dividend stock or the
stock issuable upon exercise of such warrants, options or other rights is the
same stock as that on which the dividend is being paid or ranks pari passu
with or junior to such stock). Prior to the termination of any such Extension
Period, the Company may further defer the payment of interest, PROVIDED that
no Extension Period shall exceed_______consecutive [monthly] [quarterly]
[semi-annual]interest payment periods, extend beyond the Stated Maturity of
the principal of this Security or end on a date other than an Interest
Payment Date. Upon the termination of any such Extension Period and upon the
payment of all accrued and unpaid interest and any Additional Interest then
due on any Interest Payment Date, the Company may elect to begin a new
Extension Period, subject to the above conditions. No interest shall be due
and payable during an Extension Period, except at the end thereof, but each
installment of interest that would otherwise have been due and payable during
such Extension Period shall bear Additional Interest (to the extent that the
payment of such interest shall be legally enforceable) at the [variable rate
equal to [INSERT APPLICABLE INTEREST RATE FORMULA]] [rate of ____%] per annum,
compounded [monthly] [quarterly][semi-annually] and calculated as set forth in
the first paragraph of this Security, from the date on which such amounts
would otherwise have been due and payable until
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paid or made available for payment. The Company shall give the Holder of this
Security and the Trustee notice of its election to begin any Extension Period at
least one Business Day prior to the next succeeding Interest Payment Date on
which interest on this Security would be payable but for such deferral [IF
APPLICABLE, INSERT--or so long as such securities are held by [INSERT NAME OF
APPLICABLE ISSUER TRUST], at least one Business Day prior to the earlier of (i)
the next succeeding date on which Distributions on the Capital Securities of
such Issuer Trust would be payable but for such deferral, and (ii) the date on
which the Property Trustee of such Issuer Trust is required to give notice to
holders of such Capital Securities of the record date or the date such
Distributions are payable, but in any event not less than one Business Day prior
to such record date.]
Payment of the principal of (and premium, if any) and interest on this
Security will be made at the office or agency of the Company maintained for that
purpose in the United States, 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 [IF APPLICABLE, INSERT--; PROVIDED, HOWEVER that at the option of
the Company payment of interest may be made (i) by check mailed to the address
of the Person entitled thereto as such address shall appear in the Securities
Register, or (ii) if to a Holder of $1,000,000 or more in aggregate principal
amount of this Security, by wire transfer in immediately available funds upon
written request to the Trustee not later than 15 calendar days prior to the date
on which the interest is payable].
The indebtedness evidenced by this Security is, to the extent provided
in the Indenture, subordinate and subject in right of payments to the prior
payment in full of all Senior Indebtedness, and this Security is issued subject
to the provisions of the Indenture with respect thereto. Each Holder of this
Security, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on his or her behalf to take
such actions as may be necessary or appropriate to effectuate the subordination
so provided, and (c) appoints the Trustee his or her attorney-in-fact for any
and all such purposes. Each Holder hereof, by his or her acceptance hereof,
waives all notice of the acceptance of the subordination provisions contained
herein and in the Indenture by each holder of Senior Indebtedness, whether now
outstanding or hereafter incurred, and waives reliance by each such holder upon
said provisions.
Reference is hereby made to the further provisions of this Security 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 Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
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IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
MAIN STREET BANCORP, INC.
By:
-------------------------------
Name:
Title:
Attest:
- --------------------------------
SECRETARY OR ASSISTANT SECRETARY
SECTION 2.3. FORM OF REVERSE OF SECURITY.
This Security is one of a duly authorized issue of securities of the
Company (herein called the "SECURITIES"), issued and to be issued in one or more
series under the Junior Subordinated Indenture, dated as of _______, 1999
(herein called the "INDENTURE"), between the Company and The Bank of New York,
as Trustee (herein called the "TRUSTEE", which term includes any successor
trustee under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Company, the
Trustee, the holders of Senior Indebtedness and the Holders of the Securities,
and of the terms upon which the Securities are, and are to be, authenticated and
delivered. This Security is one of the series designated on the face hereof [IF
APPLICABLE, INSERT--, limited in aggregate principal amount to $_________].
All terms used in this Security that are defined in the Indenture [IF
APPLICABLE, INSERT-- or in [insert name of trust agreement], dated as of
__________________ (as modified, amended or supplemented from time to time the
"TRUST AGREEMENT"), relating to [INSERT NAME OF ISSUER TRUST] [the ("ISSUER
TRUST") among the Company, as Depositor, the Trustees named therein and the
Holders from time to time of the Trust Securities issued pursuant thereto] shall
have the meanings assigned to them in the Indenture [IF APPLICABLE, INSERT--or
the Trust Agreement, or the Registration Rights Agreement, as the case may be].
[IF APPLICABLE, INSERT--The Company has the right to redeem this
Security (i) on or after _________, in whole at any time or in part from time to
time, or (ii) in whole (but not in part), at any time within 90 days following
the occurrence and during the continuation of a Tax Event, Investment Company
Event, or Capital Treatment Event, in each case at the Redemption Price
described below, and subject to possible regulatory approval.]
[IF APPLICABLE, INSERT--In the case of a redemption on or after
___________, the Redemption Price shall equal the following prices, expressed in
percentages of the principal amount hereof, together with accrued interest to
but excluding the date fixed for redemption, if redeemed during the 12-month
period beginning ___________:
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Redemption
YEAR Price
---- -----
and 100% on or after __________.
In the case of a redemption on or after __________ following a Tax
Event, Investment Company Event or Capital Treatment Event, the Redemption Price
shall equal the Redemption Price then applicable to a redemption under the
preceding paragraph.
[IF THE SECURITY IS SUBJECT TO REDEMPTION OF ANY KIND, INSERT--In the
event of redemption of this Security in part only, a new Security or Securities
of this series for the unredeemed portion hereof will be issued in the name of
the Holder hereof upon the cancellation hereof.]
[IF APPLICABLE, INSERT--The Indenture contains provisions for
defeasance at any time [of the entire indebtedness of this Security] [or]
[certain restrictive covenants and Events of Default with respect to this
Security] [, in each case] upon compliance by the Company with certain
conditions set forth in the Indenture.]
The Indenture permits, with certain exceptions as therein provided, the
Company and the Trustee at any time to enter into a supplemental indenture or
indentures for the purpose of modifying in any manner the rights and obligations
of the Company and of the Holders of the Securities, with the consent of the
Holders of not less than a majority in principal amount of the Outstanding
Securities of each series to be affected by such supplemental indenture. The
Indenture also contains provisions permitting Holders of specified percentages
in principal amount of the Securities of each series at the time Outstanding, on
behalf of the Holders of all Securities of such series, to waive compliance by
the Company with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Holder of this Security shall be conclusive and binding upon such Holder and
upon all future Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof,
whether or not notation of such consent or waiver is made upon this Security.
[IF THE SECURITY IS NOT A DISCOUNT SECURITY, INSERT--As provided in and
subject to the provisions of the Indenture, if an Event of Default with respect
to the Securities of this series at the time Outstanding occurs and is
continuing, then and in every such case the Trustee or the Holders of not less
than 25% in aggregate principal amount of the Outstanding Securities of this
series may declare the principal amount of all the Securities of this series to
be due and payable immediately, by a notice in writing to the Company (and to
the Trustee if given by Holders) [if applicable, insert--, provided that, if
upon an Event of Default, the Trustee or such Holders fail to declare the
principal of all the Outstanding Securities of this series to be immediately due
and payable, the Holders of at least 25% in aggregate Liquidation Amount of the
Capital Securities then outstanding shall have the right to make such
declaration by a notice in writing to the Company and the Trustee]; and upon any
such declaration the principal amount of and the accrued interest (including any
Additional Interest) on all the Securities of this series shall become
immediately due and payable, provided that the payment of principal and interest
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(including any Additional Interest) on such Securities shall remain subordinated
to the extent provided in Article XIII of the Indenture.]
[IF THE SECURITY IS A DISCOUNT SECURITY, INSERT--As provided in and
subject to the provisions of the Indenture, if an Event of Default with respect
to the Securities of this series at the time Outstanding occurs and is
continuing, then and in every such case the Trustee or the Holders of not less
than 25% in aggregate principal amount of the Outstanding Securities of this
series may declare an amount of principal of the Securities of this series to be
due and payable immediately, by a notice in writing to the Company (and to the
Trustee if given by Holders) [if applicable, insert--, provided that, if upon an
Event of Default, the Trustee or such Holders fail to declare such principal
amount of the Outstanding Securities of this series to be immediately due and
payable, the Holders of at least 25% in aggregate Liquidation Amount of the
Capital Securities then outstanding shall have the right to make such
declaration by a notice in writing to the Company and the Trustee. The principal
amount payable upon such acceleration shall be equal to--insert formula for
determining the amount]. Upon any such declaration, such amount of the principal
of and the accrued interest (including any Additional Interest) on all the
Securities of this series shall become immediately due and payable, provided
that the payment of such principal and interest (including any Additional
Interest) on all the Securities of this series shall remain subordinated to the
extent provided in Article XIII of the Indenture. Upon payment (i) of the amount
of principal so declared due and payable and (ii) of interest on any overdue
principal, premium and interest (in each case to the extent that the payment of
such interest shall be legally enforceable), all of the Company's obligations in
respect of the payment of the principal of and premium and interest, if any, on
this Security shall terminate.]
No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal of (and premium, if any) and
interest (including Additional Interest) on this Security at the times, place
and rate, and in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Security is registrable in the Securities
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company maintained under Section 10.2 of the Indenture
for such purpose, duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Company and the Securities Registrar duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Securities of this series, of like tenor,
of authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered form
without coupons in integral multiples of $10.00. Securities may be exchanged for
other Securities of like tenor, of any authorized denominations, and of like
aggregate principal amount. Any transfer, exchange or other disposition of
Securities in contravention of Section 3.6(b)(iii) of the Indenture shall be
deemed to be void and of no legal effect whatsoever, any such transferee shall
be deemed not to be the Holder or owner of any beneficial interest in such
Securities for any purpose, including but not limited to the receipt of interest
payable on such Securities, and such transferee shall be deemed to have no
interest whatsoever in such Securities. As provided in the Indenture and subject
to certain limitations therein set forth, Securities of this series are
exchangeable for a like
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aggregate principal amount of Securities of this series and of like tenor of a
different authorized denomination, as requested by the Holder surrendering the
same.
No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name this Security is registered as the owner hereof for all
purposes, whether or not this Security be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
The Company and, by its acceptance of this Security or a beneficial
interest therein, the Holder of, and any Person that acquires a beneficial
interest in, this Security agrees that for United States Federal, state and
local tax purposes it is intended that this Security constitute indebtedness.
THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
THIS SECURITY IS A DIRECT AND UNSECURED OBLIGATION OF THE COMPANY, DOES
NOT EVIDENCE DEPOSITS AND IS NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION OR ANY OTHER INSURER OR GOVERNMENT AGENCY.
SECTION 2.4. ADDITIONAL PROVISIONS REQUIRED IN GLOBAL
SECURITY.
Unless otherwise specified as contemplated by Section 3.1, any Global
Security issued hereunder shall, in addition to the provisions contained in
Sections 2.2 and 2.3, 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 A DEPOSITARY OR A NOMINEE OF A DEPOSITARY. THIS
SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME
OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN
THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND MAY
NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO
THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY, EXCEPT IN
THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
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SECTION 2.5. FORM OF TRUSTEE'S CERTIFICATE OF
AUTHENTICATION.
The Trustee's certificates of authentication shall be in substantially
the following form:
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
Dated: . THE BANK OF NEW YORK,
------------------- as Trustee
By:
------------------------------------------
Authorized Signatory
ARTICLE III
THE SECURITIES
SECTION 3.1. TITLE AND TERMS.
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. There shall be
established in or pursuant to a Board Resolution and, subject to Section 3.3,
set forth or determined in the manner provided, in an Officers' Certificate, or
established in one or more indentures supplemental hereto, prior to the issuance
of Securities as a series:
(a) the title of the securities of such series, which shall
distinguish the Securities of the series from all other Securities;
(b) the limit, if any, upon the aggregate principal amount of the
Securities of such series that 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 3.4, 3.5, 3.6, 9.6 or 11.6 and except for any
Securities that, pursuant to Section 3.3, are deemed never to have been
authenticated and delivered hereunder); provided, however, that the authorized
aggregate principal amount of such series may be increased above such amount by
a Board Resolution to such effect;
(c) the Person to whom any interest on a Security of the series shall
be payable, if other than the Person in whose name that security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest;
(d) the Stated Maturity or Maturities on which the principal of the
Securities of such series is payable or the method of determination thereof, and
any dates on which or circumstances under which, the Company shall have the
right to extend or shorten such Stated Maturity or Maturities;
(e) the rate or rates, if any, at which the Securities of such series
shall bear interest, if any, the rate or rates and extent to which Additional
Interest, if any, shall be payable with respect
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to any Securities of such series, the date or dates from which any such interest
or Additional Interest shall accrue, the Interest Payment Dates on which such
interest shall be payable, the right, pursuant to Section 3.12 or as otherwise
set forth therein, of the Company to defer or extend an Interest Payment Date,
and the Regular Record Date for the interest payable on any Interest Payment
Date or the method by which any of the foregoing shall be determined;
(f) the place or places where the principal of (and premium, if any)
and interest or Additional Interest on the Securities of such series shall be
payable, the place or places where the Securities of such series may be
presented for registration of transfer or exchange, any restrictions that may be
applicable to any such transfer or exchange in addition to or in lieu of those
set forth herein and the place or places where notices and demands to or upon
the Company in respect of the Securities of such series may be made;
(g) the period or periods within or the date or dates on which, if any,
the price or prices at which and the terms and conditions upon which the
Securities of such series may be redeemed, in whole or in part, at the option of
the Company, and if other than by a Board Resolution, the manner in which any
election by the Company to redeem such Securities shall be evidenced;
(h) the obligation or the right, if any, of the Company to redeem,
repay or purchase the Securities of such series pursuant to any sinking fund,
amortization or analogous provisions, or at the option of a Holder thereof, and
the period or periods within which, the price or prices at which, the currency
or currencies (including currency unit or units) in which and the other terms
and conditions upon which Securities of the series shall be redeemed, repaid or
purchased, in whole or in part, pursuant to such obligation;
(i) the denominations in which any Securities of such series shall be
issuable, if other than integral multiples of $10.00;
(j) if other than Dollars, the currency or currencies (including any
currency unit or units) in which the principal of (and premium, if any) and
interest and Additional Interest, if any, on the Securities of the series shall
be payable, or in which the Securities of the series shall be denominated and
the manner of determining the equivalent thereof in Dollars for purposes of the
definition of Outstanding;
(k) the additions, modifications or deletions, if any, in the Events of
Default or covenants of the Company set forth herein with respect to the
Securities of such series;
(l) if other than the principal amount thereof, the portion of the
principal amount of Securities of such series that shall be payable upon
declaration of acceleration of the Maturity thereof;
(m) if the principal amount payable at the Stated Maturity of any
Securities of the series will not be determinable as of any one or more dates
prior to the Stated Maturity, the amount which shall be deemed to be the
principal amount of such Securities as of any such date for any purpose
thereunder or hereunder, including the principal amount thereof which shall be
due and payable upon any Maturity other than the Stated Maturity or which shall
be deemed to
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be Outstanding as of any date prior to the Stated Maturity (or, in any such
case, the manner in which such amount deemed to be the principal amount shall be
determined);
(n) if applicable, that the Securities of the series, in whole or in
any specified part, shall be defeasible and, if other than by a Board
Resolution, the manner in which any election by the Company to defease such
Securities shall be evidenced;
(o) the additions or changes, if any, to this Indenture with respect to
the Securities of such series as shall be necessary to permit or facilitate the
issuance of the Securities of such series in bearer form, registrable or not
registrable as to principal, and with or without interest coupons;
(p) any index or indices used to determine the amount of payments of
principal of and premium, if any, on the Securities of such series or the manner
in which such amounts will be determined;
(q) if applicable, that any Securities of the series shall be issuable
in whole or in part in the form of one or more Global Securities and, in such
case, the respective Depositaries for such Global Securities, the form of any
legend or legends that shall be borne by any such Global Security in addition to
or in lieu of that set forth in Section 2.4 and any circumstances in addition to
or in lieu of those set forth in Section 3.5 in which any such Global Security
may be exchanged in whole or in part for Securities registered, and any transfer
of such Global Security in whole or in part may be registered, in the name or
names of Persons other than the Depositary for such Global Security or a nominee
thereof;
(r) the appointment of any Paying Agent or agents for the Securities of
such series;
(s) the terms of any right to convert or exchange Securities of such
series into any other securities or property of the Company, and the additions
or changes, if any, to this Indenture with respect to the Securities of such
series to permit or facilitate such conversion or exchange;
(t) if such Securities are to be issued to an Issuer Trust, the form or
forms of the Trust Agreement and Guarantee relating thereto;
(u) if other than as set forth herein, the relative degree, if any, to
which the Securities or the series shall be senior to or be subordinated to
other series of Securities in right of payment, whether such other series of
Securities are Outstanding or not;
(v) 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 5.2;
(w) any addition to or change in the covenants set forth in Article X
which applies to Securities of the series; and
(x) any other terms of the Securities of such series (which terms shall
not be inconsistent with the provisions of this Indenture, except as permitted
by Section 9.1()).
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All Securities of any one series shall be substantially identical
except as to denomination and except as may otherwise be provided herein or in
or pursuant to such Board Resolution and set forth, or determined in the manner
provided, in such Officers' Certificate or in any indenture supplemental hereto.
If any of the terms of the series are established by action taken
pursuant to a Board Resolution, a copy of an appropriate record of such action
shall be certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms of the series.
The securities shall be subordinated in right of payment to Senior
Indebtedness as provided in Article XIII.
SECTION 3.2. DENOMINATIONS.
The Securities of each series shall be in registered form without
coupons and shall be issuable in integral multiples of $10.00, unless otherwise
specified as contemplated by Section 3.1(i).
SECTION 3.3. EXECUTION, AUTHENTICATION, DELIVERY AND
DATING.
The Securities shall be executed on behalf of the Company by its
Chairman of the Board of Directors, its Vice Chairman of the Board of Directors,
its President or one of its Vice Presidents, under its corporate seal reproduced
or impressed thereon and attested by its Secretary or one of its Assistant
Secretaries. The signature of any of these officers on the Securities may be
manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities. At any time and from time to
time after the execution and delivery of this Indenture, the Company may deliver
Securities of any series executed by the Company to the Trustee for
authentication, together with a Company Order for the authentication and
delivery of such Securities, and the Trustee in accordance with the Company
Order shall authenticate and deliver such Securities. If the form or terms of
the Securities of the series have been established by or pursuant to one or more
Board Resolutions as permitted by Sections 2.1 and 3.1, in authenticating such
Securities, and accepting the additional responsibilities under this Indenture
in relation to such Securities, the Trustee shall be entitled to receive, and
(subject to Section 6.1) shall be fully protected in relying upon, an Opinion of
Counsel stating,
(1) if the form of such Securities has been
established by or pursuant to Board Resolution as permitted by Section
2.1, that such form has been established in conformity with the
provisions of this Indenture;
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(2) if the terms of such Securities have been
established by or pursuant to Board Resolution as permitted by Section
3.1, that such terms have been established in conformity with the
provisions of this Indenture; and
(3) that such Securities, when authenticated and
delivered by the Trustee and issued by the Company in the manner and
subject to any conditions specified in such Opinion of Counsel, will
constitute valid and legally binding obligations of the Company
enforceable in accordance with their terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar
laws of general applicability relating to or affecting creditors'
rights and to general equity principles.
If such form or terms have been so established, the Trustee shall not be
required to authenticate such Securities if the issue of such Securities
pursuant to this Indenture will affect the Trustee's own rights, duties or
immunities under the Securities and this Indenture or otherwise in a manner that
is not reasonably acceptable to the Trustee.
Notwithstanding the provisions of Section 3.1 and the preceding
paragraph, if all Securities of a series are not to be originally issued at one
time, it shall not be necessary to deliver the Officers' Certificate otherwise
required pursuant to Section 3.1 or the Company Order and Opinion of Counsel
otherwise required pursuant to such preceding paragraph at or prior to the
authentication of each Security of such series if such documents are delivered
at or prior to the authentication upon original issuance of the first Security
of such series to be issued.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose, unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by the manual signature of one of its authorized
officers or signatories, and such certificate upon any Security shall be
conclusive evidence, and the only evidence, that such Security has been duly
authenticated and delivered hereunder. Notwithstanding the foregoing, if any
Security shall have been authenticated and delivered hereunder but never issued
and sold by the Company, and the Company shall deliver such Security to the
Trustee for cancellation as provided in Section 3.10, for all purposes of this
Indenture such Security shall be deemed never to have been authenticated and
delivered hereunder and shall never be entitled to the benefits of this
Indenture.
The Trustee shall have the right to decline to authenticate and deliver
any Securities under this Section if the Trustee, being advised by counsel,
determines that such action may not lawfully be taken or if the Trustee in good
faith shall determine that such action would expose the Trustee to personal
liability to existing holders.
SECTION 3.4. TEMPORARY SECURITIES.
Pending the preparation of definitive Securities of any series, the
Company may execute, and upon receipt of a Company Order the Trustee shall
authenticate and deliver, temporary Securities that are printed, lithographed,
typewritten, mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Securities of such series in lieu
of which they are issued and with such appropriate insertions, omissions,
substitutions and
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other variations as the officers executing such Securities may determine, as
evidenced by their execution of such Securities.
If temporary Securities of any series are issued, the Company will
cause definitive Securities of such series to be prepared without unreasonable
delay. After the preparation of definitive Securities, the temporary Securities
shall be exchangeable for definitive Securities upon surrender of the temporary
Securities at the office or agency of the Company designated for that purpose
without charge to the Holder. Upon surrender for cancellation of any one or more
temporary Securities, the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor one or more definitive securities
of the same series, of any authorized denominations having the same Original
Issue Date and Stated Maturity and having the same terms as such temporary
Securities. Until so exchanged, the temporary Securities of any series shall in
all respects be entitled to the same benefits under this Indenture as definitive
Securities of such series.
SECTION 3.5. GLOBAL SECURITIES.
(a) Each Global Security issued under this Indenture shall be
registered in the name of the Depositary designated by the Company for such
Global Security or a nominee thereof and delivered to such Depositary or a
nominee thereof or custodian therefor, and each such Global Security shall
constitute a single Security for all purposes of this Indenture.
(b) Notwithstanding any other provision in this Indenture, no Global
Security may be exchanged in whole or in part for Securities registered, and no
transfer of a Global Security in whole or in part may be registered, in the name
of any Person other than the Depositary for such Global Security or a nominee
thereof unless (i) such Depositary advises the Trustee in writing that such
Depositary is no longer willing or able to properly discharge its
responsibilities as Depositary with respect to such Global Security, and the
Company is unable to locate a qualified successor, (ii) the Company executes and
delivers to the Trustee a Company Order stating that the Company elects to
terminate the book-entry system through the Depositary, or (iii) there shall
have occurred and be continuing an Event of Default or any event which after
notice or lapse of time or both would be an Event of Default.
(c) If any Global Security is to be exchanged for other Securities or
cancelled in whole, it shall be surrendered by or on behalf of the Depositary or
its nominee to the Securities Registrar for exchange or cancellation as provided
in this Article III. If any Global Security is to be exchanged for other
Securities or cancelled in part, or if another Security is to be exchanged in
whole or in part for a beneficial interest in any Global Security, then either
(i) such Global Security shall be so surrendered for exchange or cancellation as
provided in this Article III or (ii) the principal amount thereof shall be
reduced, subject to Section 3.6(b)(iii), or increased by an amount equal to the
portion thereof to be so exchanged or cancelled, or equal to the principal
amount of such other Security to be so exchanged for a beneficial interest
therein, as the case may be, by means of an appropriate adjustment made on the
records of the Securities Registrar, whereupon the Trustee, in accordance with
the Applicable Procedures, shall instruct the Depositary or its authorized
representative to make a corresponding adjustment to its records. Upon any such
surrender or adjustment of a Global Security by the Depositary, accompanied by
registration instructions, the Trustee shall, subject to Section 3.6(b) and as
otherwise provided in this Article III, authenticate and deliver any Securities
issuable in exchange for such Global
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Security (or any portion thereof) in accordance with the instructions of the
Depositary. The Trustee shall not be liable for any delay in delivery of such
instructions and may conclusively rely on, and shall be fully protected in
relying on, such instructions.
(d) Every Security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Security or any portion
thereof, whether pursuant to this Article III, Section 9.6 or 11.6 or otherwise,
shall be authenticated and delivered in the form of, and shall be, a Global
Security, unless such Security is registered in the name of a Person other than
the Depositary for such Global Security or a nominee thereof.
(e) The Depositary or its nominee, as the registered owner of a Global
Security, shall be the Holder of such Global Security for all purposes under
this Indenture and the Securities, and owners of beneficial interests in a
Global Security shall hold such interests pursuant to the Applicable Procedures.
Accordingly, any such owner's beneficial interest in a Global Security shall be
shown only on, and the transfer of such interest shall be effected only through,
records maintained by the Depositary or its nominee or agent. Neither the
Trustee nor the Securities Registrar shall have any liability in respect of any
transfers effected by the Depositary.
(f) The rights of owners of beneficial interests in a Global Security
shall be exercised only through the Depositary and shall be limited to those
established by law and agreements between such owners and the Depositary and/or
its Agent Members.
SECTION 3.6. REGISTRATION, TRANSFER AND EXCHANGE
GENERALLY; CERTAIN TRANSFERS AND EXCHANGES.
(a) The Company shall cause to be kept at the Corporate Trust Office of
the Trustee a register in which, subject to such reasonable regulations as it
may prescribe, the Company shall provide for the registration of Securities and
transfers of Securities. Such register is herein sometimes referred to as the
"SECURITIES REGISTER." The Trustee is hereby appointed "SECURITIES REGISTRAR"
for the purpose of registering Securities and transfers of Securities as herein
provided.
Upon surrender for registration of transfer of any Security at the
offices or agencies of the Company designated for that purpose, the Company
shall execute, and the Trustee shall authenticate and deliver, in the name of
the designated transferee or transferees, one or more new Securities of the same
series of any authorized denominations of like tenor and aggregate principal
amount and bearing such restrictive legends as may be required by this
Indenture.
At the option of the Holder, Securities may be exchanged for other
Securities of the same series in any authorized denominations, of like tenor and
aggregate principal amount and bearing such restrictive legends as may be
required by this Indenture, upon surrender of the Securities to be exchanged at
such office or agency. Whenever any securities are so surrendered for exchange,
the Company shall execute, and the Trustee shall authenticate and deliver, the
Securities that the Holder making the exchange is entitled to receive.
All Securities issued upon any transfer or exchange of Securities shall
be the valid obligations of the Company, evidencing the same debt, and entitled
to the same benefits under this Indenture, as the Securities surrendered upon
such transfer or exchange.
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Every Security presented or surrendered for transfer or exchange shall
(if so required by the Company or the Trustee) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Securities Registrar, duly executed by the Holder thereof or
such Holder's attorney duly authorized in writing.
No service charge shall be made to a Holder for any transfer or
exchange of Securities, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
with any transfer or exchange of Securities.
Neither the Company nor the Trustee shall be required, pursuant to the
provisions of this Section, (i) to issue, register the transfer of or exchange
any Security of any series during a period beginning at the opening of business
15 days before the day of selection for redemption of Securities of that series
pursuant to Article XI and ending at the close of business on the day of mailing
of the notice of redemption, or (ii) to register the transfer of or exchange any
Security so selected for redemption in whole or in part, except, in the case of
any such Security to be redeemed in part, any portion thereof not to be
redeemed.
(b) CERTAIN TRANSFERS AND EXCHANGES. Notwithstanding any other
provision of this Indenture, transfers and exchanges of Securities and
beneficial interests in a Global Security shall be made only in accordance with
this Section 3.6(b).
(i) NON-GLOBAL SECURITY TO NON-GLOBAL SECURITY. A Security
that is not a Global Security may be transferred, in whole or in part,
to a Person who takes delivery in the form of another Security that is
not a Global Security as provided in Section 3.6(a).
(ii) EXCHANGES BETWEEN GLOBAL SECURITY AND NON-GLOBAL
SECURITY. A beneficial interest in a Global Security may be exchanged
for a Security that is not a Global Security as provided in
Section 3.5.
(iii) Limitations Relating to Principal Amount.
Notwithstanding any other provision of this Indenture and unless
otherwise specified as permitted by Section 3.1; Securities or portions
thereof may be transferred or exchanged only in principal amounts of
not less than $10.00. Any transfer, exchange or other disposition of
Securities in contravention of this Section 3.6(b)(iii) shall be deemed
to be void and of no legal effect whatsoever, any such transferee shall
be deemed not to be the Holder or owner of any beneficial interest in
such Securities for any purpose, including but not limited to the
receipt of interest payable on such Securities, and such transferee
shall be deemed to have no interest whatsoever in such Securities.
SECTION 3.7. MUTILATED, LOST AND STOLEN SECURITIES.
If any mutilated Security is surrendered to the Trustee together with
such security or indemnity as may be required by the Company or the Trustee to
save each of them harmless, the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a new Security of the same series,
of like tenor and aggregate principal amount, bearing the same legends, and
bearing a number not contemporaneously outstanding.
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If there shall be delivered to the Company and to the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any
Security, and (ii) such security or indemnity as may be required by them to save
each of them harmless, then, in the absence of notice to the Company or the
Trustee that such Security has been acquired by a BONA FIDE purchaser, the
Company shall execute and upon its request the Trustee shall authenticate and
deliver, in lieu of any such destroyed, lost or stolen Security, a new Security
of the same series, of like tenor and aggregate principal amount and bearing the
same legends as such destroyed, lost or stolen Security, and bearing a number
not contemporaneously Outstanding.
If any such mutilated, destroyed, lost or stolen Security has become or
is about to become due and payable, the Company in its discretion may, instead
of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section 3.7, 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 issued pursuant to this Section in lieu of any
destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities of such 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 3.8. PAYMENT OF INTEREST AND ADDITIONAL INTEREST;
INTEREST RIGHTS PRESERVED.
Interest and Additional Interest on any Security of any series that is
payable, and is punctually paid or duly provided for, on any Interest Payment
Date, shall be paid to the Person in whose name that Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest in respect of Securities of such series, except
that, unless otherwise provided in the Securities of such series, interest
payable on the Stated Maturity of the principal of a Security shall be paid to
the Person to whom principal is paid. The initial payment of interest on any
Security of any series that is issued between a Regular Record Date and the
related Interest Payment Date shall be payable as provided in such Security or
in the Board Resolution pursuant to Section 3.1 with respect to the related
series of Securities.
Any interest on any Security that is due and payable, but is not timely
paid or duly provided for, on any Interest Payment Date for Securities of such
series (herein called "DEFAULTED INTEREST"), shall forthwith cease to be payable
to the registered Holder on the relevant Regular Record Date by virtue of having
been such Holder, and such Defaulted Interest may be paid by the Company, at its
election in each case, as provided in clause (1) or (2) below:
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(1) The Company may elect to make payment of any
Defaulted Interest to the Persons in whose names the Securities of such
series in respect of which interest is in default (or their respective
Predecessor Securities) are registered at the close of business on a
Special Record Date for the payment of such Defaulted Interest, which
shall be fixed in the following manner. The Company shall notify the
Trustee in writing of the amount of Defaulted Interest proposed to be
paid on each Security and the date of the proposed payment, and at the
same time the Company shall deposit with the Trustee an amount of money
equal to the aggregate amount proposed to be paid in respect of such
Defaulted Interest or shall make arrangements satisfactory to the
Trustee for such deposit prior to the date of the proposed payment,
such money when deposited to be held in trust for the benefit of the
Persons entitled to such Defaulted Interest as in this clause provided.
Thereupon, the Trustee shall fix a Special Record Date for the payment
of such Defaulted Interest, which shall be not more than 15 days and
not less than 10 days prior to the date of the proposed payment and not
less than 10 days after the receipt by the Trustee of the notice of the
proposed payment. The Trustee shall promptly notify the Company of such
Special Record Date and, in the name and at the expense of the Company,
shall cause notice of the proposed payment of such Defaulted Interest
and the Special Record Date therefor to be mailed, first class, postage
prepaid, to each Holder of a Security of such series at the address of
such Holder as it appears in the Securities Register not less than 10
days prior to such Special Record Date. The Trustee may, in its
discretion, in the name and at the expense of the Company, cause a
similar notice to be published at least once in a newspaper,
customarily published in the English language on each Business Day and
of general circulation in the Borough of Manhattan, The City of New
York, New York, but such publication shall not be a condition precedent
to the establishment of such Special Record Date. Notice of the
proposed payment of such Defaulted Interest and the Special Record Date
therefor having been mailed as aforesaid, such Defaulted Interest shall
be paid to the Persons in whose names the Securities of such series (or
their respective Predecessor Securities) are registered on such Special
Record Date and shall no longer be payable pursuant to the following
clause (2).
(2) The Company may make payment of any Defaulted
Interest in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Securities of the
series in respect of which interest is in default may be listed and,
upon such notice as may be required by such exchange (or by the Trustee
if the Securities are not listed), if, after notice given by the
Company to the Trustee of the proposed payment pursuant to this clause
(2), such payment shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section, each Security delivered
under this Indenture upon transfer of or in exchange for or in lieu of any other
Security shall carry the rights to interest accrued and unpaid, and to accrue
interest, that were carried by such other Security.
SECTION 3.9. PERSONS DEEMED OWNERS.
The Company, the Trustee and any agent of the Company or the Trustee
shall treat the Person in whose name any Security is registered as the owner of
such Security for the purpose of receiving payment of principal of and (subject
to Section 3.8) any interest on such Security and for all other purposes
whatsoever, whether or not such Security be overdue, and neither the
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Company, the Trustee nor any agent of the Company or the Trustee shall be
affected by notice to the contrary.
No holder of any beneficial interest in any Global Security held on its
behalf by a Depositary shall have any rights under this Indenture with respect
to such Global Security, and such Depositary may be treated by the Company, the
Trustee and any agent of the Company or the Trustee as the owner of such Global
Security for all purposes whatsoever. Notwithstanding the foregoing, nothing
herein shall prevent the Company, the Trustee or any agent of the Company or the
Trustee from giving effect to any written certification, proxy or other
authorization furnished by a Depositary or impair, as between a Depositary and
such holders of beneficial interests, the operation of customary practices
governing the exercise of the rights of the Depositary (or its nominee) as
Holder of any Security.
SECTION 3.10. CANCELLATION.
All Securities surrendered for payment, redemption, transfer or
exchange shall, if surrendered to any Person other than the Trustee, be
delivered to the Trustee, and any such Securities and Securities surrendered
directly to the Trustee for any such purpose shall be promptly canceled by it.
The Company may at any time deliver to the Trustee for cancellation any
Securities previously authenticated and delivered hereunder that the Company may
have acquired in any manner whatsoever, and all Securities so delivered shall be
promptly canceled by the Trustee. No Securities shall be authenticated in lieu
of or in exchange for any Securities canceled as provided in this Section,
except as expressly permitted by this Indenture. All canceled Securities shall
be destroyed by the Trustee and the Trustee shall deliver to the Company a
certificate of such destruction.
SECTION 3.11. COMPUTATION OF INTEREST.
Except as otherwise specified as contemplated by Section 3.1 for
Securities of any series, interest on the Securities of each series for any
period shall be computed on the basis of a 360-day year of twelve 30-day months
and the actual number of days elapsed in any partial month in such period, and
interest on the Securities of each series for a full period shall be computed by
dividing the rate per annum by the number of interest periods that together
constitute a full twelve months.
SECTION 3.12. DEFERRALS OF INTEREST PAYMENT DATES.
If specified as contemplated by Section 2.1 or Section 3.1 with respect
to the Securities of a particular series, so long as no Event of Default has
occurred and is continuing, the Company shall have the right, at any time during
the term of such series, from time to time to defer the payment of interest on
such Securities for such period or periods (each an "EXTENSION PERIOD") not to
exceed the number of consecutive quarterly, semi-annual or other periods that
equal five years with respect to each Extension Period, during which Extension
Periods the Company shall, if so specified as contemplated by Section 3.1, have
the right to make partial payments of interest on any Interest Payment Date. No
Extension Period shall end on a date other than an Interest Payment Date. At the
end of any such Extension Period, the Company shall pay all interest then
accrued and unpaid on the Securities (together with Additional Interest thereon,
if any, at the rate
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specified for the Securities of such series to the extent permitted by
applicable law); PROVIDED, HOWEVER, that no Extension Period shall extend beyond
the Stated Maturity of the principal of the Securities of such series; and
PROVIDED FURTHER, however, that, during any such Extension Period, the Company
shall not (i) declare or pay any dividends or distributions on, or redeem,
purchase, acquire or make a liquidation payment with respect to, any of the
Company's capital stock, or (ii) make any payment of principal of or interest or
premium, if any, on or repay, repurchase or redeem any debt securities of the
Company that rank PARI PASSU in all respects with or junior in interest to the
Securities of such series (other than (a) repurchases, redemptions or other
acquisitions of shares of capital stock of the Company in connection with any
employment contract, benefit plan or other similar arrangement with or for the
benefit of any one or more employees, officers, directors or consultants, in
connection with a dividend reinvestment or shareholder stock purchase plan or in
connection with the issuance of capital stock of the Company (or securities
convertible into or exercisable for such capital stock) as consideration in an
acquisition transaction entered into prior to the applicable Extension Period,
(b) as a result of an exchange or conversion of any class or series of the
Company's capital stock (or any capital stock of a Subsidiary of the Company)
for any class or series of the Company's capital stock or of any class or series
of the Company's indebtedness for any class or series of the Company's capital
stock, (c) the purchase of fractional interests in shares of the Company's
capital stock pursuant to the conversion or exchange provisions of such capital
stock or the security being converted or exchanged, (d) any declaration of a
dividend in connection with any Rights Plan, or the issuance of rights, stock or
other property under any Rights Plan, or the redemption or repurchase of rights
pursuant thereto, or (e) any dividend in the form of stock, warrants, options or
other rights where the dividend stock or the stock issuable upon exercise of
such warrants, options or other rights is the same stock as that on which the
dividend is being paid or ranks PARI PASSU with or junior to such stock). Prior
to that termination of any such Extension Period, the Company may further defer
the payment of interest, provided that no Event of Default has occurred and is
continuing and provided further, that no Extension Period shall exceed the
period or periods specified in such Securities, extend beyond the Stated
Maturity of the principal of such Securities or end on a date other than an
Interest Payment Date. Upon the termination of any such Extension Period and
upon the payment of all accrued and unpaid interest and any Additional Interest
then due on any Interest Payment Date, the Company may elect to begin a new
Extension Period, subject to the above conditions. No interest or Additional
Interest shall be due and payable during an Extension Period, except at the end
thereof, but each installment of interest that would otherwise have been due and
payable during such Extension Period shall bear Additional Interest as and to
the extent as may be specified as contemplated by Section 3.1. The Company shall
give the Holders of the Securities of such series and the Trustee notice of its
election to begin any such Extension Period at least one Business Day prior to
the next succeeding Interest Payment Date on which interest on Securities of
such series would be payable but for such deferral or, with respect to any
Securities of a series issued to an Issuer Trust, so long as any such Securities
are held by such Issuer Trust, at least one Business Day prior to the earlier of
(i) the next succeeding date on which Distributions on the Capital Securities of
such Issuer Trust would be payable but for such deferral, and (ii) the date on
which the Property Trustee of such Issuer Trust is required to give notice to
holders of such Capital Securities of the record date or the date such
Distributions are payable, but in any event not less than one Business Day prior
to such record date.
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The Trustee shall promptly give notice of the Company's election to
begin any such Extension Period to the Holders of the Outstanding Securities of
such series.
SECTION 3.13. RIGHT OF SET-OFF.
With respect to the Securities of a series initially issued to an
Issuer Trust, notwithstanding anything to the contrary herein, the Company shall
have the right to set off any payment it is otherwise required to make in
respect of any such Security to the extent the Company has theretofore made, or
is concurrently on the date of such payment making, a payment under the
Guarantee relating to such Security or to a holder of Capital Securities
pursuant to an action undertaken under Section 5.8 of this Indenture.
SECTION 3.14. AGREED TAX TREATMENT.
Each Security issued hereunder shall provide that the Company and, by
its acceptance of a Security or a beneficial interest therein, the Holder of,
and any Person that acquires a beneficial interest in, such Security agree that
for United States Federal, state and local tax purposes it is intended that such
Security constitutes indebtedness.
SECTION 3.15. SHORTENING OR EXTENSION OF STATED MATURITY.
If specified as contemplated by Section 2.1 or Section 3.1 with respect
to the Securities of a particular series, the Company shall have the right to
(i) shorten the Stated Maturity of the principal of the Securities of such
series at any time to any date and (ii) extend the Stated Maturity of the
principal of the Securities of such series at any time at its election for one
or more periods, provided that, if the Company elects to exercise its right to
extend the Stated Maturity of the principal of the Securities of such series
pursuant to clause (ii) above, at the time such election is made and at the time
of extension, such conditions as may be specified in such Securities shall have
been satisfied.
SECTION 3.16. 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
notice of redemption and other similar or related materials as a convenience to
Holders; provided that any such notice or other materials may state that no
representation is made as to the correctness of such numbers either as printed
on the Securities or as contained in any notice of redemption or other materials
and that reliance may be placed only on the other identification numbers printed
on the Securities, and any such redemption shall not be affected by any defect
in or omission of such numbers.
ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 4.1. SATISFACTION AND DISCHARGE OF INDENTURE.
This Indenture shall, upon Company Request, cease to be of further
effect (except as to any surviving rights of registration of transfer or
exchange of Securities herein expressly
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provided for and as otherwise provided in this Section 4.1) and the Trustee, on
demand of and at the expense of the Company, shall execute proper instruments
acknowledging satisfaction and discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and
delivered (other than (i) Securities that have been destroyed,
lost or stolen and that have been replaced or paid as provided
in Section 3.7 and (ii) Securities for whose payment money has
theretofore been deposited in trust or segregated and held in
trust by the Company and thereafter repaid to the Company or
discharged from such trust, as provided in Section 10.3) have
been delivered to the Trustee for cancellation; or
(B) all such Securities not theretofore delivered to
the Trustee for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their
Stated Maturity within one year of the date of
deposit, or
(iii) 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, in the case of subclause (B)(i), (ii) or (iii) above,
has deposited or caused to be deposited with the Trustee as trust funds
in trust for such purpose an amount in the currency or currencies in
which the Securities of such series are payable sufficient to pay and
discharge the entire indebtedness on such Securities not theretofore
delivered to the Trustee for cancellation, for the principal (and
premium, if any) and interest (including any Additional Interest) to
the date of such deposit (in the case of Securities that have become
due and payable) or to the Stated Maturity or Redemption Date, as the
case may be;
(2) the Company has paid or caused to be paid all
other sums payable hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel each stating that all conditions
precedent herein provided relating to the satisfaction and discharge of
this Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 6.7, the
obligations of the Trustee to any Authenticating Agent under Section
6.14 and, if money shall have been deposited with the Trustee pursuant
to subclause (B) of clause (1) of this Section, the obligations of the
Trustee under Section 4.2 and the last paragraph of Section 10.3 shall
survive.
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Notwithstanding the foregoing, in any case where the Securities are not due and
payable and have not been called for redemption, such Securities shall remain
recourse obligations of the Company.
SECTION 4.2 APPLICATION OF TRUST MONEY.
Subject to the provisions of the last paragraph of Section 10.3, all
money deposited with the Trustee pursuant to Section 4.1 shall be held in trust
and applied by the Trustee, in accordance with the provisions of the Securities
and this Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal (and premium, if
any) and interest and Additional Interest for the payment of which such money or
obligations have been deposited with or received by the Trustee.
ARTICLE V
REMEDIES
SECTION 5.1. EVENTS OF DEFAULT.
"EVENT OF DEFAULT", wherever used herein with respect to the Securities
of any series, means any one of the following events (whatever the reason for
such Event of Default and whether it shall be voluntary or involuntary or be
effected by operation of law or pursuant to any judgment, decree or order of any
court or any order, rule or regulation of any administrative or governmental
body):
(1) default in the payment of any interest upon any Security
of that series, including any Additional Interest in respect thereof,
when it becomes due and payable, and continuance of such default for a
period of 30 days (subject to the deferral of any due date in the case
of any Extension Period); or
(2) default in the payment of the principal of (or premium, if
any, on) any Security of that series at its Maturity; or
(3) failure on the part of the Company duly to observe or
perform any other of the covenants or agreements on the part of the
Company in the Securities of that series or in this Indenture for a
period of 90 days after the date on which written notice of such
failure, requiring the Company to remedy the same, shall have been
given to the Company by the Trustee by registered or certified mail or
to the Company and the Trustee by the Holders of at least 25% in
aggregate principal amount of the Outstanding Securities of that
series; or
(4) entry by a court having jurisdiction in the premises of
(A) a decree or order for relief in respect of the Company in an
involuntary case or proceeding under any applicable federal or state
bankruptcy, insolvency, reorganization or other similar law or (B) a
decree or order adjudging the Company a bankrupt or insolvent, or
approving as properly filed a petition seeking reorganization,
arrangement, adjustment or composition
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of or in respect of the Company under any applicable federal or state
law, at appointing a custodian, receiver, liquidator, assignee,
trustee, sequestrator or other similar official of the Company or of
substantially all of the property of the Company, or ordering the
winding-up or liquidation of its affairs, and the continuance of any
such decree of order for relief or any such other decree or order
unstayed and in effect for a period of 90 consecutive days; or
(5) (A) the commencement by the Company of a voluntary case or
proceeding under any applicable federal or state bankruptcy,
insolvency, reorganization or other similar law or of any other case or
proceeding to be adjudicated a bankrupt or insolvent, or (B) the
consent by the Company or the entry of a decree of order for relief in
respect of itself in an involuntary case or proceeding under any
applicable federal or state bankruptcy, insolvency, reorganization or
other similar law or to the commencement of any bankruptcy or
insolvency case or proceeding against the Company, or (C) the filing by
the Company of a petition or answer or consent seeking reorganization
or relief under any applicable federal or state law or (D) the consent
by the Company to the filing of such petition or to the appointment of
or taking possession by a custodian, receiver, liquidator, assignee,
trustee, sequestrator or other similar official of the Company or of
all or substantially all of the property of the Company, or (E) the
making by the Company of an assignment for the benefit of creditors; or
(6) any other Event of Default provided with respect to
Securities of that series.
SECTION 5.2. ACCELERATION OF MATURITY; RESCISSION AND
ANNULMENT.
If an Event of Default (other than an Event of Default specified in
Section 5.1(4) or 5.1(5)) with respect to Securities of any series at the time
Outstanding occurs and is continuing, then, and in every such case, the Trustee
or the Holders of not less than 25% in aggregate principal amount of the
Outstanding Securities of that series may declare the principal amount (or, if
the Securities of that series are Discount Securities, such portion of the
principal amount as may be specified in the terms of that series) of all the
Securities of that series to be due and payable immediately, by a notice in
writing to the Company (and to the Trustee if given by Holders), PROVIDED that,
in the case of the Securities of a series issued to an Issuer Trust, if, upon an
Event of Default, the Trustee or the Holders of not less than 25% in principal
amount of the Outstanding Securities of such series fail to declare the
principal of all the Outstanding Securities of such series to be immediately due
and payable, the holders of at least 25% in aggregate Liquidation Amount of the
related series of Capital Securities issued by such Issuer Trust then
outstanding shall have the right to make such declaration by a notice in writing
to the Company and the Trustee; and upon any such declaration such principal
amount (or specified portion thereof) of and the accrued interest (including any
Additional Interest) on all the Securities of such series shall become
immediately due and payable. If an Event of Default specified in Section 5.1(4)
or 5.1(5) with respect to Securities of any series at the time Outstanding
occurs, the principal amount of all the Securities of such series (or, if the
Securities of such series are Discount Securities, such portion of the principal
amount of such Securities as may be specified by the terms of that series) shall
automatically, and without any declaration or other action on the part of the
Trustee or any Holder, become immediately due and payable. Payment of principal
and interest (including any Additional Interest) on such Securities shall remain
subordinated to
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the extent provided in Article XIII notwithstanding that such amount shall
become immediately due and payable as herein provided.
At any time after such a declaration of acceleration with respect to
Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in this
Article provided, the Holders of a majority in aggregate principal amount of the
Outstanding Securities of that series, by written notice to the Company and the
Trustee, may rescind and annul such declaration and its consequences if:
(1) the Company has paid or deposited with the Trustee a sum
sufficient to pay:
(A) all overdue installments of interest on all
Securities of such series;
(B) any accrued Additional Interest on all Securities
of such series;
(C) the principal of (and premium, if any, on) any
Securities of such series that have become due otherwise than
by such declaration of acceleration and interest and
Additional Interest thereon at the rate borne by the
Securities; and
(D) all sums paid or advanced by the Trustee
hereunder and the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and
counsel; and
(2) all Events of Default with respect to Securities of that
series, other than the non-payment of the principal of Securities of
that series that has become due solely by such acceleration, have been
cured or waived as provided in Section 5.13.
In the case of Securities of a series initially issued to an Issuer
Trust, if the Holders of such Securities fail to annul such declaration and
waive such default, the holders of a majority in aggregate Liquidation Amount of
the related series of Capital Securities issued by such Issuer Trust then
outstanding shall also have the right to rescind and annul such declaration and
its consequences by written notice to the Company and the Trustee, subject to
the satisfaction of the conditions set forth in clauses (1) and (2) above of
this section 5.2.
No such rescission shall affect any subsequent default or Event of Default or
impair any right consequent thereon.
SECTION 5.3. COLLECTION OF INDEBTEDNESS AND SUITS FOR
ENFORCEMENT BY TRUSTEE.
The Company covenants that if:
(1) default is made in the payment of any installment of
interest (including any Additional Interest) on any Security of any
series when such interest becomes due and payable and such default
continues for a period of 30 days, or
(2) default is made in the payment of the principal of (and
premium, if any, on) any Security at the Maturity thereof,
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the Company will, upon demand of the Trustee, pay to the Trustee, for
the benefit of the Holders of such Securities, the whole amount then
due and payable on such Securities for principal (and premium, if any)
and interest (including any Additional Interest), and, in addition
thereto, all amounts owing the Trustee under Section 6.7.
If the Company fails to pay such amounts forthwith upon such demand,
the Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, and may
prosecute such proceeding to judgment or final decree, and may enforce the same
against the Company or any other obligor upon such Securities and collect the
monies adjudged or decreed to be payable in the manner provided by law out of
the property of the Company or any other obligor upon the Securities, wherever
situated.
If an Event of Default with respect to 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 5.4. TRUSTEE MAY FILE PROOFS OF CLAIM.
In case of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial or
administrative 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,
(a) the Trustee (irrespective of whether the principal of the
Securities of any series 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 (and
premium, if any) or interest (including any Additional Interest)) shall be
entitled and empowered, by intervention in such proceeding or otherwise,
(i) to file and prove a claim for the whole amount of
principal (and premium, if any) and interest (including any Additional
Interest) owing and unpaid in respect to the Securities and to file
such other papers or documents as may be necessary or advisable and to
take any and all actions as are authorized under the Trust Indenture
Act in order to have the claims of the Holders and any predecessor to
the Trustee under Section 6.7 allowed in any such judicial or
administrative proceedings; and
(ii) in particular, the Trustee shall be authorized to collect and
receive any monies or other property payable or deliverable on any such
claims and to distribute the same in accordance with Section 5.6; and
(b) any custodian, receiver, assignee, trustee, liquidator,
sequestrator, conservator (or other similar official) in any such judicial or
administrative proceeding is hereby authorized by each Holder to make such
payments to the Trustee for distribution in accordance with Section
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5.6, 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 to it and
any predecessor Trustee under Section 6.7.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to 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; provided, however,
that the Trustee may, on behalf of the Holders, vote for the election of a
trustee in bankruptcy or similar official and be a member of a creditors' or
other similar committee.
SECTION 5.5. TRUSTEE MAY ENFORCE CLAIM WITHOUT POSSESSION
OF SECURITIES.
All rights of action and claims under this Indenture or the Securities
may be prosecuted and enforced by the Trustee without the possession of any of
the Securities or the production thereof in any proceeding relating thereto, and
any such proceeding instituted by the Trustee shall be brought in its own name
as trustee of an express trust, and any recovery of judgment shall, subject to
Article XIII and after provision for the payment of all the amounts owing the
Trustee and any predecessor Trustee under Section 6.7, 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 5.6 APPLICATION OF MONEY COLLECTED.
Any money or property collected or to be applied by the Trustee with
respect to a series of Securities 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 or property on account of principal (or premium,
if any) or interest (including any Additional 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 and any
predecessor Trustee under Section 6.7;
SECOND: Subject to Article XIII, to the payment of the amounts then due
and unpaid upon Securities of such series for principal (and premium, if any)
and interest (including any Additional Interest) in respect of which or for the
benefit of which such money has been collected, ratably, without preference or
priority of any kind, according to the amounts due and payable on such series of
Securities for principal (and premium, if any) and interest (including any
Additional Interest), respectively; and
THIRD: The balance, if any, to the Person or Persons entitled thereto.
SECTION 5.7 LIMITATION ON SUITS.
Subject to Section 5.8, no Holder of any Securities of any series shall
have any right to institute any proceeding, judicial or otherwise, with respect
to this Indenture or for the
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appointment of a receiver, assignee, trustee, liquidator, sequestrator (or other
similar official) or for any other remedy hereunder, unless:
(1) such Holder has previously given written notice to the
Trustee of a continuing Event of Default with respect to the Securities
of that series;
(2) the Holders of not less than 25% in aggregate 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;
(3) such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and liabilities to be
incurred in compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such
proceeding; and
(5) 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 aggregate principal amount of the 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 itself of, any provision of this Indenture to affect, disturb
or prejudice the rights of any other Holders of Securities, or to
obtain or to seek to obtain priority or preference over any other of
such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all
such Holders.
SECTION 5.8. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE
PRINCIPAL, PREMIUM AND INTEREST; DIRECT
ACTION BY HOLDERS OF CAPITAL SECURITIES.
Notwithstanding any other provision in this Indenture, the Holder of
any Security of any series shall have the right, which is absolute and
unconditional, to receive payment of the principal of (and premium, if any) and
(subject to Sections 3.8 and 3.12) interest (including any Additional Interest)
on such Security on the respective 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 right shall not be impaired
without the consent of such Holder. In the case of Securities of a series issued
to an Issuer Trust, any registered holder of the series of Capital Securities
issued by such Issuer Trust shall have the right, upon the occurrence of an
Event of Default described in Section 5.1(1) or 5.1(2), to institute a suit
directly against the Company for enforcement of payment to such holder of
principal of (premium, if any) and (subject to Sections 3.8 and 3.12) interest
(including any Additional Interest) on the Securities having a principal amount
equal to the aggregate Liquidation Amount of such Capital Securities held by
such holder.
SECTION 5.9. RESTORATION OF RIGHTS AND REMEDIES.
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If the Trustee, any Holder or any holder of Capital Securities issued
by any Issuer Trust has instituted any proceeding to enforce any right or remedy
under this Indenture and such proceeding has been discontinued or abandoned for
any reason, or has been determined adversely to the Trustee, such Holder or such
holder of Capital Securities, then, and in every such case, the Company, the
Trustee, such Holders and such holder of Capital Securities shall, subject to
any determination in such proceeding, be restored severally and respectively to
their former positions hereunder, and thereafter all rights and remedies of the
Trustee, such Holder and such holder of Capital Securities shall continue as
though no such proceeding had been instituted.
SECTION 5.10. RIGHTS AND REMEDIES CUMULATIVE.
Except as otherwise provided in the last paragraph of Section 3.7, no
right or remedy herein conferred upon or reserved to the Trustee or the Holders
is intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
SECTION 5.11. DELAY OR OMISSION NOT WAIVER.
No delay or omission of the Trustee, any Holder of any Security with
respect to the Securities of the related series or any holder of any Capital
Security to exercise any right or remedy accruing upon any Event of Default with
respect to the Securities of the related series 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 and the right and remedy given to the holders of Capital
Securities by Section 5.8 may be exercised from time to time, and as often as
may be deemed expedient, by the Trustee, the Holders or the holders of Capital
Securities, as the case may be.
SECTION 5.12. CONTROL BY HOLDERS.
The Holders of not less than a majority in aggregate 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:
(1) such direction shall not be in conflict with any rule of
law or with this Indenture;
(2) the Trustee may take any other action deemed proper by the
Trustee that is not inconsistent with such direction; and
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(3) subject to the provisions of Section 6.1, the Trustee
shall have the right to decline to follow such direction if a
Responsible Officer or Officers of the Trustee shall, in good faith,
determine that the proceeding so directed would be unjustly prejudicial
to the Holders not joining in any such direction or would involve the
Trustee in personal liability.
SECTION 5.13. WAIVER OF PAST DEFAULTS.
The Holders of not less than a majority in aggregate principal amount
of the Outstanding Securities of any series affected thereby and, in the case of
any Securities of a series initially issued to an Issuer Trust, the holders of a
majority in aggregate Liquidation Amount of the Capital Securities issued by
such Issuer Trust may waive any past default hereunder and its consequences with
respect to such series except a default:
(1) in the payment of the principal of (or premium, if any) or
interest (including any Additional Interest) on any Security of such
series (unless such default has been cured and the Company has paid to
or deposited with the Trustee a sum sufficient to pay all matured
installments of interest (including Additional Interest) and all
principal of (and premium, if any, on) all Securities of that series
due otherwise than by acceleration); or
(2) in respect of a covenant or provision hereof that under
Article IX cannot be modified or amended without the consent of each
Holder of any Outstanding Security of such series affected.
Any such waiver shall be deemed to be on behalf of the Holders of all
the Securities of such series, or in the case of waiver by holders of Capital
Securities issued by such Issuer Trust, by all holders of Capital Securities
issued by such Issuer Trust.
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 Event of Default or impair any right consequent thereon.
SECTION 5.14. UNDERTAKING FOR COSTS.
All parties to this Indenture agree, and each Holder of any Security by
his acceptance thereof shall be deemed to have agreed, that any court may, in
its discretion, require, in any suit for the enforcement of any right or remedy
under this Indenture, or in any suit against the Trustee for any action taken or
omitted by it as Trustee, the filing by any party litigant in 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
Trustee, to any suit instituted by any Holder, or group of Holders, holding in
the aggregate more than 10% in aggregate 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
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interest (including any Additional Interest) on any Security on or after the
respective Stated Maturities expressed in such Security.
SECTION 5.15. WAIVER OF USURY, STAY OR EXTENSION LAWS.
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any usury, stay or extension law wherever
enacted, now or at any time hereafter in force, which may affect the covenants
or the performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
ARTICLE VI
THE TRUSTEE
SECTION 6.1. CERTAIN DUTIES AND RESPONSIBILITIES.
(a) Except during the continuance of an Event of Default,
(1) the Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture, and no
implied covenants or obligations shall be read into this Indenture
against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements of
this Indenture, but in the case of any such certificates or opinions
that by any provisions hereof are specifically required to be furnished
to the Trustee, the Trustee shall be under a duty to examine the same
to determine whether or not they conform to the requirements of this
Indenture.
(b) In case an Event of Default has occurred and is continuing, the
Trustee shall exercise such of 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 person would exercise or use under the circumstances in the conduct of
his or her own affairs.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct except that
(1) this subsection shall not be construed to limit the
effect of subsection (a) of this Section;
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(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it shall be proved
that the Trustee was negligent in ascertaining the pertinent facts; and
(3) the Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with the
direction of Holders pursuant to Section 5.12 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 a
series.
(d) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder, or in the exercise of any of its
rights or powers, if there shall be reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.
(e) Whether or not therein expressly so provided, every provision of
this Indenture relating to the conduct or affecting the liability of or
affording protection to the Trustee shall be subject to the provisions of this
Section.
SECTION 6.2. NOTICE OF DEFAULTS.
Within 90 days after actual knowledge by a Responsible Officer of the
Trustee of the occurrence of any default hereunder with respect to the
Securities of any series, the Trustee shall transmit by mail to all Holders of
Securities of such series, as their names and addresses appear in the Securities
Register, notice of such default, unless such default shall have been cured or
waived; PROVIDED, HOWEVER, that, except in the case of a default in the payment
of the principal of (or premium, if any) or interest (including any Additional
Interest) on any Security of such series, the Trustee shall be protected in
withholding such notice if and so long as the board of directors, the executive
committee or a trust committee of directors and/or Responsible Officers of the
Trustee in good faith determines that the withholding of such notice is in the
interests of the Holders of Securities of such series; and PROVIDED FURTHER,
that, in the case of any default of the character specified in Section 5.1(3),
no such notice to Holders of Securities of such series shall be given until at
least 30 days after the occurrence thereof. For the purpose of this Section, the
term "DEFAULT" means any event that is, or after notice or lapse of time or both
would become, an Event of Default with respect to Securities of such series.
SECTION 6.3. CERTAIN RIGHTS OF TRUSTEE.
Subject to the provisions of Section 6.1:
(a) the Trustee conclusively may rely and shall be protected in acting
or refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, Security or other paper or document believed by it to be genuine and
to have been signed or presented by the proper party or parties;
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(b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any resolution
of the Board of Directors may be sufficiently evidenced by a Board Resolution;
(c) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other evidence
be herein specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officers' Certificate;
(d) the Trustee may consult with counsel of its selection 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 in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders pursuant to this Indenture, unless such Holders shall have
offered to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities that might be incurred by it in compliance with such
request or direction;
(f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, indenture,
Security or other paper or document, but the Trustee in its discretion may make
such inquiry or investigation into such facts or matters as it may see fit, and,
if the Trustee shall determine to make such inquiry or investigation, it shall
be entitled to examine the books, records and premises of the Company,
personally or by agent or attorney at the sole cost of the Company;
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder;
(h) the Trustee shall not be liable for any action taken, suffered, or
omitted to be taken by it in good faith and reasonably believed by it to be
authorized or within the discretion or rights or powers conferred upon it by
this Indenture.
(i) 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 of this Indenture; and
(j) the rights privileges, protections, immunities and benefits given
to the Trustee, including, without limitation, its right to be indemnified, are
extended to, and shall be enforceable by, the Trustee in each of its capacities
hereunder, and to each agent, custodian and other Person employed to act
hereunder.
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SECTION 6.4. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF
SECURITIES.
The recitals contained herein and in the Securities, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and neither the Trustee nor any Authenticating Agent assumes any
responsibility for their correctness. The Trustee makes no representations as to
the validity or sufficiency of this Indenture or of the Securities. Neither the
Trustee nor any Authenticating Agent shall be accountable for the use or
application by the Company of the Securities or the proceeds thereof.
SECTION 6.5. MAY HOLD SECURITIES.
The Trustee, any Authenticating Agent, any Paying Agent, any Securities
Registrar or any other agent of the Company, in its individual or any other
capacity, may become the owner or pledgee of Securities and, subject to Sections
6.8 and 6.13, may otherwise deal with the Company with the same rights it would
have if it were not Trustee, Authenticating Agent, Paying Agent, Securities
Registrar or such other agent.
SECTION 6.6. MONEY HELD IN TRUST.
Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. The Trustee shall be
under no liability for interest on any money received by it hereunder except as
otherwise agreed with the Company.
SECTION 6.7. COMPENSATION AND REIMBURSEMENT.
(a) The Company agrees to pay to the Trustee from time to time such
compensation as shall be agreed to in writing from time to time by the Company
and the Trustee for all services rendered by it hereunder in such amounts as the
Company and the Trustee shall agree from time to time (which compensation shall
not be limited by any provision of law in regard to the compensation of a
trustee of an express trust).
(b) The Company agrees to reimburse the Trustee upon its request for
all reasonable expenses, disbursements and advances incurred or made by the
Trustee in accordance with any provision of this Indenture (including the
reasonable compensation and the expenses and disbursements of its agents and
counsel), except any such expense, disbursement or advance as may be
attributable to its negligence or bad faith.
(c) Since the Issuer Trust is being formed solely to facilitate an
investment in the Trust Securities, the Company, as Depositor of the Issuer
Trust under the Trust Agreement, hereby covenants to pay all debts and
obligations (other than with respect to the Capital Securities and the Common
Securities) and all reasonable costs and expenses of the Issuer Trust (including
without limitation all reasonable costs and expenses relating to the
organization of the Issuer Trust, the fees and expenses of the trustees and all
costs and expenses relating to the operation of the Issuer Trust) and to pay any
and all taxes, duties, assessments or governmental charges of whatever nature
(other than withholding taxes) imposed on the Issuer Trust by the United States,
or any taxing authority, so that the net amounts received and retained by the
Issuer Trust and the Property Trustee after paying such expenses will be equal
to the amounts the Issuer
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Trust and the Property Trustee would have received had no such costs or expenses
been incurred by or imposed on the Issuer Trust. The foregoing obligations of
the Company are for the benefit of, and shall be enforceable by, any person to
whom any such debts, obligations, costs, expenses and taxes are owed (each, a
"Creditor") whether or not such Creditor has received notice thereof. Any such
Creditor may enforce such obligations directly against the Company, and the
Company irrevocably waives any right or remedy to require that any such Creditor
take any action against the Issuer Trust or any other person before proceeding
against the Company. The Company shall execute such additional agreements as may
be necessary or desirable to give full effect to the foregoing.
(d) The Company shall indemnify the Trustee and any predecessor Trustee
for, and hold it harmless against, any loss, liability or expense (including the
reasonable compensation and the expenses and disbursements of its agents and
counsel) incurred without negligence or bad faith, arising out of or in
connection with the acceptance or administration of this trust or the
performance of its duties hereunder, including the reasonable costs and expenses
of defending itself against any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder. This
indemnification shall survive the termination of this Indenture or the
resignation or removal of the Trustee.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 5.1(4) or 5.1(5) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under the Bankruptcy Reform Act of 1978 or any successor statute.
SECTION 6.8. DISQUALIFICATION; CONFLICTING INTERESTS.
The Trustee for the Securities of any series issued hereunder shall be
subject to the provisions of Section 310(b) of the Trust Indenture Act. Nothing
herein shall prevent the Trustee from filing with the Commission the application
referred to in the second to last paragraph of said Section 310(b).
SECTION 6.9. CORPORATE TRUSTEE REQUIRED; ELIGIBILITY.
There shall at all times be a Trustee hereunder which shall be:
(a) an entity organized and doing business under the laws of the United
States of America or of any state or territory thereof or of the District of
Columbia, authorized under such laws to exercise corporate trust powers and
subject to supervision or examination by Federal, state, territorial or District
of Columbia authority; or
(b) an entity or other Person organized and doing business under the
laws of a foreign government that is permitted to act as Trustee pursuant to a
rule, regulation or order of the Commission, authorized under such laws to
exercise corporate trust powers, and subject to supervision or examination by
authority of such foreign government or a political subdivision thereof
substantially equivalent to supervision or examination applicable to United
States institutional trustees;
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in either case having a combined capital and surplus of at least $50,000,000 and
subject to supervision or examination by Federal or state authority. If such
entity publishes reports of condition at least annually, pursuant to law or to
the requirements of the aforesaid supervising or examining authority, then, for
the purposes of this Section, the combined capital and surplus of such entity
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. If at any time the Trustee shall cease
to be eligible in accordance with the provisions of this Section, it shall
resign immediately in the manner and with the effect hereinafter specified in
this Article. Neither the Company nor any Person directly or indirectly
controlling, controlled by or under common control with the Company shall serve
as Trustee for the Securities of any series issued hereunder.
SECTION 6.10. RESIGNATION AND REMOVAL; APPOINTMENT OF
SUCCESSOR.
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 6.11.
(b) The Trustee may resign at any time with respect to the Securities
of one or more series by giving written notice thereof to the Company. If an
instrument of acceptance by a successor Trustee shall not have been delivered to
the Trustee within 30 days after the giving of such notice of resignation, the
resigning Trustee may petition any court of competent jurisdiction for the
appointment of a successor Trustee with respect to the Securities of such
series.
(c) The Trustee may be removed at any time with respect to the
Securities of any series by Act of the Holders of a majority in aggregate
principal amount of the Outstanding Securities of such series, delivered to the
Trustee and to the Company.
If an instrument of acceptance by a successor Trustee shall not have
been delivered to the Trustee within 30 days after giving of such notice of
removal, the Trustee being removed may petition, at the expense of the Company,
any court of competent jurisdiction for the appointment of a successor Trustee
with respect to the Securities of such series.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 6.8 after
written request therefor by the Company or by any Holder who has been a
bona fide Holder of a Security for at least six months; or
(2) the Trustee shall cease to be eligible under Section 6.9
and shall fail to resign after written request therefor by the Company
or by any such Holder; or
(3) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of its
property shall be appointed or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation;
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then, in any such case, (i) the Company, acting pursuant to the authority of a
Board Resolution, may remove the Trustee with respect to the Securities of all
series issued hereunder, or (ii) subject to Section 5.14, any Holder who has
been a bona fide Holder of a Security for at least six months may, on behalf of
such Holder and all others similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee with respect to the Securities of
all series issued hereunder and the appointment of a successor Trustee or
Trustees.
(e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause with
respect to the Securities of one or more series, the Company, by a Board
Resolution, shall promptly appoint a successor Trustee with respect to the
Securities of that or those series. If, within one year after such resignation,
removal or incapability, or the occurrence of such vacancy, a successor Trustee
with respect to the Securities of any series shall be appointed by Act of the
Holders of a majority in aggregate principal amount of the Outstanding
Securities of such series delivered to the Company and the retiring Trustee, the
successor Trustee so appointed shall, forthwith upon its acceptance of such
appointment, become the successor Trustee with respect to the Securities of such
series and supersede the successor Trustee appointed by the Company. If no
successor Trustee with respect to the Securities of any series shall have been
so appointed by the Company or the Holders and accepted appointment in the
manner hereinafter provided, any Holder who has been a bona fide Holder of a
Security of such series for at least six months may, subject to Section 5.14, on
behalf of such Holder and all others similarly situated, petition any court of
competent jurisdiction for the appointment of a successor Trustee with respect
to the Securities of such series.
(f) The Company shall give notice of each resignation and each removal
of the Trustee with respect to the Securities of any series and each appointment
of a successor Trustee with respect to the Securities of any series by mailing
written notice of such event by first-class mail, postage prepaid, to the
Holders of Securities of such series as their names and addresses appear in the
Securities Register. Each notice shall include the name of the successor Trustee
with respect to the Securities of such series and the address of its Corporate
Trust Office.
SECTION 6.11. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.
(a) In case of the appointment hereunder of a successor Trustee with
respect to all Securities, every such successor Trustee so appointed shall
execute, acknowledge and deliver to the Company and to the retiring Trustee an
instrument accepting such appointment, and thereupon the resignation or removal
of the retiring Trustee shall become effective and such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee; but, on the request
of the Company or the successor Trustee, such retiring Trustee shall, upon
payment of its charges, execute and deliver an instrument transferring to such
successor Trustee all the rights, powers and trusts of the retiring Trustee and
shall duly assign, transfer and deliver to such successor Trustee all property
and money held by such retiring Trustee hereunder.
(b) In case of the appointment hereunder of a successor Trustee with
respect to the Securities of one or more (but not all) series, the Company, the
retiring Trustee and each successor Trustee with respect to the Securities of
one or more series shall execute and deliver an indenture supplemental hereto
wherein each successor Trustee shall accept such appointment and
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which (1) shall contain such provisions as shall be necessary or desirable to
transfer and confirm to, and to vest in, each successor Trustee all the rights,
powers, trusts and duties of the retiring Trustee with respect to the Securities
of that or those series to which the appointment of such successor Trustee
relates, (2) if the retiring Trustee is not retiring with respect to all
Securities, shall contain such provisions as shall be deemed necessary or
desirable to confirm that all the rights, powers, trusts and duties of the
retiring Trustee with respect to the Securities of that or those series as to
which the retiring Trustee is not retiring shall continue to be vested in the
retiring Trustee, and (3) shall 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, it being understood that
nothing herein or in such supplemental indenture shall constitute such Trustees
or co-trustees of the same trust and that each such Trustee shall be trustee of
a trust or trusts hereunder separate and apart from any trust or trusts
hereunder administered by any other such Trustee; and upon the execution and
delivery of such supplemental indenture the resignation or removal of the
retiring Trustee shall become effective to the extent provided therein and each
removal of the retiring Trustee, without any further act, deed or conveyance,
shall become vested with all the rights, powers, trusts, and duties of the
retiring Trustee with respect to the Securities of that or those series to which
the appointment of such successor Trustee relates; but, on request of the
Company or any successor Trustee, such retiring Trustee shall duly assign,
transfer and deliver to such successor Trustee all property and money held by
such retiring Trustee hereunder with respect to the Securities of that or those
series to which the appointment of such successor Trustee relates.
(c) Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all rights, powers and trusts referred to
in paragraph (a) or (b) of this Section, as the case may be.
(d) No successor Trustee shall accept its appointment unless, at the
time of such acceptance, such successor Trustee shall be qualified and eligible
under this Article.
SECTION 6.12. MERGER, CONVERSION, CONSOLIDATION OR
SUCCESSION TO BUSINESS.
Any entity into which the Trustee may be merged or converted or with
which it may be consolidated, or any entity resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any entity
succeeding to all or substantially all of the corporate trust business of the
Trustee, shall be the successor of the Trustee hereunder, provided such entity
shall be otherwise qualified and eligible under this Article, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto. In case any Securities shall have been authenticated, but not
delivered, by the Trustee then in office, any successor by merger, conversion or
consolidation to such authenticating Trustee may adopt such authentication and
deliver the Securities so authenticated, and in case any Securities shall not
have been authenticated, any successor to the Trustee may authenticate such
Securities either in the name of any predecessor Trustee or in the name of such
successor Trustee, and in all cases the certificate of authentication shall have
the full force which it is provided anywhere in the Securities or in this
Indenture that the certificate of the Trustee shall have.
SECTION 6.13. PREFERENTIAL COLLECTION OF CLAIMS AGAINST
COMPANY.
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If and when the Trustee shall be or become a creditor of the Company
(or any other obligor upon the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Company (or any such other obligor).
SECTION 6.14. APPOINTMENT OF AUTHENTICATING AGENT.
The Trustee may appoint an Authenticating Agent or Agents with respect
to one or more series of Securities, which shall be authorized to act on behalf
of the Trustee to authenticate Securities of such series issued upon original
issue and upon exchange, registration of transfer or partial redemption thereof
or pursuant to Section 3.6, and Securities so authenticated shall be entitled to
the benefits of this Indenture and shall be valid and obligatory for all
purposes as if authenticated by the Trustee hereunder. Wherever reference is
made in this Indenture to the authentication and delivery of Securities by the
Trustee or the Trustee's certificate of authentication, such reference shall be
deemed to include authentication and delivery on behalf of the Trustee by an
Authenticating Agent. Each Authenticating Agent shall be acceptable to the
Company and shall at all times be an entity organized and doing business under
the laws of the United States of America, or of any state or territory thereof
or of the District of Columbia, authorized under such laws to act as
Authenticating Agent, having a combined capital and surplus of not less than
$50,000,000 and subject to supervision or examination by Federal or state
authority. If such Authenticating Agent publishes reports of condition at least
annually, pursuant to law or to the requirements of said supervising or
examining authority, then for the purposes of this Section the combined capital
and surplus of such Authenticating Agent shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. If at any time an Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section, such Authenticating Agent shall
resign immediately in the manner and with the effect specified in this Section.
Any entity into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any entity resulting from any
merger, conversion or consolidation to which such Authenticating Agent shall be
a party, or any entity succeeding to all or substantially all of the corporate
trust business of an Authenticating Agent shall be the successor Authenticating
Agent hereunder, provided such entity shall be otherwise eligible under this
Section, without the execution or filing of any paper or any further act on the
part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Company. The Trustee may at any time terminate
the agency of an Authenticating Agent by giving written notice thereof to such
Authenticating Agent and to the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent, which shall be acceptable to the Company and shall give notice of such
appointment in the manner provided in Section 1.6 to all Holders of Securities
of the series with respect to which such Authenticating Agent will serve. Any
successor Authenticating Agent upon acceptance hereunder shall become vested
with all the rights, powers and duties of its predecessor hereunder, with like
effect as if originally named as an Authenticating Agent. No successor
Authenticating Agent shall be appointed unless eligible under the provision of
this Section.
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The Company agrees to pay to each Authenticating Agent from time to
time reasonable compensation for its services under this Section, and the
Trustee shall be entitled to be reimbursed for such payment, subject to the
provisions of Section 6.7.
If an appointment with respect to one or more series is made pursuant
to this Section, the Securities of such series may have endorsed thereon, in
addition to the Trustee's certificate of authentication, an alternative
certificate of authentication in the following form:
This is one of the Securities referred to in the within mentioned
Indenture.
- --------------------------------- ----------------------------------------------
Dated: THE BANK OF NEW YORK,
---------------------
as Trustee
By:
----------------------------
As Authenticating Agent
Name:
Title:
By:
----------------------------
As Authenticating Agent
Name:
Title:
- --------------------------------- ----------------------------------------------
SECTION 6.15. APPOINTMENT OF CO-TRUSTEE.
(a) Notwithstanding any other provisions of this Indenture, at any
time, for the purpose of meeting any legal requirement of any jurisdiction in
which any part of the Trust may at the time be located, the Trustee shall have
the power and may execute and deliver all isntruments necessary to appoint one
or more Persons to act as a co-trustee or co-trustees, or separate trustee or
separate trustees, of all or any part of the Trust, and to vest in such Person
or Persons, in such capacity and for the benefit of the Noteholders, such title
to the Trust or any part hereof, and subject to the other provisions of this
Section, such powers, duties, obligations, rights and trusts as the Trustee may
consider necessary or desirable. No co-trustee or separate trustee hereunder
shall be required to meet the terms of eligibility as a successor trustee under
Section 6.9 and no notice to Noteholders of the appointment of any co-trustee or
separate trustee shall be required under Section 6.10(f) hereof.
(b) Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) all rights, powers, duties and obligations conferred or
imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or
co-trustee jointly (it being understood that such separate trustee or
co-trustee is not authorized to act separately without the Trustee
joining in such
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act), except to the extent that under any law of any jurisdiction in
which any particular act or acts are to be performed the Trustee shall
be incompetent or unqualified to perform such act or acts, in which
event such rights, powers, duties and obligations (including the
holding of title to the Trust or any portion thereof in any such
jurisdiction) shall be exercised and performed singly by such separate
trustee or co-trustee, but solely at the direction of the Trustee;
(ii) no trustee hereunder shall be personally liable by a
reason of any act or omission of any other trustee hereunder; and
(iii) the Trustee may at any time accept the resignation of or
remove any separate trustee or co-trustee.
(c) Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Indenture and the conditions
of this Article VI. Each separate trustee and co-trustee, upon its acceptance of
the trusts conferred, shall be vested with the estates or property specified in
its instrument of appointment, either jointly with the Trustee or separately, as
may be provided therein, subject to all the provisions of this Indenture,
specifically including every provision of this Indenture relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee.
(d) Any separate trustee or co-trustee may at any time constitute the
Trustee its agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Indenture on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee.
ARTICLE VII
HOLDER'S LISTS AND REPORTS BY TRUSTEE,
PAYING AGENT AND COMPANY
SECTION 7.1. COMPANY TO FURNISH TRUSTEE NAMES AND
ADDRESSES OF HOLDERS.
The Company will furnish or cause to be furnished to the Trustee:
(a) quarterly, not more than 15 days after the last day of February,
May, August and November in each year, a list, in such form as the Trustee may
reasonably require, of the names and addresses of the Holders as of the last day
of February, May, August and November, as applicable; and
(b) at such other times as the Trustee may request in writing, within
30 days after the receipt by the Company of any such request, a list of similar
form and content as of a date not
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more than 15 days prior to the time such list
is furnished, EXCLUDING from any such list names and addresses received by the
Trustee in its capacity as Securities Registrar.
SECTION 7.2. PRESERVATION OF INFORMATION; COMMUNICATIONS
TO HOLDERS.
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 7.1 and the names and
addresses of Holders received by the Trustee in its capacity as Securities
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 7.1 upon receipt of a new list so furnished.
(b) The rights of Holders to communicate with other Holders with
respect to their rights under this Indenture or under the Securities, and the
corresponding rights and privileges of the Trustee, shall be as provided in the
Trust Indenture Act.
(c) Every Holder of Securities, by receiving and holding the same,
agrees with the Company and the Trustee that neither the Company nor the Trustee
nor any agent of either of them shall be held accountable by reason of the
disclosure of information as to the names and addresses of the Holders made
pursuant to the Trust Indenture Act.
SECTION 7.3. REPORTS BY TRUSTEE AND PAYING AGENT.
(a) The Trustee shall transmit to Holders such reports concerning the
Trustee and its actions under this Indenture as may be required pursuant to the
Trust Indenture Act, at the times and in the manner provided pursuant thereto.
(b) Reports so required to be transmitted at stated intervals of not
more than 12 months shall be transmitted no later than January 31 in each
calendar year, commencing with the first January 31 after the first issuance of
Securities under this Indenture.
(c) A copy of each such report shall, at the time of such transmission
to Holders, be filed by the Trustee with each securities exchange upon which any
Securities are listed and also with the Commission. The Company will notify the
Trustee when any Securities are listed on any securities exchange.
(d) The Paying Agent shall comply with all withholding, backup
withholding, tax and information reporting requirements under the Internal
Revenue Code of 1986, as amended, and the Treasury Regulations issued thereunder
with respect to payments on, or with respect to, the Securities.
SECTION 7.4. REPORTS BY COMPANY.
The Company shall file or cause to be filed with the Trustee and with
the Commission, and transmit to Holders, such information, documents and other
reports, and such summaries thereof, as may be required pursuant to the Trust
Indenture Act at the times and in the manner provided in the Trust Indenture
Act. In the case of information, documents or reports required to be filed with
the Commission pursuant to Section 13(a) or Section 15(d) of the Exchange Act,
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the Company shall file or cause the filing of such information documents or
reports with the Trustee within 15 days after the same are required to be filed
with the Commission. 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 Officers' Certificates).
SECTION 7.5. STATEMENT BY OFFICERS AS TO DEFAULT.
The Company shall deliver to the Trustee, as soon as possible and in
any event within five days after the Company becomes aware of the occurrence of
any Event of Default or an event which, with notice or the lapse of time or
both, would constitute an Event of Default, an Officers' Certificate setting
forth the details of such Event of Default or default and the action which the
Company proposes to take with respect thereto.
ARTICLE VIII
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 8.1. COMPANY MAY CONSOLIDATE, ETC., ONLY ON
CERTAIN TERMS.
The Company shall not consolidate with or merge into any other Person
or convey, transfer or lease its properties and assets substantially as an
entirety to any Person, and no Person shall consolidate with or merge into the
Company or convey, transfer or lease its properties and assets substantially as
an entirety to the Company, unless:
(1) If the Company shall consolidate with or merge into
another Person or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, the entity formed by such
consolidation or into which the Company is merged or the Person that
acquires by conveyance or transfer, or that leases, the properties and
assets of the Company substantially as an entirety shall be an entity
organized and existing under the laws of the United States of America
or any state thereof or the District of Columbia and shall expressly
assume, by an indenture supplemental hereto, executed and delivered to
the Trustee, in form satisfactory to the Trustee, the due and punctual
payment of the principal of (and premium, if any), and interest
(including any Additional Interest) on all the Securities of every
series and the performance of every covenant of this Indenture on the
part of the Company to be performed or observed; provided, however,
that nothing herein shall be deemed to restrict or prohibit, and no
supplemental indenture shall be required in the case of, the merger of
a Principal Subsidiary Bank with and into a Principal Subsidiary Bank
or the Company, the consolidation of Principal Subsidiary Banks into a
Principal Subsidiary Bank or the Company, or the sale or other
disposition of all or substantially all of the assets of any Principal
Subsidiary Bank to another Principal Subsidiary Bank or the Company,
if, in any such case in which the surviving, resulting or acquiring
entity is not the Company, the Company would own, directly or
indirectly, at least 80% of the voting securities of the Principal
Subsidiary Bank (and of any other Principal Subsidiary Bank any voting
securities of which are
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owned, directly or indirectly, by such Principal Subsidiary Bank)
surviving such merger, resulting from such consolidation or acquiring
such assets;
(2) immediately after giving effect to such transaction, no
Event of Default, and no event that, after notice or lapse of time, or
both, would constitute an Event of Default, shall have occurred and be
continuing; and
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, conveyance, transfer or lease and any such
supplemental indenture comply with this Article and that all conditions
precedent herein provided for relating to such transaction have been
complied with and, in the case of a transaction subject to this Section
8.1 but not requiring a supplemental indenture under paragraph (1) of
this Section 8.1, an Officer's Certificate or Opinion of Counsel to the
effect that the surviving, resulting or successor entity is legally
bound by the Indenture and the Securities; and the Trustee, subject to
Section 6.1, may rely upon such Officers' Certificates and Opinions of
Counsel as conclusive evidence that such transaction complies with this
Section 8.1.
SECTION 8.2. SUCCESSOR COMPANY SUBSTITUTED.
Upon any consolidation or merger by the Company with or into any other
Person, or any conveyance, transfer or lease by the Company of its properties
and assets substantially as an entirety to any Person in accordance with Section
8.1, the successor entity formed by such consolidation or into which the Company
is merged or to which such conveyance, transfer or lease is made shall succeed
to, and be substituted for, and may exercise every right and power of, the
Company under this Indenture with the same effect as if such successor Person
had been named as the Company herein; and in the event of any such conveyance,
transfer or lease the Company shall be discharged from all obligations and
covenants under the Indenture and the Securities.
Such successor Person may cause to be executed, and may issue either in
its own name or in the name of the Company, any or all of the Securities
issuable hereunder that theretofore shall not have been signed by the Company
and delivered to the Trustee; and, upon the order of such successor Person
instead of the Company and subject to all the terms, conditions and limitations
in this Indenture prescribed, the Trustee shall authenticate and shall deliver
any Securities that previously shall have been signed and delivered by the
officers of the Company to the Trustee for authentication pursuant to such
provisions and any Securities that such successor Person thereafter shall cause
to be executed and delivered to the Trustee on its behalf for the purpose
pursuant to such provisions. All the Securities so issued shall in all respects
have the same legal rank and benefit under this Indenture as the Securities
theretofore or thereafter issued in accordance with the terms of this Indenture.
In case of any such consolidation, merger, sale, conveyance or lease,
such changes in phraseology and form may be made in the Securities thereafter to
be issued as may be appropriate.
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ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.1. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF
HOLDERS.
Without the consent of any Holders, the Company, when authorized by a
Board Resolution, and the Trustee, at any time and from time to time, may amend
or waive any provision of this Indenture or may enter into one or more
indentures supplemental hereto, in form satisfactory to the Trustee, for any of
the following purposes:
(1) to evidence the succession of another Person to the
Company, and the assumption by any such successor of the covenants of
the Company herein and in the Securities contained; or
(2) to convey, transfer, assign, mortgage or pledge any
property to or with the Trustee or to surrender any right or power
herein conferred upon the Company; or
(3) to establish the form or terms of Securities of
any series as permitted by Sections 2.1 or 3.1; or
(4) to facilitate the issuance of Securities of any
series in certificated or other definitive form; or
(5) to add to the covenants of the Company for the benefit of
the Holders of all or any series of Securities (and if such covenants
are to be for the benefit of less than all series of Securities,
stating that such covenants are expressly being included solely for the
benefit of the series specified) or to surrender any right or power
herein conferred upon the Company; or
(6) to add any additional Events of Default for the benefit of
the Holders of all or any series of Securities (and if such additional
Events of Defaults are to be for the benefit of less than all series of
Securities, stating that such additional Events of Default are
expressly being included solely for the benefit of the series
specified); or
(7) to change or eliminate any of the provisions of this
Indenture, provided that any such change or elimination shall (a)
become effective only when there is no Security Outstanding of any
series created prior to the execution of such supplemental indenture
that is entitled to the benefit of such provision or (b) not apply to
any Outstanding Securities; or
(8) to cure any ambiguity, to correct or supplement any
provision herein that may be defective or inconsistent with any other
provision herein, or to make any other provisions with respect to
matters or questions arising under this Indenture, provided that such
action pursuant to this clause (8) shall not adversely affect the
interest of the Holders of Securities of any series in any material
respect or, in the case of the Securities of a series issued to an
Issuer Trust and for so long as any of the corresponding series of
Capital Securities issued by such Issuer Trust shall remain
outstanding, the holders of such Capital Securities; or
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(9) 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,
pursuant to the requirements of Section 6.11(b); or
(10) to comply with the requirements of the Commission in
order to effect or maintain the qualification of this Indenture under
the Trust Indenture Act.
SECTION 9.2. SUPPLEMENTAL INDENTURES WITH CONSENT OF
HOLDERS.
With the consent of the Holders of not less than a majority in
aggregate principal amount of the Outstanding Securities of each series affected
by such supplemental indenture, by Act of said Holders delivered to the Company
and the Trustee, the Company, when authorized by a Board Resolution, and the
Trustee may enter into an indenture or indentures supplemental hereto for the
purpose of adding any provisions to or changing in any manner or eliminating any
of the provisions of this Indenture or of modifying in any manner the rights of
the Holders of Securities of such series under this Indenture; provided,
however, that no such supplemental indenture shall, without the consent of the
Holder of each Outstanding Security of each series affected thereby,
(1) change the Stated Maturity of the principal of, or any
installment of interest (including any Additional Interest) on, any
Security, or reduce the principal amount thereof or the rate of
interest thereon or any premium payable upon the redemption thereof, or
reduce the amount of principal of a Discount Security that would be due
and payable upon a declaration of acceleration of the Maturity thereof
pursuant to Section 5.2, or change the place of payment where, or the
coin or currency in which, any Security or interest thereon is payable,
or impair the right to institute suit for the enforcement of any such
payment on or after the Stated Maturity thereof (or, in the case of
redemption, on or after the Redemption Date), or
(2) reduce the percentage in aggregate principal amount of the
Outstanding Securities of any series, the consent of whose Holders is
required for any such supplemental indenture, or the consent of whose
Holders is required for any waiver (of compliance with certain
provisions of this Indenture or certain defaults hereunder and their
consequences) provided for in this Indenture, or
(3) modify any of the provisions of this Section, Section 5.13
or Section 10.5, except to increase any such percentage or to provide
that certain other provisions of this Indenture cannot be modified or
waived without the consent of the Holder of each Security affected
thereby;
PROVIDED, FURTHER, that, in the case of the Securities of a series
issued to an Issuer Trust, so long as any of the corresponding series
of Capital Securities issued by such Issuer Trust remains outstanding,
(i) no such amendment shall be made that adversely affects the holders
of such Capital Securities in any material respect, and no termination
of this
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Indenture shall occur, and no waiver of any Event of Default or
compliance with any covenant under this Indenture shall be effective,
without the prior consent of the holders of at least a majority of the
aggregate Liquidation Amount of such Capital Securities then
outstanding unless and until the principal of (and premium, if any, on)
the Securities of such series and all accrued and (subject to Section
3.8) unpaid interest (including any Additional Interest) thereon have
been paid in full, and (ii) no amendment shall be made to Section 5.8
of this Indenture that would impair the rights of the holders of
Capital Securities issued by an Issuer Trust provided therein without
the prior consent of the holders of each such Capital Security then
outstanding unless and until the principal of (and premium, if any, on)
the Securities of such series and all accrued and (subject to Section
3.8) unpaid interest (including any Additional Interest) thereon have
been paid in full.
A supplemental indenture that changes or eliminates any covenant or
other provision of this Indenture that has expressly been included solely for
the benefit of one or more particular series of Securities or any corresponding
series of Capital Securities of an Issuer Trust that holds the Securities of any
series, or that modifies the rights of the Holders of Securities of such series
or holders of such Capital Securities of such corresponding series with respect
to such covenant or other provision, shall be deemed not to affect the rights
under this Indenture of the Holders of Securities of any other series or holders
of Capital Securities of any other such corresponding series.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Persons entitled to consent to any indenture
supplemental hereto. If a record date is fixed, the Holders on such record date,
or their duly designated proxies, and only such Persons, shall be entitled to
consent to such supplemental indenture, whether or not such Holders remain
Holders after such record date; provided, that unless such consent shall become
effective by virtue of the requisite percentage having been obtained prior to
the date which is 90 days after such record date, any such consent previously
given shall automatically and without further action by any Holder be cancelled
and of no further effect.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
SECTION 9.3. EXECUTION OF SUPPLEMENTAL INDENTURES.
In executing or accepting the additional trusts created by any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 6.1) shall be fully protected in relying upon, an
Officers' Certificate and an Opinion of Counsel stating that the execution of
such supplemental indenture is authorized or permitted by this Indenture, and
that all conditions precedent herein provided for relating to such action have
been complied with. The Trustee may, but shall not be obligated to, enter into
any such supplemental indenture that affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.
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SECTION 9.4. EFFECT OF SUPPLEMENTAL INDENTURES.
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
SECTION 9.5. CONFORMITY WITH TRUST INDENTURE ACT.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act as then in effect.
SECTION 9.6. REFERENCE IN SECURITIES TO SUPPLEMENTAL
INDENTURES.
Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article may, and shall if required by
the Company, bear a notation in form approved by the Company as to any matter
provided for in such supplemental indenture. If the Company shall so determine,
new Securities of any series so modified as to conform, in the opinion of the
Company, to any such supplemental indenture may be prepared and executed by the
Company and authenticated and delivered by the Trustee in exchange for
Outstanding Securities of such series.
ARTICLE X
COVENANTS
SECTION 10.1 PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST.
The Company covenants and agrees for the benefit of each series of
Securities that it will duly and punctually pay the principal of (and premium,
if any) and interest (including any Additional Interest) on the Securities of
that series in accordance with the terms of such Securities and this Indenture.
SECTION 10.2 MAINTENANCE OF OFFICE OR AGENCY.
The Company will maintain in each Place of Payment for any series of
Securities an office or agency where Securities of that series may be presented
or surrendered for payment, where Securities of that 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 that series and this Indenture
may be served. The Company initially appoints the Trustee, acting through its
Corporate Trust Office, as its agent for said purposes. The Company will give
prompt written notice to the Trustee of any change in the location of any such
office or agency. If at any time the Company shall fail to maintain such office
or agency or shall fail to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or served 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 other
offices or agencies where the Securities may be presented or surrendered for any
or all of such purposes, and may
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from time to time rescind such designations; provided, however, that no such
designation or rescission shall in any manner relieve the Company of its
obligation to maintain an office or agency in each Place of Payment for
Securities of any series for such purposes. The Company will give prompt written
notice to the Trustee of any such designation and any change in the location of
any such office or agency.
SECTION 10.3. MONEY FOR SECURITY PAYMENTS TO BE HELD IN
TRUST.
If the Company shall at any time act as its own Paying Agent with
respect to any series of Securities, it will, on or before each due date of the
principal of (and premium, if any) or interest (including Additional Interest)
on any of the Securities of such series, segregate and hold in trust for the
benefit of the Persons entitled thereto a sum sufficient to pay the principal
(and premium, if any) or interest (including Additional Interest) so becoming
due until such sums shall be paid to such Persons or otherwise disposed of as
herein provided, and will promptly notify the Trustee of its failure so to act.
Whenever the Company shall have one or more Paying Agents, it will,
prior to 10:00 a.m., New York City time, on each due date of the principal of
(or premium, if any) or interest, including Additional Interest on any
Securities, deposit with a Paying Agent a sum sufficient to pay the principal
(and premium, if any) or interest, including Additional Interest so becoming
due, such sum to be held in trust for the benefit of the Persons entitled to
such principal (and premium, if any) or interest, including Additional Interest,
and (unless such Paying Agent is the Trustee) the Company will promptly notify
the Trustee of its failure so to act.
The Company will cause each Paying Agent other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section, that
such Paying Agent will:
(1) hold all sums held by it for the payment of the principal of (and
premium, if any) or interest (including Additional Interest) on the Securities
of a series in trust for the benefit of the Persons entitled thereto until such
sums shall be paid to such Persons or otherwise disposed of as herein provided;
(2) give the Trustee notice of any default by the Company (or any other
obligor upon such Securities) in the making of any payment of principal (and
premium, if any) or interest (or Additional Interest) in respect of any Security
of any Series;
(3) at any time during the continuance of any default with respect to a
series of Securities, upon the written request of the Trustee, forthwith pay to
the Trustee all sums so held in trust by such Paying Agent with respect to such
series; and
(4) comply with the provisions of the Trust Indenture Act applicable to
it as a Paying Agent.
The Company may, at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent,
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such sums to be held by the Trustee upon the same terms as those upon which such
sums were held by the Company or such Paying Agent; and, upon such payment by
any Paying Agent to the Trustee, such Paying Agent shall be released from all
further liability with respect to such money.
Any money deposited with the Trustee or any Paying Agent, or then held
by the Company in trust for the payment of the principal of (and premium, if
any) or interest (including Additional Interest) on any Security and remaining
unclaimed for two years after such principal (and premium, if any) or interest
(including Additional Interest) has become due and payable shall (unless
otherwise required by mandatory provision of applicable escheat or abandoned or
unclaimed property law) be paid on Company Request to the Company, or (if then
held by the Company) shall (unless otherwise required by mandatory provision of
applicable escheat or abandoned or unclaimed property law) be discharged from
such trust; and the Holder of such Security shall thereafter, as an unsecured
general creditor, look only to the Company for payment thereof, and all
liability of the Trustee or such Paying Agent with respect to such trust money,
and all liability of the Company as trustee thereof, shall thereupon cease;
provided, however, that the Trustee or such Paying Agent, before being required
to make any such repayment, may at the expense of the Company cause to be
published once, in a newspaper published in the English language, customarily
published on each Business Day and of general circulation in the Borough of
Manhattan, the City of New York, notice that such money remains unclaimed and
that, after a date specified therein, which shall not be less than 30 days from
the date of such publication, any unclaimed balance of such money then remaining
will be repaid to the Company.
SECTION 10.4 STATEMENT AS TO COMPLIANCE.
The Company shall deliver to the Trustee, beginning ________________
within 120 days after the end of each fiscal year of the Company ending after
the date hereof, an Officers' Certificate covering the preceding calendar
year, stating whether or not to the best knowledge of the signers thereof the
Company is in default in the performance, observance or fulfillment of or
compliance with any of the terms, provisions, covenants and conditions of
this Indenture, and if the Company shall be in default, specifying all such
defaults and the nature and status thereof of which they may have knowledge.
For the purpose of this Section 10.4, compliance shall be determined without
regard to any grace period or requirement of notice provided pursuant to the
terms of this Indenture.
SECTION 10.5 WAIVER OF CERTAIN COVENANTS.
Subject to the rights of holders of Capital Securities specified in
Section 9.2, if any, the Company may omit in any particular instance to comply
with any covenant or condition provided pursuant to Section 3.1 with respect to
the Securities of any series, if before or after the time for such compliance
the Holders of at least a majority in aggregate principal amount of the
Outstanding Securities of such series shall, by Act of such Holders, either
waive such compliance in such instance or generally waive compliance with such
covenant or condition, but no such waiver shall extend to or affect such
covenant or condition except to the extent so expressly waived, and, until such
waiver shall become effective, the obligations of the Company in respect of any
such covenant or condition shall remain in full force and effect.
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SECTION 10.6 ADDITIONAL SUMS.
In the case of the Securities of a series initially issued to an Issuer
Trust, so long as no Event of Default has occurred and is continuing and except
as otherwise specified as contemplated by Section 2.1 or Section 3.1, if (i) an
Issuer Trust is the Holder of all of the Outstanding Securities of such series,
and (ii) a Tax Event has occurred and is continuing in respect of such Issuer
Trust, the Company shall pay to such Issuer Trust (and its permitted successors
or assigns under the related Trust Agreement) for so long as such Issuer Trust
(or its permitted successor or assignee) is the registered holder of the
Outstanding Securities of such series, such additional sums as may be necessary
in order that the amount of Distributions (including any Additional Amounts (as
defined in such Trust Agreement)) then due and payable by such Issuer Trust on
the related Capital Securities and Common Securities that at any time remain
outstanding in accordance with the terms thereof shall not be reduced as a
result of such Additional Taxes (the "ADDITIONAL SUMS"). Whenever in this
Indenture or the Securities there is a reference in any context to the payment
of principal of or interest on the Securities, such mention shall be deemed to
include mention of the payments of the Additional Sums provided for in this
paragraph to the extent that, in such context, Additional Sums are, were or
would be payable in respect thereof pursuant to the provisions of this paragraph
and express mention of the payment of Additional Sums (if applicable) in any
provisions hereof shall not be construed as excluding Additional Sums in those
provisions hereof where such express mention is not made; provided, however,
that the deferral of the payment of interest pursuant to Section 3.12 on the
Securities shall not defer the payment of any Additional Sums that may be due
and payable.
SECTION 10.7 ADDITIONAL COVENANTS.
The Company covenants and agrees with each Holder of Securities of each
series that it shall not (x) declare or pay any dividends or distributions on,
or redeem, purchase, acquire or make a liquidation payment with respect to, any
shares of the Company's capital stock, or (y) make any payment of principal of
or interest or premium, if any, on or repay, repurchase or redeem any debt
securities of the Company that rank PARI PASSU in all respects with or junior in
interest to the Securities of such series (other than (a) repurchases,
redemptions or other acquisitions of shares of capital stock of the Company in
connection with any employment contract, benefit plan or other similar
arrangement with or for the benefit of any one or more employees, officers,
directors or consultants, in connection with a dividend reinvestment or
shareholder stock purchase plan or in connection with the issuance of capital
stock of the Company (or securities convertible into or exercisable for such
capital stock) as consideration in an acquisition transaction entered into prior
to the applicable Extension Period or other event referred to below, (b) as a
result of an exchange or conversion of any class or series of the Company's
capital stock (or any capital stock of a Subsidiary of the Company) for any
class or series of the Company's capital stock or of any class or series of the
Company's indebtedness for any class or series of the Company's capital stock,
(c) the purchase of fractional interests in shares of the Company's capital
stock pursuant to the conversion or exchange provisions of such capital stock or
the security being converted or exchanged, (d) any declaration of a dividend in
connection with any Rights Plan, or the issuance of rights, stock or other
property under any Rights Plan, or the redemption or repurchase of rights
pursuant thereto, or (e) any dividend in the form of stock, warrants, options or
other rights where the dividend stock or the stock issuable upon exercise of
such warrants, options or other rights is the same stock as that on which the
dividend is being paid or ranks PARI PASSU with or junior to such stock) if at
such time (i) there shall have occurred any event (A) of which the Company has
actual knowledge that with the
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giving of notice or the lapse of time, or both, would constitute an Event of
Default with respect to the Securities of such series, and (B) which the Company
shall not have taken reasonable steps to cure, (ii) if the Securities of such
series are held by an Issuer Trust, the Company shall be in default with respect
to its payment of any obligations under the Guarantee relating to the Capital
Securities issued by such Issuer Trust, or (iii) the Company shall have given
notice of its election to begin an Extension Period with respect to the
Securities of such series as provided herein and shall not have rescinded such
notice, or such Extension Period, or any extension thereof, shall be continuing.
The Company also covenants with each Holder of Securities of a series
issued to an Issuer Trust (i) to hold, directly or indirectly, 100% of the
Common Securities of such Issuer Trust, PROVIDED that any permitted successor of
the Company as provided under Section 8.2 may succeed to the Company's ownership
of such Common Securities, (ii) as holder of such Common Securities, not to
voluntarily terminate, windup or liquidate such Issuer Trust, other than (a) in
connection with a distribution of the Securities of such series to the holders
of the related Capital Securities in liquidation of such Issuer Trust, or (b) in
connection with certain mergers, consolidations or amalgamations permitted by
the related Trust Agreement, and (iii) to use its reasonable efforts, consistent
with the terms and provisions of such Trust Agreement, to cause such Issuer
Trust to continue to be taxable as a grantor trust for United States Federal
income tax purposes.
SECTION 10.8 FURNISHING ANNUAL INFORMATION.
On or before December 15 of each year during which any Securities are
outstanding, the Company shall furnish to each Paying Agent such information as
may be reasonably requested by each Paying Agent in order that each Paying Agent
may prepare the information which it is required to report for such year on
Internal Revenue Service Forms 1096 and 1099 pursuant to Section 6049 of the
Internal Revenue Code of 1986, as amended. Such information shall include the
amount of any original issue discount includable in income for each authorized
minimum denomination of principal amount at Stated Maturity of outstanding
Securities during such year.
ARTICLE XI
REDEMPTION OF SECURITIES
SECTION 11.1 APPLICABILITY OF THIS ARTICLE.
Redemption of Securities of any series as permitted or required by any
form of Security issued pursuant to this Indenture shall be made in accordance
with such form of Security and this Article; provided, however, that, if any
provision of any such form of Security shall conflict with any provision of this
Article, the provision of such form of Security shall govern.
SECTION 11.2 ELECTION TO REDEEM; NOTICE TO TRUSTEE.
The election of the Company to redeem any Securities shall be evidenced
by or pursuant to a Board Resolution. In case of any redemption at the election
of the Company, the Company shall, not less than 30 nor more than 60 days prior
to the Redemption Date (unless a shorter notice shall be satisfactory to the
Trustee), notify the Trustee and, in the case of Securities of a series held by
an Issuer Trust, the Property Trustee under the related Trust Agreement, of such
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date and of the principal amount of Securities of the applicable series to be
redeemed and provide the additional information required to be included in the
notice or notices contemplated by Section 11.4; provided that, in the case of
any series of Securities initially issued to an Issuer Trust, for so long as
such Securities are held by such Issuer Trust, such notice shall be given not
less than 45 nor more than 75 days prior to such Redemption Date (unless a
shorter notice shall be satisfactory to the Property Trustee under the related
Trust Agreement). In the case of any redemption of Securities prior to the
expiration of any restriction on such redemption provided in the terms of such
Securities, the Company shall furnish the Trustee with an Officers' Certificate
and an Opinion of Counsel evidencing compliance with such restriction.
SECTION 11.3 SELECTION OF SECURITIES TO BE REDEEMED.
If less than all the Securities of any series are to be redeemed, the
particular Securities to be redeemed shall be selected not more than 60 days
prior to the Redemption Date by the Trustee, from the Outstanding Securities of
such series not previously called for redemption, by such method as the Trustee
shall deem fair and appropriate and which may provide for the selection for
redemption of a portion of the principal amount of any Security of such series,
provided that the unredeemed portion of the principal amount of any Security
shall be in an authorized denomination (which shall not be less than the minimum
authorized denomination) for such Security.
The Trustee shall promptly notify the Company in writing of the
Securities selected for partial redemption and the principal amount thereof to
be redeemed. For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall relate,
in the case of any Security redeemed or to be redeemed only in part, to the
portion of the principal amount of such Security that has been or is to be
redeemed.
SECTION 11.4 NOTICE OF REDEMPTION.
Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not later than the thirtieth day, and not earlier than the
sixtieth day, prior to the Redemption Date, to each Holder of Securities to be
redeemed, at the address of such Holder as it appears in the Securities
Register.
With respect to Securities of such series to be redeemed, each notice
of redemption shall state:
(a) the Redemption Date;
(b) the Redemption Price or, if the Redemption Price cannot be
calculated prior to the time the notice is required to be sent, the estimate of
the Redemption Price provided pursuant to the Indenture together with a
statement that it is an estimate and that the actual Redemption Price will be
calculated on the third Business Day prior to the Redemption Date (if such an
estimate of the Redemption Price is given, a subsequent notice shall be given as
set forth above setting forth the Redemption Price promptly following the
calculation thereof);
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(c) if less than all Outstanding Securities of such particular series
are to be redeemed, the identification (and, in the case of partial redemption,
the respective principal amounts) of the particular Securities to be redeemed;
(d) that, on the Redemption Date, the Redemption Price will become due
and payable upon each such Security or portion thereof, and that interest
thereon, if any, shall cease to accrue on and after said date;
(e) the place or places where such Securities are to be surrendered for
payment of the Redemption Price;
(f) such other provisions as may be required in respect of the terms of
a particular series of Securities; and
(g) that the redemption is for a sinking fund, if such is the case.
Notice of redemption of Securities to be redeemed at the election of
the Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company and shall be irrevocable.
The notice, if mailed in the manner provided above, shall be conclusively
presumed to have been duly given, whether or not the Holder receives such
notice. In any case, a failure to give such notice by mail or any defect in the
notice to the Holder of any Security designated for redemption as a whole or in
part shall not affect the validity of the proceedings for the redemption of any
other Security.
SECTION 11.5 DEPOSIT OF REDEMPTION PRICE.
Prior to 10:00 a.m., New York City time, on the Redemption Date
specified in the notice of redemption given as provided in Section 11.4, the
Company will deposit with the Trustee or with one or more Paying Agents (or if
the Company is acting as its own Paying Agent, the Company will segregate and
hold in trust as provided in Section 10.3) an amount of money sufficient to pay
the Redemption Price of, and any accrued interest (including Additional
Interest) on, all the Securities (or portions thereof) that are to be redeemed
on that date.
SECTION 11.6. PAYMENT OF SECURITIES CALLED FOR REDEMPTION.
If any notice of redemption has been given as provided in Section 11.4,
the Securities or portion of Securities with respect to which such notice has
been given shall become due and payable on the date and at the place or places
stated in such notice at the applicable Redemption Price, together with accrued
interest (including any Additional Interest) to the Redemption Date. On
presentation and surrender of such Securities at a Place of Payment in said
notice specified, the said Securities or the specified portions thereof shall be
paid and redeemed by the Company at the applicable Redemption Price, together
with accrued interest (including any Additional Interest) to the Redemption
Date; provided, however, that, unless otherwise specified as contemplated by
Section 3.1, installments of interest (including Additional Interest) whose
Stated Maturity is on or prior to the Redemption Date will be payable to the
Holders of such Securities, or one or more Predecessor Securities, registered as
such at the close of business on the relevant record dates according to their
terms and the provisions of Section 3.8.
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Upon presentation of any Security redeemed in part only, the Company
shall execute and the Trustee shall authenticate and deliver to the Holder
thereof, at the expense of the Company, a new Security or Securities of the same
series, of authorized denominations, in aggregate principal amount equal to the
unredeemed portion of the Security so presented and having the same Original
Issue Date, Stated Maturity and terms.
If any Security called for redemption shall not be so paid under
surrender thereof for redemption, the principal of and premium, if any, on such
Security shall, until paid, bear interest from the Redemption Date at the rate
prescribed therefor in the Security.
SECTION 11.7. RIGHT OF REDEMPTION OF SECURITIES INITIALLY
ISSUED TO AN ISSUER TRUST.
In the case of the Securities of a series initially issued to an Issuer
Trust, except as otherwise specified as contemplated by Section 3.1, the
Company, at its option, may redeem such Securities (i) on or after the date
specified in such Security, in whole at any time or in part from time to time,
or (ii) upon the occurrence and during the continuation of a Tax Event, an
Investment Company Event or a Capital Treatment Event, at any time within 90
days following the occurrence and during the continuation of such Tax Event,
Investment Company Event or Capital Treatment Event, in whole (but not in part),
in each case at a Redemption Price specified in such Security, together with
accrued interest (including Additional Interest) to the Redemption Date.
If less than all the Securities of any such series are to be redeemed,
the aggregate principal amount of such Securities remaining Outstanding after
giving effect to such redemption shall be sufficient to satisfy any provisions
of the Trust Agreement related to the Issuer Trust to which such Securities were
issued.
ARTICLE XII
SINKING FUNDS
Except as may be provided in any supplemental or amended indenture, no
sinking fund shall be established or maintained for the retirement of Securities
of any series.
ARTICLE XIII
SUBORDINATION OF SECURITIES
SECTION 13.1. SECURITIES SUBORDINATE TO SENIOR
INDEBTEDNESS.
The Company covenants and agrees, and each Holder of a Security, by its
acceptance thereof, likewise covenants and agrees, that, to the extent and in
the manner hereinafter set forth in this Article, the payment of the principal
of (and premium, if any) and interest (including any Additional Interest) on
each and all of the Securities of each and every series are hereby expressly
made subordinate and subject in right of payment to the prior payment in full of
all Senior Indebtedness.
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SECTION 13.2. NO PAYMENT WHEN SENIOR INDEBTEDNESS IN
DEFAULT; PAYMENT OVER OF PROCEEDS UPON
DISSOLUTION, ETC.
If the Company shall default in the payment of any principal of (or
premium, if any) or interest on any Senior Indebtedness when the same becomes
due and payable, whether at maturity or at a date fixed for prepayment or by
declaration of acceleration or otherwise, then, upon written notice of such
default to the Company by the holders of Senior Indebtedness or any trustee
therefor, unless and until such default shall have been cured or waived or shall
have ceased to exist, no direct or indirect payment (in cash, property,
securities, by set-off or otherwise) shall be made or agreed to be made on
account of the principal of (or premium, if any) or interest (including
Additional Interest) on any of the Securities, or in respect of any redemption,
repayment, retirement, purchase or other acquisition of any of the Securities.
In the event of (i) any insolvency, bankruptcy, receivership,
liquidation, reorganization, readjustment, composition or other similar
proceeding relating to the Company, its creditors or its property, (ii) any
proceeding for the liquidation, dissolution or other winding-up of the Company,
voluntary or involuntary, whether or not involving insolvency or bankruptcy
proceedings, (iii) any assignment by the Company for the benefit of creditors or
(iv) any other marshalling of the assets of the Company (each such event, if
any, herein sometimes referred to as a "PROCEEDING"), all Senior Indebtedness
(including any interest thereon accruing after the commencement of any such
proceedings) shall first be paid in full before any payment or distribution,
whether in cash, securities or other property, shall be made to any Holder of
any of the Securities on account thereof. Any payment or distribution, whether
in cash, securities or other property (other than securities of the Company or
any other entity provided for by a plan of reorganization or readjustment, the
payment of which is subordinate, at least to the extent provided in these
subordination provisions with respect to the indebtedness evidenced by the
Securities, to the payment of all Senior Indebtedness at the time outstanding
and to any securities issued in respect thereof under any such plan of
reorganization or readjustment), which would otherwise (but for these
subordination provisions) be payable or deliverable in respect of the Securities
of any series shall be paid or delivered directly to the holders of Senior
Indebtedness in accordance with the priorities then existing among such holders
until all Senior Indebtedness (including any interest thereon accruing after the
commencement of any Proceeding) shall have been paid in full.
In the event of any Proceeding, after payment in full of all sums owing
with respect to Senior Indebtedness, the Holders of the Securities, together
with the holders of any obligations of the Company ranking on a parity with the
Securities, shall be entitled to be paid from the remaining assets of the
Company the amounts at the time due and owing on account of unpaid principal of
(and premium, if any) and interest on the Securities and such other obligations
before any payment or other distribution, whether in cash, property or
otherwise, shall be made on account of any capital stock or any obligations of
the Company ranking junior to the Securities and such other obligations. If,
notwithstanding the foregoing, any payment or distribution of any character or
any security, whether in cash, securities or other property (other than
securities of the Company or any other entity provided for by a plan of
reorganization or readjustment the payment of which is subordinate, at least to
the extent provided in these subordination provisions with respect to the
indebtedness evidenced by the Securities, to the payment of all Senior
Indebtedness at the time outstanding and to any securities issued in respect
thereof under any plan of reorganization or readjustment), shall be received by
the Trustee or any
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Holder in contravention of any of the terms hereof and before all Senior
Indebtedness shall have been paid in full, such payment or distribution or
security shall be received in trust for the benefit of, and shall be paid over
or delivered and transferred to, the holders of the Senior Indebtedness at the
time outstanding in accordance with the priorities then existing among such
holders for application to the payment of all Senior Indebtedness remaining
unpaid, to the extent necessary to pay all such Senior Indebtedness in full. In
the event of the failure of the Trustee or any Holder to endorse or assign any
such payment, distribution or security, each holder of Senior Indebtedness is
hereby irrevocably authorized to endorse or assign the same.
The Trustee and the Holders shall take such action (including, without
limitation, the delivery of this Indenture to an agent for the holders of Senior
Indebtedness or consent to the filing of a financing statement with respect
hereto) as may, in the opinion of counsel designated by the holders of a
majority in principal amount of the Senior Indebtedness at the time outstanding,
be necessary or appropriate to assure the effectiveness of the subordination
effected by these provisions.
The provisions of this Section 13.2 shall not impair any rights,
interests, remedies or powers of any secured creditor of the Company in respect
of any security interest the creation of which is not prohibited by the
provisions of this Indenture.
The securing of any obligations of the Company, otherwise ranking on a
parity with the Securities or ranking junior to the Securities shall not be
deemed to prevent such obligations from constituting, respectively, obligations
ranking on a parity with the Securities or ranking junior to the Securities.
SECTION 13.3 PAYMENT PERMITTED IF NO DEFAULT.
Nothing contained in this Article or elsewhere in this Indenture or in
any of the Securities shall prevent (a) the Company, at any time, except during
the pendency of the conditions described in the first paragraph of Section 13.2
or of any Proceeding referred to in Section 13.2, from making payments at any
time of principal of (and premium, if any) or interest (including Additional
Interest) on the Securities, or (b) the application by the Trustee of any monies
deposited with it hereunder to the payment of or on account of the principal of
(and premium, if any) or interest (including any Additional Interest) on the
Securities or the retention of such payment by the Holders, if, at the time of
such application by the Trustee, it did not have knowledge that such payment
would have been prohibited by the provisions of this Article.
SECTION 13.4. SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR
INDEBTEDNESS.
Subject to the payment in full of all amounts due or to become due on
all Senior Indebtedness, or the provision for such payment in cash or cash
equivalents or otherwise in a manner satisfactory to the holders of Senior
Indebtedness, 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 (equally and ratably with the holders
of all indebtedness of the Company that by its express terms is subordinated to
Senior Indebtedness of the Company to substantially the same extent as the
Securities are subordinated to the Senior Indebtedness and is entitled to like
rights of subrogation by reason of any payments or distributions made to holders
of such Senior Indebtedness) to the rights of the holders of such
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Senior Indebtedness to receive payments and distributions of cash, property and
securities applicable to the Senior Indebtedness until the principal of (and
premium if any) and interest (including Additional Interest) on the Securities
shall be paid in full. For purposes of such subrogation, no payments or
distributions to the holders of the Senior 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, and no payments over
pursuant to the provisions of this Article to the holders of Senior Indebtedness
by Holders of the Securities or the Trustee, shall, as among the Company, its
creditors other than holders of Senior Indebtedness, and the Holders of the
Securities, be deemed to be a payment or distribution by the Company to or on
account of the Senior Indebtedness.
SECTION 13.5 PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS.
The provisions of this Article are and are intended solely for the
purpose of defining the relative rights of the Holders of the Securities on the
one hand and the holders of Senior Indebtedness on the other hand. Nothing
contained in this Article or elsewhere in this Indenture or in the Securities is
intended to or shall: (a) impair, as between the Company and the Holders of the
Securities, the obligations of the Company, which are absolute and
unconditional, to pay to the Holders of the Securities the principal of (and
premium, if any) and interest (including any Additional Interest) on the
Securities as and when the same shall become due and payable in accordance with
their terms; or (b) affect the relative rights against the Company of the
Holders of the Securities and creditors of the Company other than their rights
in relation to the holders of Senior Indebtedness; or (c) prevent the Trustee or
the Holder of any Security (or to the extent expressly provided herein, the
holder of any Capital Security) from exercising all remedies otherwise permitted
by applicable law upon default under this Indenture, including filing and voting
claims in any Proceeding, subject to the rights, if any, under this Article of
the holders of Senior Indebtedness to receive cash, property and securities
otherwise payable or deliverable to the Trustee or such Holder.
SECTION 13.6 TRUSTEE TO EFFECTUATE SUBORDINATION.
Each Holder of a Security by his or her acceptance thereof authorizes
and directs the Trustee on his or her behalf to take such action as may be
necessary or appropriate to acknowledge or effectuate the subordination provided
in this Article and appoints the Trustee his or her attorney-in-fact for any and
all such purposes.
SECTION 13.7 NO WAIVER OF SUBORDINATION PROVISIONS.
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 that any such holder may have or
be otherwise charged with.
Without in any way limiting the generality of the immediately preceding
paragraph, the holders of Senior Indebtedness may, at any time and from time to
time, without the consent of or notice to the Trustee or the Holders of the
Securities of any series, without incurring
73
<PAGE>
responsibility to such Holders of the Securities and without impairing or
releasing the subordination provided in this Article or the obligations
hereunder of such Holders of the Securities to the holders of Senior
Indebtedness, do any one or more of the following: (i) change the manner, place
or terms of payment or extent the time of payment of, or renew or alter, Senior
Indebtedness, or otherwise amend or supplement in any manner Senior Indebtedness
or any instrument evidencing the same or any agreement under which Senior
Indebtedness is outstanding; (ii) sell, exchange, release or otherwise deal with
any property pledged, mortgaged or otherwise securing Senior Indebtedness; (iii)
release any Person liable in any manner for the collection of Senior
Indebtedness; and (iv) exercise or refrain from exercising any rights against
the Company and any other Person.
SECTION 13.8. NOTICE TO TRUSTEE.
The Company shall give prompt written notice to a Responsible Officer
of the Trustee of any fact known to the Company that would prohibit the making
of any payment to or by the Trustee in respect of the Securities.
Notwithstanding the provisions of this Article or any other provision of this
Indenture, the Trustee shall not be charged with knowledge of the existence of
any facts that would prohibit the making of any payment to or by the Trustee in
respect of the Securities, unless and until the Trustee shall have received
written notice thereof from the Company or a holder of Senior Indebtedness or
from any trustee, agent or representative therefor; provided, however, that if
the Trustee shall not have received the notice provided for in this Section at
least two Business Days prior to the date upon which by the terms hereof any
monies may become payable for any purpose (including, the payment of the
principal of (and premium, if any, on) or interest (including any Additional
Interest) on any Security), then, anything herein contained to the contrary
notwithstanding, the Trustee shall have full power and authority to receive such
monies and to apply the same to the purpose for which they were received and
shall not be affected by any notice to the contrary that may be received by it
within two Business Days prior to such date.
Subject to the provisions of Section 6.1, the Trustee shall be entitled
to rely on the delivery to it of a written notice by a Person representing
himself or herself to be a holder of Senior Indebtedness (or a trustee or
attorney-in-fact therefor) to establish that such notice has been given by a
holder of Senior Indebtedness (or a trustee or attorney-in-fact therefor). In
the event that the Trustee determines in good faith that further evidence is
required with respect to the right of any Person as a holder of Senior
Indebtedness to participate in any payment or distribution pursuant to this
Article, 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 Person under this Article, 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.
74
<PAGE>
SECTION 13.9. RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF
LIQUIDATING AGENT.
Upon any payment or distribution of assets of the Company referred to
in this Article, the Trustee, subject to the provisions of Section 6.1, and the
Holders of the Securities shall be entitled to rely upon any order or decree
entered by any court of competent jurisdiction in which such Proceeding is
pending, or a certificate of the trustee in bankruptcy, receiver, conservator,
liquidating trustee, custodian, assignee for the benefit of creditors, agent or
other Person making such payment or distribution, delivered to the Trustee or to
the Holders of Securities, for the purpose of ascertaining the Persons entitled
to participate in such payment or distribution, the holders of the Senior
Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article.
SECTION 13.10. TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR
INDEBTEDNESS.
The Trustee, in its capacity as trustee under this Indenture, shall not
be deemed to owe any fiduciary duty to the holders of Senior Indebtedness and
shall not be liable to any such holders if it shall in good faith mistakenly pay
over or distribute to Holders of Securities or to the Company or to any other
Person cash, property or securities to which any holders of Senior Indebtedness
shall be entitled by virtue of this Article or otherwise.
SECTION 13.11. RIGHTS OF TRUSTEE AS HOLDER OF SENIOR
INDEBTEDNESS; PRESERVATION OF TRUSTEE'S
RIGHTS.
The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article with respect to any Senior Indebtedness that
may at any time be held by it, to the same extent as any other holder of Senior
Indebtedness, and nothing in this Indenture shall deprive the Trustee of any of
its rights as such holder.
SECTION 13.12. ARTICLE APPLICABLE TO PAYING AGENTS.
In case 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 in such case (unless the context otherwise
requires) be construed as extending to and including such Paying Agent within
its meaning as fully for all intents and purposes as if such Paying Agent were
named in this Article in addition to or in place of the Trustee.
SECTION 13.13 Certain Conversions or Exchanges Deemed
Payment.
For purposes of this Article only, (a) the issuance and delivery of
junior securities upon conversion or exchange of Securities of any series shall
not be deemed to constitute a payment or distribution on account of the
principal of (or premium, if any, on) or interest (including any Additional
Interest) on such Securities or on account of the purchase or other acquisition
of such Securities, and (b) the payment, issuance or delivery of cash, property
or securities (other than junior securities) upon conversion or exchange of a
Security of any series shall be deemed to constitute payment on account of the
principal of such security. For the purposes of this Section, the term "JUNIOR
SECURITIES" means (i) shares of any stock of any class of the Company, and (ii)
securities of the Company that are subordinated in right of payment to all
Senior
75
<PAGE>
Indebtedness that may be outstanding at the time of issuance or delivery of such
securities to substantially the same extent as, or to a greater extent than, the
Securities are so subordinated as provided in this Article.
* * * *
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
[Remainder of page left intentionally blank; signatures appear
on following page.]
76
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
- ------------------------------------- ------------------------------------------
MAIN STREET BANCORP, INC.
By:
Name: Nelson R. Oswald
Attest: Title: President
- ------------------------------------- ------------------------------------------
THE BANK OF NEW YORK,
as Trustee, and not in its individual
capacity
By:
Name:
Attest: Title:
- ------------------------------------- ------------------------------------------
77
<PAGE>
Exhibit 4.2
-----------
FORM OF FACE OF SECURITY.
MAIN STREET BANCORP, INC.
[Title of Security]
CUSIP NO.
No. $
MAIN STREET BANCORP, INC., a Pennsylvania corporation (hereinafter
called the "Company", which term includes any successor Person under the
Indenture hereinafter referred to), for value received, hereby promises to
pay to __________ , or registered assigns, the principal sum of __________
Dollars on_________, [IF THE SECURITY IS A GLOBAL SECURITY, then insert, if
applicable--, or such other principal amount represented hereby as may be set
forth in the records of the Securities Registrar hereinafter referred to in
accordance with the Indenture,] [; provided that the Company may (i) shorten the
Stated Maturity of the principal of this Security to a date not earlier than
__________, and (ii) extend the Stated Maturity of the principal of this
Security at any time on one or more occasions, subject to certain conditions
specified in Section 3.15 of the Indenture, but in no event to a date later
than __________]. The Company further promises to pay interest on said
principal from __________, or from the most recent Interest Payment Date to
which interest has been paid or duly provided for, [monthly][quarterly]
[semi-annually] [IF APPLICABLE, insert--(subject to deferral as set forth
herein)] in arrears on [INSERT APPLICABLE INTEREST PAYMENT DATES] of each
year, commencing ______________ at the [variable rate equal to [INSERT
APPLICABLE INTEREST RATE FORMULA]] [rate of ____%] per annum, [if applicable
insert--together with Additional Sums, if any, as provided in Section 10.6 of
the Indenture,] until the principal hereof is paid or duly provided for or
made available for payment [if applicable, insert--; provided that any overdue
principal, premium or Additional Sums and any overdue installment of interest
shall bear Additional Interest at the [variable rate equal to [INSERT APPLICABLE
INTEREST RATE FORMULA]] [rate of ____%] per annum (to the extent that the
payment of such interest shall be legally enforceable), compounded [monthly]
[quarterly] [semi-annually], from the dates such amounts are due until they
are paid or made available for payment, and such interest shall be payable on
demand]. The amount of interest payable for any period less than a full
interest period shall be computed on the basis of a 360-day year of twelve
30-day months and the actual days elapsed in a partial month in such period.
The amount of interest payable for any full interest period shall be computed
by dividing the applicable rate per annum by [twelve/four/two]. The interest
so payable, and punctually paid or duly provided for, on any Interest Payment
Date will, as provided in the Indenture, be paid to the Person in whose name
this Security (or one or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for such interest installment
[IF APPLICABLE, INSERT--, which shall be the [___or____whether or not a Business
Day), as the case may be, next preceding such Interest Payment Date]. Any
such interest not so punctually paid or duly provided for shall forthwith
cease to be payable to the Holder on such Regular Record Date and may either
be paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on a Special Record Date
for the payment of such Defaulted Interest to be fixed by the Trustee (notice
whereof shall be given to Holders of Securities of this series not less than
10 days prior to such Special Record Date) or be paid at any time in any
other lawful manner not inconsistent with the requirements of any securities
exchange on which the Securities of this series may be listed, and
<PAGE>
upon such notice as may be required by such exchange, all as
more fully provided in said Indenture.
[IF APPLICABLE, INSERT--So long as no Event of Default has occurred and is
continuing, the Company shall have the right, at any time during the term of
this Security, from time to time to defer the payment of interest on this
Security for up to __________ consecutive [monthly] [quarterly] [semi-annual]
interest payment periods with respect to each deferral period (each an
"Extension Period") [IF APPLICABLE, INSERT--, during which Extension Periods the
Company shall have the right to make partial payments of interest on any
Interest Payment Date, and] at the end of which the Company shall pay all
interest then accrued and unpaid including Additional Interest, as provided
below; PROVIDED, HOWEVER, that no Extension Period shall extend beyond the
Stated Maturity of the principal of this Security [IF STATED MATURITY can be
shortened or extended, insert--, as then in effect,] and no such Extension
Period may end on a date other than an Interest Payment Date; and PROVIDED,
FURTHER, however, that during any such Extension Period, the Company shall
not (i) declare or pay any dividends or distributions on, or redeem,
purchase, acquire or make a liquidation payment with respect to, any of the
Company's capital stock, or (ii) make any payment of principal of or interest
or premium, if any, on or repay, repurchase or redeem any debt securities of
the Company that rank PARI PASSU in all respects with or junior in interest
to this Security (other than (a) repurchases, redemptions or other
acquisitions of shares of capital stock of the Company in connection with any
employment contract, benefit plan or other similar arrangement with or for
the benefit of any one or more employees, officers, directors or consultants,
in connection with a dividend reinvestment or shareholder stock purchase plan
or in connection with the issuance of capital stock of the Company (or
securities convertible into or exercisable for such capital stock) as
consideration in an acquisition transaction entered into prior to the
applicable Extension Period, (b) as a result of an exchange or conversion of
any class or series of the Company's capital stock (or any capital stock of a
Subsidiary of the Company) for any class or series of the Company's capital
stock or of any class or series of the Company's indebtedness for any class
or series of the Company's capital stock, (c) the purchase of fractional
interests in shares of the Company's capital stock pursuant to the conversion
or exchange provisions of such capital stock or the security being converted
or exchanged, (d) any declaration of a dividend in connection with any Rights
Plan, or the issuance of rights, stock or other property under any Rights
Plan, or the redemption or repurchase of rights pursuant thereto, or (e) any
dividend in the form of stock, warrants, options or other rights where the
dividend stock or the stock issuable upon exercise of such warrants, options
or other rights is the same stock as that on which the dividend is being paid
or ranks pari passu with or junior to such stock). Prior to the termination
of any such Extension Period, the Company may further defer the payment of
interest, PROVIDED that no Extension Period shall exceed __________
consecutive [monthly] [quarterly] [semi-annual]interest payment periods,
extend beyond the Stated Maturity of the principal of this Security or end on
a date other than an Interest Payment Date. Upon the termination of any such
Extension Period and upon the payment of all accrued and unpaid interest and
any Additional Interest then due on any Interest Payment Date, the Company
may elect to begin a new Extension Period, subject to the above conditions.
No interest shall be due and payable during an Extension Period, except at
the end thereof, but each installment of interest that would otherwise have
been due and payable during such Extension Period shall bear Additional
Interest (to the extent that the payment of such interest shall be legally
enforceable) at the [variable rate equal to [INSERT APPLICABLE INTEREST RATE
FORMULA]] [rate of ____%] per annum, compounded [monthly] [quarterly]
[semi-annually] and calculated as set forth in the first paragraph of this
Security, from the date on which such amounts would otherwise have been due
and payable until paid or made available for payment. The Company shall give
the Holder of this Security and the
<PAGE>
Trustee notice of its election to begin any Extension Period at least one
Business Day prior to the next succeeding Interest Payment Date on which
interest on this Security would be payable but for such deferral [IF APPLICABLE,
INSERT--or so long as such securities are held by [INSERT NAME OF APPLICABLE
ISSUER TRUST], at least one Business Day prior to the earlier of (i) the next
succeeding date on which Distributions on the Capital Securities of such Issuer
Trust would be payable but for such deferral, and (ii)the date on which the
Property Trustee of such Issuer Trust is required to give notice to holders of
such Capital Securities of the record date or the date such Distributions are
payable, but in any event not less than one Business Day prior to such record
date.]
Payment of the principal of (and premium, if any) and interest on this
Security will be made at the office or agency of the Company maintained for that
purpose in the United States, 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 [IF APPLICABLE, INSERT--; PROVIDED, HOWEVER that at the option of
the Company payment of interest may be made (i) by check mailed to the address
of the Person entitled thereto as such address shall appear in the Securities
Register, or (ii) if to a Holder of $1,000,000 or more in aggregate principal
amount of this Security, by wire transfer in immediately available funds upon
written request to the Trustee not later than 15 calendar days prior to the date
on which the interest is payable].
The indebtedness evidenced by this Security is, to the extent provided
in the Indenture, subordinate and subject in right of payments to the prior
payment in full of all Senior Indebtedness, and this Security is issued subject
to the provisions of the Indenture with respect thereto. Each Holder of this
Security, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on his or her behalf to take
such actions as may be necessary or appropriate to effectuate the subordination
so provided, and (c) appoints the Trustee his or her attorney-in-fact for any
and all such purposes. Each Holder hereof, by his or her acceptance hereof,
waives all notice of the acceptance of the subordination provisions contained
herein and in the Indenture by each holder of Senior Indebtedness, whether now
outstanding or hereafter incurred, and waives reliance by each such holder upon
said provisions.
Reference is hereby made to the further provisions of this Security 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 Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
MAIN STREET BANCORP, INC.
By:
------------------------
------------------------
Name:
Title:
Attest:
- --------------------------------
SECRETARY OR ASSISTANT SECRETARY
FORM OF REVERSE OF SECURITY.
This Security is one of a duly authorized issue of securities of the
Company (herein called the "SECURITIES"), issued and to be issued in one or more
series under the Junior Subordinated Indenture, dated as of _______, 1999
(herein called the "INDENTURE"), between the Company and The Bank of New York,
as Trustee (herein called the "TRUSTEE", which term includes any successor
trustee under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Company, the
Trustee, the holders of Senior Indebtedness and the Holders of the Securities,
and of the terms upon which the Securities are, and are to be, authenticated and
delivered. This Security is one of the series designated on the face hereof [IF
APPLICABLE, INSERT--, limited in aggregate principal amount to $_________].
All terms used in this Security that are defined in the Indenture [IF
APPLICABLE, INSERT-- or in [insert name of trust agreement], dated as of
__________________ (as modified, amended or supplemented from time to time the
"TRUST AGREEMENT"), relating to [INSERT NAME OF ISSUER TRUST] [the ("ISSUER
TRUST") among the Company, as Depositor, the Trustees named therein and the
Holders from time to time of the Trust Securities issued pursuant thereto] shall
have the meanings assigned to them in the Indenture [IF APPLICABLE, INSERT--or
the Trust Agreement, or the Registration Rights Agreement, as the case may be].
[IF APPLICABLE, INSERT--The Company has the right to redeem this
Security (i) on or after _________, in whole at any time or in part from time to
time, or (ii) in whole (but not in part), at any time within 90 days following
the occurrence and during the continuation of a Tax Event, Investment Company
Event, or Capital Treatment Event, in each case at the Redemption Price
described below, and subject to possible regulatory approval.]
[IF APPLICABLE, INSERT--In the case of a redemption on or after
___________, the Redemption Price shall equal the following prices, expressed in
percentages of the principal amount hereof, together with accrued interest to
but excluding the date fixed for redemption, if redeemed during the 12-month
period beginning ___________:
Redemption
<PAGE>
YEAR PRICE
and 100% on or after __________.
In the case of a redemption on or after __________ following a Tax
Event, Investment Company Event or Capital Treatment Event, the Redemption Price
shall equal the Redemption Price then applicable to a redemption under the
preceding paragraph.
[IF THE SECURITY IS SUBJECT TO REDEMPTION OF ANY KIND, INSERT--In the
event of redemption of this Security in part only, a new Security or Securities
of this series for the unredeemed portion hereof will be issued in the name of
the Holder hereof upon the cancellation hereof.]
[IF APPLICABLE, INSERT--The Indenture contains provisions for
defeasance at any time [of the entire indebtedness of this Security] [or]
[certain restrictive covenants and Events of Default with respect to this
Security] [, in each case] upon compliance by the Company with certain
conditions set forth in the Indenture.]
The Indenture permits, with certain exceptions as therein provided, the
Company and the Trustee at any time to enter into a supplemental indenture or
indentures for the purpose of modifying in any manner the rights and obligations
of the Company and of the Holders of the Securities, with the consent of the
Holders of not less than a majority in principal amount of the Outstanding
Securities of each series to be affected by such supplemental indenture. The
Indenture also contains provisions permitting Holders of specified percentages
in principal amount of the Securities of each series at the time Outstanding, on
behalf of the Holders of all Securities of such series, to waive compliance by
the Company with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Holder of this Security shall be conclusive and binding upon such Holder and
upon all future Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof,
whether or not notation of such consent or waiver is made upon this Security.
[IF THE SECURITY IS NOT A DISCOUNT SECURITY, INSERT--As provided in and
subject to the provisions of the Indenture, if an Event of Default with respect
to the Securities of this series at the time Outstanding occurs and is
continuing, then and in every such case the Trustee or the Holders of not less
than 25% in aggregate principal amount of the Outstanding Securities of this
series may declare the principal amount of all the Securities of this series to
be due and payable immediately, by a notice in writing to the Company (and to
the Trustee if given by Holders) [if applicable, insert--, provided that, if
upon an Event of Default, the Trustee or such Holders fail to declare the
principal of all the Outstanding Securities of this series to be immediately due
and payable, the Holders of at least 25% in aggregate Liquidation Amount of the
Capital Securities then outstanding shall have the right to make such
declaration by a notice in writing to the Company and the Trustee]; and upon any
such declaration the principal amount of and the accrued interest (including any
Additional Interest) on all the Securities of this series shall become
immediately due and payable, provided that the payment of principal and interest
(including any Additional Interest) on such Securities shall remain subordinated
to the extent provided in Article XIII of the Indenture.]
<PAGE>
[IF THE SECURITY IS A DISCOUNT SECURITY, INSERT--As provided in and
subject to the provisions of the Indenture, if an Event of Default with respect
to the Securities of this series at the time Outstanding occurs and is
continuing, then and in every such case the Trustee or the Holders of not less
than 25% in aggregate principal amount of the Outstanding Securities of this
series may declare an amount of principal of the Securities of this series to be
due and payable immediately, by a notice in writing to the Company (and to the
Trustee if given by Holders) [if applicable, insert--, provided that, if upon an
Event of Default, the Trustee or such Holders fail to declare such principal
amount of the Outstanding Securities of this series to be immediately due and
payable, the Holders of at least 25% in aggregate Liquidation Amount of the
Capital Securities then outstanding shall have the right to make such
declaration by a notice in writing to the Company and the Trustee. The principal
amount payable upon such acceleration shall be equal to--insert formula for
determining the amount]. Upon any such declaration, such amount of the principal
of and the accrued interest (including any Additional Interest) on all the
Securities of this series shall become immediately due and payable, provided
that the payment of such principal and interest (including any Additional
Interest) on all the Securities of this series shall remain subordinated to the
extent provided in Article XIII of the Indenture. Upon payment (i) of the amount
of principal so declared due and payable and (ii) of interest on any overdue
principal, premium and interest (in each case to the extent that the payment of
such interest shall be legally enforceable), all of the Company's obligations in
respect of the payment of the principal of and premium and interest, if any, on
this Security shall terminate.]
No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal of (and premium, if any) and
interest (including Additional Interest) on this Security at the times, place
and rate, and in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Security is registrable in the Securities
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company maintained under Section 10.2 of the Indenture
for such purpose, duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Company and the Securities Registrar duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Securities of this series, of like tenor,
of authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.
<PAGE>
The Securities of this series are issuable only in registered form
without coupons in integral multiples of $10.00. Securities may be exchanged for
other Securities of like tenor, of any authorized denominations, and of like
aggregate principal amount. Any transfer, exchange or other disposition of
Securities in contravention of Section 3.6(b)(iii) of the Indenture shall be
deemed to be void and of no legal effect whatsoever, any such transferee shall
be deemed not to be the Holder or owner of any beneficial interest in such
Securities for any purpose, including but not limited to the receipt of interest
payable on such Securities, and such transferee shall be deemed to have no
interest whatsoever in such Securities. As provided in the Indenture and subject
to certain limitations therein set forth, Securities of this series are
exchangeable for a like aggregate principal amount of Securities of this series
and of like tenor of a different authorized denomination, as requested by the
Holder surrendering the same.
No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name this Security is registered as the owner hereof for all
purposes, whether or not this Security be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
The Company and, by its acceptance of this Security or a beneficial
interest therein, the Holder of, and any Person that acquires a beneficial
interest in, this Security agrees that for United States Federal, state and
local tax purposes it is intended that this Security constitute indebtedness.
THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
THIS SECURITY IS A DIRECT AND UNSECURED OBLIGATION OF THE COMPANY, DOES
NOT EVIDENCE DEPOSITS AND IS NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION OR ANY OTHER INSURER OR GOVERNMENT AGENCY.
<PAGE>
EXHIBIT 4.3
CERTIFICATE OF TRUST OF
MSB CAPITAL TRUST I
THIS Certificate of Trust of MSB Capital Trust I (the "Trust") is being
duly executed and filed by The Bank of New York (Delaware), The Bank of New
York, Nelson R. Oswald, Robert D. McHugh, Jr. and Donna L. Rickert, as trustees,
to form a business trust under the Delaware Business Trust Act (12 DEL. C. ss.
3801 eT Seq.) (the "Act").
1. NAME. The name of the business trust formed hereby is MSB Capital
Trust I.
2. DELAWARE TRUSTEE. The name and business address of the trustee of the
Trust in the State of Delaware is The Bank of New York (Delaware), White Clay
Center, Newark, Delaware 19711.
3. EFFECTIVE DATE. This Certificate of Trust shall be effective upon filing
with the Secretary of State.
IN WITNESS WHEREOF, the undersigned, being all of the trustees of the
Trust, have duly executed this Certificate of Trust in accordance with Section
3811(a) of the Act.
THE BANK OF NEW YORK (DELAWARE),
not in its individual capacity but solely as
Trustee of the Trust
By:
----------------------------------
Name:
Title:
THE BANK OF NEW YORK, not in its
individual capacity but solely as Trustee of the
Trust
By:
----------------------------------
Name:
Title:
<PAGE>
------------------------------------
NELSON R. OSWALD, not in his individual
capacity but solely as Trustee of the Trust
------------------------------------
ROBERT D. McHugh, Jr., not in his individual
capacity but solely as Trustee of the Trust
------------------------------------
Donna L. Rickert, not in her individual capacity
but solely as Trustee of the Trust
<PAGE>
EXHIBIT 4.4
TRUST AGREEMENT
This TRUST AGREEMENT, dated as of September 1, 1999 (this "Trust
Agreement"), among (i) Main Street Bancorp Inc., a Pennsylvania corporation (the
"Depositor"), (ii) The Bank of New York (Delaware), a Delaware banking
corporation, as trustee, (iii) The Bank of New York, a New York banking
corporation, as trustee, and (iv) Nelson R. Oswald, Robert D. McHugh, Jr. and
Donna L. Rickert, each an individual, as trustees (each of such trustees in
(ii), (iii) and (iv) a "Trustee" and collectively, the "Trustees"). The
Depositor and the Trustees hereby agree as follows:
1. The trust created hereby (the "Trust") shall be known as
"MSB Capital Trust I" in which name the Trustees, or the Depositor to the extent
provided herein, may engage in the transactions contemplated hereby, make and
execute contracts, and sue and be sued.
2. The Depositor hereby assigns, transfers conveys and sets
over to the Trustees the sum of $10. The Trustees hereby acknowledge receipt of
such amount in trust from the Depositor, which amount shall constitute the
initial trust estate. The Trustees hereby declare that they will hold the trust
estate in trust for the Depositor. It is the intention of the parties hereto
that the Trust created hereby constitute a business trust under Chapter 38 of
Title 12 of the Delaware Code, 12 DEL. C. ss. 3801, eT Seq. (the "Business Trust
Act"), and that this document constitutes the governing instrument of the Trust.
The Trustees are hereby authorized and directed to execute and file a
certificate of trust with the Delaware Secretary of State in accordance with the
provisions of the Business Trust Act.
3. The Depositor and the Trustees will enter into an amended
and restated Trust Agreement, satisfactory to each such party and substantially
in the form included as an exhibit to the 1933 Act Registration Statement (as
defined below), to provide for the contemplated operation of the Trust created
hereby and the issuance of the Capital Securities and Common Securities referred
to therein. Prior to the execution and delivery of such amended and restated
Trust Agreement, the Trustees shall not have any duty or obligation hereunder or
with respect to the trust estate, except as otherwise required by applicable law
or as may be necessary to obtain prior to such execution and delivery of any
licenses, consents or approvals required by applicable law or otherwise.
4. The Depositor, as the sponsor of the Trust, is hereby
authorized (i) to file with the Securities and Exchange Commission (the
"Commission") and execute, in each case on behalf of the Trust, (a) the
Registration Statement on Form S-3 (the "1933 Act Registration Statement"),
including any pre-effective or post-effective amendments to the 1933 Act
Registration Statement, relating to the registration under the Securities Act of
1933, as amended, of the Capital Securities of the Trust and possibly certain
other securities and (b) a Registration Statement on Form 8-A (the "1934 Act
Registration Statement") (including all pre-effective and post-effective
amendments thereto) relating to the registration of the Capital Securities of
the Trust under the Securities Exchange Act of 1934, as amended; (ii) to file
with the New York
<PAGE>
Stock Exchange or any other national stock exchange or The Nasdaq National
Market (each, an "Exchange") and execute on behalf of the Trust one or more
listing applications and all other applications, statements, certificates,
agreements and other instruments as shall be necessary or desirable to cause the
Capital Securities to be listed on any of the Exchanges; (iii) to file and
execute on behalf of the Trust such applications, reports, surety bonds,
irrevocable consents, appointments of attorney for service of process and other
papers and documents as shall be necessary or desirable to register the Capital
Securities under the securities or blue sky laws of such jurisdictions as the
Depositor, on behalf of the Trust, may deem necessary or desirable and (iv) to
execute on behalf of the Trust that certain Underwriting Agreement relating to
the Capital Securities, among the Trust, the Depositor and the several
Underwriters named therein, substantially in the form included as an exhibit to
the 1933 Act Registration Statement. In the event that any filing referred to in
clauses (i), (ii) and (iii) above is required by the rules and regulations of
the Commission, an Exchange or state securities or blue sky laws, to be executed
on behalf of the Trust by one or more of the Trustees, each of the individual
Trustees, in his capacity as a Trustee of the Trust, is hereby authorized and
directed to join in any such filing and to execute on behalf of the Trust any
and all of the foregoing. In connection with the filings referred to above, the
Depositor and Nelson R. Oswald, Robert D. McHugh, Jr. and Donna L. Rickert, each
as a Trustee and not in his individual capacity, hereby constitutes and appoints
Nelson R. Oswald, Robert D. McHugh, Jr. and Donna L. Rickert, and each of them,
as their true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for the Depositor or such Trustee or in the
Depositor's or such Trustee's name, place and stead, in any and all capacities,
to sign any and all amendments (including post-effective amendments) to the 1933
Act Registration Statement and the 1934 Act Registration Statement and to file
the same, with all exhibits thereto, and other documents in connection
therewith, with the Commission, the Exchanges and administrators of state
securities or blue sky laws, granting unto said attorneys-in-fact and agents
full power and authority to do and perform each and every act and thing
requisite and necessary to be done in connection therewith, as fully to all
intents and purposes as the Depositor or such Trustee might or could to in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents or any of them, or their respective substitute or substitutes, shall do
or cause to be done by virtue hereof.
5. This Trust Agreement may be executed in one or more
counterparts.
6. The number of Trustees initially shall be five (5) and
thereafter the number of Trustees shall be such number as shall be fixed from
time to time by a written instrument signed by the Depositor which may increase
or decrease the number of Trustees; provided, however, that to the extent
required by the Business Trust Act, one Trustee shall either be a natural person
who is a resident of the State of Delaware or, if not a natural person, an
entity which has its principal place of business in the State of Delaware and
otherwise meets the requirements of applicable Delaware law. Subject to the
foregoing, the Depositor is entitled to appoint or remove without cause any
Trustee at any time. The Trustees may resign upon thirty (30) days' prior notice
to the Depositor.
7. This Trust Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware (without regard to conflict
of laws of principles).
2
<PAGE>
[SIGNATURE PAGE FOLLOWS]
3
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Trust Agreement
to be duly executed as of the day and year first above written.
MAIN STREET BANCORP INC., as Depositor
By:
--------------------------------
Name:
Title:
The Bank of New York (Delaware), as Trustee
of the Trust
By:
--------------------------------
Name:
Title:
The Bank of New York, as Trustee of the Trust
By:
--------------------------------
Name:
Title:
---------------------------------
NELSON R. OSWALD, as Trustee of the Trust
---------------------------------
ROBERT D. MCHUGH, JR., as Trustee of the Trust
---------------------------------
DONNA L. RICKERT, as Trustee of the Trust
4
<PAGE>
EXHIBIT 4.5
AMENDED AND RESTATED
TRUST AGREEMENT
among
MAIN STREET BANCORP, INC.
as Depositor,
THE BANK OF NEW YORK
as Property Trustee,
and
THE BANK OF NEW YORK (DELAWARE),
as Delaware Trustee
Dated as of September __, 1999
---------------------------
MBNK CAPITAL TRUST I
---------------------------
<PAGE>
MBNK CAPITAL TRUST I
Certain Sections of this Trust Agreement relating, to
Sections 310 through 318 of the
Trust Indenture Act of 1939:
<TABLE>
<CAPTION>
Trust Indenture Act
Section Trust Agreement Section
- ------------------------- --------------------------
<S> <C> <C>
Section 310 (a)(1) 8.7
(a)(2) 8.7
(a)(3) 8.9
(a)(4) 2.7(a)(ii)
(b) 8.8, 10.10(b)
Section 311 (a) 8.13, 10.10(b)
8.13, 10.10(b)
Section 312 (a) 10.10(b)
(b) 10.10(b), (f)
(c) 5.7
Section 313 (a) 8.15(a)
(a)(4) 10.10(c)
(b) 8.15(c), 10.10(c)
(c) 10.8, 10.10(c)
(d) 10.10(c)
Section 314 (a) 8.16, 10.10(d)
(b) Not Applicable
(c)(1) 8.17, 10.10(d), (e)
(c)(2) 8.17, 10.10(d), (e)
(c)(3) 8.17, 10.10(d), (e)
(e) 8.17, 10.10(e)
Section 315 (a) 8.1(d)
(b) 8.2
(c) 8.1(c)
(d) 8.1(d)
(e) Not Applicable
Section 316 (a) Not Applicable
(a)(1)(A) Not Applicable
(a)(1)(B) Not Applicable
(a)(2) Not Applicable
(b) 5.13
(c) 6.7
Section 317 (a)(1) Not Applicable
(a)(2) 8.14
(b) 5.10
Section 318 (a) 10.10(a)
</TABLE>
Note: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of the Trust Agreement.
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
-----------------
<S> <C>
ARTICLE I DEFINED TERMS 2
SECTION 1.1. Definitions......................................................................................2
ARTICLE II CONTINUATION OF THE ISSUER TRUST................................................................11
SECTION 2.1. Name.............................................................................................................11
SECTION 2.2. Office of the Delaware Trustee; Principal Place of Business.....................................11
SECTION 2.3. Initial Contribution of Trust Property; Organizational Expenses.................................12
SECTION 2.4. Issuance of the Capital Securities..............................................................12
SECTION 2.5. Issuance of the Common Securities; Subscription and Purchase of Junior Subordinated Debentures..12
SECTION 2.6. Declaration of Trust............................................................................12
SECTION 2.7. Authorization to Enter into Certain Transactions................................................13
SECTION 2.8. Assets of Trust.................................................................................16
SECTION 2.9. Title to Trust Property.........................................................................16
ARTICLE III PAYMENT ACCOUNT.................................................................................16
SECTION 3.1. Payment Account.................................................................................16
ARTICLE IV DISTRIBUTIONS; REDEMPTION.......................................................................17
SECTION 4.1. Distributions...................................................................................17
SECTION 4.2. Redemption......................................................................................18
SECTION 4.3. Subordination of Common Securities..............................................................20
SECTION 4.4. Payment Procedures..............................................................................21
SECTION 4.5. Tax Returns and Reports.........................................................................21
SECTION 4.6. Payment of Taxes, Duties, Etc. of the Issuer Trust..............................................21
SECTION 4.7. Payments under Indenture or Pursuant to Direct Actions..........................................21
SECTION 4.8. Liability of the Holder of Common Securities....................................................21
ARTICLE V TRUST SECURITIES CERTIFICATES...................................................................22
SECTION 5.1. Initial Ownership...............................................................................22
SECTION 5.2. The Trust Securities Certificates...............................................................22
SECTION 5.3. Execution and Delivery of Trust Securities Certificates.........................................22
SECTION 5.4. Global Capital Securities.......................................................................23
SECTION 5.5. Registration of Transfer and Exchange Generally; Certain Transfers and Exchanges; Capital
Securities Certificates..............................................................24
SECTION 5.6. Mutilated, Destroyed, Lost or Stolen Trust Securities Certificates..............................25
SECTION 5.7. Persons Deemed Holders..........................................................................25
SECTION 5.8. Access to List of Holders' Names and Addresses..................................................26
SECTION 5.9. Maintenance of Office or Agency.................................................................26
SECTION 5.10. Appointment of Paying Agent.....................................................................26
SECTION 5.11. Ownership of Common Securities by Depositor.....................................................26
SECTION 5.12. Notices to Clearing Agency......................................................................27
SECTION 5.13. Rights of Holders...............................................................................27
</TABLE>
<PAGE>
<TABLE>
<S> <C>
ARTICLE VI ACTS OF HOLDERS; MEETINGS; VOTING...............................................................29
SECTION 6.1. Limitations on Holder's Voting Rights...........................................................29
SECTION 6.2. Notice of Meetings..............................................................................30
SECTION 6.3. Meetings of Holders.............................................................................30
SECTION 6.4. Voting Rights...................................................................................31
SECTION 6.5. Proxies, etc....................................................................................31
SECTION 6.6. Holder Action by Written Consent................................................................31
SECTION 6.7. Record Date for Voting and Other Purposes.......................................................31
SECTION 6.8. Acts of Holders.................................................................................32
SECTION 6.9. Inspection of Records...........................................................................33
ARTICLE VII REPRESENTATIONS AND WARRANTIES..................................................................33
SECTION 7.1. Representations and Warranties of the Property Trustee and the Delaware Trustee.................33
SECTION 7.2. Representations and Warranties of Depositor.....................................................34
ARTICLE VIII THE ISSUER TRUSTEES; THE ADMINISTRATORS.........................................................34
SECTION 8.1. Certain Duties and Responsibilities.............................................................34
SECTION 8.2. Certain Notices.................................................................................37
SECTION 8.3. Certain Rights of Property Trustee..............................................................37
SECTION 8.4. Not Responsible for Recitals or Issuance of Securities..........................................38
SECTION 8.5. May Hold Securities.............................................................................39
SECTION 8.6. Compensation; Indemnity; Fees...................................................................39
SECTION 8.7. Corporate Property Trustee Required; Eligibility of Trustees and Administrators.................40
SECTION 8.8. Conflicting Interests...........................................................................40
SECTION 8.9. Co-Trustees and Separate Trustee................................................................41
SECTION 8.10. Resignation and Removal; Appointment of Successor...............................................42
SECTION 8.11. Acceptance of Appointment by Successor..........................................................43
SECTION 8.12. Merger, Conversion, Consolidation or Succession to Business.....................................44
SECTION 8.13. Preferential Collection of Claims Against Depositor or Issuer Trust.............................44
SECTION 8.14. Trustee May File Proofs of Claim................................................................44
SECTION 8.15. Reports by Property Trustee.....................................................................45
SECTION 8.16. Reports to the Property Trustee.................................................................45
SECTION 8.17. Evidence of Compliance with Conditions Precedent................................................45
SECTION 8.18. Number of Issuer Trustees.......................................................................45
SECTION 8.19. Delegation of Power.............................................................................46
SECTION 8.20. Appointment of Administrators...................................................................46
ARTICLE IX DISSOLUTION, LIQUIDATION AND MERGER.............................................................47
SECTION 9.1. Dissolution Upon Expiration Date................................................................47
SECTION 9.2. Early Dissolution..............................................................................47
SECTION 9.3. Termination.....................................................................................47
SECTION 9.4. Liquidation.....................................................................................48
SECTION 9.5. Mergers, Consolidations, Amalgamations or Replacements of the Issuer Trust......................49
ARTICLE X MISCELLANEOUS PROVISIONS........................................................................50
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C>
SECTION 10.1. Limitation of Rights of Holders................................................................50
SECTION 10.2. Amendment......................................................................................50
SECTION 10.3. Separability...................................................................................51
SECTION 10.4. Governing Law..................................................................................51
SECTION 10.5. Payments Due on Non-Business Day...............................................................52
SECTION 10.6. Successors.....................................................................................52
SECTION 10.7. Headings.......................................................................................53
SECTION 10.8. Reports, Notices and Demands...................................................................53
SECTION 10.9. Agreement Not to Petition......................................................................53
SECTION 10.10. Trust Indenture Act; Conflict with Trust Indenture Act.........................................54
SECTION 10.11. Acceptance of Terms of Trust Agreement, Guarantee and Indenture................................55
</TABLE>
Exhibit A.........Certificate of Trust
Exhibit B.........[Intentionally Omitted]
Exhibit C.........Form of Common Securities Certificate
Exhibit D.........Form of Capital Securities Certificate
<PAGE>
AGREEMENT
THIS AMENDED AND RESTATED TRUST AGREEMENT, dated as of September
__, 1999, is by and among (i) Main Street Bancorp, Inc., a Pennsylvania
corporation (including any successors or assigns, the "Depositor"), (ii) The
Bank of New York, a New York banking corporation, as property trustee (in such
capacity, the "Property Trustee" and, in its separate corporate capacity and not
in its capacity as Property Trustee, the "Bank"), (iii) The Bank of New York
(Delaware), a Delaware banking corporation, as Delaware trustee (the "Delaware
Trustee") (the Property Trustee and the Delaware Trustee are referred to
collectively herein as the "Issuer Trustees"), (iv) the Administrators, as
hereinafter defined, and (v) the several Holders, as hereinafter defined.
WITNESSETH
WHEREAS, the Depositor and the Delaware Trustee have heretofore
duly declared and established a business trust pursuant to the Delaware Business
Trust Act by entering into a certain Trust Agreement, dated as of September __,
1999 (the "Original Trust Agreement"), and by the execution and filing by the
Delaware Trustee with the Secretary of State of the State of Delaware of the
Certificate of Trust, filed on September __, 1999 (the "Certificate of Trust"),
attached as Exhibit A; and
WHEREAS, the Depositor and the Delaware Trustee desire to amend
and restate the Original Trust Agreement in its entirety as set forth herein to
provide for, among other things, (i) the issuance of the Common Securities by
the Issuer Trust to the Depositor, (ii) the issuance and sale of the Capital
Securities by the Issuer Trust pursuant to the Underwriting Agreement, (iii) the
acquisition by the Issuer Trust from the Depositor of all of the right, title
and interest in the Junior Subordinated Debentures, (iv) the appointment of the
Administrators and (v) the addition of the Property Trustee as a party to this
Trust Agreement.
NOW THEREFORE, in consideration of the agreements and
obligations set forth herein and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, each party, for the
benefit of the other parties and for the benefit of the Holders, hereby amends
and restates the Original Trust Agreement in its entirety and agrees, intending
to be legally bound, as follows:
<PAGE>
ARTICLE I
DEFINED TERMS
SECTION 1.1. Definitions.
For all purposes of this Trust Agreement, except as otherwise
expressly provided or unless the context otherwise requires:
The terms defined in this Article have the meanings assigned to them in this
Article and include the plural as well as the singular;
All other terms used herein that are defined in the Trust Indenture Act, either
directly or by reference therein, have the meanings assigned to them therein;
The words "include," "includes" and "including" shall be deemed to be followed
by the phrase "without limitation";
All accounting terms used but not defined herein have the meanings assigned to
them in accordance with United States generally accepted accounting principles
as in effect at the time of computation;
Unless the context otherwise requires, any reference to an "Article" or a
"Section" refers to an Article or a Section, as the case may be, of this Trust
Agreement;
The words "herein", "hereof" and "hereunder" and other words of similar import
refer to this Trust Agreement as a whole and not to any particular Article,
Section or other subdivision; and
all references to the date the Capital Securities were originally issued shall
refer to the date the ___% Capital Securities were originally issued.
"Act" has the meaning specified in Section 6.8.
"Additional Amounts" means, with respect to Trust Securities of
a given Liquidation Amount and/or a given period, the amount of Additional
Interest (as defined in the Indenture) paid by the Depositor on a Like Amount of
Junior Subordinated Debentures for such period.
"Additional Sums" has the meaning specified in Section 10.6 of
the Indenture.
"Administrators" means each Person appointed in accordance with Section
8.20 solely in such Person's capacity as Administrator of the Issuer Trust
continued hereunder and not in such Person's individual capacity, or any
successor Administrator appointed as herein provided; with the initial
Administrators being Nelson R. Oswald, Robert D. McHugh, Jr. and Donna L.
Rickert.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified
2
<PAGE>
Person means the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting securities, by
contract or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Capital Security or beneficial interest therein,
the rules and procedures of the Depositary for such Capital Security, in each
case to the extent applicable to such transaction and as in effect from time to
time.
"Bank" has the meaning specified in the preamble to this Trust
Agreement.
"Bankruptcy Event" means, with respect to any Person:
(a) the entry of a decree or order by a court having
jurisdiction in the premises judging such Person a bankrupt or insolvent, or
approving as properly filed a petition seeking reorganization, arrangement,
adjudication or composition of or in respect of such Person under any applicable
federal or State bankruptcy, insolvency, reorganization or other similar law, or
appointing a receiver, liquidator, assignee, trustee, sequestrator (or other
similar official) of such Person or of any substantial part of its property or
ordering the winding-up or liquidation of its affairs, and the continuance of
any such decree or order unstayed and in effect for a period of 60 consecutive
days; or
the institution by such Person of proceedings to be adjudicated a bankrupt or
insolvent, or the consent by it to the institution of bankruptcy or insolvency
proceedings against it, or the filing by it of a petition or answer or consent
seeking reorganization or relief under any applicable federal or State
bankruptcy, insolvency, reorganization or other similar law, or the consent by
it to the filing of any such petition or to the appointment of a receiver,
liquidator, assignee, trustee, sequestrator (or similar official) of such Person
or of any substantial part of its property or the making by it of an assignment
for the benefit of creditors, or the admission by it in writing of its inability
to pay its debts generally as they become due and its willingness to be
adjudicated a bankrupt, or the taking of corporate action by such Person in
furtherance of any such action.
"Bankruptcy Laws" has the meaning specified in Section 10.9.
"Board of Directors" means the board of directors of the
Depositor or the Executive Committee of the board of directors of the Depositor
(or any other committee of the board of directors of the Depositor performing
similar functions) or a committee designated by the board of directors of the
Depositor (or any such committee), comprised of two or more members of the board
of directors of the Depositor or officers of the Depositor, or both.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Depositor to have been duly adopted
by the Depositor's Board of Directors, or such committee of the Board of
Directors or officers of the Depositor to which authority to act on behalf of
the Board of Directors has been delegated, and to be in full force and effect on
the date of such certification, and delivered to the Issuer Trustees.
"Business Day" means a day other than (a) a Saturday or Sunday,
(b) a day on which banking institutions in the City of New York, New York are
authorized or required by law
3
<PAGE>
or executive order to remain closed or (c) a day on which the Property Trustee's
Corporate Trust Office or the Delaware Trustee's corporate trust office or the
corporate trust office of the Debenture Trustee is closed for business.
"Capital Securities Certificate" means a certificate evidencing
ownership of Capital Securities, substantially in the form attached as Exhibit
D.
"Capital Security" means a preferred undivided beneficial
interest in the assets of the Issuer Trust, having a Liquidation Amount of
$10.00 and having the rights provided therefor in this Trust Agreement,
including the right to receive Distributions and a Liquidation Distribution as
provided herein.
"Capital Treatment Event" means, in respect of the Issuer Trust,
the reasonable determination by the Depositor that, as a result of the
occurrence of any amendment to, or change (including any announced prospective
change) in, the laws (or any rules or regulations thereunder) of the United
States or any political subdivision thereof or therein, or as a result of any
official or administrative pronouncement or action or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
effective or such pronouncement, action or decision is announced on or after the
date of the issuance of the Capital Securities of the Issuer Trust, there is
more than an insubstantial risk that the Depositor will not be entitled to treat
an amount equal to the Liquidation Amount of such Capital Securities as "Tier 1
Capital" (or the then equivalent thereof) for purposes of the risk-based capital
adequacy guidelines of the Board of Governors of the Federal Reserve System, as
then in effect and applicable to the Depositor.
"Cede" means Cede & Co.
"Certificate of Trust" has the meaning specified in the preamble
to this Trust Agreement.
"Clearing Agency" means an organization registered as a
"clearing agency" pursuant to Section 17A of the Exchange Act. The Depositary
shall be the initial Clearing Agency.
"Clearing Agency Participant" means a broker, dealer, bank,
other financial institution or other Person for whom from time to time a
Clearing Agency effects book-entry transfers and pledges of securities deposited
with the Clearing Agency.
"Closing Date" means the Closing Time, which date is also the
date of execution and delivery of this Trust Agreement.
"Closing Time" has the meaning in the Underwriting Agreement.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission, as from time
to time constituted, created under the Exchange Act, as amended, or, if at any
time after the execution of
4
<PAGE>
this instrument such Commission is not existing and performing the duties now
assigned to it under the Trust Indenture Act, then the body performing such
duties at such time.
"Common Securities Certificate" means a certificate evidencing
ownership of Common Securities, substantially in the form attached as Exhibit C.
"Common Securities Purchase Agreement" means the Common
Securities Purchase Agreement dated as of September __, 1999 between the Issuer
Trust and the Depositor, as the same may be amended from time to time.
"Common Security" means an undivided beneficial interest in the
assets of the Issuer Trust, having a Liquidation Amount of $10.00 and having the
rights provided therefor in this Trust Agreement, including the right to receive
Distributions and a Liquidation Distribution as provided herein.
"Corporate Trust Office" means the principal office of the
Property Trustee located in the City of New York which at the time of the
execution of this Trust Agreement is located at 101 Barclay Street, 21 West, New
York, New York 10286.
"Debenture Event of Default" means an "Event of Default" as
defined in the Indenture.
"Debentures Purchase Agreement" means the Junior Subordinated
Deferrable Interest Debentures Purchase Agreement dated as of September __, 1999
between the Depositor and the Issuer Trust, as the same may be amended from time
to time.
"Debenture Redemption Date" means, with respect to any Junior
Subordinated Debentures to be redeemed under the Junior Subordinated Indenture,
the date fixed for redemption of such Debentures under the Indenture.
"Debenture Trustee" means The Bank of New York, a New York
banking corporation and any successor.
"Delaware Business Trust Act" means Chapter 38 of Title 12 of
the Delaware Code, 12 Del. C. ss. 3801, et seq., as it may be amended from
time to time.
"Delaware Trustee" means the corporation identified as the
"Delaware Trustee" in the preamble to this Trust Agreement solely in its
capacity as Delaware Trustee of the Issuer Trust continued hereunder and not in
its individual capacity, or its successor in interest in such capacity, or any
successor trustee appointed as herein provided.
"Depositary" means The Depository Trust Company or any successor
thereto.
"Depositor" has the meaning specified in the preamble to this
Trust Agreement.
"Distribution Date" has the meaning specified in Section 4.1(a).
5
<PAGE>
"Distributions" means amounts payable in respect of the Trust
Securities as provided in Section 4.1.
"Early Termination Event" has the meaning specified in
Section 9.2.
"Event of Default" means any one of the following events
(whatever the reason for such Event of Default and whether it shall be voluntary
or involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(a) the occurrence of a Debenture Event of Default; or
(b) default by the Issuer Trust in the payment of any
Distribution when it becomes due and payable, and continuation of such default
for a period of 30 days; or
(c) default by the Issuer Trust in the payment of any Redemption
Price of any Trust Security when it becomes due and payable; or
(d) default in the performance, or breach, in any material
respect, of any covenant or warranty of the Issuer Trustees in this Trust
Agreement (other than a covenant or warranty a default in the performance of
which or the breach of which is dealt with in clause (b) or (c) above) and
continuation of such default or breach for a period of 60 days after there has
been given, by registered or certified mail, to the Issuer Trustees and the
Depositor by the Holders of at least 25% in aggregate Liquidation Amount of the
Outstanding Capital Securities, a written notice specifying such default or
breach and requiring it to be remedied and stating that such notice is a "Notice
of Default" hereunder; or
(e) the occurrence of any Bankruptcy Event with respect to the
Property Trustee or all or substantially all of its property if a successor
Property Trustee has not been appointed within a period of 90 days thereof.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended, and any successor statute thereto, as amended from time to time.
"Expiration Date" has the meaning specified in Section 9.1.
"Global Capital Securities Certificate" means a Capital
Securities Certificate evidencing ownership of Global Capital Securities.
"Global Capital Security" means a Capital Security, the
ownership and transfers of which shall be made through book entries by a
Clearing Agency as described in Section 5.4.
"Guarantee" means the Guarantee Agreement executed and delivered
by the Depositor and The Bank of New York, as trustee, contemporaneously with
the execution and delivery of this Trust Agreement, for the benefit of the
Holders of the Capital Securities, as amended from time to time.
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"Holder" means a Person in whose name a Trust Security or Trust
Securities is registered in the Securities Register; any such Person shall be
deemed to be a beneficial owner within the meaning of the Delaware Business
Trust Act.
"Indenture" means the Junior Subordinated Indenture, dated as of
September __, 1999, between the Depositor and the Debenture Trustee (as amended
or supplemented from time to time) relating to the issuance of the Junior
Subordinated Debentures.
"Investment Company Act" means the Investment Company Act of
1940, as amended.
"Investment Company Event" means the receipt by the Issuer Trust
of an Opinion of Counsel experienced in such matters to the effect that, as a
result of the occurrence of a change in law or regulation or a written change
(including any announced prospective change) in interpretation or application of
law or regulation by any legislative body, court, governmental agency or
regulatory authority, there is more than an insubstantial risk that the Issuer
Trust is or will be considered an "investment company" that is required to be
registered under the Investment Company Act, which change or prospective change
becomes effective or would become effective, as the case may be, on or after the
date of the issuance of the Capital Securities.
"Issuer Trust" means MBNK Capital Trust I.
"Issuer Trustees" means, collectively, the Property Trustee and
the Delaware Trustee.
"Junior Subordinated Debentures" means the aggregate principal
amount of the Depositor's _.__% Junior Subordinated Deferrable Interest
Debentures, due September 30, 2029, issued pursuant to the Indenture.
"Lien" means any lien, pledge, charge, encumbrance, mortgage,
deed of trust, adverse ownership interest, hypothecation, assignment, security
interest or preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever.
"Like Amount" means (a) with respect to a redemption of Trust
Securities, Trust Securities having a Liquidation Amount equal to that portion
of the principal amount of Junior Subordinated Debentures to be
contemporaneously redeemed in accordance with the Indenture, allocated to the
Common Securities and to the Capital Securities pro rata based upon the relative
Liquidation Amounts of such classes and (b) with respect to a distribution of
Junior Subordinated Debentures to Holders of Trust Securities in connection with
a dissolution or liquidation of the Issuer Trust, Junior Subordinated Debentures
having a principal amount equal to the Liquidation Amount of the Trust
Securities of the Holder to whom such Junior Subordinated Debentures are
distributed.
"Liquidation Amount" means the stated amount of $10.00 per Trust
Security.
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"Liquidation Date" means the date on which Junior Subordinated
Debentures are to be distributed to Holders of Trust Securities in connection
with a dissolution and liquidation of the Issuer Trust pursuant to Section 9.4.
"Liquidation Distribution" has the meaning specified in Section
9.4(d).
"Majority in Liquidation Amount of the Capital Securities" or
"Majority in Liquidation Amount of the Common Securities" means, except as
provided by the Trust Indenture Act, Capital Securities or Common Securities, as
the case may be, representing more than 50% of the aggregate Liquidation Amount
of all then Outstanding Capital Securities or Common Securities, as the case may
be.
"Officers' Certificate" means a certificate signed by the
Chairman of the Board, Vice Chairman of the Board, Chief Executive Officer,
President or an Executive Vice President, a Senior Vice President or Vice
President, and by the Treasurer, an Assistant Treasurer, the Secretary or an
Assistant Secretary, of the Depositor, and delivered to the party provided
herein. Any Officers' Certificate delivered with respect to compliance with a
condition or covenant provided for in this Trust Agreement shall include:
(a) a statement by each officer signing the Officers'
Certificate that such officer has read the covenant or condition and the
definitions relating thereto;
(b) a brief statement of the nature and scope of the examination
or investigation undertaken by such officer in rendering the Officers'
Certificate;
(c) a statement that such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such officer
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(d) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied with.
"Opinion of Counsel" means a written opinion of counsel, who may
be counsel for or an employee of the Depositor or any Affiliate of the
Depositor.
"Original Trust Agreement" has the meaning specified in the preamble to
this Trust Agreement.
"Outstanding," with respect to Trust Securities, means, as of the date
of determination, all Trust Securities theretofore executed and delivered under
this Trust Agreement, except:
(a) Trust Securities theretofore canceled by the Property
Trustee or delivered to the Property Trustee for cancellation;
(b) Trust Securities for whose payment or redemption money in
the necessary amount has been theretofore deposited with the Property Trustee or
any Paying Agent for the Holders of such Capital Securities, provided that if
such Trust Securities are to be redeemed, notice of such redemption has been
duly given pursuant to this Trust Agreement; and
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(c) Trust Securities which have been paid, or in exchange for,
or in lieu of which, other Trust Securities have been executed and delivered
pursuant to Sections 5.4, 5.5 and 5.6;
provided, however, that in determining whether the Holders of the requisite
Liquidation Amount of the Outstanding Capital Securities have given any request,
demand, authorization, direction, notice, consent or waiver hereunder, Capital
Securities owned by the Depositor, any Issuer Trustee, any Administrator or any
Affiliate of the Depositor, shall be disregarded and deemed not to be
Outstanding, except that (a) in determining whether any Issuer Trustee or any
Administrator shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Capital Securities
that such Issuer Trustee or such Administrator, as the case may be, knows to be
so owned shall be so disregarded and (b) the foregoing shall not apply at any
time when all of the Outstanding Capital Securities are owned by the Depositor,
one or more of the Issuer Trustees, one or more of the Administrators and/or any
such Affiliate. Capital Securities so owned which have been pledged in good
faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Administrators the pledgee's right so to act with respect to
such Capital Securities and that the pledgee is not the Depositor or any
Affiliate of the Depositor.
"Owner" means each Person who is the beneficial owner of Global
Capital Securities as reflected in the records of the Clearing Agency or, if a
Clearing Agency Participant is not the Owner, then as reflected in the records
of a Person maintaining an account with such Clearing Agency (directly or
indirectly), in accordance with the rules of such Clearing Agency.
"Paying Agent" means any paying agent or co-paying agent
appointed pursuant to Section 5.10 and shall initially be the Property Trustee.
"Payment Account" means a segregated non-interest-bearing
corporate trust account maintained with the Property Trustee in its trust
department for the benefit of the Holders in which all amounts paid in respect
of the Junior Subordinated Debentures will be held and from which the Property
Trustee, through the Paying Agent, shall make payments to the Holders in
accordance with Sections 4.1 and 4.2.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, company, limited liability company, trust, unincorporated organization
or government or any agency or political subdivision thereof, or any other
entity of whatever nature.
"Property Trustee" means the Person identified as the "Property
Trustee" in the preamble to this Trust Agreement solely in its capacity as
Property Trustee of the Issuer Trust continued hereunder and not in its
individual capacity, or its successor in interest in such capacity, or any
successor property trustee appointed as herein provided.
"Redemption Date" means, with respect to any Trust Security to
be redeemed, the date fixed for such redemption by or pursuant to this Trust
Agreement; provided that each Debenture Redemption Date and the stated maturity
of the Junior Subordinated Debentures shall
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be a Redemption Date for a Like Amount of Trust Securities, including but not
limited to any date of redemption pursuant to the occurrence of any Special
Event.
"Redemption Price" means a price equal to the Liquidation
Amount, together with accumulated Distributions to but excluding the date fixed
for redemption.
"Relevant Trustee" has the meaning specified in Section 8.10.
"Responsible Officer" when used with respect to the Property
Trustee means any officer assigned to the Corporate Trust Office, including any
managing director, vice president, principal, assistant vice president,
assistant treasurer, assistant secretary or any other officer of the Property
Trustee customarily performing functions similar to those performed by any of
the above designated officers and having direct responsibility for the
administration of the Indenture, and also, with respect to a particular matter,
any other officer to whom such matter is referred because of such officer's
knowledge of and familiarity with the particular subject.
"Securities Act" means the Securities Act of 1933, as amended,
and any successor statute thereto, in each case as amended from time to time.
"Senior Indebtedness" has the meaning specified in the
Indenture.
"Securities Register" and "Securities Registrar" have the
respective meanings specified in Section 5.5.
"Special Event" means any Tax Event, Capital Treatment Event or
Investment Company Event.
"Successor Capital Securities Certificate" of any particular
Capital Securities Certificate means every Capital Securities Certificate issued
after, and evidencing all or a portion of the same beneficial interest in the
Issuer Trust as that evidenced by, such particular Capital Securities
Certificate; and, for the purposes of this definition, any Capital Securities
Certificate executed and delivered under Section 5.6 in exchange for or in lieu
of a mutilated, destroyed, lost or stolen Capital Securities Certificate shall
be deemed to evidence the same beneficial interest in the Issuer Trust as the
mutilated, destroyed, lost or stolen Capital Securities Certificate.
"Successor Capital Security" has the meaning specified in
Section 9.5.
"Tax Event" means the receipt by the Issuer Trust of an Opinion
of Counsel experienced in such matters to the effect that, as a result of any
amendment to, or change (including any announced prospective change) in, the
laws (or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein, or as a result of any
official or administrative pronouncement or action or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
effective or which pronouncement, action or decision is announced on or after
the date of issuance of the Capital Securities (including, without limitation,
any of the foregoing arising with respect to, or resulting from, any proceeding
or other action commencing on or before such date), there is more than an
insubstantial risk that (i) the Issuer Trust is, or will be within 90 days of
the delivery of such Opinion of Counsel, subject to United States federal income
tax with respect to income received
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or accrued on the Junior Subordinated Debentures, (ii) interest payable by the
Depositor on the Junior Subordinated Debentures is not, or within 90 days of the
delivery of such Opinion of Counsel will not be, deductible by the Depositor, in
whole or in part, for United States federal income tax purposes, or (iii) the
Issuer Trust is, or will be within 90 days of the delivery of such Opinion of
Counsel, subject to more than a de minimis amount of other taxes, duties or
other governmental charges.
"Trust Agreement" means this Amended and Restated Trust
Agreement, as the same may be modified, amended or supplemented in accordance
with the applicable provisions hereof, including (i) all exhibits hereto, and
(ii) for all purposes of this Amended and Restated Trust Agreement any such
modification, amendment or supplement, the provisions of the Trust Indenture Act
that are deemed to be a part of and govern this Amended and Restated Trust
Agreement and any modification, amendment or supplement, respectively.
"Trust Indenture Act" means the Trust Indenture Act of 1939 or
any successor statute, in each case as amended from time to time.
"Trust Property" means (a) the Junior Subordinated Debentures,
(b) any cash on deposit in, or owing to, the Payment Account, (c) all proceeds
and rights in respect of the foregoing and (d) any other property and assets for
the time being held or deemed to be held by the Property Trustee pursuant to the
trusts of this Trust Agreement.
"Trust Securities Certificate" means any one of the Common
Securities Certificates or the Capital Securities Certificates.
"Trust Security" means any one of the Common Securities or the
Capital Securities.
"Underwriter" has the meaning specified in the Underwriting
Agreement.
"Underwriting Agreement" means the Underwriting Agreement, dated
as of June 3, 1998, among the Issuer Trust, the Depositor and the Underwriter,
as the same may be amended from time to time.
ARTICLE II
CONTINUATION OF THE ISSUER TRUST
SECTION 2.1. Name.
The Issuer Trust continued hereby shall be known as "MBNK
Capital Trust I", as such name may be modified from time to time by the
Administrators following written notice to the Holders of Trust Securities and
the Issuer Trustees, in which name the Administrators and the Issuer Trustees
may engage in the transactions contemplated hereby, make and execute contracts
and other instruments on behalf of the Issuer Trust and sue and be sued.
SECTION 2.2. Office of the Delaware Trustee; Principal Place of
Business.
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The address of the Delaware Trustee in the State of Delaware is
The Bank of New York (Delaware), White Clay Center, Route 273, Newark, Delaware
19711, Attention: Corporate Trust, or such other address in the State of
Delaware as the Delaware Trustee may designate by written notice to the Holders
and the Depositor. The principal executive office of the Issuer Trust is in care
of_______________________, Delaware _____ Attention:
SECTION 2.3. Initial Contribution of Trust Property;
Organizational Expenses.
The Property Trustee acknowledges receipt in trust from the
Depositor in connection with this Trust Agreement of the sum of $10.00, which
constitutes the initial Trust Property. The Depositor shall pay all
organizational expenses of the Issuer Trust as they arise or shall, upon request
of any Issuer Trustee, promptly reimburse such Issuer Trustee for any such
expenses paid by such Issuer Trustee. The Depositor shall make no claim upon the
Trust Property for the payment of such expenses.
SECTION 2.4. Issuance of the Capital Securities.
The Depositor and the Issuer Trust executed and delivered the
Underwriting Agreement pursuant to the Original Trust Agreement.
Contemporaneously with the execution and delivery of this Trust Agreement, an
Administrator, on behalf of the Issuer Trust, shall manually execute in
accordance with Section 5.3 and upon a written order of the Trust signed by one
Administrator, the Property Trustee shall manually authenticate in accordance
with Section 5.3 and deliver to the Underwriter, Capital Securities
Certificates, registered in the names requested by the Underwriter, in an
aggregate amount of 4,000,000 Capital Securities having an aggregate Liquidation
Amount of $40,000,000, against receipt of the aggregate purchase price of such
Capital Securities of $40,000,000, by the Property Trustee.
The Property Trustee may appoint an authenticating agent
acceptable to the Administrative Trustees to authenticate the Capital
Securities. An authenticating agent may authenticate Capital Securities whenever
the Property Trustee may do so. Each reference in this Declaration to
authenticate by the Property Trustee includes authentication by such agent. An
authenticating agent has the same rights as the Property Trustee to deal with
the Sponsor or an Affiliate.
SECTION 2.5. Issuance of the Common Securities; Subscription and
Purchase of Junior Subordinated Debentures.
Contemporaneously with the execution and delivery of this Trust
Agreement, an Administrator, on behalf of the Issuer Trust, shall execute or
cause to be executed in accordance with Section 5.3 and the Property Trustee
shall authenticate and shall deliver to the Depositor Common Securities
Certificates, registered in the name of the Depositor, in an aggregate amount of
120,000 Common Securities having an aggregate Liquidation Amount of $1,200,000
against receipt of the aggregate purchase price of such Common Securities of
$1,200,000 by the Property Trustee. Contemporaneously therewith, an
Administrator, on behalf of the Issuer Trust, shall subscribe for and purchase
from the Depositor the Junior Subordinated Debentures,
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registered in the name of the Issuer Trust and having an aggregate principal
amount equal to $41,200,000, and, in satisfaction of the purchase price for such
Junior Subordinated Debentures, the Property Trustee, on behalf of the Issuer
Trust, shall deliver to the Depositor the sum of $41,200,000 (being the sum of
the amounts delivered to the Property Trustee pursuant to (i) the second
sentence of Section 2.4, and (ii) the first sentence of this Section 2.5) and
receive on behalf of the Issuer Trust the Junior Subordinated Debentures.
SECTION 2.6. Declaration of Trust.
The exclusive purposes and functions of the Issuer Trust are to
(a) issue and sell Trust Securities and use the proceeds from such sale to
acquire the Junior Subordinated Debentures, and (b) engage in only those other
activities necessary, convenient or incidental thereto. The Depositor hereby
appoints the Issuer Trustees as trustees of the Issuer Trust, to have all the
rights, powers and duties to the extent set forth herein, and the Issuer
Trustees hereby accept such appointment. The Property Trustee hereby declares
that it will hold the Trust Property in trust upon and subject to the conditions
set forth herein for the benefit of the Issuer Trust and the Holders. The
Depositor hereby appoints the Administrators, with such Administrators having
all rights, powers and duties set forth herein with respect to accomplishing the
purposes of the Issuer Trust, and the Administrators hereby accept such
appointment; provided, however, that it is the intent of the parties hereto that
such Administrators shall not be trustees or, to the fullest extent permitted by
law, fiduciaries with respect to the Issuer Trust and this Trust Agreement shall
be construed in a manner consistent with such intent. The Property Trustee shall
have the right and power to perform those duties assigned to the Administrators.
The Delaware Trustee shall not be entitled to exercise any powers, nor shall the
Delaware Trustee have any of the duties and responsibilities, of the Property
Trustee or the Administrators set forth herein. The Delaware Trustee shall be
one of the trustees of the Issuer Trust for the sole and limited purpose of
fulfilling the requirements of Section 3807 of the Delaware Business Trust Act
and for taking such actions as are required to be taken by a Delaware trustee
under the Delaware Business Trust Act.
SECTION 2.7. Authorization to Enter into Certain Transactions.
(a) The Issuer Trustees and the Administrators shall conduct the
affairs of the Issuer Trust in accordance with the terms of this Trust
Agreement. Subject to the limitations set forth in paragraph (b) of this Section
and in accordance with the following provisions (i), (ii) and (iii), the Issuer
Trustees and the Administrators shall act as follows:
(i) each Administrator, acting jointly or singly, shall:
(1) comply with the Underwriting Agreement regarding the
issuance and sale of the Trust Securities;
(2) assist in compliance with the Securities Act, applicable
state securities or blue sky laws, and the Trust Indenture
Act;
(3) assist in the listing of the Capital Securities upon
such securities exchange or exchanges as shall be determined
by the Depositor, with the
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registration of the Capital Securities under the Exchange
Act, if required, and the preparation and filing of all
periodic and other reports and other documents pursuant to
the foregoing;
(4) execute the Trust Securities on behalf of the Issuer
Trust in accordance with this Trust Agreement;
(5) execute and deliver an application for a taxpayer
identification number for the Issuer Trust;
(6) assist in the filing with the Commission, at such time
as determined by the Depositor, any registration statement
under the Securities Act, including any amendments thereto;
(7) unless otherwise required by the Trust Indenture Act,
execute on behalf of the Issuer Trust any documents that the
Administrators have the power to execute pursuant to this
Trust Agreement, including without limitation, the
Debentures Purchase Agreement and the Common Securities
Purchase Agreement; and
(8) take any action incidental to the foregoing as necessary
or advisable to give effect to the terms of this Trust
Agreement.
(ii) The Property Trustee shall have the power and authority to
act on behalf of the Issuer Trust with respect to the following
matters:
(1) the establishment of the Payment Account;
(2) the receipt of the Junior Subordinated Debentures;
(3) the receipt and collection of interest, principal and
any other payments made in respect of the Junior Subordinated
Debentures in the Payment Account;
(4) the distribution of amounts owed to the Holders in
respect of the Trust Securities;
(5) the exercise of all of the rights, powers and privileges
of a holder of the Junior Subordinated Debentures;
(6) the sending of notices of default and other information
regarding the Trust Securities and the Junior Subordinated
Debentures to the Holders in accordance with this Trust
Agreement;
(7) the distribution of the Trust Property in accordance
with the terms of this Trust Agreement;
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(8) to the extent provided in this Trust Agreement, the
winding-up of the affairs of and liquidation of the Issuer
Trust and the preparation, execution and filing of the
certificate of cancellation with the Secretary of State of
the State of Delaware; and
(9) after an Event of Default (other than under paragraph
(b), (c), (d), or (e) of the definition of such term if such
Event of Default is by or with respect to the Property
Trustee), comply with the provisions of this Trust Agreement
and take any action to give effect to the terms of this Trust
Agreement and protect and conserve the Trust Property for the
benefit of the Holders (without consideration of the effect
of any such action on any particular Holder);
provided, however, that nothing in this Section 2.7(a)(ii) shall
require the Property Trustee to take any action that is not otherwise
required in this Trust Agreement.
(iii) The Property Trustee shall comply with the listing
requirements of the Capital Securities upon such securities exchange or
exchanges as shall be determined by the Depositor, the registration of
the Capital Securities under the Exchange Act, if required, and the
preparation and filing of all periodic and other reports and other
documents pursuant to the foregoing.
(b) So long as this Trust Agreement remains in effect, the
Issuer Trust (or the Issuer Trustees or Administrators acting on behalf of the
Issuer Trust) shall not undertake any business, activities or transaction except
as expressly provided herein or contemplated hereby. In particular, neither the
Issuer Trustees nor the Administrators shall (i) acquire any investments or
engage in any activities not authorized by this Trust Agreement, (ii) sell,
assign, transfer, exchange, mortgage, pledge, set-off or otherwise dispose of
any of the Trust Property or interests therein, including to Holders, except as
expressly provided herein, (iii) take any action that would cause the Issuer
Trust to become taxable other than as a grantor trust for United States Federal
income tax purposes, (iv) incur any indebtedness for borrowed money or issue any
other debt, or (v) take or consent to any action that would result in the
placement of a Lien on any of the Trust Property. The Property Trustee shall
defend all claims and demands of all Persons at any time claiming any Lien on
any of the Trust Property adverse to the interest of the Issuer Trust or the
Holders in their capacity as Holders.
(c) In connection with the issue and sale of the Capital
Securities, the Depositor shall have the right and responsibility to assist the
Issuer Trust with respect to, or effect on behalf of the Issuer Trust, the
following (and any actions taken by the Depositor in furtherance of the
following prior to the date of this Trust Agreement are hereby ratified and
confirmed in all respects):
(i) the preparation, execution and filing with the Commission of
a registration statement on the appropriate form under the Securities
Act with respect to the Capital Securities;
(ii) the determination of the states in which to take
appropriate action to qualify or register for sale all or part of the
Capital Securities and the determination of
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any and all such acts, other than actions that must be taken by or on
behalf of the Issuer Trust, and the advice to the Issuer Trustees of
actions they must take on behalf of the Issuer Trust, and the
preparation for execution and filing of any documents to be executed
and filed by the Issuer Trust or on behalf of the Issuer Trust, as the
Depositor deems necessary or advisable in order to comply with the
applicable laws of any such States in connection with the sale of the
Capital Securities;
(iii) the negotiation of the terms of, and the execution and
delivery of, the Underwriting Agreement providing for the sale of the
Capital Securities; and
(iv) the taking of any other actions necessary or desirable to
carry out any of the foregoing activities.
(d) Notwithstanding anything herein to the contrary, the
Administrators and the Property Trustee are authorized and directed to conduct
the affairs of the Issuer Trust and to operate the Issuer Trust so that the
Issuer Trust will not be deemed to be an "investment company" required to be
registered under the Investment Company Act, and will not be taxable other than
as a grantor trust for the United States Federal income tax purposes and so that
the Junior Subordinated Debentures will be treated as indebtedness of the
Depositor for United States Federal income tax purposes. In this connection, the
Property Trustee and the Holders of Common Securities are authorized to take any
action, not inconsistent with applicable law, the Certificate of Trust or this
Trust Agreement, that the Property Trustee and Holders of Common Securities
determine in their discretion to be necessary or desirable for such purposes, as
long as such action does not adversely affect in any material respect the
interests of the holders of the Outstanding Capital Securities. In no event
shall the Administrators or the Issuer Trustees be liable to the Issuer Trust or
the Holders for any failure to comply with this Section that results from a
change in law or regulations or in the interpretation thereof.
SECTION 2.8. Assets of Trust.
The assets of the Issuer Trust shall consist solely of the Trust
Property.
SECTION 2.9. Title to Trust Property.
Legal title to all Trust Property shall be vested at all times in the
Property Trustee (in its capacity as such) and shall be held and administered by
the Property Trustee for the benefit of the Issuer Trust and the Holders in
accordance with this Trust Agreement.
ARTICLE III
PAYMENT ACCOUNT
SECTION 3.1. Payment Account.
(a) On or prior to the Closing Date, the Property Trustee shall
establish the Payment Account. The Property Trustee and its agents shall have
exclusive control and sole right of withdrawal with respect to the Payment
Account for the purpose of making deposits in and withdrawals from the Payment
Account in accordance with this Trust Agreement. All
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monies and other property deposited or held from time to time in the Payment
Account shall be held by the Property Trustee in the Payment Account for the
exclusive benefit of the Holders and for distribution as herein provided,
including (and subject to) any priority of payments provided for herein.
(b) The Property Trustee shall deposit in the Payment Account,
promptly upon receipt, all payments of principal of or interest on, and any
other payments or proceeds with respect to, the Junior Subordinated Debentures.
Amounts held in the Payment Account shall not be invested by the Property
Trustee pending distribution thereof.
ARTICLE IV
DISTRIBUTIONS; REDEMPTION
SECTION 4.1. Distributions.
(a) The Trust Securities represent undivided beneficial
interests in the Trust Property, and Distributions (including of Additional
Amounts) will be made on the Trust Securities at the rate and on the dates that
payments of interest (including of Additional Interest, as defined in the
Indenture) are made on the Junior Subordinated Debentures. Accordingly:
(i) Distributions on the Trust Securities shall be cumulative
and will accumulate whether or not there are funds of the Issuer Trust
available for the payment of Distributions. Distributions shall
accumulate from September __, 1999, and, except in the event (and to
the extent) that the Depositor exercises its right to defer the payment
of interest on the Junior Subordinated Debentures pursuant to the
Indenture, shall be payable quarterly in arrears on March 31, June 30,
September 30 and December 31 of each year, commencing on December 31,
1999. If any date on which a Distribution is otherwise payable on the
Trust Securities is not a Business Day, then the payment of such
Distribution shall be made on the next succeeding day that is a
Business Day (without any additional Distributions or other payment in
respect of any such delay), with the same force and effect as if made
on the date on which such payment was originally payable (each date on
which distributions are payable in accordance with this Section 4.1(a),
a "Distribution Date").
(ii) The Trust Securities shall be entitled to Distributions
payable at a rate of _.__% per annum of the Liquidation Amount of the
Trust Securities. The amount of Distributions payable for any period
less than a full Distribution period shall be computed on the basis of
a 360-day year of twelve 30-day months and the actual number of days
elapsed in a partial month in a period. Distributions payable for each
full Distribution period will be computed by dividing the rate per
annum by four. The amount of Distributions payable for any period shall
include any Additional Amounts in respect of such period.
(iii) So long as no Debenture Event of Default has occurred and
is continuing, the Depositor has the right under the Indenture to defer
the payment of interest on the Junior Subordinated Debentures at any
time and from time to time for a period not exceeding 20 consecutive
quarterly periods (an "Extension Period"), provided that no
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Extension Period may extend beyond September 30, 2029. As a consequence
of any such deferral, quarterly Distributions on the Trust Securities
by the Issuer Trust will also be deferred (and the amount of
Distributions to which Holders of the Trust Securities are entitled
will accumulate additional Distributions thereon at a rate of _.__% per
annum, compounded quarterly from the relevant payment date for such
Distributions, computed on the basis of a 360-day year of twelve 30-day
months and the actual days elapsed in a partial month in such period).
Additional Distributions payable for each full Distribution period will
be computed by dividing the rate per annum by four. The term
"Distributions" as used in Section 4.1 shall include any such
additional Distributions provided pursuant to this Section 4.1(a)(iii).
(iv) Distributions on the Trust Securities shall be made by the
Property Trustee from the Payment Account and shall be payable on each
Distribution Date only to the extent that the Issuer Trust has funds
then on hand and available in the Payment Account for the payment of
such Distributions.
(b) Distributions on the Trust Securities with respect to a
Distribution Date shall be payable to the Holders thereof as they appear on the
Securities Register for the Trust Securities at the close of business on the
relevant record date, which shall be at the close of business on the fifteenth
day (whether or not a Business Day) next preceding the relevant Distribution
Date.
SECTION 4.2. Redemption.
(a) On each Debenture Redemption Date and on the stated maturity
of the Junior Subordinated Debentures, the Issuer Trust will be required to
redeem a Like Amount of Trust Securities at the Redemption Price.
(b) Notice of redemption shall be given by the Property Trustee
by first-class mail, postage prepaid, mailed not less than 30 nor more than 60
days prior to the Redemption Date to each Holder of Trust Securities to be
redeemed, at such Holder's address appearing in the Security Register. All
notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price, or if the Redemption Price cannot be
calculated prior to the time the notice is required to be sent, the
estimate of the Redemption Price provided pursuant to the Indenture
together with a statement that it is an estimate and that the actual
Redemption Price will be calculated on the third Business Day prior to
the Redemption Date (and if an estimate is provided, a further notice
shall be sent of the actual Redemption Price on the date, or as soon as
practicable thereafter, that notice of such actual Redemption Price is
received pursuant to the Indenture);
(iii) the CUSIP number or CUSIP numbers of the Capital
Securities affected;
(iv) if less than all the Outstanding Trust Securities are to be
redeemed, the identification and the total Liquidation Amount of the
particular Trust Securities to be redeemed;
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(v) that on the Redemption Date the Redemption Price will become
due and payable upon each such Trust Security to be redeemed and that
Distributions thereon will cease to accumulate on and after said date,
except as provided in Section 4.2(d) below; and
(vi) the place or places where Trust Securities are to be
surrendered for the payment of the Redemption Price.
The Issuer Trust in issuing the Trust Securities may use "CUSIP" or
"private placement" numbers (if then generally in use), and, if so, the Property
Trustee shall indicate the "CUSIP" or "private placement" numbers of the Trust
Securities in notices of redemption and related materials as a convenience to
Holders; provided, that any such notice may state that no representation is made
as to the correctness of such numbers either as printed on the Trust Securities
or as contained in any notice of redemption and related material.
(c) The Trust Securities redeemed on each Redemption Date shall
be redeemed at the Redemption Price with the applicable proceeds from the
contemporaneous redemption of Junior Subordinated Debentures. Redemptions of the
Trust Securities shall be made and the Redemption Price shall be payable on each
Redemption Date only to the extent that the Issuer Trust has funds then on hand
and available in the Payment Account for the payment of such Redemption Price.
(d) If the Issuer Trust gives a notice of redemption in respect
of any Capital Securities, then, by 12:00 noon, New York City time, on the
Redemption Date, subject to Section 4.2(c), the Property Trustee will, with
respect to Capital Securities held in global form, irrevocably deposit with the
Clearing Agency for such Capital Securities, to the extent available therefor,
funds sufficient to pay the applicable Redemption Price and will give such
Clearing Agency irrevocable instructions and authority to pay the Redemption
Price to the Holders of the Capital Securities. With respect to Capital
Securities that are not held in global form, the Property Trustee, subject to
Section 4.2(c), will irrevocably deposit with the Paying Agent, to the extent
available therefor, funds sufficient to pay the applicable Redemption Price and
will give the Paying Agent irrevocable instructions and authority to pay the
Redemption Price to the Holder of the Capital Securities upon surrender of their
Capital Securities Certificates. Notwithstanding the foregoing, Distributions
payable on or prior to the Redemption Date for any Trust Securities called for
redemption shall be payable to the Holders of such Trust Securities as they
appear on the Securities Register for the Trust Securities on the relevant
record dates for the related Distribution Dates. If notice of redemption shall
have been given and funds deposited as required, then, upon the date of such
deposit, all rights of Holders holding Trust Securities so called for redemption
will cease, except the right of such Holders to receive the Redemption Price and
any Distribution payable in respect of the Trust Securities on or prior to the
Redemption Date, but without interest, and such Trust Securities will cease to
be Outstanding. In the event that any date on which any applicable Redemption
Price is payable is not a Business Day, then payment of the applicable
Redemption Price payable on such date will be made on the next succeeding day
that is a Business Day (and without any interest or other payment in respect of
any such delay), except that, if such Business Day falls in the next calendar
year, such payment will be made on the immediately preceding Business Day, in
each case, with the same force and effect as if made on such date. In the event
that payment of the Redemption Price
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in respect of any Trust Securities called for redemption is improperly withheld
or refused and not paid either by the Issuer Trust or by the Depositor pursuant
to the Guarantee, Distributions on such Trust Securities will continue to
accumulate, as set forth in Section 4.1 and in accordance with the continued
accrual of interest on the Junior Subordinated Debentures, from the Redemption
Date originally established by the Issuer Trust for such Trust Securities to the
date such applicable Redemption Price is actually paid, in which case the actual
payment date will be the date fixed for redemption for purposes of calculating
the applicable Redemption Price.
(e) Subject to Section 4.3(a), if less than all the Outstanding
Trust Securities are to be redeemed on a Redemption Date, then the aggregate
Liquidation Amount of such Trust Securities to be redeemed shall be allocated
pro rata to the Common Securities and the Capital Securities based on the
relative Liquidation Amounts of such classes. The particular Capital Securities
to be redeemed shall be selected on a pro rata basis based on their respective
Liquidation Amounts not more than 60 days prior to the Redemption Date by the
Property Trustee from the Outstanding Capital Securities not previously called
for redemption, or if the Capital Securities are then held in the form of a
Global Capital Security in accordance with the customary procedures for the
Clearing Agency. The Property Trustee shall promptly notify the Securities
Registrar in writing of the Capital Securities selected for redemption and, in
the case of any Capital Securities selected for partial redemption, the
Liquidation Amount thereof to be redeemed. For all purposes of this Trust
Agreement, unless the context otherwise requires, all provisions relating to the
redemption of Capital Securities shall relate, in the case of any Capital
Securities redeemed or to be redeemed only in part, to the portion of the
aggregate Liquidation Amount of Capital Securities that has been or is to be
redeemed.
SECTION 4.3. Subordination of Common Securities.
(a) Payment of Distributions (including Additional Amounts, if
applicable) on, the Redemption Price of, and the Liquidation Distribution in
respect of, the Trust Securities, as applicable, shall be made, subject to
Section 4.2(e), pro rata among the Common Securities and the Capital Securities
based on the Liquidation Amount of such Trust Securities; provided, however,
that if on any Distribution Date or Redemption Date any Event of Default
resulting from a Debenture Event of Default in Section 5.1(1) or 5.1(2) of the
Indenture shall have occurred and be continuing, no payment of any Distribution
(including any Additional Amounts) on, Redemption Price of, or Liquidation
Distribution in respect of, any Common Security, and no other payment on account
of the redemption, liquidation or other acquisition of Common Securities, shall
be made unless payment in full in cash of all accumulated and unpaid
Distributions (including any Additional Amounts) on all Outstanding Capital
Securities for all Distribution periods terminating on or prior thereto, or, in
the case of payment of the Redemption Price, the full amount of such Redemption
Price on all Outstanding Capital Securities then called for redemption, or in
the case of payment of the Liquidation Distribution, the full amount of such
Liquidation Distribution on all Outstanding Capital Securities, shall have been
made or provided for, and all funds immediately available to the Property
Trustee shall first be applied to the payment in full in cash of all
Distributions (including any Additional Amounts) on, or the Redemption Price of,
or Liquidation Distribution in respect of, Capital Securities then due and
payable. The existence of an Event of Default does not entitle the Holders of
Capital Securities to accelerate the maturity thereof.
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(b) In the case of the occurrence of any Event of Default
resulting from any Debenture Event of Default, the Holders of the Common
Securities shall be deemed to have waived any right to act with respect to any
such Event of Default under this Trust Agreement until the effects of all such
Events of Default with respect to the Capital Securities have been cured, waived
or otherwise eliminated. Until all such Events of Default under this Trust
Agreement with respect to the Capital Securities have been so cured, waived or
otherwise eliminated, the Property Trustee shall act solely on behalf of the
Holders of the Capital Securities and not on behalf of the Holder of the Common
Securities, and only the Holders of the Capital Securities will have the right
to direct the Property Trustee to act on their behalf.
SECTION 4.4. Payment Procedures.
Payments of Distributions (including any Additional Amounts) in respect
of the Capital Securities shall be made by check mailed to the address of the
Person entitled thereto as such address shall appear on the Securities Register
or, if the Capital Securities are held by a Clearing Agency, such Distributions
shall be made to the Clearing Agency in immediately available funds, which will
credit the relevant accounts on the applicable Distribution Dates. Payments in
respect of the Common Securities shall be made in such manner as shall be
mutually agreed between the Property Trustee and the Holder of the Common
Securities.
SECTION 4.5. Tax Returns and Reports.
The Administrators shall prepare (or cause to be prepared), at the
Depositor's expense, and file all United States Federal, state and local tax and
information returns and reports required to be filed by or in respect of the
Issuer Trust. In this regard, the Administrators shall (a) prepare and file (or
cause to be prepared and filed) all Internal Revenue Service forms required to
be filed in respect of the Issuer Trust in each taxable year of the Issuer Trust
and (b)prepare and furnish (or cause to be prepared and furnished) to each
Holder all Internal Revenue Service forms required to be provided by the Issuer
Trust. The Administrators shall provide the Depositor and the Property Trustee
with a copy of all such returns and reports promptly after such filing or
furnishing. The Issuer Trustees shall comply with United States Federal
withholding and backup withholding tax laws and information reporting
requirements with respect to any payments to Holders under the Trust Securities.
On or before December 15 of each year during which any Capital
Securities are outstanding, the Administrators shall furnish to the Paying Agent
such information as may be reasonably requested by the Property Trustee in order
that the Property Trustee may prepare the information which it is required to
report for such year on Internal Revenue Service Forms 1096 and 1099 pursuant to
Section 6049 of the Code. Such information shall include the amount of original
issue discount includable in income for each outstanding Capital Security during
such year, if any.
SECTION 4.6. Payment of Taxes, Duties, Etc. of the Issuer Trust.
Upon receipt under the Junior Subordinated Debentures of Additional
Sums, the Property Trustee shall promptly pay any taxes, duties or governmental
charges of whatsoever nature (other than withholding taxes) imposed on the
Issuer Trust by the United States or any other taxing authority.
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SECTION 4.7. Payments under Indenture or Pursuant to Direct Actions.
Any amount payable hereunder to any Holder of Capital Securities shall
be reduced by the amount of any corresponding payment such Holder has directly
received pursuant to Section 5.8 of the Indenture or Section 5.13 of this Trust
Agreement.
SECTION 4.8. Liability of the Holder of Common Securities.
The Holder of Common Securities shall be liable for the debts and
obligations of the Issuer Trust as set forth in Section 6.7 of the Indenture
regarding allocation of expenses.
ARTICLE V
TRUST SECURITIES CERTIFICATES
SECTION 5.1. Initial Ownership.
Upon the creation of the Issuer Trust and the contribution by the
Depositor pursuant to Section 2.3 and until the issuance of the Trust
Securities, and at any time during which no Trust Securities are Outstanding,
the Depositor shall be the sole beneficial owner of the Issuer Trust.
SECTION 5.2. The Trust Securities Certificates.
(a) The Capital Securities Certificates shall be issued in fully
registered form. The Trust Securities Certificates shall be executed on behalf
of the Issuer Trust by manual or facsimile signature of at least one
Administrator except as provided in Section 5.3. Trust Securities Certificates
bearing the manual or facsimile signatures of individuals who were, at the time
when such signatures shall have been affixed, authorized to sign on behalf of
the Issuer Trust, shall be validly issued and entitled to the benefits of this
Trust Agreement, notwithstanding that such individuals or any of them shall have
ceased to be so authorized prior to the delivery of such Trust Securities
Certificates or did not hold such offices at the date of delivery of such Trust
Securities Certificates. A transferee of a Trust Securities Certificate shall
become a Holder, and shall be entitled to the rights and subject to the
obligations of a Holder hereunder, upon due registration of such Trust
Securities Certificate in such transferee's name pursuant to Section 5.5.
(b) Upon their original issuance, Capital Securities
Certificates shall be issued in the form of one or more Global Capital
Securities Certificates registered in the name of Cede as Depositary's nominee
and deposited with or on behalf of Depositary for credit by Depositary to the
respective accounts of the Owners thereof (or such other accounts as they may
direct). Except as set forth herein, record ownership of the Global Capital
Securities may be transferred, in whole or in part, only to another nominee of
Depositary or to a successor of Depository or its nominee.
(c) A single Common Securities Certificate representing the
Common Securities shall be issued to the Depositor in the form of a definitive
Common Securities Certificate.
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SECTION 5.3. Execution and Delivery of Trust Securities Certificates.
At the Closing Time, and on the date, if any, on which the Underwriter
exercises its option to purchase additional Capital Securities pursuant to the
terms of the Underwriting Agreement, as applicable, an Administrator shall cause
Trust Securities Certificates, in an aggregate Liquidation Amount as provided in
Sections 2.4 and 2.5, to be executed on behalf of the Issuer Trust and delivered
to the Property Trustee and upon such delivery the Property Trustee shall
authenticate such Trust Securities Certificates and deliver such Trust
Securities Certificates upon the written order of the Trust, executed by an
Administrator thereof, without further corporate action by the Depositor, in
authorized denominations.
SECTION 5.4. Global Capital Securities.
(a) The Global Capital Securities issued under this Trust
Agreement shall be registered in the name of the nominee of the Clearing Agency
and delivered to the Property Trustee as custodian for the Clearing Agency.
(b) Notwithstanding any other provision in this Trust Agreement,
the Global Capital Securities may not be exchanged in whole or in part for
Capital Securities registered, and no transfer of the Global Capital Securities
in whole or in part may be registered, in the name of any Person other than the
Clearing Agency for such Global Capital Security, Cede, or other nominee thereof
unless (i) such Clearing Agency advises the Depositor and the Property Trustee
in writing that such Clearing Agency is no longer willing or able to properly
discharge its responsibilities as Clearing Agency with respect to such Global
Capital Security, and the Depositor is unable to locate a qualified successor,
(ii) the Issuer Trust at its option advises the Depositary in writing that it
elects to terminate the book-entry system through the Clearing Agency, or (iii)
there shall have occurred and be continuing an Event of Default or any event
which after notice or lapse of time or both would be an Event of Default. In
addition, beneficial interests in a Global Capital Security may be exchanged for
a Capital Securities Certificate registered in the name of the owner of such
beneficial interest upon request but only upon at least twenty (20) days prior
written notice given to the Property Trustee by or on behalf of the Depositary
in accordance with the Applicable Procedures..
(c) Every Capital Security executed, authenticated and delivered
upon registration of transfer of, or in exchange for or in lieu of, a Global
Capital Security or any portion thereof, whether pursuant to this Article V or
Article IV or otherwise, shall be authenticated and delivered in the form of,
and shall be, a Global Capital Security, unless such Global Capital Security is
registered in the name of a Person other than the Clearing Agency for such
Global Capital Security or a nominee thereof.
(d) The Clearing Agency or its nominee, as the registered owner
of the Global Capital Security, shall be considered the Holder of the Capital
Securities represented by the Global Capital Security for all purposes under
this Trust Agreement and the Capital Securities, and owners of beneficial
interests in the Global Capital Security shall hold such interests pursuant to
the Applicable Procedures and, except as otherwise provided herein, shall not be
entitled to have any of the individual Capital Securities represented by the
Global Security registered in their names, shall not receive nor be entitled to
receive physical delivery of any
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such Capital Securities in definitive form and shall not be considered the
Holders thereof under this Trust Agreement. Accordingly, any such owner's
beneficial interest in the Global Capital Security shall be shown only on, and
the transfer of such interest shall be effected only through, records maintained
by the Clearing Agency or its nominee. Neither the Property Trustee nor the
Securities Registrar shall have any liability in respect of any transfers
effected by the Clearing Agency.
(e) The rights of owners of beneficial interests in the Global
Capital Security shall be exercised only through the Clearing Agency and shall
be limited to those established by law and agreements between such owners and
the Clearing Agency.
SECTION 5.5. Registration of Transfer and Exchange Generally;
Certain Transfers and Exchanges; Capital Securities Certificates.
(a) The Property Trustee shall keep or cause to be kept at its
Corporate Trust Office a register or registers for the purpose of registering
Capital Securities Certificates and transfers and exchanges of Capital
Securities Certificates in which the registrar and transfer agent with respect
to the Capital Securities (the "Securities Registrar"), subject to such
reasonable regulations as it may prescribe, shall provide for the registration
of Capital Securities Certificates and Common Securities Certificates (subject
to Section 5.11 in the case of Common Securities Certificates) and registration
of transfers and exchanges of Capital Securities Certificates as herein
provided. Such register is herein sometimes referred to as the "Securities
Register." The Property Trustee is hereby appointed Securities Registrar for the
purpose of registering Capital Securities and transfers of Capital Securities as
herein provided.
Upon surrender for registration of transfer of any Capital Security at
the offices or agencies of the Property Trustee designated for that purpose the
Administrators shall execute, and the Property Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Capital Securities of the same series of any authorized denominations of
like tenor and aggregate principal amount and bearing such restrictive legends
as may be required by this Trust Agreement.
At the option of the Holder, Capital Securities may be exchanged for
other Capital Securities of any authorized denominations, of like tenor and
aggregate Liquidation Amount and bearing such restrictive legends as may be
required by this Trust Agreement, upon surrender of the Capital Securities to be
exchanged at such office or agency. Whenever any Capital Securities are so
surrendered for exchange, the Administrators shall execute and the Property
Trustee shall authenticate and deliver the Capital Securities that the Holder
making the exchange is entitled to receive.
All Capital Securities issued upon any transfer or exchange of Capital
Securities shall be the valid obligations of the Issuer Trust, evidencing the
same debt, and entitled to the same benefits under this Trust Agreement, as the
Capital Securities surrendered upon such transfer or exchange.
Every Capital Security presented or surrendered for transfer or
exchange shall (if so required by the Property Trustee) be duly endorsed, or be
accompanied by a written instrument
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of transfer in form satisfactory to the Property Trustee and the Securities
Registrar, duly executed by the Holder thereof or such Holder's attorney duly
authorized in writing.
No service charge shall be made to a Holder for any transfer or
exchange of Capital Securities, but the Property Trustee may require payment of
a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Capital Securities.
Neither the Issuer Trust nor the Property Trustee shall be required,
pursuant to the provisions of this Section, (i) to issue, register the transfer
of or exchange any Capital Security during a period beginning at the opening of
business 15 days before the day of selection for redemption of Capital
Securities pursuant to Article IV and ending at the close of business on the day
of mailing of the notice of redemption, or (ii) to register the transfer of or
exchange any Capital Security so selected for redemption in whole or in part,
except, in the case of any such Capital Security to be redeemed in part, any
portion thereof not to be redeemed.
(b) Certain Transfers and Exchanges. Notwithstanding any other
provision of this Trust Agreement, transfers and exchanges of Capital Securities
and beneficial interests in a Global Capital Security shall be made only in
accordance with this Section 5.5(b).
(i) Non-Global Capital Security to Non-Global Capital Security.
A Trust Security that is not a Global Capital Security may be
transferred, in whole or in part, to a Person who takes delivery in the
form of another Trust Security that is not a Global Capital Security as
provided in Section 5.5(a).
(ii) Exchanges Between Global Capital Security and Non-Global
Trust Security. A beneficial interest in a Global Capital Security may
be exchanged for a Trust Security that is not a Global Capital Security
as provided in Section 5.4.
SECTION 5.6. Mutilated, Destroyed, Lost or Stolen Trust Securities
Certificates.
If (a) any mutilated Trust Securities Certificate shall be surrendered
to the Securities Registrar, or if the Securities Registrar shall receive
evidence to its satisfaction of the destruction, loss or theft of any Trust
Securities Certificate and (b) there shall be delivered to the Securities
Registrar and the Administrators such security or indemnity as may be required
by them to save each of them harmless, then in the absence of notice that such
Trust Securities Certificate shall have been acquired by a bona fide purchaser,
the Administrators, or any one of them, on behalf of the Issuer Trust shall
execute and make available for delivery, and the Property Trustee shall
authenticate, in exchange for or in lieu of any such mutilated, destroyed, lost
or stolen Trust Securities Certificate, a new Trust Securities Certificate of
like class, tenor and denomination. In connection with the issuance of any new
Trust Securities Certificate under this Section, the Administrators or the
Securities Registrar may require the payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in connection therewith.
Any duplicate Trust Securities Certificate issued pursuant to this Section shall
constitute conclusive evidence of an undivided beneficial interest in the assets
of the Issuer Trust corresponding to that evidenced by the lost, stolen or
destroyed Trust Securities Certificate, as if originally issued, whether or not
the lost, stolen or destroyed Trust Securities Certificate shall be found at any
time.
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SECTION 5.7. Persons Deemed Holders.
The Issuer Trustees or the Securities Registrar shall treat the Person
in whose name any Trust Securities are issued as the owner of such Trust
Securities for the purpose of receiving Distributions and for all other purposes
whatsoever, and none of the Issuer Trustees, the Administrators nor the
Securities Registrar shall be bound by any notice to the contrary.
SECTION 5.8. Access to List of Holders' Names and Addresses.
Each Holder and each Owner shall be deemed to have agreed not to hold
the Depositor, the Property Trustee, or the Administrators accountable by reason
of the disclosure of its name and address, regardless of the source from which
such information was derived.
SECTION 5.9. Maintenance of Office or Agency.
The Property Trustee shall designate, with the consent of the
Administrators, which consent shall not be unreasonably withheld, an office or
offices or agency or agencies where Capital Securities Certificates may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Issuer Trustees in respect of the Trust Securities
Certificates may be served. The Property Trustee initially designates its
Corporate Trust Office at 101 Barclay Street, 21 West, New York, NY 10286, as
its corporate trust office for such purposes. The Property Trustee shall give
prompt written notice to the Depositor, the Administrators and to the Holders of
any change in the location of the Securities Register or any such office or
agency.
SECTION 5.10. Appointment of Paying Agent.
The Paying Agent shall make Distributions to Holders from the Payment
Account and shall report the amounts of such Distributions to the Property
Trustee and the Administrators. Any Paying Agent shall have the revocable power
to withdraw funds from the Payment Account solely for the purpose of making the
Distributions referred to above. The Property Trustee may revoke such power and
remove any Paying Agent in its sole discretion. The Paying Agent shall initially
be the Property Trustee. Any Person acting as Paying Agent shall be permitted to
resign as Paying Agent upon 30 days' written notice to the Administrators, and
the Property Trustee. In the event that the Property Trustee shall no longer be
the Paying Agent or a successor Paying Agent shall resign or its authority to
act be revoked, the Property Trustee shall appoint a successor (which shall be a
bank or trust company) that is reasonably acceptable to the Administrators to
act as Paying Agent. Such successor Paying Agent or any additional Paying Agent
appointed by the Administrators shall execute and deliver to the Issuer Trustees
an instrument in which such successor Paying Agent or additional Paying Agent
shall agree with the Issuer Trustees that as Paying Agent, such successor Paying
Agent or additional Paying Agent will hold all sums, if any, held by it for
payment to the Holders in trust for the benefit of the Holders entitled thereto
until such sums shall be paid to such Holders. The Paying Agent shall return all
unclaimed funds to the Property Trustee and upon removal of a Paying Agent such
Paying Agent shall also return all funds in its possession to the Property
Trustee. The provisions of Sections 8.1, 8.3 and 8.6 herein shall apply to the
Bank also in its role as Paying Agent, for so long as the Bank shall act as
Paying Agent and, to the extent applicable, to any other paying
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agent appointed hereunder. Any reference in this Trust Agreement to the Paying
Agent shall include any co-paying agent chosen by the Property Trustee unless
the context requires otherwise.
SECTION 5.11. Ownership of Common Securities by Depositor.
At each Closing Time, the Depositor shall acquire and retain beneficial
and record ownership of the Common Securities. Neither the Depositor nor any
successor Holder of the Common Securities may transfer less than all the Common
Securities, and the Depositor or any such successor Holder may transfer the
Common Securities only (i) in connection with a consolidation or merger of the
Depositor into another corporation or any conveyance, transfer or lease by the
Depositor of its properties and assets substantially as an entirety to any
Person, pursuant to Section 8.1 of the Indenture, or (ii) to an Affiliate of the
Depositor in compliance with applicable law (including the Securities Act and
applicable state securities and blue sky laws); provided that any such transfer
shall be subject to the condition that the transferor shall have obtained (A)
either a ruling from the Internal Revenue Service or an unqualified written
opinion addressed to the Issuer Trust and delivered to the Issuer Trustees of
nationally recognized independent tax counsel experienced in such matters to the
effect that such transfer will not (1) cause the Issuer Trust to be treated as
issuing a class of interests in the Issuer Trust differing from the class of
interests represented by the Common Securities originally issued to the
Depositor, (2) result in the Issuer Trust acquiring or disposing of, or being
deemed to have acquired or disposed of, an asset, or (3) result in or cause the
Issuer Trust to be treated as anything other than a grantor trust for United
States Federal income tax purposes and (B) an unqualified written opinion
addressed to the Issuer Trust and delivered to the Issuer Trustees of a
nationally recognized independent counsel experienced in such matters that such
transfer will not cause the Issuer Trust to be an "investment company" or
controlled by an "investment company" that is required to be registered under
the Investment Company Act. To the fullest extent permitted by law, any
attempted transfer of the Common Securities, other than as set forth in the
immediately preceding sentence, shall be void. The Administrators shall cause
each Common Securities Certificate issued to the Depositor to contain a legend
stating "THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT TO THE DEPOSITOR OR AN
AFFILIATE OF THE DEPOSITOR IN COMPLIANCE WITH APPLICABLE LAW AND SECTION 5.11 OF
THE TRUST AGREEMENT."
SECTION 5.12. Notices to Clearing Agency.
To the extent that a notice or other communication to the Holders is
required under this Trust Agreement, with respect to Capital Securities
represented by Global Capital Securities Certificates, the Administrators and
the Issuer Trustees shall give all such notices and communications specified
herein to be given to the Clearing Agency, and shall have no obligations to the
Owners.
SECTION 5.13. Rights of Holders.
(a) The legal title to the Trust Property is vested exclusively
in the Property Trustee (in its capacity as such) in accordance with Section
2.9, and the Holders shall not have any right or title therein other than the
undivided beneficial ownership interest in the assets of the Issuer Trust
conferred by their Trust Securities and they shall have no right to call for any
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partition or division of property, profits or rights of the Issuer Trust except
as described below. The Trust Securities shall be personal property giving only
the rights specifically set forth therein and in this Trust Agreement. The Trust
Securities shall have no preemptive or similar rights and when issued and
delivered to Holders against payment of the purchase price therefor, as provided
herein, will be fully paid and nonassessable by the Issuer Trust. Except as
otherwise provided in Section 4.8, the Holders of the Trust Securities, in their
capacities as such, shall be entitled to the same limitation of personal
liability extended to stockholders of private corporations for profit organized
under the General Corporation Law of the State of Delaware.
(b) For so long as any Capital Securities remain Outstanding,
if, upon a Debenture Event of Default, the Debenture Trustee fails or the
holders of not less than 25% in principal amount of the outstanding Junior
Subordinated Debentures fail to declare the principal of all of the Junior
Subordinated Debentures to be immediately due and payable, the Holders of at
least 25% in Liquidation Amount of the Capital Securities then Outstanding shall
have such right to make such declaration by a notice in writing to the Property
Trustee, the Depositor and the Debenture Trustee.
At any time after such a declaration of acceleration with respect to
the Junior Subordinated Debentures has been made and before a judgment or decree
for payment of the money due has been obtained by the Debenture Trustee as
provided in the Indenture, the Holders of a Majority in Liquidation Amount of
the Capital Securities, by written notice to the Property Trustee, the Depositor
and the Debenture Trustee, may rescind and annul such declaration and its
consequences if:
(i) the Depositor has paid or deposited with the Debenture
Trustee a sum sufficient to pay
(1) all overdue installments of interest on all of the
Junior Subordinated Debentures,
(2) any accrued Additional Interest on all of the Junior
Subordinated Debentures,
(3) the principal of any Junior Subordinated Debentures
which have become due otherwise than by such declaration of
acceleration and interest and Additional Interest thereon at
the rate borne by the Junior Subordinated Debentures, and
(4) all sums paid or advanced by the Debenture Trustee under
the Indenture and the reasonable compensation, expenses,
disbursements and advances of the Debenture Trustee and the
Property Trustee, their agents and counsel; and
(ii) all Events of Default with respect to the Junior
Subordinated Debentures, other than the non-payment of the
principal of the Junior Subordinated Debentures which has
become due solely by such acceleration, have been cured or
waived as provided in Section 5.13 of the Indenture.
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If the Property Trustee fails to annul any such declaration and waive
such default, the Holders of at least a Majority in Liquidation Amount of the
Capital Securities shall also have the right to rescind and annul such
declaration and its consequences by written notice to the Depositor, the
Property Trustee and the Debenture Trustee, subject to the satisfaction of the
conditions set forth in clauses (i) and (ii) of this Section 5.13(b).
The Holders of at least a Majority in Liquidation Amount of the Capital
Securities may, on behalf of the Holders of all the Capital Securities, waive
any past default under the Indenture, except a default in the payment of
principal or interest (unless such default has been cured and a sum sufficient
to pay all matured installments of interest and principal due otherwise than by
acceleration has been deposited with the Debenture Trustee) or a default in
respect of a covenant or provision which under the Indenture cannot be modified
or amended without the consent of the holder of each outstanding Junior
Subordinated Debentures. No such rescission shall affect any subsequent default
or impair any right consequent thereon.
Upon receipt by the Property Trustee of written notice declaring such
an acceleration, or rescission and annulment thereof, by Holders of the Capital
Securities all or part of which is represented by Global Capital Securities, a
record date shall be established for determining Holders of Outstanding Capital
Securities entitled to join in such notice, which record date shall be at the
close of business on the day the Property Trustee receives such notice. The
Holders on such record date, or their duly designated proxies, and only such
Persons, shall be entitled to join in such notice, whether or not such Holders
remain Holders after such record date; provided, that, unless such declaration
of acceleration, or rescission and annulment, as the case may be, shall have
become effective by virtue of the requisite percentage having joined in such
notice prior to the day which is 90 days after such record date, such notice of
declaration of acceleration, or rescission and annulment, as the case may be,
shall automatically and without further action by any Holder be canceled and of
no further effect. Nothing in this paragraph shall prevent a Holder, or a proxy
of a Holder, from giving, after expiration of such 90-day period, a new written
notice of declaration of acceleration, or rescission and annulment thereof, as
the case may be, that is identical to a written notice which has been canceled
pursuant to the proviso to the preceding sentence, in which event a new record
date shall be established pursuant to the provisions of this Section 5.13(b).
(c) For so long as any Capital Securities remain Outstanding, to
the fullest extent permitted by law and subject to the terms of this Trust
Agreement and the Indenture, upon a Debenture Event of Default specified in
Section 5.1(1) or 5.1(2) of the Indenture, any Holder of Capital Securities
shall have the right to institute a proceeding directly against the Depositor,
pursuant to Section 5.8 of the Indenture, for enforcement of payment to such
Holder of the principal amount of or interest on Junior Subordinated Debentures
having an aggregate principal amount equal to the aggregate Liquidation Amount
of the Capital Securities of such Holder (a "Direct Action"). Except as set
forth in Sections 5.13(b) and 5.13(c), the Holders of Capital Securities shall
have no right to exercise directly any right or remedy available to the holders
of, or in respect of, the Junior Subordinated Debentures.
ARTICLE VI
ACTS OF HOLDERS; MEETINGS; VOTING
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SECTION 6.1. Limitations on Holder's Voting Rights.
(a) Except as provided in this Trust Agreement and in the
Indenture and as otherwise required by law, no Holder of Capital Securities
shall have any right to vote or in any manner otherwise control the
administration, operation and management of the Issuer Trust or the obligations
of the parties hereto, nor shall anything herein set forth or contained in the
terms of the Trust Securities Certificates be construed so as to constitute the
Holders from time to time as members of an association.
(b) So long as any Junior Subordinated Debentures are held by
the Property Trustee on behalf of the Issuer Trust, the Property Trustee shall
not (i) direct the time, method and place of conducting any proceeding for any
remedy available to the Debenture Trustee, or execute any trust or power
conferred on the Property Trustee with respect to such Junior Subordinated
Debentures, (ii) waive any past default that may be waived under Section 5.13 of
the Indenture, (iii) exercise any right to rescind or annul a declaration that
the principal of all the Junior Subordinated Debentures shall be due and payable
or (iv) consent to any amendment, modification or termination of the Indenture
or the Junior Subordinated Debentures, where such consent shall be required,
without, in each case, obtaining the prior approval of the Holders of at least a
Majority in Liquidation Amount of the Capital Securities, provided, however,
that where a consent under the Indenture would require the consent of each
holder of Junior Subordinated Debentures affected thereby, no such consent shall
be given by the Property Trustee without the prior written consent of each
Holder of Capital Securities. The Property Trustee shall not revoke any action
previously authorized or approved by a vote of the Holders of Capital
Securities, except by a subsequent vote of the Holders of Capital Securities.
The Property Trustee shall notify all Holders of the Capital Securities of any
notice of default received with respect to the Junior Subordinated Debentures.
In addition to obtaining the foregoing approvals of the Holders of the Capital
Securities, prior to taking any of the foregoing actions, the Property Trustee
shall, at the expense of the Depositor, obtain an Opinion of Counsel experienced
in such matters to the effect that such action will not cause the Issuer Trust
to be taxable other than as a grantor trust for United States Federal income tax
purposes.
(c) If any proposed amendment to the Trust Agreement provides
for, or the Issuer Trust otherwise proposes to effect, (i) any action that would
adversely affect in any material respect the interests, powers, preferences or
special rights of the Capital Securities, whether by way of amendment to the
Trust Agreement or otherwise, or (ii) the dissolution, winding-up or termination
of the Issuer Trust, other than pursuant to the terms of this Trust Agreement,
then the Holders of Outstanding Trust Securities as a class will be entitled to
vote on such amendment or proposal and such amendment or proposal shall not be
effective except with the approval of the Holders of at least a Majority in
Liquidation Amount of the Capital Securities. Notwithstanding any other
provision of this Trust Agreement, no amendment to this Trust Agreement may be
made if, as a result of such amendment, it would cause the Issuer Trust to be
taxable other than as a grantor trust for United States Federal income tax
purposes.
SECTION 6.2. Notice of Meetings.
Notice of all meetings of the Holders, stating the time, place and
purpose of the meeting, shall be given by the Property Trustee pursuant to
Section 10.8 to each Holder of record, at his registered address, at least 15
days and not more than 90 days before the meeting. At any such
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meeting, any business properly before the meeting may be so considered whether
or not stated in the notice of the meeting. Any adjourned meeting may be held as
adjourned without further notice.
SECTION 6.3. Meetings of Holders.
No annual meeting of Holders is required to be held. The Property
Trustee, however, shall call a meeting of Holders to vote on any matter upon the
written request of the Holders of record of 25% of the aggregate Liquidation
Amount of the Capital Securities and the Administrators or the Property Trustee
may, at any time in their discretion, call a meeting of Holders of Capital
Securities to vote on any matters as to which Holders are entitled to vote.
Holders of at least a Majority in Liquidation Amount of the Capital
Securities, present in person or represented by proxy, shall constitute a quorum
at any meeting of Holders of the Capital Securities.
If a quorum is present at a meeting, an affirmative vote by the Holders
of record present, in person or by proxy, holding Capital Securities
representing at least a Majority in Liquidation Amount of the Capital Securities
held by the Holders present, either in person or by proxy, at such meeting shall
constitute the action of the Holders of Capital Securities, unless this Trust
Agreement requires a greater number of affirmative votes.
SECTION 6.4. Voting Rights.
Holders shall be entitled to one vote for each $10.00 of Liquidation
Amount represented by their Outstanding Trust Securities in respect of any
matter as to which such Holders are entitled to vote.
SECTION 6.5. Proxies, etc.
At any meeting of Holders, any Holder entitled to vote thereat may vote
by proxy, provided that no proxy shall be voted at any meeting unless it shall
have been placed on file with the Property Trustee, or with such other officer
or agent of the Issuer Trust as the Property Trustee may direct, for
verification prior to the time at which such vote shall be taken. Pursuant to a
resolution of the Property Trustee, proxies may be solicited in the name of the
Property Trustee or one or more officers of the Property Trustee. Only Holders
of record shall be entitled to vote. When Trust Securities are held jointly by
several persons, any one of them may vote at any meeting in person or by proxy
in respect of such Trust Securities, but if more than one of them shall be
present at such meeting in person or by proxy, and such joint owners or their
proxies so present disagree as to any vote to be cast, such vote shall not be
received in respect of such Trust Securities. A proxy purporting to be executed
by or on behalf of a Holder shall be deemed valid unless challenged at or prior
to its exercise, and the burden of proving invalidity shall rest on the
challenger. No proxy shall be valid more than three years after its date of
execution.
SECTION 6.6. Holder Action by Written Consent.
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Any action which may be taken by Holders at a meeting may be taken
without a meeting if Holders holding at least a Majority in Liquidation Amount
of all Trust Securities entitled to vote in respect of such action (or such
larger proportion thereof as shall be required by any other provision of this
Trust Agreement) shall consent to the action in writing.
SECTION 6.7. Record Date for Voting and Other Purposes.
For the purposes of determining the Holders who are entitled to notice
of and to vote at any meeting or by written consent, or to participate in any
distribution on the Trust Securities in respect of which a record date is not
otherwise provided for in this Trust Agreement, or for the purpose of any other
action, the Administrators or Property Trustee may from time to time fix a date,
not more than 90 days prior to the date of any meeting of Holders or the payment
of a distribution or other action, as the case may be, as a record date for the
determination of the identity of the Holders of record for such purposes.
SECTION 6.8. Acts of Holders.
Any request, demand, authorization, direction, notice, consent, waiver
or other action provided or permitted by this Trust Agreement to be given, made
or taken by Holders may be embodied in and evidenced by one or more instruments
of substantially similar tenor signed by such Holders in person or by an agent
duly appointed in writing; and, except as otherwise expressly provided herein,
such action shall become effective when such instrument or instruments are
delivered to the Property Trustee. Such instrument or instruments (and the
action embodied therein and evidenced thereby) are herein sometimes referred to
as the "Act" of the Holders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent shall
be sufficient for any purpose of this Trust Agreement and (subject to Section
8.1) conclusive in favor of the Issuer Trustees, if made in the manner provided
in this Section.
The fact and date of the execution by any Person of any such instrument
or writing may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged to him the execution thereof. Where such execution is by
a signer acting in a capacity other than his individual capacity, such
certificate or affidavit shall also constitute sufficient proof of his
authority. The fact and date of the execution of any such instrument or writing,
or the authority of the Person executing the same, may also be proved in any
other manner which any Issuer Trustee or Administrator receiving the same deems
sufficient.
The ownership of Trust Securities shall be proved by the Securities
Register.
Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the Holder of any Trust Security shall bind every future Holder
of the same Trust Security and the Holder of every Trust Security issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done, omitted or suffered to be done by the Issuer
Trustees, the Administrators or the Issuer Trust in reliance thereon, whether or
not notation of such action is made upon such Trust Security.
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Without limiting the foregoing, a Holder entitled hereunder to take any
action hereunder with regard to any particular Trust Security may do so with
regard to all or any part of the Liquidation Amount of such Trust Security or by
one or more duly appointed agents each of which may do so pursuant to such
appointment with regard to all or any part of such Liquidation Amount.
If any dispute shall arise among the Holders, the Administrators or the
Issuer Trustees with respect to the authenticity, validity or binding nature of
any request, demand, authorization, direction, consent, waiver or other Act of
such Holder or Issuer Trustee under this Article VI, then the determination of
such matter by the Property Trustee shall be conclusive with respect to such
matter.
SECTION 6.9. Inspection of Records.
Upon reasonable notice to the Administrators and the Property Trustee,
the records of the Issuer Trust shall be open to inspection by Holders during
normal business hours for any purpose reasonably related to such Holder's
interest as a Holder.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
SECTION 7.1. Representations and Warranties of the Property Trustee
and the Delaware Trustee.
The Property Trustee and the Delaware Trustee, each severally on behalf
of and as to itself, hereby represents and warrants for the benefit of the
Depositor and the Holders that:
(a) The Property Trustee is a banking corporation with trust
powers, duly organized, validly existing and in good standing under the laws of
New York, with trust power and authority to execute and deliver, and to carry
out and perform its obligations under the terms of this Trust Agreement.
(b) The execution, delivery and performance by the Property
Trustee of this Trust Agreement has been duly authorized by all necessary
corporate action on the part of the Property Trustee; and this Trust Agreement
has been duly executed and delivered by the Property Trustee, and constitutes a
legal, valid and binding obligation of the Property Trustee, enforceable against
it in accordance with its terms, subject to applicable bankruptcy,
reorganization, moratorium, insolvency, and other similar laws affecting
creditors' rights generally and to general principles of equity and the
discretion of the court (regardless of whether the enforcement of such remedies
is considered in a proceeding in equity or at law).
(c) The execution, delivery and performance of this Trust
Agreement by the Property Trustee does not conflict with or constitute a breach
of the certificate of incorporation or by-laws of the Property Trustee.
(d) At the Closing Time, the Property Trustee has not knowingly
created any Liens on the Trust Securities.
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(e) No consent, approval or authorization of, or registration
with or notice to, any New York State or federal banking authority is required
for the execution, delivery or performance by the Property Trustee, of this
Trust Agreement.
(f) The Delaware Trustee is duly organized, validly existing and
in good standing under the laws of the State of Delaware, with trust power and
authority to execute and deliver, and to carry out and perform its obligations
under the terms of, this Trust Agreement.
(g) The execution, delivery and performance by the Delaware
Trustee of this Trust Agreement has been duly authorized by all necessary
corporate action on the part of the Delaware Trustee; and this Trust Agreement
has been duly executed and delivered by the Delaware Trustee, and constitutes a
legal, valid and binding obligation of the Delaware Trustee, enforceable against
it in accordance with its terms, subject to applicable bankruptcy,
reorganization, moratorium, insolvency, and other similar laws affecting
creditors' right generally and to general principles of equity and the
discretion of the court (regardless of whether the enforcement of such remedies
is considered in a proceeding in equity or at law).
(h) The execution, delivery and performance of this Trust
Agreement by the Delaware Trustee does not conflict with or constitute a breach
of the certificate of incorporation or by-laws of the Delaware Trustee.
(i) No consent, approval or authorization of, or registration
with or notice to any state or Federal banking authority is required for the
execution, delivery or performance by the Delaware Trustee, of this Trust
Agreement.
(j) The Delaware Trustee is an entity which has its principal
place of business in the State of Delaware.
SECTION 7.2. Representations and Warranties of Depositor.
The Depositor hereby represents and warrants for the benefit of the
Holders that:
(a) the Trust Securities Certificates issued at the Closing Time
on behalf of the Issuer Trust have been duly authorized and will have been duly
and validly executed, and, subject to payment therefor, issued and delivered by
the Issuer Trustees pursuant to the terms and provisions of, and in accordance
with the requirements of, this Trust Agreement, and the Holders will be, as of
each such date, entitled to the benefits of this Trust Agreement; and
(b) there are no taxes, fees or other governmental charges
payable by the Issuer Trust (or the Issuer Trustees on behalf of the Issuer
Trust) under the laws of the State of Delaware or any political subdivision
thereof in connection with the execution, delivery and performance by either the
Property Trustee or the Delaware Trustee, as the case may be, of this Trust
Agreement.
ARTICLE VIII
THE ISSUER TRUSTEES; THE ADMINISTRATORS
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SECTION 8.1. Certain Duties and Responsibilities.
(a) The duties and responsibilities of the Issuer Trustees and
the Administrators shall be as provided by this Trust Agreement and, in the case
of the Property Trustee, by the Trust Indenture Act. Notwithstanding the
foregoing, no provision of this Trust Agreement shall require the Issuer
Trustees or the Administrators to expend or risk their own funds or otherwise
incur any financial liability in the performance of any of their duties
hereunder, or in the exercise of any of their rights or powers, if they shall
have reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it.
Whether or not therein expressly so provided, every provision of this Trust
Agreement relating to the conduct or affecting the liability of or affording
protection to the Issuer Trustees or the Administrators shall be subject to the
provisions of this Section. Nothing in this Trust Agreement shall be construed
to release an Administrator or an Issuer Trustee from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct. To the extent that, at law or in equity, an Issuer Trustee or
Administrator has duties and liabilities relating to the Issuer Trust or to the
Holders, such Issuer Trustee or Administrator shall not be liable to the Issuer
Trust or to any Holder for such Issuer Trustee's or Administrator's good faith
reliance on the provisions of this Trust Agreement. The provisions of this Trust
Agreement, to the extent that they restrict the duties and liabilities of the
Issuer Trustees and Administrators otherwise existing at law or in equity, are
agreed by the Depositor and the Holders to replace such other duties and
liabilities of the Issuer Trustees and Administrators.
(b) All payments made by the Property Trustee or a Paying Agent
in respect of the Trust Securities shall be made only from the revenue and
proceeds from the Trust Property and only to the extent that there shall be
sufficient revenue or proceeds from the Trust Property to enable the Property
Trustee or a Paying Agent to make payments in accordance with the terms hereof.
Each Holder, by its acceptance of a Trust Security, agrees that it will look
solely to the revenue and proceeds from the Trust Property to the extent legally
available for distribution to it as herein provided and that neither the Issuer
Trustees nor the Administrators are personally liable to it for any amount
distributable in respect of any Trust Security or for any other liability in
respect of any Trust Security. This Section 8.1(b) does not limit the liability
of the Issuer Trustees expressly set forth elsewhere in this Trust Agreement or,
in the case of the Property Trustee, in the Trust Indenture Act.
(c) The Property Trustee, before the occurrence of any Event of
Default and after the curing of all Events of Default that may have occurred,
shall undertake to perform only such duties as are specifically set forth in
this Trust Agreement (including pursuant to Section 10.10), and no implied
covenants shall be read into this Trust Agreement against the Property Trustee.
If an Event of Default has occurred (that has not been cured or waived pursuant
to Section 5.13 of the Indenture), the Property Trustee shall enforce this Trust
Agreement for the benefit of the Holders and shall exercise such of the rights
and powers vested in it by this Trust Agreement, and use the same degree of care
and skill in its exercise thereof, as a prudent person would exercise or use
under the circumstances in the conduct of his or her own affairs.
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(d) No provision of this Trust Agreement shall be construed to
relieve the Property Trustee from liability for its own negligent action, its
own negligent failure to act, or its own willful misconduct, except that:
(i) prior to the occurrence of any Event of Default and
after the curing or waiving of all such Events of Default that may have
occurred:
(1) the duties and obligations of the Property Trustee
shall be determined solely by the express provisions of this
Trust Agreement (including pursuant to Section 10.10), and
the Property Trustee shall not be liable except for the
performance of such duties and obligations as are
specifically set forth in this Trust Agreement (including
pursuant to Section 10.10); and
(2) in the absence of bad faith on the part of the
Property Trustee, the Property Trustee may conclusively rely,
as to the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or opinions
furnished to the Property Trustee and conforming to the
requirements of this Trust Agreement; but in the case of any
such certificates or opinions that by any provision hereof or
of the Trust Indenture Act are specifically required to be
furnished to the Property Trustee, the Property Trustee shall
be under a duty to examine the same to determine whether or
not they conform to the requirements of this Trust Agreement;
(ii) the Property Trustee shall not be liable for any error
of judgment made in good faith by an authorized officer of the Property
Trustee, unless it shall be proved that the Property Trustee was
negligent in ascertaining the pertinent facts;
(iii) the Property Trustee shall not be liable with respect
to any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of at least a Majority in
Liquidation Amount of the Capital Securities relating to the time,
method and place of conducting any proceeding for any remedy available
to the Property Trustee, or exercising any trust or power conferred
upon the Property Trustee under this Trust Agreement;
(iv) the Property Trustee's sole duty with respect to the
custody, safe keeping and physical preservation of the Junior
Subordinated Debentures and the Payment Account shall be to deal with
such property in a similar manner as the Property Trustee deals with
similar property for its own account, subject to the protections and
limitations on liability afforded to the Property Trustee under this
Trust Agreement and the Trust Indenture Act;
(v) the Property Trustee shall not be liable for any
interest on any money received by it except as it may otherwise agree
with the Depositor; and money held by the Property Trustee need not be
segregated from other funds held by it except in relation to the
Payment Account maintained by the Property Trustee pursuant to Section
3.1 and except to the extent otherwise required by law;
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(vi) the Property Trustee shall not be responsible for
monitoring the compliance by the Administrators or the Depositor with
their respective duties under this Trust Agreement, nor shall the
Property Trustee be liable for the default or misconduct of any other
Issuer Trustee, the Administrators or the Depositor; and
(vii) no provision of this Trust Agreement shall require the
Property Trustee to expend or risk its own funds or otherwise incur
personal financial liability in the performance of any of its duties or
in the exercise of any of its rights or powers, if the Property Trustee
shall have reasonable grounds for believing that the repayment of such
funds or liability is not reasonably assured to it under the terms of
this Trust Agreement or adequate indemnity against such risk or
liability is not reasonably assured to it.
(e) The Administrators shall not be responsible for monitoring
the compliance by the Issuer Trustees or the Depositor with their respective
duties under this Trust Agreement, nor shall either Administrator be liable for
the default or misconduct of any other Administrator, the Issuer Trustees or the
Depositor.
SECTION 8.2. Certain Notices.
(a) Within five Business Days after the occurrence of any Event
of Default actually known to a Responsible Officer of the Property Trustee, the
Property Trustee shall transmit, in the manner and to the extent provided in
Section 10.8, notice of such Event of Default to the Holders and the
Administrators, unless such Event of Default shall have been cured or waived.
(b) Within five Business Days after the receipt of notice of the
Depositor's exercise of its right to defer the payment of interest on the Junior
Subordinated Debentures pursuant to the Indenture, the Property Trustee shall
transmit, in the manner and to the extent provided in Section 10.8, notice of
such exercise to the Holders and the Administrators, unless such exercise shall
have been revoked.
SECTION 8.3. Certain Rights of Property Trustee.
Subject to the provisions of Section 8.1:
(a) the Property Trustee may conclusively rely and shall be
fully protected in acting or refraining from acting in good faith upon any
resolution, Opinion of Counsel, certificate, written representation of a Holder
or transferee, certificate of auditors or any other certificate, statement,
instrument, opinion, report, notice, request, consent, order, appraisal, bond,
debenture, note, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed or presented by the proper
party or parties;
(b) any direction or act of the Depositor contemplated by this
Trust Agreement shall be sufficiently evidenced by an Officers' Certificate;
(c) the Property Trustee shall have no duty to see to any
recording, filing or registration of any instrument (including any financing or
continuation statement or any filing under tax or securities laws) or any
re-recording, refiling or reregistration thereof;
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(d) the Property Trustee may consult with counsel of its own
choosing (which counsel may be counsel to the Depositor or any of its
Affiliates, and may include any of its employees) and the advice of such counsel
shall be full and complete authorization and protection in respect of any action
taken suffered or omitted by it hereunder in good faith and in reliance thereon
and in accordance with such advice; the Property Trustee shall have the right at
any time to seek instructions concerning the administration of this Trust
Agreement from any court of competent jurisdiction;
(e) the Property Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Trust Agreement at the
request or direction of any of the Holders pursuant to this Trust Agreement,
unless such Holders shall have offered to the Property Trustee security or
indemnity satisfactory to it against the costs, expenses and liabilities which
might be incurred by it in compliance with such request or direction; provided
that, nothing contained in this Section 8.3(e) shall be taken to relieve the
Property Trustee, upon the occurrence of an Event of Default, of its obligation
to exercise the rights and powers vested in it by this Trust Agreement;
(f) the Property Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order,
approval, bond, debenture, note or other evidence of indebtedness or other paper
or document, unless requested in writing to do so by one or more Holders, but
the Property Trustee may make such further inquiry or investigation into such
facts or matters as it may see fit;
(g) the Property Trustee may execute any of the trusts or powers
hereunder or perform any of its duties hereunder either directly or by or
through its agents or attorneys, provided that the Property Trustee shall not be
responsible for any misconduct or negligence on the part of any agent or
attorney appointed with due care by it hereunder;
(h) whenever in the administration of this Trust Agreement the
Property Trustee shall deem it desirable to receive instructions with respect to
enforcing any remedy or right or taking any other action hereunder, the Property
Trustee (i) may request instructions from the Holders (which instructions may
only be given by the Holders of the same proportion in Liquidation Amount of the
Trust Securities as would be entitled to direct the Property Trustee under the
terms of the Trust Securities in respect of such remedy, right or action), (ii)
may refrain from enforcing such remedy or right or taking such other action
until such instructions are received, and (iii) shall be fully protected in
acting in accordance with such instructions; and
(i) except as otherwise expressly provided by this Trust
Agreement, the Property Trustee shall not be under any obligation to take any
action that is discretionary under the provisions of this Trust Agreement.
No provision of this Trust Agreement shall be deemed to impose any duty
or obligation on any Issuer Trustee or Administrator to perform any act or acts
or exercise any right, power, duty or obligation conferred or imposed on it, in
any jurisdiction in which it shall be illegal, or in which the Property Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts, or to exercise any such right, power, duty or
obligation. No
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permissive power or authority available to any Issuer Trustee or Administrator
shall be construed to be a duty.
SECTION 8.4. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Trust Securities Certificates
shall be taken as the statements of the Issuer Trust, and the Issuer Trustees
and the Administrators do not assume any responsibility for their correctness.
The Issuer Trustees and the Administrators shall not be accountable for the use
or application by the Depositor of the proceeds of the Junior Subordinated
Debentures.
SECTION 8.5. May Hold Securities.
Except as provided in the definition of the term "Outstanding" in
Article I, the Administrators, any Issuer Trustee or any other agent of any
Issuer Trustee or the Issuer Trust, in its individual or any other capacity, may
become the owner or pledgee of Trust Securities and, subject to Sections 8.8 and
8.13, may otherwise deal with the Issuer Trust with the same rights it would
have if it were not an Administrator, Issuer Trustee or such other agent.
SECTION 8.6. Compensation; Indemnity; Fees.
The Depositor, as borrower, agrees:
(a) to pay to the Issuer Trustees from time to time such
compensation as shall from time to time be agreed to in writing by the Company
and the Trustee for all services rendered by them hereunder (which compensation
shall not be limited by any provision of law in regard to the compensation of a
trustee of an express trust);
(b) to reimburse the Issuer Trustees upon request for all
reasonable expenses, disbursements and advances incurred or made by the Issuer
Trustees in accordance with any provision of this Trust Agreement (including the
reasonable compensation, expenses and disbursements of its agents and counsel),
except any such expense, disbursement or advance as may be attributable to their
negligence or willful misconduct; and
(c) to the fullest extent permitted by applicable law, to
indemnify and hold harmless (i) each Issuer Trustee, (ii) each Administrator,
(iii) any Affiliate of any Issuer Trustee, (iv) any officer, director,
shareholder, employee, representative or agent of any Issuer Trustee, and (v)
any employee or agent of the Issuer Trust, (referred to herein as an
"Indemnified Person") from and against any loss, damage, liability, tax,
penalty, expense or claim of any kind or nature whatsoever incurred by such
Indemnified Person arising out of or in connection with the creation, operation
or dissolution of the Issuer Trust or any act or omission performed or omitted
by such Indemnified Person in good faith on behalf of the Issuer Trust and in a
manner such Indemnified Person reasonably believed to be within the scope of
authority conferred on such Indemnified Person by this Trust Agreement, except
that no Indemnified Person shall be entitled to be indemnified in respect of any
loss, damage or claim incurred by such Indemnified Person by reason of
negligence or willful misconduct with respect to such acts or omissions.
The provisions of this Section 8.6 shall survive the termination of
this Trust Agreement.
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No Issuer Trustee may claim any Lien on any Trust Property as a result
of any amount due pursuant to this Section 8.6.
The Depositor, any Administrator and any Issuer Trustee may engage in
or possess an interest in other business ventures of any nature or description,
independently or with others, similar or dissimilar to the business of the
Issuer Trust, and the Issuer Trust and the Holders of Trust Securities shall
have no rights by virtue of this Trust Agreement in and to such independent
ventures or the income or profits derived therefrom, and the pursuit of any such
venture, even if competitive with the business of the Issuer Trust, shall not be
deemed wrongful or improper. Neither the Depositor, any Administrator, nor any
Issuer Trustee shall be obligated to present any particular investment or other
opportunity to the Issuer Trust even if such opportunity is of a character that,
if presented to the Issuer Trust, could be taken by the Issuer Trust, and the
Depositor, any Administrator or any Issuer Trustee shall have the right to take
for its own account (individually or as a partner or fiduciary) or to recommend
to others any such particular investment or other opportunity. Any Issuer
Trustee may engage or be interested in any financial or other transaction with
the Depositor or any Affiliate of the Depositor, or may act as depository for,
trustee or agent for, or act on any committee or body of holders of, securities
or other obligations of the Depositor or its Affiliates.
SECTION 8.7. Corporate Property Trustee Required; Eligibility of
Trustees and Administrators.
(a) There shall at all times be a Property Trustee hereunder
with respect to the Trust Securities. The Property Trustee shall be a Person
that is a national or state chartered bank and eligible pursuant to the Trust
Indenture Act to act as such and has a combined capital and surplus of at least
$50,000,000. If any such Person publishes reports of condition at least
annually, pursuant to law or to the requirements of its supervising or examining
authority, then for the purposes of this Section, the combined capital and
surplus of such Person shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time
the Property Trustee with respect to the Trust Securities shall cease to be
eligible in accordance with the provisions of this Section, it shall resign
immediately in the manner and with the effect hereinafter specified in this
Article VIII. At the time of appointment, the Property Trustee must have
securities rated in one of the three highest rating categories by a nationally
recognized statistical rating organization.
(b) There shall at all times be one or more Administrators
hereunder. Each Administrator shall be either a natural person who is at least
21 years of age or a legal entity that shall act through one or more persons
authorized to bind that entity. An employee, officer or Affiliate of the
Depositor may serve as an Administrator.
(c) There shall at all times be a Delaware Trustee. The Delaware
Trustee shall either be (i) a natural person who is at least 21 years of age and
a resident of the State of Delaware or (ii) a legal entity with its principal
place of business in the State of Delaware and that otherwise meets the
requirements of applicable Delaware law that shall act through one or more
persons authorized to bind such entity.
SECTION 8.8. Conflicting Interests.
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(a) If the Property Trustee has or shall acquire a conflicting
interest within the meaning of the Trust Indenture Act, the Property Trustee
shall either eliminate such interest or resign, to the extent and in the manner
provided by, and subject to the provisions of, the Trust Indenture Act and this
Trust Agreement.
(b) The Guarantee and the Indenture shall be deemed to be
sufficiently described in this Trust Agreement for the purposes of clause (i) of
the first proviso contained in Section 310(b) of the Trust Indenture Act.
SECTION 8.9. Co-Trustees and Separate Trustee.
Unless an Event of Default shall have occurred and be continuing, at
any time or times, for the purpose of meeting the legal requirements of the
Trust Indenture Act or of any jurisdiction in which any part of the Trust
Property may at the time be located, the Property Trustee shall have power to
appoint, and upon the written request of the Property Trustee, the Depositor and
the Administrators shall for such purpose join with the Property Trustee in the
execution, delivery, and performance of all instruments and agreements necessary
or proper to appoint, one or more Persons approved by the Property Trustee
either to act as co-trustee, jointly with the Property Trustee, of all or any
part of such Trust Property, or to the extent required by law to act as separate
trustee of any such property, in either case with such powers as may be provided
in the instrument of appointment, and to vest in such Person or Persons in the
capacity aforesaid, any property, title, right or power deemed necessary or
desirable, subject to the other provisions of this Section. Any co-trustee or
separate trustee appointed pursuant to this Section shall either be (i) a
natural person who is at least 21 years of age and a resident of the United
States or (ii) a legal entity with its principal place of business in the United
States that shall act through one or more persons authorized to bind such
entity.
Should any written instrument from the Depositor be required by any
co-trustee or separate trustee so appointed for more fully confirming to such
co-trustee or separate trustee such property, title, right, or power, any and
all such instruments shall, on request, be executed, acknowledged and delivered
by the Depositor.
Every co-trustee or separate trustee shall, to the extent permitted by
law, but to such extent only, be appointed subject to the following terms,
namely:
(a) The Trust Securities shall be executed by one or more
Administrators, and the Trust Securities shall be authenticated and delivered
and all rights, powers, duties, and obligations hereunder in respect of the
custody of securities, cash and other personal property held by, or required to
be deposited or pledged with, the Property Trustee specified hereunder, shall be
exercised, solely by the Property Trustee and not by such co-trustee or separate
trustee.
(b) The rights, powers, duties, and obligations hereby conferred
or imposed upon the Property Trustee in respect of any property covered by such
appointment shall be conferred or imposed upon and exercised or performed by the
Property Trustee and such co-trustee or separate trustee jointly, as shall be
provided in the instrument appointing such co-trustee or separate trustee,
except to the extent that under any law of any jurisdiction in which any
particular act is to be performed, the Property Trustee shall be incompetent or
unqualified to
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perform such act, in which event such rights, powers, duties and
obligations shall be exercised and performed by such co-trustee or separate
trustee.
(c) The Property Trustee at any time, by an instrument in
writing executed by it, with the written concurrence of the Depositor, may
accept the resignation of or remove any co-trustee or separate trustee appointed
under this Section, and, in case a Debenture Event of Default has occurred and
is continuing, the Property Trustee shall have power to accept the resignation
of, or remove, any such co-trustee or separate trustee without the concurrence
of the Depositor. Upon the written request of the Property Trustee, the
Depositor shall join with the Property Trustee in the execution, delivery and
performance of all instruments and agreements necessary or proper to effectuate
such resignation or removal. A successor to any co-trustee or separate trustee
so resigned or removed may be appointed in the manner provided in this Section
8.9.
(d) No co-trustee or separate trustee hereunder shall be
personally liable by reason of any act or omission of the Property Trustee or
any other trustee hereunder.
(e) The Property Trustee shall not be liable by reason of any
act of a co-trustee or separate trustee.
(f) Any Act of Holders delivered to the Property Trustee shall
be deemed to have been delivered to each such co-trustee and separate trustee.
SECTION 8.10. Resignation and Removal; Appointment of Successor.
No resignation or removal of any Issuer Trustee (the "Relevant
Trustee") and no appointment of a successor trustee pursuant to this Article
shall become effective until the acceptance of appointment by the successor
trustee in accordance with the applicable requirements of Section 8.11.
Subject to the immediately preceding paragraph, a Relevant Trustee may
resign at any time by giving written notice thereof to the Holders. The Relevant
Trustee shall appoint a successor by requesting from at least three Persons
meeting the eligibility requirements its expenses and charges to serve as the
successor trustee on a form provided by the Administrators, and selecting the
Person who agrees to the lowest expenses and charges, subject to the prior
consent of the Depositor which consent shall not be unreasonably withheld. If
the instrument of acceptance by the successor trustee required by Section 8.11
shall not have been delivered to the Relevant Trustee within 60 days after the
giving of such notice of resignation, the Relevant Trustee may petition, at the
expense of the Issuer Trust, any court of the State of Delaware for the
appointment of a successor Relevant Trustee.
The Property Trustee or the Delaware Trustee may be removed at any time
by Act of the Holders of at least a Majority in Liquidation Amount of the
Capital Securities, delivered to the Relevant Trustee (in its individual
capacity and on behalf of the Issuer Trust) (i) for cause (including upon the
occurrence of an Event of Default described in subparagraph (e) of the
definition thereof with respect to the Relevant Trustee), or (ii) if a Debenture
Event of Default shall have occurred and be continuing at any time.
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If any Issuer Trustee shall resign, it shall appoint its successor. If
a resigning Relevant Trustee shall fail to appoint a successor, or if a Relevant
Trustee shall be removed or become incapable of acting as Issuer Trustee, or if
any vacancy shall occur in the office of any Issuer Trustee for any cause, the
Holders of the Capital Securities, by Act of the Holders of record of not less
than 25% in aggregate Liquidation Amount of the Capital Securities then
Outstanding delivered to such Relevant Trustee, shall promptly appoint a
successor Relevant Trustee or Trustees, and such successor Issuer Trustee shall
comply with the applicable requirements of Section 8.11. If no successor trustee
shall have been so appointed by the Holders of the Capital Securities and
accepted appointment in the manner required by Section 8.11, any Holder, on
behalf of himself and all others similarly situated, or any other Issuer
Trustee, may petition any court in the State of Delaware for the appointment of
a successor trustee.
The Property Trustee shall give notice of each resignation and each
removal of a Relevant Trustee and each appointment of a successor trustee to all
Holders in the manner provided in Section 10.8 and shall give notice to the
Depositor and to the Administrators. Each notice shall include the name of the
Relevant Trustee and the address of its Corporate Trust Office if it is the
Property Trustee.
Notwithstanding the foregoing or any other provision of this Trust
Agreement, in the event any Delaware Trustee who is a natural person dies or
becomes, in the opinion of the Holders of the Common Securities, incompetent or
incapacitated, the vacancy created by such death, incompetence or incapacity may
be filled by the Property Trustee following the procedures regarding expenses
and charges set forth above (with the successor in each case being a Person who
satisfies the eligibility requirement for the Delaware Trustee, as the case may
be, set forth in Section 8.7).
SECTION 8.11. Acceptance of Appointment by Successor.
In case of the appointment hereunder of a successor Relevant Trustee,
the retiring Relevant Trustee and each such successor Relevant Trustee with
respect to the Trust Securities shall execute, acknowledge and deliver an
amendment hereto wherein each successor Relevant Trustee shall accept such
appointment and which (a) shall contain such provisions as shall be necessary or
desirable to transfer and confirm to, and to vest in, each successor Relevant
Trustee all the rights, powers, trusts and duties of the retiring Relevant
Trustee with respect to the Trust Securities and the Issuer Trust, and (b) shall
add to or change any of the provisions of this Trust Agreement as shall be
necessary to provide for or facilitate the administration of the Issuer Trust by
more than one Relevant Trustee, it being understood that nothing herein or in
such amendment shall constitute such Relevant Trustee a co-trustee and upon the
execution and delivery of such amendment the resignation or removal of the
retiring Relevant Trustee shall become effective to the extent provided therein
and each such successor Relevant Trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and duties
of the retiring Relevant Trustee; but, on request of the Issuer Trust or any
successor Relevant Trustee such retiring Relevant Trustee shall duly assign,
transfer and deliver to such successor Relevant Trustee all Trust Property, all
proceeds thereof and money held by such retiring Relevant Trustee hereunder with
respect to the Trust Securities and the Issuer Trust.
Upon request of any such successor Relevant Trustee, the Issuer Trust
shall execute any and all instruments for more fully and certainly vesting in
and confirming to such successor
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Relevant Trustee all such rights, powers and trusts referred to in the first or
second preceding paragraph, as the case may be.
No successor Relevant Trustee shall accept its appointment unless at
the time of such acceptance such successor Relevant Trustee shall be qualified
and eligible under this Article VIII.
SECTION 8.12. Merger, Conversion, Consolidation or Succession to
Business.
Any Person into which the Property Trustee or the Delaware Trustee may
be merged or converted or with which it may be consolidated, or any Person
resulting from any merger, conversion or consolidation to which such Relevant
Trustee shall be a party, or any Person succeeding to all or substantially all
the corporate trust business of such Relevant Trustee, shall be the successor of
such Relevant Trustee hereunder, provided that such Person shall be otherwise
qualified and eligible under this Article VIII, without the execution or filing
of any paper or any further act on the part of any of the parties hereto.
SECTION 8.13. Preferential Collection of Claims Against Depositor or
Issuer Trust.
If and when the Property Trustee shall be or become a creditor of the
Depositor (or any other obligor upon the Trust Securities), the Property Trustee
shall be subject to the provisions of the Trust Indenture Act regarding the
collection of claims against the Depositor (or any such other obligor) only if
this Trust Agreement is subject to the Trust Indenture Act.
SECTION 8.14. Trustee May File Proofs of Claim.
In case of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other similar judicial
proceeding relative to the Issuer Trust or any other obligor upon the Trust
Securities or the property of the Issuer Trust or of such other obligor, the
Property Trustee (irrespective of whether any Distributions on the Trust
Securities shall then be due and payable and irrespective of whether the
Property Trustee shall have made any demand on the Issuer Trust for the payment
of any past due Distributions) shall be entitled and empowered, to the fullest
extent permitted by law, by intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount of any
Distributions owing and unpaid in respect of the Trust Securities and to file
such other papers or documents as may be necessary or advisable in order to have
the claims of the Property Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Property Trustee, its
agents and counsel) and of the Holders allowed in such judicial proceeding; and
(b) to collect and receive any monies or other property payable
or deliverable on any such claims and to distribute the same; and any custodian,
receiver, assignee, trustee, liquidator, sequestrator or other similar official
in any such judicial proceeding is hereby authorized by each Holder to make such
payments to the Property Trustee and, in the event the Property Trustee shall
consent to the making of such payments directly to the Holders, to pay to the
Property Trustee any amount due it for the reasonable compensation, expenses,
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disbursements and advances of the Property Trustee, its agents and counsel, and
any other amounts due the Property Trustee.
Nothing herein contained shall be deemed to authorize the Property
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement, adjustment or compensation affecting
the Trust Securities or the rights of any Holder thereof or to authorize the
Property Trustee to vote in respect of the claim of any Holder in any such
proceeding.
SECTION 8.15. Reports by Property Trustee.
(a) Not later than January 31 of each year commencing with
January 31, 2000, the Property Trustee shall transmit to all Holders in
accordance with Section 10.8, and to the Depositor, a brief report dated as of
the immediately preceding December 31 with respect to:
(i) its eligibility under Section 8.7 or, in lieu thereof, if to
the best of its knowledge it has continued to be eligible under said
Section, a written statement to such effect; and
(ii) any change in the property and funds in its possession as
Property Trustee since the date of its last report and any action taken
by the Property Trustee in the performance of its duties hereunder
which it has not previously reported and which in its opinion
materially affects the Trust Securities.
(b) In addition the Property Trustee shall transmit to Holders
such reports concerning the Property Trustee and its actions under this Trust
Agreement as may be required pursuant to the Trust Indenture Act at the times
and in the manner provided pursuant thereto.
(c) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Property Trustee with the Depositor.
SECTION 8.16. Reports to the Property Trustee.
The Depositor and the Administrators on behalf of the Issuer Trust
shall provide to the Property Trustee such documents, reports and information as
required by Section 314 of the Trust Indenture Act (if any) and the compliance
certificate required by Section 314(a) of the Trust Indenture Act in the form,
in the manner and at the times required by Section 314 of the Trust Indenture
Act. The Depositor and the Administrators shall annually file with the Property
Trustee a certificate specifying whether such Person is in compliance with all
the terms and covenants applicable to such Person hereunder.
SECTION 8.17. Evidence of Compliance with Conditions Precedent.
Each of the Depositor and the Administrators on behalf of the Issuer
Trust shall provide to the Property Trustee such evidence of compliance with any
conditions precedent, if any, provided for in this Trust Agreement that relate
to any of the matters set forth in Section 314(c) of the Trust Indenture Act.
Any certificate or opinion required to be given by an officer pursuant
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to Section 314(c)(1) of the Trust Indenture Act shall be given in the form of an
Officers' Certificate.
SECTION 8.18. Number of Issuer Trustees.
(a) The number of Issuer Trustees shall be two. The Property
Trustee and the Delaware Trustee may be the same Person, in which case, the
number of Issuer Trustees may be one.
(b) If an Issuer Trustee ceases to hold office for any reason, a
vacancy shall occur. The vacancy shall be filled with an Issuer Trustee
appointed in accordance with Section 8.10.
(c) The death, resignation, retirement, removal, bankruptcy,
incompetence or incapacity to perform the duties of an Issuer Trustee shall not
operate to dissolve, terminate or annul the Issuer Trust or terminate this Trust
Agreement.
SECTION 8.19. Delegation of Power.
(a) Any Administrator may, by power of attorney consistent with
applicable law, delegate to any other natural person over the age of 21 his or
her power for the purpose of executing any documents contemplated in Section
2.7(a) or making any governmental filing; and
(b) The Administrators shall have power to delegate from time to
time to such of their number the doing of such things and the execution of such
instruments either in the name of the Issuer Trust or the names of the
Administrators or otherwise as the Administrators may deem expedient, to the
extent such delegation is not prohibited by applicable law or contrary to the
provisions of this Trust Agreement.
SECTION 8.20. Appointment of Administrators.
(a) The Administrators shall be appointed by the Holders of a
Majority in Liquidation Amount of the Common Securities and may be removed by
the Holders of a Majority in Liquidation Amount of the Common Securities or may
resign at any time. Upon any resignation or removal, the Depositor shall appoint
a successor Administrator. Each Administrator shall execute this Trust Agreement
thereby agreeing to comply with, and be legally bound by, all of the terms,
conditions and provisions of this Trust Agreement. If at any time there is no
Administrator, the Property Trustee or any Holder who has been a Holder of Trust
Securities for at least six months may petition any court of competent
jurisdiction for the appointment of one or more Administrators.
(b) Whenever a vacancy in the number of Administrators shall
occur, until such vacancy is filled by the appointment of an Administrator in
accordance with this Section 8.20, the Administrators in office, regardless of
their number (and notwithstanding any other provision of this Agreement), shall
have all the powers granted to the Administrators and shall discharge all the
duties imposed upon the Administrators by this Trust Agreement.
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(c) Notwithstanding the foregoing, or any other provision of
this Trust Agreement, in the event any Administrator who is a natural person
dies or becomes, in the opinion of the Holders of a Majority in Liquidation
Amount of the Common Securities, incompetent, or incapacitated, the vacancy
created by such death, incompetence or incapacity may be filled by the remaining
Administrators, if there were at least two of them prior to such vacancy, and by
the Depositor, if there were not two such Administrators immediately prior to
such vacancy (with the successor in each case being a Person who satisfies the
eligibility requirement for Administrators, as the case may be, set forth in
Section 8.7).
Except as otherwise provided in this Trust Agreement, or by applicable
law, any one Administrator may execute any document or otherwise take any action
which the Administrators are authorized to take under this Trust Agreement.
ARTICLE IX
DISSOLUTION, LIQUIDATION AND MERGER
SECTION 9.1. Dissolution Upon Expiration Date.
Unless earlier dissolved, the Issuer Trust shall automatically dissolve
on June 30, 2029 (the "Expiration Date"), and thereafter the Trust Property
shall be distributed in accordance with Section 9.4.
SECTION 9.2. Early Dissolution.
The first to occur of any of the following events is an "Early
Termination Event," upon the occurrence of which the Issuer Trust shall
dissolve:
(a) the occurrence of the appointment of a receiver or other
similar official in any liquidation, insolvency or similar proceeding with
respect to the Depositor or all or substantially all of its property, or a court
or other governmental agency shall enter a decree or order and such decree or
order shall remain unstayed and undischarged for a period of 60 days, unless the
Depositor shall transfer the Common Securities as provided by Section 5.11, in
which case this provision shall refer instead to any such successor Holder of
the Common Securities;
(b) the written direction to the Property Trustee from the
Holder of the Common Securities at any time to dissolve the Issuer Trust and to
distribute the Junior Subordinated Debentures to Holders in exchange for the
Capital Securities (which direction, subject to Section 9.4(a), is optional and
wholly within the discretion of the Holder of the Common Securities);
(c) the repayment of all of the Capital Securities in connection
with the redemption of all the Junior Subordinated Debentures; and
(d) the entry of an order for dissolution of the Issuer Trust by
a court of competent jurisdiction.
SECTION 9.3. Termination.
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As soon as is practicable after the occurrence of an event referred to
in Section 9.1 or 9.2, and upon the completion of the winding-up and liquidation
of the Issuer Trust, the Administrators and the Issuer Trustees (each of whom is
hereby authorized to take such action) shall file a certificate of cancellation
with the Secretary of State of the State of Delaware terminating the Issuer
Trust and, upon such filing, the respective obligations and responsibilities of
the Issuer Trustees, the Administrators and the Issuer Trust created and
continued hereby shall terminate.
SECTION 9.4. Liquidation.
(a) If an Early Termination Event specified in clause (a), (b)
or (d) of Section 9.2 occurs or upon the Expiration Date, the Issuer Trust shall
be wound-up and liquidated by the Property Trustee as expeditiously as the
Property Trustee determines to be possible by distributing, after paying or
making reasonable provision to pay all claims and obligations of the Issuer
Trust in accordance with Section 3808(e) of the Delaware Business Trust Act, to
each Holder a Like Amount of Junior Subordinated Debentures, subject to Section
9.4(d). Notice of liquidation shall be given by the Property Trustee by
first-class mail, postage prepaid, mailed not later than 15 nor more than 45
days prior to the Liquidation Date to each Holder of Trust Securities at such
Holder's address appearing in the Securities Register. All notices of
liquidation shall:
(i) state the Liquidation Date;
(ii) state that, from and after the Liquidation Date, the Trust
Securities will no longer be deemed to be Outstanding and any Trust
Securities Certificates not surrendered for exchange will be deemed to
represent a Like Amount of Junior Subordinated Debentures; and
(iii) provide such information with respect to the mechanics by
which Holders may exchange Trust Securities Certificates for Junior Subordinated
Debentures, or if Section 9.4(d) applies receive a Liquidation Distribution, as
the Administrators or the Property Trustee shall deem appropriate.
(b) Except where Section 9.2(c) or 9.4(d) applies, in order to
effect the liquidation of the Issuer Trust and distribution of the Junior
Subordinated Debentures to Holders, the Property Trustee shall establish a
record date for such distribution (which shall be not more than 30 days prior to
the Liquidation Date) and, either itself acting as exchange agent or through the
appointment of a separate exchange agent, shall establish such procedures as it
shall deem appropriate to effect the distribution of Junior Subordinated
Debentures in exchange for the Outstanding Trust Securities Certificates.
(c) Except where Section 9.2(c) or 9.4(d) applies, after the
Liquidation Date, (i) the Trust Securities will no longer be deemed to be
Outstanding, (ii) the Clearing Agency for the Capital Securities or its nominee,
as the registered Holder of the Global Capital Securities Certificates, shall
receive a registered global certificate or certificates representing the Junior
Subordinated Debentures to be delivered upon such distribution with respect to
Capital Securities held by the Clearing Agency or its nominee, and, (iii) any
Trust Securities Certificates not held
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by the Clearing Agency for the Capital Securities or its nominee as specified in
clause (ii) above will be deemed to represent Junior Subordinated Debentures
having a principal amount equal to the stated Liquidation Amount of the Trust
Securities represented thereby and bearing accrued and unpaid interest in an
amount equal to the accumulated and unpaid Distributions on such Trust
Securities until such certificates are presented to the Securities Registrar for
transfer or reissuance.
(d) If, notwithstanding the other provisions of this Section
9.4, whether because of an order for dissolution entered by a court of competent
jurisdiction or otherwise, distribution of the Junior Subordinated Debentures is
not practical, or if any Early Termination Event specified in clause (c) of
Section 9.2 occurs, the Issuer Trust shall be dissolved, and the Trust Property
shall be liquidated, by the Property Trustee in such manner as the Property
Trustee determines. In such event, on the date of the dissolution of the Issuer
Trust, Holders will be entitled to receive out of the assets of the Issuer Trust
available for distribution to Holders, after paying or making reasonable
provision to pay all claims and obligations of the Issuer Trust in accordance
with Section 3808(e) of the Delaware Business Trust Act, an amount equal to the
aggregate of Liquidation Amount per Trust Security plus accumulated and unpaid
Distributions thereon to the date of payment (such amount being the "Liquidation
Distribution"). If, upon any such dissolution, the Liquidation Distribution can
be paid only in part because the Issuer Trust has insufficient assets available
to pay in full the aggregate Liquidation Distribution, then, subject to the next
succeeding sentence, the amounts payable by the Issuer Trust on the Trust
Securities shall be paid on a pro rata basis (based upon Liquidation Amounts).
The Holders of the Common Securities will be entitled to receive Liquidation
Distributions upon any such dissolution, pro rata (determined as aforesaid) with
Holders of Capital Securities, except that, if a Debenture Event of Default has
occurred and is continuing, the Capital Securities shall have a priority over
the Common Securities as provided in Section 4.3.
SECTION 9.5. Mergers, Consolidations, Amalgamations or Replacements of
the Issuer Trust.
The Issuer Trust may not merge with or into, consolidate, amalgamate,
or be replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to, any entity, except pursuant to this Section 9.5
or Section 9.4. At the request of the Holders of the Common Securities, and with
the consent of the Holders of at least a Majority in Liquidation Amount of the
Capital Securities, but without the consent of the Issuer Trustees, the Issuer
Trust may merge with or into, consolidate, amalgamate, or be replaced by or
convey, transfer or lease its properties and assets substantially as an entirety
to a trust organized as such under the laws of any state; provided, however,
that (i) such successor entity either (a) expressly assumes all of the
obligations of the Issuer Trust with respect to the Capital Securities or (b)
substitutes for the Capital Securities other securities having substantially the
same terms as the Capital Securities (the "Successor Capital Securities") so
long as the Successor Capital Securities have the same priority as the Capital
Securities with respect to distributions and payments upon liquidation,
redemption and otherwise, (ii) a trustee of such successor entity possessing the
same powers and duties as the Property Trustee is appointed to hold the Junior
Subordinated Debentures, (iii) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not cause the Capital Securities
(including any Successor Capital Securities) to be downgraded by any nationally
recognized statistical rating organization, (iv) such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease does not adversely
affect the rights,
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preferences and privileges of the holders of the Capital Securities (including
any Successor Capital Securities) in any material respect, (v) such successor
entity has a purpose substantially identical to that of the Issuer Trust, (vi)
prior to such merger, consolidation, amalgamation, replacement, conveyance,
transfer or lease, the Issuer Trustee has received an Opinion of Counsel from
independent counsel experienced in such matters to the effect that (a) such
merger, consolidation, amalgamation, replacement, conveyance, transfer or lease
does not adversely affect the rights preferences and privileges of the holders
of the Capital Securities (including any Successor Capital Securities) in any
material respect, and (b) following such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, neither the Issuer Trust nor such
successor entity will be required to register as an "investment company" under
the Investment Company Act and (vii) the Depositor or any permitted transferee
to whom it has transferred the Common Securities hereunder owns all of the
common securities of such successor entity and guarantees the obligations of
such successor entity under the Successor Capital Securities at least to the
extent provided by the Guarantee. Notwithstanding the foregoing, the Issuer
Trust shall not, except with the consent of Holders of 100% in Liquidation
Amount of the Capital Securities, consolidate, amalgamate, merge with or into,
or be replaced by or convey, transfer or lease its properties and assets
substantially as an entirety to, any other entity or permit any other entity to
consolidate, amalgamate, merge with or into, or replace it if such
consolidation, amalgamation, merger, replacement, conveyance, transfer or lease
would cause the Issuer Trust or the successor entity to be taxable other than as
a grantor trust for United States Federal income tax purposes.
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.1. Limitation of Rights of Holders.
Except as set forth in Section 9.2, the bankruptcy, dissolution,
termination, death or incapacity of any Person having an interest, beneficial or
otherwise, in Trust Securities shall not operate to terminate this Trust
Agreement, nor entitle the legal representatives or heirs of such person or any
Holder for such person, to claim an accounting, take any action or bring any
proceeding in any court for a partition or winding-up of the arrangements
contemplated hereby, nor otherwise affect the rights, obligations and
liabilities of the parties hereto or any of them. Any merger or similar
agreement shall be executed by the Administrators on behalf of the Issuer Trust.
SECTION 10.2. Amendment.
(a) This Trust Agreement may be amended from time to time by the
Property Trustee and the Holders of a Majority in Liquidation Amount of the
Common Securities, without the consent of any Holder of the Capital Securities
(i) to cure any ambiguity, correct or supplement any provision herein which may
be inconsistent with any other provision herein, or to make any other provisions
with respect to matters or questions arising under this Trust Agreement,
provided, however, that such amendment shall not adversely affect in any
material respect the interests of any Holder or (ii) to modify, eliminate or add
to any provisions of this Trust Agreement to such extent as shall be necessary
to ensure that the Issuer Trust will not be taxable other than as a grantor
trust for United States Federal income tax purposes at any time
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<PAGE>
that any Trust Securities are Outstanding or to ensure that the Issuer Trust
will not be required to register as an investment company under the Investment
Company Act.
(b) Except as provided in Section 10.2(c) hereof, any provision
of this Trust Agreement may be amended by the Property Trustee and the Holders
of a Majority in Liquidation Amount of the Common Securities with (i) the
consent of Holders of at least a Majority in Liquidation Amount of the Capital
Securities and (ii) receipt by the Issuer Trustees of an Opinion of Counsel to
the effect that such amendment or the exercise of any power granted to the
Issuer Trustees in accordance with such amendment will not affect the Issuer
Trust's being taxable as a grantor trust for United States Federal income tax
purposes or the Issuer Trust's exemption from status of an "investment company"
under the Investment Company Act.
(c) In addition to and notwithstanding any other provision in
this Trust Agreement, without the consent of each affected Holder (such consent
being obtained in accordance with Section 6.3 or 6.6 hereof), this Trust
Agreement may not be amended to (i) change the amount or timing of any
Distribution on the Trust Securities or otherwise adversely affect the amount of
any Distribution required to be made in respect of the Trust Securities as of a
specified date or (ii) restrict the right of a Holder to institute suit for the
enforcement of any such payment on or after such date.
(d) Notwithstanding any other provisions of this Trust
Agreement, no Issuer Trustee shall enter into or consent to any amendment to
this Trust Agreement which would cause the Issuer Trust to fail or cease to
qualify for the exemption from status as an "investment company" under the
Investment Company Act or be taxable other than as a grantor trust for United
States Federal income tax purposes.
(e) Notwithstanding anything in this Trust Agreement to the
contrary, without the consent of the Depositor and the Administrators, this
Trust Agreement may not be amended in a manner which imposes any additional
obligation on the Depositor or the Administrators.
(f) In the event that any amendment to this Trust Agreement is
made, the Administrators or the Property Trustee shall promptly provide to the
Depositor a copy of such amendment.
(g) Neither the Property Trustee nor the Delaware Trustee shall
be required to enter into any amendment to this Trust Agreement which affects
its own rights, duties or immunities under this Trust Agreement. The Property
Trustee shall be entitled to receive an Opinion of Counsel and an Officers'
Certificate stating that any amendment to this Trust Agreement is in compliance
with this Trust Agreement.
(h) Any amendments to this Trust Agreement made pursuant to
Section 10.2(a) shall become effective when notice of such amendment is given to
the Holders of the Trust Securities.
SECTION 10.3. Separability.
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In case any provision in this Trust Agreement or in the Trust
Securities Certificates shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
SECTION 10.4. Governing Law.
THIS TRUST AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF EACH OF THE
HOLDERS, THE ISSUER TRUST, THE DEPOSITOR, THE ISSUER TRUSTEES AND THE
ADMINISTRATORS SHALL BE GOVERNED BY AND INTERPRETED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF DELAWARE AND ALL RIGHTS AND REMEDIES SHALL BE GOVERNED BY SUCH
LAWS WITHOUT REGARD TO THE PRINCIPLES OF CONFLICT OF LAWS OF THE STATE OF
DELAWARE OR ANY OTHER JURISDICTION THAT WOULD CALL FOR THE APPLICATION OF THE
LAW OF ANY JURISDICTION OTHER THAN THE STATE OF DELAWARE; PROVIDED, HOWEVER,
THAT THERE SHALL NOT BE APPLICABLE TO THE HOLDERS, THE ISSUER TRUST, THE
DEPOSITOR, THE ISSUER TRUSTEES, THE ADMINISTRATORS OR THIS TRUST AGREEMENT ANY
PROVISION OF THE LAWS (STATUTORY OR COMMON) OF THE STATE OF DELAWARE PERTAINING
TO TRUSTS OTHER THAN THE DELAWARE BUSINESS TRUST ACT THAT RELATE TO OR REGULATE,
IN A MANNER INCONSISTENT WITH THE TERMS HEREOF (A) THE FILING WITH ANY COURT OR
GOVERNMENTAL BODY OR AGENCY OF TRUSTEE ACCOUNTS OR SCHEDULES OF TRUSTEE FEES AND
CHARGES, (B) AFFIRMATIVE REQUIREMENTS TO POST BONDS FOR TRUSTEES, OFFICERS,
AGENTS OR EMPLOYEES OF A TRUST, (C) THE NECESSITY FOR OBTAINING COURT OR OTHER
GOVERNMENTAL APPROVAL CONCERNING THE ACQUISITION, HOLDING OR DISPOSITION OF REAL
OR PERSONAL PROPERTY, (D) FEES OR OTHER SUMS PAYABLE TO TRUSTEES, OFFICERS,
AGENTS OR EMPLOYEES OF A TRUST, (E) THE ALLOCATION OF RECEIPTS AND EXPENDITURES
TO INCOME OR PRINCIPAL, (F) RESTRICTIONS OR LIMITATIONS ON THE PERMISSIBLE
NATURE, AMOUNT OR CONCENTRATION OF TRUST INVESTMENTS OR REQUIREMENTS RELATING TO
THE TITLING, STORAGE OR OTHER MANNER OF HOLDING OR INVESTING TRUST ASSETS OR (G)
THE ESTABLISHMENT OF FIDUCIARY OR OTHER STANDARDS OF RESPONSIBILITY OR
LIMITATIONS ON THE ACTS OR POWERS OF TRUSTEES THAT ARE INCONSISTENT WITH THE
LIMITATIONS OR LIABILITIES OR AUTHORITIES AND POWERS OF THE ISSUER TRUSTEES OR
THE ADMINISTRATOR AS SET FORTH OR REFERENCED IN THIS TRUST AGREEMENT. SECTION
3540 OF TITLE 12 OF THE DELAWARE CODE SHALL NOT APPLY TO THE ISSUER TRUST.
SECTION 10.5. Payments Due on Non-Business Day.
If the date fixed for any payment on any Trust Security shall be a day
that is not a Business Day, then such payment need not be made on such date but
may be made on the next succeeding day that is a Business Day (except as
otherwise provided in Sections 4.2(d)), with the same force and effect as though
made on the date fixed for such payment, and no Distributions shall accumulate
on such unpaid amount for the period after such date.
SECTION 10.6. Successors.
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This Trust Agreement shall be binding upon and shall inure to the
benefit of any successor to the Depositor, the Issuer Trust, the Administrators
and any Issuer Trustee, including any successor by operation of law. Except in
connection with a consolidation, merger or sale involving the Depositor that is
permitted under Article VIII of the Indenture and pursuant to which the assignee
agrees in writing to perform the Depositor's obligations hereunder, the
Depositor shall not assign its obligations hereunder.
SECTION 10.7. Headings.
The Article and Section headings are for convenience only and shall not
affect the construction of this Trust Agreement.
SECTION 10.8. Reports, Notices and Demands.
Any report, notice, demand or other communication that by any provision
of this Trust Agreement is required or permitted to be given or served to or
upon any Holder or the Depositor may be given or served in writing by deposit
thereof, first class postage prepaid, in the United States mail, hand delivery
or facsimile transmission, in each case, addressed, (a) in the case of a Holder
of Capital Securities, to such Holder as such Holder's name and address may
appear on the Securities Register; and (b) in the case of the Holder of Common
Securities or the Depositor, to Main Street Bancorp, Inc.,
__________________________________________, Attention: Nelson R. Oswald ,
facsimile No. (___) _________ or to such other address as may be specified in a
written notice by the Depositor to the Property Trustee. Such notice, demand or
other communication to or upon a Holder shall be deemed to have been
sufficiently given or made, for all purposes, upon hand delivery, mailing or
transmission. Such notice, demand or other communication to or upon the
Depositor shall be deemed to have been sufficiently given or made only upon
actual receipt of the writing by the Depositor.
Any notice, demand or other communication which by any provision of
this Trust Agreement is required or permitted to be given or served to or upon
the Issuer Trust, the Property Trustee, the Delaware Trustee, the
Administrators, or the Issuer Trust shall be given in writing addressed (until
another address is published by the Issuer Trust) as follows: (a) with respect
to the Property Trustee to The Bank of New York, 101 Barclay Street, 21 West,
New York, NY 10286; (b) with respect to the Delaware Trustee to The Bank of New
York (Delaware), White Clay Center, Route 273, Newark, Delaware 19711 Attention:
Corporate Trust Department; and (c) with respect to the Administrators, to them
at the address above for notices to the Depositor, marked "Attention: Nelson R.
Oswald". Such notice, demand or other communication to or upon the Issuer Trust
or the Property Trustee shall be deemed to have been sufficiently given or made
only upon actual receipt of the writing by the Issuer Trust, the Property
Trustee, or such Administrator.
SECTION 10.9. Agreement Not to Petition.
Each of the Issuer Trustees, the Administrators and the Depositor agree
for the benefit of the Holders that, until at least one year and one day after
the Issuer Trust has been terminated in accordance with Article IX, they shall
not file, or join in the filing of, a petition against the Issuer Trust under
any bankruptcy, insolvency, reorganization or other similar law (including,
without limitation, the United States Bankruptcy Code) (collectively,
"Bankruptcy Laws") or otherwise
53
<PAGE>
join in the commencement of any proceeding against the Issuer Trust under any
Bankruptcy Law. In the event the Depositor takes action in violation of this
Section 10.9, the Property Trustee agrees, for the benefit of Holders, that at
the expense of the Depositor, it shall file an answer with the bankruptcy court
or otherwise properly contest the filing of such petition by the Depositor
against the Issuer Trust or the commencement of such action and raise the
defense that the Depositor has agreed in writing not to take such action and
should be estopped and precluded therefrom and such other defenses, if any, as
counsel for the Issuer Trustee or the Issuer Trust may assert. If any Issuer
Trustee or Administrator takes action in violation of this Section 10.9, the
Depositor agrees, for the benefit of the Holders, that at the expense of the
Depositor, it shall file an answer with the bankruptcy court or otherwise
properly contest the filing of such petition by such Person against the
Depositor or the commencement of such action and raise the defense that such
Person has agreed in writing not to take such action and should be estopped and
precluded therefrom and such other defenses, if any, as counsel for the Issuer
Trustee or the Issuer Trust may assert. The provisions of this Section 10.9
shall survive the termination of this Trust Agreement.
SECTION 10.10. Trust Indenture Act; Conflict with Trust Indenture Act.
(a) Trust Indenture Act; Application. (i) This Trust Agreement
is subject to the provisions of the Trust Indenture Act that are required to be
a part of this Trust Agreement and shall, to the extent applicable, be governed
by such provisions; (ii) if and to the extent that any provision of this Trust
Agreement limits, qualifies or conflicts with the duties imposed by Sections 310
to 317, inclusive, of the Trust Indenture Act, such imposed duties shall
control; (iii) for purposes of this Trust Agreement, the Property Trustee, to
the extent permitted by applicable law and/or the rules and regulations of the
Commission, shall be the only Issuer Trustee which is a trustee for the purposes
of the Trust Indenture Act; and (iv) the application of the Trust Indenture Act
to this Trust Agreement shall not affect the nature of the Capital Securities
and the Common Securities as equity securities representing undivided beneficial
interests in the assets of the Issuer Trust.
(b) Lists of Holders of Preferred Securities. (i) Each of the
Depositor and the Administrators on behalf of the Trust shall provide the
Property Trustee with such information as is required under Section 312(a) of
the Trust Indenture Act at the times and in the manner provided in Section
312(a) and (ii) the Property Trustee shall comply with its obligations under
Sections 310(b), 311 and 312(b) of the Trust Indenture Act.
(c) Reports by the Property Trustee. Within 60 days after
January 31 of each year commencing January 31, 2000, the Property Trustee shall
provide to the Holders of the Trust Securities such reports as are required by
Section 313 of the Trust Indenture Act, if any, in the form, in the manner and
at the times provided by Section 313 of the Trust Indenture Act. The Property
Trustee shall also comply with the requirements of Section 313(d) of the Trust
Indenture Act.
(d) Periodic Reports to Property Trustee. Each of the Depositor
and the Administrators on behalf of the Issuer Trust shall provide to the
Property Trustee, the Commission and the Holders of the Trust Securities, as
applicable, such documents, reports and information as required by Section
315(a)(1) - (3) (if any) of the Trust Indenture Act and the compliance
certificates required by Section 314(a)(4) and (c) of the Trust Indenture Act
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<PAGE>
(provided that any certificate to be provided pursuant to Section 314(a)(4) of
the Trust Indenture Act shall be provided within 120 days of the end of each
fiscal year of the Issuer Trust).
(e) Evidence of Compliance with Conditions Precedent. Each of
the Depositor and the Administrators on behalf of the Issuer Trust shall provide
to the Property Trustee such evidence of compliance with any conditions
precedent, if any, provided for in this Trust Agreement which relate to any of
the matters set forth in Section 314(c) of the Trust Indenture Act. Any
certificate or opinion required to be given pursuant to Section 314(c) shall
comply with Section 314(e) of the Trust Indenture Act.
(f) Disclosure Information. The disclosure of information as to
the names and addresses of the Holders of Trust Securities in accordance with
Section 312 of the Trust Indenture Act, regardless of the source from which such
information was derived, shall not be deemed to be a violation of any existing
law or any law hereafter enacted which does not specifically refer to Section
312 of the Trust Indenture Act, nor shall the Property Trustee be held
accountable by reason of mailing any material pursuant to a request made under
Section 312(b) of the Trust Indenture Act.
SECTION 10.11. Acceptance of Terms of Trust Agreement, Guarantee and
Indenture.
THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST THEREIN
BY OR ON BEHALF OF A HOLDER OR ANY BENEFICIAL OWNER, WITHOUT ANY SIGNATURE OR
FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL ACCEPTANCE
BY THE HOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN SUCH TRUST SECURITY
OF ALL THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT, THE GUARANTEE AND THE
INDENTURE, AND THE AGREEMENT TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF
THE GUARANTEE AND THE INDENTURE, AND SHALL CONSTITUTE THE AGREEMENT OF THE
ISSUER TRUST, SUCH HOLDER AND SUCH OTHERS THAT THE TERMS AND PROVISIONS OF THIS
TRUST AGREEMENT SHALL BE BINDING, OPERATIVE AND EFFECTIVE AS BETWEEN THE ISSUER
TRUST AND SUCH HOLDER AND SUCH OTHERS.
* * * *
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Trust
Agreement to be duly executed, all as of the day and year first above written.
MAIN STREET BANCORP, INC.
as Depositor
By:
-----------------------
Name: Nelson R. Oswald
Title: Chairman, President and Chief Executive
Officer
THE BANK OF NEW YORK,
as Property Trustee, and not in its individual
capacity
By:
--------------------------------
Name:
Title:
56
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THE BANK OF NEW YORK (DELAWARE),
as Delaware Trustee, and not
in its individual capacity
By:
----------------------------
Name:
Title:
Agreed to and Accepted by,
- --------------------------
Name: Nelson R. Oswald
Title: Administrator
- --------------------------
Name: Robert D. McHugh, Jr.
Title: Administrator
- --------------------------
Name: Donna L. Rickert
Title: Administrator
57
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EXHIBIT A
[INSERT CERTIFICATE OF TRUST FILED WITH DELAWARE]
58
<PAGE>
EXHIBIT B
[INTENTIONALLY OMITTED]
59
<PAGE>
EXHIBIT C
THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT TO THE
DEPOSITOR OR AN AFFILIATE OF THE DEPOSITOR
IN COMPLIANCE WITH APPLICABLE LAW AND
SECTION 5.11 OF THE TRUST AGREEMENT
Certificate Number
Number of Common Securities
C-1
-----------------
($_________ Aggregate Liquidation Amount)
Certificate Evidencing Common Securities
of
MBNK Capital Trust I
_.__% Common Securities
(liquidation amount $10.00 per Common Security)
MBNK Capital Trust I, a statutory business trust created under
the laws of the State of Delaware (the "Issuer Trust"), hereby certifies that
Main Street Bancorp, Inc. (the "Holder") is the registered owner of one hundred
and twenty thousand (120,000) common securities of the Issuer Trust representing
undivided beneficial interests in the assets of the Issuer Trust and designated
as the MBNK Capital Trust I _.__% Common Securities (liquidation amount $10.00
per Common Security) (the "Common Securities"). Except in accordance with
Section 5.11 of the Trust Agreement (as defined below) the Common Securities are
not transferable and any attempted transfer hereof other than in accordance
therewith shall be void. The designations, rights, privileges, restrictions,
preferences and other terms and provisions of the Common Securities are set
forth in, and this certificate and the Common Securities represented hereby are
issued and shall in all respects be subject to the terms and provisions of, the
Amended and Restated Trust Agreement of the Issuer Trust, dated as of September
__, 1999, as the same may be amended from time to time (the "Trust Agreement")
among Main Street Bancorp, Inc., as Depositor, The Bank of New York, as Property
Trustee, The Bank of New York (Delaware), as Delaware Trustee, the
Administrators named therein and the Holders of Trust Securities, including the
designation of the terms of the Common Securities as set forth therein. The
Issuer Trust will furnish a copy of the Trust Agreement to the Holder without
charge upon written request to the Issuer Trust at its principal place of
business or registered office.
Upon receipt of this certificate, the Holder is bound by the
Trust Agreement and is entitled to the benefits thereunder.
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Terms used but not defined herein have the meanings set forth
in the Trust Agreement.
IN WITNESS WHEREOF, one of the Administrators of the Issuer
Trust has executed this certificate this __th day of September, 1999.
MBNK CAPITAL TRUST I
By:
-----------------------------
Nelson R. Oswald
Administrator
AUTHENTICATED:
THE BANK OF NEW YORK,
as Property Trustee
By:
--------------------------
Authorized Signatory
61
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EXHIBIT D
[IF THE CAPITAL SECURITIES CERTIFICATE IS TO BE A GLOBAL CAPITAL SECURITIES
CERTIFICATE, INSERT:] This Capital Securities Certificate is a Global Capital
Securities Certificate within the meaning of the Trust Agreement hereinafter
referred to and is registered in the name of a Depositary or a nominee of a
Depositary. This Capital Securities Certificate is exchangeable for Capital
Securities Certificates registered in the name of a person other than the
Depositary or its nominee only in the limited circumstances described in the
Trust Agreement and may not be transferred except as a whole by the Depositary
to a nominee of the Depositary or by a nominee of the Depositary to the
Depositary or another nominee of the Depositary, except in the limited
circumstances described in the Trust Agreement.
Unless this Capital Securities Certificate is presented by an
authorized representative of The Depository Trust Company, a New York
Corporation ("DTC"), to MBNK Capital Trust I or its agent for registration of
transfer, exchange or payment, and any Capital Securities Certificate issued is
registered in the name of Cede & Co. or 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 A PERSON IS
WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
NO EMPLOYEE BENEFIT OR OTHER PLAN OR INDIVIDUAL RETIREMENT
ACCOUNT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE") (EACH, A "PLAN"), NO ENTITY WHOSE UNDERLYING
ASSETS INCLUDE "PLAN ASSETS" BY REASON OF ANY PLAN'S INVESTMENT IN THE ENTITY
(A "PLAN ASSET ENTITY"), AND NO PERSON INVESTING "PLAN ASSETS" OF ANY PLAN,
MAY ACQUIRE OR HOLD THIS CAPITAL SECURITIES CERTIFICATE OR ANY INTEREST
HEREIN, UNLESS SUCH PURCHASE OR HOLDING IS COVERED BY THE EXEMPTIVE RELIEF
PROVIDED BY U.S. DEPARTMENT OF LABOR PROHIBITED TRANSACTION CLASS EXEMPTION
("PTCE") 96-23, 95-60, 91-38, 90-1 OR 84-14 OR ANOTHER APPLICABLE EXEMPTION
WITH RESPECT TO SUCH PURCHASE OR HOLDING. ANY PURCHASER OR HOLDER OF THIS
CAPITAL SECURITIES CERTIFICATE OR ANY INTEREST HEREIN THAT IS A PLAN OR A
PLAN ASSET ENTITY OR IS PURCHASING SUCH SECURITIES ON BEHALF OF OR WITH "PLAN
ASSETS" WILL BE DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND HOLDING HEREOF
THAT (A) THE PURCHASE AND HOLDING OF THE CAPITAL SECURITIES IS COVERED BY THE
EXEMPTIVE RELIEF PROVIDED BY PTCE 96-23, 95-60, 91-38, 90-1 OR 84-14 OR
ANOTHER APPLICABLE EXEMPTION, (B) THE COMPANY AND THE ADMINISTRATORS ARE NOT
"FIDUCIARIES" WITHIN THE MEANING OF SECTION 3(21) OF ERISA AND THE
REGULATIONS THEREUNDER, WITH RESPECT TO SUCH PERSON'S INTEREST IN THE CAPITAL
SECURITIES OR THE JUNIOR SUBORDINATED DEBENTURES, AND (C) IN PURCHASING THE
CAPITAL SECURITIES SUCH PERSON APPROVES THE PURCHASE OF THE JUNIOR
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<PAGE>
SUBORDINATED DEBENTURES AND THE APPOINTMENT OF THE ISSUER TRUSTEES.
Certificate Number Aggregate Liquidation
Amount
D- $40,000,000
------
(4,000,000 Capital
Securities)
CUSIP NO.
-----------------------
Certificate Evidencing Capital Securities
of
MBNK Capital Trust I
_.__% Capital Securities
(liquidation amount $10.00 per Capital Security)
MBNK Capital Trust I, a statutory business trust created under
the laws of the State of Delaware (the "Issuer Trust"), hereby certifies that
______________________ (the "Holder") is the registered owner of Forty Million
Dollars ($40,000,000) aggregate liquidation amount of capital securities of the
Issuer Trust representing a preferred undivided beneficial interest in the
assets of the Issuer Trust and designated as the MBNK Capital Trust I _.__%
Capital Securities (liquidation amount $10.00 per Capital Security) (the
"Capital Securities"). The Capital Securities are transferable on the books and
records of the Issuer Trust, in person or by a duly authorized attorney, upon
surrender of this certificate duly endorsed and in proper form for transfer as
provided in Section 5.5 of the Trust Agreement (as defined below). The
designations, rights, privileges, restrictions, preferences and other terms and
provisions of the Capital Securities are set forth in, and this certificate and
the Capital Securities represented hereby are issued and shall in all respects
be subject to the terms and provisions of, the Amended and Restated Trust
Agreement of the Issuer Trust, dated as of September __, 1999, as the same may
be amended from time to time (the "Trust Agreement"), among Main Street Bancorp,
Inc., as Depositor, The Bank of New York, as Property Trustee, The Bank of New
York (Delaware), as Delaware Trustee, the Administrators named herein and the
Holders of Trust Securities, including the designation of the terms of the
Capital Securities as set forth therein. The Holder is entitled to the benefits
of the Guarantee Agreement entered into by Main Street Bancorp, Inc., as
Guarantor, and The Bank of New York, as Guarantee Trustee, dated as of September
__, 1999 (the "Guarantee Agreement"), to the extent provided therein. The Issuer
Trust will furnish a copy of the Trust Agreement and the Guarantee Agreement to
the Holder without charge upon written request to the Issuer Trust by contacting
the Issuer Trustees.
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Upon receipt of this certificate, the Holder is bound by the
Trust Agreement and is entitled to the benefits thereunder.
Terms used but not defined herein have the meanings set forth
in the Trust Agreement.
IN WITNESS WHEREOF, one of the Administrators of the Issuer
Trust has executed this certificate this __th day of September, 1999.
MBNK CAPITAL TRUST I
By:
-------------------------
Name:Nelson R. Oswald
Administrator
AUTHENTICATED:
THE BANK OF NEW YORK,
as Property Trustee
By:
---------------------------
Authorized Signatory
64
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Capital Security
to:
- ------------------------------------------------------------------------------
(Insert assignee's social security or tax identification number)
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(Insert address and zip code of assignee)
and irrevocably appoints
-----------------------------------------------------
- ------------------------------------------------------------------------------
agent to transfer this Capital Securities Certificate on the books of the Issuer
Trust. The agent may substitute another to act for him or her.
Date:
-----------------------
Signature:
---------------------------------------------------------------
(Sign exactly as your name appears on the other side of
this Capital Securities Certificate)
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in an approved signature guarantee medallion program), pursuant to
S.E.C. Rule 17Ad-15.
65
<PAGE>
Certificate Number Aggregate Liquidation Amount
D- $40,000,000
---
(4,000,000 Capital Securities)
CUSIP NO.
Certificate Evidencing Capital Securities
of
MBNK Capital Trust I
_.__% Capital Securities
(liquidation amount $10.00 per Capital Security)
MBNK Capital Trust I, a statutory business trust created under the laws of
the State of Delaware (the "Issuer Trust"), hereby certifies that
______________________ (the "Holder") is the registered owner of Forty Million
Dollars ($40,000,000) aggregate liquidation amount of capital securities of the
Issuer Trust representing a preferred undivided beneficial interest in the
assets of the Issuer Trust and designated as the MBNK Capital Trust I _.__%
Capital Securities (liquidation amount $10.00 per Capital Security) (the
"Capital Securities"). The Capital Securities are transferable on the books and
records of the Issuer Trust, in person or by a duly authorized attorney, upon
surrender of this certificate duly endorsed and in proper form for transfer as
provided in Section 5.5 of the Trust Agreement (as defined below). The
designations, rights, privileges, restrictions, preferences and other terms and
provisions of the Capital Securities are set forth in, and this certificate and
the Capital Securities represented hereby are issued and shall in all respects
be subject to the terms and provisions of, the Amended and Restated Trust
Agreement of the Issuer Trust, dated as of October __, 1999, as the same may be
amended from time to time (the "Trust Agreement"), among Main Street Bancorp,
Inc., as Depositor, The Bank of New York, as Property Trustee, The Bank of New
York (Delaware), as Delaware Trustee, the Administrators named herein and the
Holders of Trust Securities, including the designation of the terms of the
Capital Securities as set forth therein. The Holder is entitled to the benefits
of the Guarantee Agreement entered into by Main Street Bancorp, Inc., as
Guarantor, and The Bank of New York, as Guarantee Trustee, dated as of October
__, 1999 (the "Guarantee Agreement"), to the extent provided therein. The Issuer
Trust will furnish a copy of the Trust Agreement and the Guarantee Agreement to
the Holder without charge upon written request to the Issuer Trust by contacting
the Issuer Trustees.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.
<PAGE>
Terms used but not defined herein have the meanings set forth in the Trust
Agreement.
IN WITNESS WHEREOF, one of the Administrators of the Issuer Trust has
executed this certificate this __th day of October, 1999.
MBNK CAPITAL TRUST I
By:
----------------------------------
Name: Nelson R. Oswald
Administrator
AUTHENTICATED:
THE BANK OF NEW YORK,
as Property Trustee
By:
--------------------------------
Authorized Signatory
<PAGE>
EXHIBIT 4.7
GUARANTEE AGREEMENT
BETWEEN
MAIN STREET BANCORP, INC.
AS GUARANTOR,
AND
THE BANK OF NEW YORK
AS GUARANTEE TRUSTEE,
DATED AS OF OCTOBER __, 1999
<PAGE>
MBNK CAPITAL TRUST I
CERTAIN SECTIONS OF THIS GUARANTEE AGREEMENT RELATING TO
SECTIONS 310 THROUGH 318 OF THE
TRUST INDENTURE ACT OF 1939:
<TABLE>
<CAPTION>
TRUST INDENTURE GUARANTEE AGREEMENT
ACT SECTION SECTION
- --------------- -------------------
<S> <C> <C>
Section 310 (a) (1).................................................................4.1 (a)
(a) (2).................................................................4.1 (a)
(a) (3).................................................................Not Applicable
(a) (4).................................................................Not Applicable
(b).....................................................................2.8, 4.1 (c)
Section 311 (a).....................................................................Not Applicable
(b).....................................................................Not Applicable
Section 312 (a).....................................................................2.2 (a)
(b).....................................................................2.2 (b)
(c).....................................................................Not Applicable
Section 313 (a).....................................................................2.3
(a) (4).................................................................2.3
(b).....................................................................2.3
(c).....................................................................2.3
(d).....................................................................2.3
Section 314 (a).....................................................................2.4
(b).....................................................................2.4
(c) (1).................................................................2.5
(c) (2).................................................................2.5
(c) (3).................................................................2.5
(e).....................................................................1.1, 2.5, 3.2
Section 315 (a).....................................................................3.1 (d)
(b).....................................................................2.7
(c).....................................................................3.1 (c)
(d).....................................................................3.1 (d)
(e).....................................................................Not Applicable
Section 316 (a).....................................................................1.1, 2.6, 5.4
(a) (1) (A).............................................................5.4
(a) (1) (B).............................................................5.4
(a) (2).................................................................Not Applicable
(b).....................................................................5.3
(c).....................................................................Not Applicable
Section 317 (a) (1).................................................................Not Applicable
(a) (2).................................................................Not Applicable
(b).....................................................................Not Applicable
Section 318 (a).....................................................................2.1
</TABLE>
Note: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of the Guarantee Agreement.
(i)
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
<S> <C>
ARTICLE I. DEFINITIONS...........................................................................................2
SECTION 1.1. DEFINITIONS...................................................................2
ARTICLE II. TRUST INDENTURE ACT..................................................................................6
SECTION 2.1. TRUST INDENTURE ACT; APPLICATION..............................................6
SECTION 2.2. LIST OF HOLDERS...............................................................6
SECTION 2.3. REPORTS BY THE GUARANTEE TRUSTEE..............................................6
SECTION 2.4. PERIODIC REPORTS TO THE GUARANTEE TRUSTEE.....................................6
SECTION 2.5. EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT..............................7
SECTION 2.6. EVENTS OF DEFAULT; WAIVER.....................................................7
SECTION 2.7. EVENT OF DEFAULT; NOTICE......................................................7
SECTION 2.8. CONFLICTING INTERESTS.........................................................7
ARTICLE III. POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE..................................................8
SECTION 3.1. POWERS AND DUTIES OF THE GUARANTEE TRUSTEE....................................8
SECTION 3.2. CERTAIN RIGHTS OF GUARANTEE TRUSTEE...........................................9
SECTION 3.3. INDEMNITY....................................................................10
SECTION 3.4. EXPENSES.....................................................................11
ARTICLE IV. GUARANTEE TRUSTEE...................................................................................11
SECTION 4.1. GUARANTEE TRUSTEE; ELIGIBILITY...............................................11
SECTION 4.2. APPOINTMENT, REMOVAL AND RESIGNATION OF THE GUARANTEE TRUSTEE................11
ARTICLE V. GUARANTEE.............................................................................................12
SECTION 5.1. GUARANTEE....................................................................12
SECTION 5.2. WAIVER OF NOTICE AND DEMAND..................................................12
SECTION 5.3. OBLIGATIONS NOT AFFECTED.....................................................12
SECTION 5.4. RIGHTS OF HOLDERS............................................................13
SECTION 5.5. GUARANTEE OF PAYMENT.........................................................14
SECTION 5.6. SUBROGATION..................................................................14
SECTION 5.7. INDEPENDENT OBLIGATIONS......................................................14
ARTICLE VI. COVENANTS AND SUBORDINATION.........................................................................14
SECTION 6.1. SUBORDINATION................................................................14
SECTION 6.2. PARI PASSU GUARANTEES........................................................14
ARTICLE VII. TERMINATION........................................................................................15
SECTION 7.1. TERMINATION..................................................................15
ARTICLE VIII. MISCELLANEOUS.....................................................................................15
SECTION 8.1. SUCCESSORS AND ASSIGNS.......................................................15
SECTION 8.2. AMENDMENTS...................................................................15
SECTION 8.3. NOTICES......................................................................15
SECTION 8.4. BENEFIT......................................................................16
SECTION 8.5. INTERPRETATION...............................................................17
SECTION 8.6. GOVERNING LAW................................................................17
SECTION 8.7. COUNTERPARTS.................................................................17
</TABLE>
(i)
<PAGE>
GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT, dated as of October __, 1999 is
executed and delivered by MAIN STREET BANCORP, INC., a Pennsylvania corporation
(the "Guarantor") having its principal office at 601 Penn Street, Reading,
Pennsylvania 19603, and THE BANK OF NEW YORK, a New York banking corporation, as
trustee (the "Guarantee Trustee"), for the benefit of the Holders (as defined
herein) from time to time of the Capital Securities (as defined herein) of MBNK
Capital Trust I, a Delaware statutory business trust (the "Issuer Trust").
WHEREAS, pursuant to an Amended and Restated Trust Agreement
(the "Trust Agreement"), dated as of October __, 1999, among Main Street
Bancorp, Inc., as Depositor, The Bank of New York, as Property Trustee (the
"Property Trustee"), The Bank of New York (Delaware), as Delaware Trustee (the
"Delaware Trustee") (collectively, the "Issuer Trustees"), the Administrators
named therein and the Holders from time to time of preferred undivided
beneficial ownership interests in the assets of the Issuer Trust, the Issuer
Trust is issuing up to$40,000,000 aggregate Liquidation Amount (as defined
herein) of its _.__% Capital Securities, Liquidation Amount $ 10.00 per capital
security (the "Capital Securities"), representing preferred undivided beneficial
ownership interests in the assets of the Issuer Trust and having the terms set
forth in the Trust Agreement;
WHEREAS, the Capital Securities will be issued by the Issuer
Trust and the proceeds thereof, together with the proceeds from the issuance of
the Issuer Trust's Common Securities (as defined herein), will be used to
purchase the Junior Subordinated Debentures due September 30, 2029 (the "Junior
Subordinated Debentures") of the Guarantor which will be deposited with The Bank
of New York, as Property Trustee under the Trust Agreement, as trust assets; and
WHEREAS, as incentive for the Holders to purchase the Capital
Securities, the Guarantor desires irrevocably and unconditionally to agree, to
the extent set forth herein, to pay to the Holders of the Capital Securities the
Guarantee Payments (as defined herein) and to make certain other payments on the
terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the purchase of the
Capital Securities by each Holder, which purchase the Guarantor hereby
acknowledges shall benefit the Guarantor, and intending to be legally bound
hereby, the Guarantor executes and delivers this Guarantee Agreement for the
benefit of the Holders from time to time of the Capital Securities.
ARTICLE I. DEFINITIONS
SECTION 1.1. DEFINITIONS.
As used in this Guarantee Agreement, the terms set forth below
shall, unless the context otherwise requires, have the following meanings.
Capitalized terms used but not otherwise defined herein shall have the meanings
assigned to such terms in the Trust Agreement as in effect on the date hereof.
(2)
<PAGE>
"AFFILIATE" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"CONTROL" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "CONTROLLING" AND "CONTROLLED" have meanings correlative to the
foregoing.
"CAPITAL SECURITIES" shall have the meaning specified in the
first recital of this Guarantee Agreement.
"COMMON SECURITIES" means the securities representing common
undivided beneficial interests in the assets of the Issuer Trust.
"DISTRIBUTIONS" means preferential cumulative cash
distributions accumulating from September __, 1999 and payable quarterly in
arrears on March 31, June 30, September 30 and December 31 of each year,
commencing December 31, 1999, at an annual rate of _.__% of the Liquidation
Amount.
"EVENT OF DEFAULT" means (i) a default by the Guarantor in any
of its payment obligations under this Guarantee Agreement, or (ii) a default by
the Guarantor in any other obligation hereunder that remains unremedied for 30
days.
"GUARANTEE AGREEMENT" means this Guarantee Agreement, as
modified, amended or supplemented from time to time.
"GUARANTEE PAYMENTS" means the following payments or
distributions, without duplication, with respect to the Capital Securities, to
the extent not paid or made by or on behalf of the Issuer Trust: (i) any
accumulated and unpaid Distributions (as defined in the Trust Agreement)
required to be paid on the Capital Securities, to the extent the Issuer Trust
shall have funds on hand available therefor at such time, (ii) the Redemption
Price, with respect to the Capital Securities called for redemption by the
Issuer Trust to the extent that the Issuer Trust shall have funds on hand
available therefor at such time, and (iii) upon a voluntary or involuntary
termination, winding-up or liquidation of the Issuer Trust, unless the Junior
Subordinated Debentures are distributed to the Holders, the lesser of (a) the
aggregate of the Liquidation Amount and all accumulated and unpaid Distributions
to the date of payment to the extent the Issuer Trust shall have funds on hand
available to make such payment at such time and (b) the amount of assets of the
Issuer Trust remaining available for distribution to Holders on liquidation of
the Issuer Trust (in either case, the "LIQUIDATION DISTRIBUTION").
"GUARANTEE TRUSTEE" means The Bank of New York, until a
Successor Guarantee Trustee has been appointed and has accepted such appointment
pursuant to the terms of this Guarantee Agreement and thereafter means each such
Successor Guarantee Trustee.
"GUARANTOR" shall have the meaning specified in the first
paragraph of this Guarantee Agreement.
(3)
<PAGE>
"HOLDER" means any holder, as registered on the books and
records of the Issuer Trust, of any Capital Securities; PROVIDED, HOWEVER, that,
in determining whether the holders of the requisite percentage of Capital
Securities have given any request, notice, consent or waiver hereunder, "Holder"
shall not include the Guarantor, the Guarantee Trustee, or any Affiliate of the
Guarantor or the Guarantee Trustee.
"INDENTURE" means the Junior Subordinated Indenture dated as
of October __, 1999, between Main Street Bancorp, Inc. and The Bank of New York,
as trustee, as may be modified, amended or supplemented from time to time.
"ISSUER TRUST" shall have the meaning specified in the first
paragraph of this Guarantee Agreement.
"LIKE AMOUNT" means (a) with respect to a redemption of Trust
Securities, Trust Securities having a Liquidation Amount equal to that portion
of the principal amount of Junior Subordinated Debentures to be
contemporaneously redeemed in accordance with the Indenture, allocated to the
Common Securities and to the Capital Securities based upon the relative
Liquidation Amounts of such classes and (b) with respect to a distribution of
Junior Subordinated Debentures to Holders of Trust Securities in connection with
a dissolution or liquidation of the Issuer Trust, Junior Subordinated Debentures
having a principal amount equal to the Liquidation Amount of the Trust
Securities of the Holder to whom such Junior Subordinated Debentures are
distributed.
"LIQUIDATION AMOUNT" means the stated amount of $ 10.00 per
Capital Security.
"MAJORITY IN LIQUIDATION AMOUNT OF THE CAPITAL SECURITIES"
means, except as provided by the Trust Indenture Act, Capital Securities
representing more than 50% of the aggregate Liquidation Amount of all then
outstanding Capital Securities issued by the Issuer Trust.
"OFFICERS' CERTIFICATE" means a certificate signed by the
Chairman of the Board, Vice Chairman of the Board, Chief Executive Officer,
President, Executive Vice President or a Senior Vice President or Vice
President, and by the Treasurer, an Assistant Treasurer, the Secretary or an
Assistant Secretary of the Guarantor, and delivered to the Guarantee Trustee.
Any Officers' Certificate delivered with respect to compliance with a condition
or covenant provided for in this Guarantee Agreement shall include:
(a) a statement by each officer signing the Officers'
Certificate that such officer has read the covenant or condition and the
definitions relating thereto;
(b) a brief statement of the nature and scope of the
examination or investigation undertaken by such officer in rendering the
Officers' Certificate;
(c) a statement that such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such officer
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(4)
<PAGE>
(d) a statement as to whether, in the opinion of such officer,
such condition or covenant has been complied with.
"PERSON" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"REDEMPTION DATE" means, with respect to any Capital Security
to be redeemed, the date fixed for such redemption by or pursuant to the Trust
Agreement; provided that each Junior Subordinated Debenture Redemption Date and
the stated maturity of the Junior Subordinated Debentures shall be a Redemption
Date for a Like Amount of Capital Securities.
"REDEMPTION PRICE" shall have the meaning specified in the
Trust Agreement.
"RESPONSIBLE OFFICER" means, when used with respect to the
Guarantee Trustee, any officer assigned to the Corporate Trust Office, including
any managing director, vice president, principal, assistant vice president,
assistant treasurer, assistant secretary or any other officer of the Guarantee
Trustee customarily performing functions similar to those performed by any of
the above designated officers and having direct responsibility for the
administration of this Indenture, and also, with respect to a particular matter,
any other officer to whom such matter is referred because of such officer's
knowledge of and familiarity with the particular subject.
"SENIOR INDEBTEDNESS" shall have the meaning specified in the
Indenture.
"SUCCESSOR GUARANTEE TRUSTEE" means a successor Guarantee
Trustee possessing the qualifications to act as Guarantee Trustee under
Section 4.1.
"TRUST AGREEMENT" means the Amended and Restated Trust
Agreement, dated October __, 1999, executed by Main Street Bancorp, Inc., as
Depositor, The Bank of New York (Delaware), as Delaware Trustee, The Bank of New
York, as Property Trustee, the Administrators named therein and the Holders
defined therein.
"TRUST INDENTURE ACT" means the Trust Indenture Act of 1939
(15 U.S.C. Sections 77aaa-77bbbb), as amended.
"TRUST SECURITIES" means the Common Securities and the Capital
Securities.
(5)
<PAGE>
ARTICLE II. TRUST INDENTURE ACT
SECTION 2.1. TRUST INDENTURE ACT; APPLICATION.
If any provision hereof limits, qualifies or conflicts with a
provision of the Trust Indenture Act that is required under such Act to be a
part of and govern this Guarantee Agreement, the provision of the Trust
Indenture Act shall control. If any provision of this Guarantee Agreement
modifies or excludes any provision of the Trust Indenture Act that may be so
modified or excluded, the latter provision shall be deemed to apply to this
Guarantee Agreement as so modified or excluded, as the case may be.
SECTION 2.2. LIST OF HOLDERS.
(a) The Guarantor will furnish or cause to be furnished to the
Guarantee Trustee a list of Holders at the following times:
(i) quarterly, not more than 15 days after the last
day of February, May, August and November in each year, a list, in such form as
the Guarantee Trustee may reasonably require, of the names and addresses of the
Holders as of the last day of February, May, August and November, as
applicable; and
(ii) at such other times as the Guarantee Trustee may
request in writing, within 30 days after the receipt by the Guarantor of any
such request, a list of similar form and content as of a date not more than 15
days prior to the time such list is furnished.
(b) The Guarantee Trustee shall comply with the
requirements of Section 312(b) of the Trust Indenture Act.
SECTION 2.3. REPORTS BY THE GUARANTEE TRUSTEE.
Not later than January 31 of each year, commencing January 31,
2000, the Guarantee Trustee shall provide to the Holders such reports, if any,
as are required by Section 313 of the Trust Indenture Act in the form and in the
manner provided by Section 313 of the Trust Indenture Act. If this Guarantee
Agreement shall have been qualified under the Trust Indenture Act, the Guarantee
Trustee shall also comply with the requirements of Section 313(d) of the Trust
Indenture Act.
SECTION 2.4. PERIODIC REPORTS TO THE GUARANTEE TRUSTEE.
The Guarantor shall provide to the Guarantee Trustee, and the
Holders such documents, reports and information, if any, as required by Section
314 of the Trust Indenture Act and the compliance certificate required by
Section 314 of the Trust Indenture Act, in the form, in the manner and at the
times required by Section 314 of the Trust Indenture Act, provided that such
documents, reports and information shall be required to be provided to the
Securities and Exchange Commission only if this Guarantee Agreement shall have
been qualified under the Trust Indenture Act.
(6)
<PAGE>
SECTION 2.5. EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT.
The Guarantor shall provide to the Guarantee Trustee such evidence of
compliance with such conditions precedent, if any, provided for in this
Guarantee Agreement that relate to any of the matters set forth in Section
314(c) of the Trust Indenture Act. Any certificate or opinion required to be
given by an officer pursuant to Section 314(c)(1) may be given in the form of an
Officers' Certificate.
SECTION 2.6. EVENTS OF DEFAULT; WAIVER.
The Holders of a Majority in Liquidation Amount of the Capital
Securities may, by vote, on behalf of the Holders, waive any past Event of
Default and its consequences. Upon such waiver, any such Event of Default shall
cease to exist, and any Event of Default arising therefrom shall be deemed to
have been cured, for every purpose of this Guarantee Agreement, but no such
waiver shall extend to any subsequent or other default or Event of Default or
impair any right consequent therefrom.
SECTION 2.7. EVENT OF DEFAULT; NOTICE.
(a) The Guarantee Trustee shall, within 90 days after the occurrence of
an Event of Default, transmit by mail, first class postage prepaid, to the
Holders, notice of all Events of Default known to the Guarantee Trustee, unless
such Events of Default have been cured before the giving of such notice;
PROVIDED THAT, except in the case of a default in the payment of a Guarantee
Payment, the Guarantee Trustee shall be protected in withholding such notice if
and so long as the Board of Directors, the executive committee or a trust
committee of directors and/or Responsible Officers of the Guarantee Trustee in
good faith determines that the withholding of such notice is in the interests of
the Holders.
(b) The Guarantee Trustee shall not be deemed to have knowledge of any
Event of Default unless a Responsible Officer charged with the administration of
this Guarantee Agreement shall have received written notice of such Event of
Default.
SECTION 2.8. CONFLICTING INTERESTS.
The Trust Agreement shall be deemed to be specifically described in
this Guarantee Agreement for the purposes of clause (i) of the first proviso
contained in Section 310(b) of the Trust Indenture Act.
(7)
<PAGE>
ARTICLE III. POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE
SECTION 3.1. POWERS AND DUTIES OF THE GUARANTEE TRUSTEE.
(a) This Guarantee Agreement shall be held by the Guarantee Trustee for
the benefit of the Holders, and the Guarantee Trustee shall not transfer this
Guarantee Agreement to any Person except a Holder exercising his or her rights
pursuant to Section 5.4(iv) or to a Successor Guarantee Trustee on acceptance by
such Successor Guarantee Trustee of its appointment to act as Successor
Guarantee Trustee hereunder. The right, title and interest of the Guarantee
Trustee, as such, hereunder shall automatically vest in any Successor Guarantee
Trustee, upon acceptance by such Successor Guarantee Trustee of its appointment
hereunder, and such vesting and cessation of title shall be effective whether or
not conveyancing documents have been executed and delivered pursuant to the
appointment of such Successor Guarantee Trustee.
(b) If an Event of Default has occurred and is continuing, the
Guarantee Trustee shall enforce this Guarantee Agreement for the benefit of the
Holders.
(c) The Guarantee Trustee, before the occurrence of any Event of
Default and after the curing of all Events of Default that may have occurred,
shall be obligated to perform only such duties as are specifically set forth in
this Guarantee Agreement (including pursuant to Section 2.1), and no implied
covenants shall be read into this Guarantee Agreement against the Guarantee
Trustee. If an Event of Default has occurred (that has not been cured or waived
pursuant to Section 2.6), the Guarantee Trustee shall exercise such of the
rights and powers vested in it by this Guarantee Agreement, and use the same
degree of care and skill in its exercise thereof, as a prudent person would
exercise or use under the circumstances in the conduct of his or her own
affairs.
(d) No provision of this Guarantee Agreement shall be construed to
relieve the Guarantee Trustee from liability for its own negligent action, its
own negligent failure to act or its own willful misconduct, except that:
(i) Prior to the occurrence of any Event of Default and after
the curing or waiving of all such Events of Default that may have occurred:
(A) the duties and obligations of the Guarantee
Trustee shall be determined solely by the express provisions of this
Guarantee Agreement (including pursuant to Section 2.1), and the Guarantee
Trustee shall not be liable except for the performance of such duties and
obligations as are specifically set forth in this Guarantee Agreement
(including pursuant to Section 2.1); and
(B) in the absence of bad faith on the part of the
Guarantee Trustee, the Guarantee Trustee may conclusively rely, as to the
truth of the statements and the correctness of the opinions expressed
therein, upon any certificates or opinions furnished to the Guarantee Trustee
and conforming to the requirements of this Guarantee Agreement; but in the
case of any such certificates or opinions that by any provision hereof or of
the Trust Indenture Act are specifically required to be furnished to the
Guarantee Trustee, the Guarantee Trustee shall be under a duty to examine
the same to determine whether or not they conform to the requirements of
this Guarantee Agreement;
(8)
<PAGE>
(ii) The Guarantee Trustee shall not be liable for any error
of judgment made in good faith by a Responsible Officer of the Guarantee
Trustee, unless it shall be proved that the Guarantee Trustee was negligent in
ascertaining the pertinent facts upon which such judgment was made;
(iii) The Guarantee Trustee shall not be liable with respect
to any action taken or omitted to be taken by it in good faith in accordance
with the direction of the Holders of not less than a Majority in Liquidation
Amount of the Capital Securities relating to the time, method and place of
conducting any proceeding for any remedy available to the Guarantee Trustee, or
exercising any trust or power conferred upon the Guarantee Trustee under this
Guarantee Agreement; and
(iv) No provision of this Guarantee Agreement shall require
the Guarantee Trustee to expend or risk its own funds or otherwise incur
personal financial liability in the performance of any of its duties or in the
exercise of any of its rights or powers if the Guarantee Trustee shall have
reasonable grounds for believing that the repayment of such funds or liability
is not assured to it under the terms of this Guarantee Agreement or adequate
indemnity against such risk or liability is not reasonably assured to it.
SECTION 3.2. CERTAIN RIGHTS OF GUARANTEE TRUSTEE.
(a) Subject to the provisions of Section 3.1:
(i) The Guarantee Trustee may conclusively rely and shall be
fully protected in acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of indebtedness or other
paper or document reasonably believed by it to be genuine and to have been
signed, sent or presented by the proper party or parties.
(ii) Any direction or act of the Guarantor contemplated by
this Guarantee Agreement shall be sufficiently evidenced by an Officers'
Certificate unless otherwise prescribed herein.
(iii) Whenever, in the administration of this Guarantee
Agreement, the Guarantee Trustee shall deem it desirable that a matter be proved
or established before taking, suffering or omitting to take any action
hereunder, the Guarantee Trustee (unless other evidence is herein specifically
prescribed) may, in the absence of bad faith on its part, request and
conclusively rely upon an Officers' Certificate which, upon receipt of such
request from the Guarantee Trustee, shall be promptly delivered by the
Guarantor.
(iv) The Guarantee Trustee may consult with legal counsel, and
the advice or written opinion of such legal counsel with respect to legal
matters shall be full and complete authorization and protection in respect of
any action taken, suffered or omitted to be taken by it hereunder in good faith
and in accordance with such advice or opinion. Such legal counsel may be legal
counsel to the Guarantor or any of its Affiliates and may be one of its
employees. The Guarantee Trustee shall have the right at any time to seek
instructions concerning the administration of this Guarantee Agreement from any
court of competent jurisdiction.
(9)
<PAGE>
(v) The Guarantee Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Guarantee Agreement at
the request or direction of any Holder, unless such Holder shall have provided
to the Guarantee Trustee such security and indemnity as would satisfy a
reasonable person in the position of the Guarantee Trustee, against the costs,
expenses (including attorneys' fees and expenses) and liabilities that might be
incurred by it in complying with such request or direction, including such
reasonable advances as may be requested by the Guarantee Trustee.
(vi) The Guarantee Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Guarantee Trustee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it may see fit.
(vii) The Guarantee Trustee may execute any
of the trusts or powers hereunder or perform any duties hereunder either
directly or by or through its agents or attorneys, and the Guarantee Trustee
shall not be responsible for any negligence or wilful misconduct on the part of
any such agent or attorney appointed with due care by it hereunder.
(viii) Whenever in the administration of this Guarantee
Agreement the Guarantee Trustee shall deem it desirable to receive instructions
with respect to enforcing any remedy or right or taking any other action
hereunder, the Guarantee Trustee (A) may request instructions from the Holders,
(B) may refrain from enforcing such remedy or right or taking such other action
until such instructions are received and (C) shall be fully protected in acting
in accordance with such instructions.
(b) No provision of this Guarantee Agreement shall be deemed to impose
any duty or obligation on the Guarantee Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it in any
jurisdiction in which it shall be illegal, or in which the Guarantee Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Guarantee Trustee
shall be construed to be a duty to act in accordance with such power and
authority.
SECTION 3.3. INDEMNITY.
The Guarantor agrees to indemnify the Guarantee Trustee for, and to
hold it harmless against, any loss, liability or expense incurred without
negligence, wilful misconduct or bad faith on the part of the Guarantee Trustee,
arising out of or in connection with the acceptance or administration of this
Guarantee Agreement, including the costs and expenses of defending itself
against any claim or liability in connection with the exercise or performance of
any of its powers or duties hereunder. The Guarantee Trustee will not claim or
exact any lien or charge on any Guarantee Payments as a result of any amount due
to it under this Guarantee Agreement.
(10)
<PAGE>
SECTION 3.4. EXPENSES.
The Guarantor shall from time to time reimburse the Guarantee Trustee
for its expenses and costs (including reasonable attorneys' or agents' fees)
incurred in connection with the performance of its duties hereunder.
ARTICLE IV. GUARANTEE TRUSTEE
SECTION 4.1. GUARANTEE TRUSTEE; ELIGIBILITY.
(a) There shall at all times be a Guarantee Trustee which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a Person that is eligible pursuant to the Trust
Indenture Act to act as such and has a combined capital and surplus of at least
$50,000,000, and shall be a corporation meeting the requirements of Section
310(c) of the Trust Indenture Act. If such corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of the
supervising or examining authority, then, for the purposes of this Section and
to the extent permitted by the Trust Indenture Act, the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published.
(b) If at any time the Guarantee Trustee shall cease to be eligible to
so act under Section 4.1(a), the Guarantee Trustee shall immediately resign in
the manner and with the effect set out in Section 4.2.
(c) If the Guarantee Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture Act, the
Guarantee Trustee and Guarantor shall in all respects comply with the provisions
of Section 310(b) of the Trust Indenture Act.
SECTION 4.2. APPOINTMENT, REMOVAL AND RESIGNATION OF THE GUARANTEE TRUSTEE.
(a) No resignation or removal of the Guarantee Trustee and no
appointment of a Successor Guarantee Trustee pursuant to this Article shall
become effective until the acceptance of appointment by the Successor Guarantee
Trustee by written instrument executed by the Successor Guarantee Trustee and
delivered to the Holders and the Guarantee Trustee.
(b) Subject to the immediately preceding paragraph, a
Guarantee Trustee may resign at any time by giving written notice thereof to the
Holders. The Guarantee Trustee shall appoint a successor by requesting from at
least three Persons meeting the eligibility requirements such Person's expenses
and charges to serve as the Guarantee Trustee, and selecting the Person who
agrees to the lowest expenses and charges. If the instrument of acceptance by
the Successor Guarantee Trustee shall not have been delivered to the Guarantee
Trustee within 60 days after the giving of such notice of resignation, the
Guarantee Trustee may petition, at the expense of the Guarantor, any court of
competent jurisdiction for the appointment of a Successor Guarantee Trustee.
(11)
<PAGE>
(c) The Guarantee Trustee may be removed for cause at any time
by Act (within the meaning of Section 6.8 of the Trust Agreement) of the Holders
of at least a Majority in Liquidation Amount of the Capital Securities,
delivered to the Guarantee Trustee.
(d) If a resigning Guarantee Trustee shall fail to appoint a
successor, or if a Guarantee Trustee shall be removed or become incapable of
acting as Guarantee Trustee, or if any vacancy shall occur in the office of any
Guarantee Trustee for any cause, the Holders of the Capital Securities, by Act
of the Holders of record of not less than 25% in aggregate Liquidation Amount of
the Capital Securities then outstanding delivered to such Guarantee Trustee,
shall promptly appoint a successor Guarantee Trustee. If no Successor Guarantee
Trustee shall have been so appointed by the Holders of the Capital Securities
and such appointment accepted by the Successor Guarantee Trustee, any Holder, on
behalf of himself and all others similarly situated, may petition any court of
competent jurisdiction for the appointment of a Successor Guarantee Trustee.
ARTICLE V. GUARANTEE
SECTION 5.1. GUARANTEE.
The Guarantor irrevocably and unconditionally agrees to pay in
full to the Holders the Guarantee Payments (without duplication of amounts
theretofore paid by or on behalf of the Issuer Trust), as and when due,
regardless of any defense, right of set-off or counterclaim which the Issuer
Trust may have or assert, except the defense of payment. The Guarantor's
obligation to make a Guarantee Payment may be satisfied by direct payment of the
required amounts by the Guarantor to the Holders or by causing the Issuer Trust
to pay such amounts to the Holders. The Guarantor shall give prompt written
notice to the Guarantee Trustee in the event it makes any direct payment
hereunder.
SECTION 5.2. WAIVER OF NOTICE AND DEMAND.
The Guarantor hereby waives notice of acceptance of the
Guarantee Agreement and of any liability to which it applies or may apply,
presentment, demand for payment, any right to require a proceeding first against
the Guarantee Trustee, the Issuer Trust or any other Person before proceeding
against the Guarantor, protest, notice of nonpayment, notice of dishonor, notice
of redemption and all other notices and demands.
SECTION 5.3. OBLIGATIONS NOT AFFECTED.
The obligations, covenants, agreements and duties of the
Guarantor under this Guarantee Agreement shall in no way be affected or impaired
by reason of the happening from time to time of any of the following:
(a) the release or waiver, by operation of law or otherwise,
of the performance or observance by the Issuer Trust of any express or implied
agreement, covenant, term or condition relating to the Capital Securities to be
performed or observed by the Issuer Trust;
(12)
<PAGE>
(b) the extension of time for the payment by the Issuer Trust
of all or any portion of the Distributions (other than an extension of time for
payment of Distributions that results from the extension of any interest payment
period on the Junior Subordinated Debentures as so provided in the Indenture),
Redemption Price, Liquidation Distribution or any other sums payable under the
terms of the Capital Securities or the extension of time for the performance of
any other obligation under, arising out of, or in connection with, the Capital
Securities;
(c) any failure, omission, delay or lack of diligence on the
part of the Holders to enforce, assert or exercise any right, privilege, power
or remedy conferred on the Holders pursuant to the terms of the Capital
Securities, or any action on the part of the Issuer Trust granting indulgence or
extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution,
sale of any collateral, receivership, insolvency, bankruptcy, assignment for the
benefit of creditors, reorganization, arrangement, composition or readjustment
of debt of, or other similar proceedings affecting, the Issuer Trust or any of
the assets of the Issuer Trust;
(e) any invalidity of, or defect or deficiency in, the
Capital Securities;
(f) the settlement or compromise of any obligation
guaranteed hereby or hereby incurred; or
(g) any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a guarantor (other than
payment of the underlying obligation), it being the intent of this Section 5.3
that the obligations of the Guarantor hereunder shall be absolute and
unconditional under any and all circumstances.
There shall be no obligation of the Holders to give notice to,
or obtain the consent of, the Guarantor with respect to the happening of any of
the foregoing.
SECTION 5.4. RIGHTS OF HOLDERS.
The Guarantor expressly acknowledges that: (i) this Guarantee
Agreement will be deposited with the Guarantee Trustee to be held for the
benefit of the Holders; (ii) the Guarantee Trustee has the right to enforce this
Guarantee Agreement on behalf of the Holders; (iii) the Holders of a Majority in
Liquidation Amount of the Capital Securities have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Guarantee Trustee in respect of this Guarantee Agreement or exercising any trust
or power conferred upon the Guarantee Trustee under this Guarantee Agreement;
and (iv) any Holder may institute a legal proceeding directly against the
Guarantor to enforce its rights under this Guarantee Agreement, without first
instituting a legal proceeding against the Guarantee Trustee, the Issuer Trust
or any other Person.
(13)
<PAGE>
SECTION 5.5. GUARANTEE OF PAYMENT.
This Guarantee Agreement creates a guarantee of payment and
not of collection. This Guarantee Agreement will not be discharged except by
payment of the Guarantee Payments in full (without duplication of amounts
theretofore paid by the Issuer Trust) or upon the distribution of Junior
Subordinated Debentures to Holders as provided in the Trust Agreement.
SECTION 5.6. SUBROGATION.
The Guarantor shall be subrogated to all rights (if any) of
the Holders against the Issuer Trust in respect of any amounts paid to the
Holders by the Guarantor under this Guarantee Agreement; PROVIDED, HOWEVER, that
the Guarantor shall not (except to the extent required by mandatory provisions
of law) be entitled to enforce or exercise any rights which it may acquire by
way of subrogation or any indemnity, reimbursement or other agreement, in all
cases as a result of payment under this Guarantee Agreement, if at the time of
any such payment, any amounts are due and unpaid under this Guarantee Agreement.
If any amount shall be paid to the Guarantor in violation of the preceding
sentence, the Guarantor agrees to hold such amount in trust for the Holders and
to pay over such amount to the Holders.
SECTION 5.7. INDEPENDENT OBLIGATIONS.
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Issuer Trust with respect to the Capital
Securities and that the Guarantor shall be liable as principal and as debtor
hereunder to make Guarantee Payments pursuant to the terms of this Guarantee
Agreement notwithstanding the occurrence of any event referred to in subsections
(a) through (g), inclusive, of Section 5.3 hereof.
ARTICLE VI. COVENANTS AND SUBORDINATION
SECTION 6.1. SUBORDINATION.
This Guarantee Agreement will constitute an unsecured
obligation of the Guarantor and will rank subordinate and junior in right of
payment to all Senior Indebtedness of the Guarantor to the extent and in the
manner set forth in the Indenture with respect to the Junior Subordinated
Debentures, and the provisions of Article XIII of the Indenture will apply,
MUTATIS MUTANDIS, to the obligations of the Guarantor hereunder. The obligations
of the Guarantor hereunder do not constitute Senior Indebtedness of the
Guarantor.
SECTION 6.2. PARI PASSU GUARANTEES.
The obligations of the Guarantor under this Guarantee
Agreement shall rank PARI PASSU with any similar guarantee agreements issued by
the Guarantor on behalf of the holders of preferred or capital securities issued
by the Issuer Trust and with any other security, guarantee or other obligation
that is expressly stated to rank PARI PASSU with the obligations of the
Guarantor under this Guarantee Agreement.
(14)
<PAGE>
ARTICLE VII. TERMINATION
SECTION 7.1. TERMINATION.
This Guarantee Agreement shall terminate and be of no further
force and effect upon (i) full payment of the Redemption Price of all Capital
Securities, (ii) the distribution of Junior Subordinated Debentures to the
Holders in exchange for all of the Capital Securities or (iii) full payment of
the amounts payable in accordance with Article IX of the Trust Agreement upon
liquidation of the Issuer Trust. Notwithstanding the foregoing, this Guarantee
Agreement will continue to be effective or will be reinstated, as the case may
be, if at any time any Holder is required to restore payment of any sums paid
under the Capital Securities or this Guarantee Agreement.
ARTICLE VIII. MISCELLANEOUS
SECTION 8.1. SUCCESSORS AND ASSIGNS.
All guarantees and agreements contained in this Guarantee
Agreement shall bind the successors, assigns, receivers, trustees and
representatives of the Guarantor and shall inure to the benefit of the Holders
of the Capital Securities then outstanding. Except in connection with a
consolidation, merger or sale involving the Guarantor that is permitted under
Article VIII of the Indenture and pursuant to which the assignee agrees in
writing to perform the Guarantor's obligations hereunder, the Guarantor shall
not assign its obligations hereunder, and any purported assignment that is not
in accordance with these provisions shall be void.
SECTION 8.2. AMENDMENTS.
Except with respect to any changes that do not materially
adversely affect the rights of the Holders (in which case no consent of the
Holders will be required), this Guarantee Agreement may only be amended with the
prior approval of the Holders of not less than a Majority in Liquidation Amount
of the Capital Securities. The provisions of Article VI of the Trust Agreement
concerning meetings of the Holders shall apply to the giving of such approval.
SECTION 8.3. NOTICES.
Any notice, request or other communication required or
permitted to be given hereunder shall be in writing, duly signed by the party
giving such notice, and delivered, telecopied (confirmed by delivery of the
original) or mailed by first class mail as follows:
(a) if given to the Guarantor, to the address or telecopy
number set forth below or such other address or telecopy number or to the
attention of such other Person as the Guarantor may give notice to the Holders:
(15)
<PAGE>
Main Street Bancorp, Inc.
601 Penn Street
Reading, Pennsylvania 19603
Facsimile No.: (610) 685-1514
Attention: Nelson R. Oswald
(b) if given to the Issuer Trust, in care of the Guarantee
Trustee, at the Issuer Trust's (and the Guarantee Trustee's) address set forth
below or such other address or telecopy number or to the attention of such other
Person as the Guarantee Trustee on behalf of the Issuer Trust may give notice to
the Holders:
MBNK Capital Trust I
-------------------
________, Delaware ________
Facsimile No.: (___)___-____
Attention: Nelson R. Oswald
with a copy to:
The Bank of New York
101 Barclay Street
21 West
New York, NY 10286
Facsimile No.: (212) 815-5915
Attention: Corporate Trust
(c) if given to the Guarantee Trustee
The Bank of New York
101 Barclay Street
21 West
New York, NY 10286
Facsimile No.: (212) 815-5915
Attention: Corporate Trust
(d) if given to any Holder, at the address set forth on the
books and records of the Issuer Trust.
All notices hereunder shall be deemed to have been given when
received in person, telecopied with receipt confirmed, or mailed by first class
mail, postage prepaid, except that if a notice or other document is refused
delivery or cannot be delivered because of a changed address of which no notice
was given, such notice or other document shall be deemed to have been delivered
on the date of such refusal or inability to deliver.
SECTION 8.4. BENEFIT.
This Guarantee Agreement is solely for the benefit of the
Holders and is not separately transferable from the Capital Securities.
(16)
<PAGE>
SECTION 8.5. INTERPRETATION.
In this Guarantee Agreement, unless the context otherwise
requires:
(a) capitalized terms used in this Guarantee Agreement but not
defined in the preamble hereto have the respective meanings assigned to them in
Section 1.1;
(b) a term defined anywhere in this Guarantee Agreement has
the same meaning throughout;
(c) all references to "the Guarantee Agreement" or "this
Guarantee Agreement" are to this Guarantee Agreement as modified, supplemented
or amended from time to time;
(d) all references in this Guarantee Agreement to Articles and
Sections are to Articles and Sections of this Guarantee Agreement unless
otherwise specified;
(e) a term defined in the Trust Indenture Act has the same
meaning when used in this Guarantee Agreement unless otherwise defined in this
Guarantee Agreement or unless the context otherwise requires;
(f) a reference to the singular includes the plural and vice
versa; and
(g) the masculine, feminine or neuter genders used herein
shall include the masculine, feminine and neuter genders.
SECTION 8.6. GOVERNING LAW.
THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT
REGARD TO THE CONFLICT OF LAW PRINCIPLES THEREOF.
SECTION 8.7. COUNTERPARTS.
This instrument may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
(17)
<PAGE>
THIS GUARANTEE AGREEMENT is executed as of the day and year
first above written.
MAIN STREET BANCORP, INC.
as Guarantor
By:
Name: Nelson R. Oswald
Title: President
THE BANK OF NEW YORK,
as Guarantee Trustee, and not
in its individual capacity
By:
Name:
Title: Vice President
(18)
<PAGE>
October __, 1999
[Letterhead of Stevens & Lee P.C.]
MBNK Capital Trust I
Main Street Bancorp, Inc.
601 Penn Street
Reading, Pennsylvania 19601
Ladies and Gentlemen:
We have acted as counsel to MAIN STREET BANCORP, Inc., a Pennsylvania
corporation (the "Company"), and MBNK Capital Trust I, a business trust formed
under the Business Trust Act of the State of Delaware (Chapter 38, Title 12, of
the Delaware Code, 12 Del L. Sec. 3801 ET. SEQ.) (the "Trust"), in connection
with the preparation of the Registration Statement on Form S-3 filed by the
Company and the Trust with respect to the registration under the Securities Act
of 1933, as amended (the "Act"), of (i) the guarantee by the Company of
4,000,000 of the Trust's _____% capital securities, liquidation amount of $10
per capital security (the "Capital Securities") with respect to distributions
and payments upon liquidation, redemption and otherwise (the "Guarantee"), (ii)
$40,000,000 principal amount of _____% Junior Subordinated Deferrable Interest
Debentures due September 30, 2029 (the "Junior Subordinated Debentures") to be
issued by the Company and (iii) the Capital Securities.
This opinion is being provided in accordance with the requirements of
Item 601(b)(5) of Regulation S-K under the Securities Act of 1933, as amended
(the "Act").
In connection with this opinion, we have reviewed originals or copies,
certified or otherwise identified to our satisfaction, of the following
documents:
(i) the Registration Statement on Form S-3 (File No. 333-86943) as
filed by the Company and the Trust with the Securities and Exchange Commission
(the "Commission") on September 10, 1999 under the Act, and Amendment No. 1
thereto filed with the Commission on
<PAGE>
October __, 1999
Page 2
October 25, 1999 (such Registration Statement, as so amended, being hereinafter
referred to as the "Registration Statement");
(ii) the Certificate of Trust of the Trust filed with the Secretary of
State of the State of Delaware on September 1, 1999;
(iii) the Amended and Restated Trust Agreement of the Trust, dated as
of _______ __, 1999 (the "Declaration"), among Nelson R. Oswald, Donna L.
Rickert, and Robert D. McHugh, Jr., as administrative trustees, The Bank of New
York, as property trustee (the "Property Trustee") and The Bank of New York
(Delaware), as Delaware trustee;
(iv) the form of the Capital Securities and a specimen certificate
thereof;
(v) an executed copy of the Indenture, dated as of September __, 1999
(the "Indenture"), between The Bank of New York, as Indenture Trustee, and the
Company;
(vi) the form of the Junior Subordinated Debentures and a specimen
certificate thereof;
(vii) the Guarantee;
(viii) the Articles of Incorporation and Bylaws of the Company as
certified by the Secretary of the Company, and
(ix) resolutions adopted by the Board of Directors of the Company on
September __, 1999 as certified by the Secretary of the Company.
-------------------------------------
<PAGE>
October __, 1999
Page 3
Based upon our review of the foregoing documents, and subject to the
qualifications set forth below, it is our opinion that when the Registration
Statement becomes effective:
1. The Guarantee has been duly authorized by the Company, and
when (i) the Declaration and Indenture have been qualified under the Trust
Indenture Act of 1939, as amended, and (ii) the Guarantee is duly executed and
delivered by the Company and issued as contemplated by the Registration
Statement, the Guarantee will constitute a valid, legal and binding agreement of
the Company in favor of the holders of Capital Securities, enforceable against
the Company in accordance with its terms, except to the extent that enforcement
thereof may be limited by (1) bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance or other similar laws now or hereafter in
effect relating to creditors' rights generally and (2) general principles of
equity (regardless of whether enforceability is considered in a proceeding at
law or in equity).
2. The Junior Subordinated Debentures have been duly authorized
for issuance by the Company, and when (i) the Declaration and Indenture have
been qualified under the Trust Indenture Act of 1939, as amended, and (ii) the
Junior Subordinated Debentures are duly executed, authenticated and issued in
accordance with the Indenture and the Registration Statement, the Junior
Subordinated Debentures will constitute valid and binding obligations of the
Company enforceable against the Company in accordance with their terms, except
to the extent that enforcement thereof may be limited by (1) bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance or other similar
laws now or hereafter in effect relating to creditors' rights generally and (2)
general principles of equity (regardless of whether enforceability is considered
in a proceeding at law or in equity).
<PAGE>
October __, 1999
Page 4
3. The Capital Securities have been duly authorized for issuance
by the Trust, and when (i) the Declaration has been qualified under the Trust
Indenture Act of 1939, as amended, and (ii) the Capital Securities are duly
executed, authenticated and issued in accordance with the Declaration and
delivered and issued as contemplated by the Registration Statement, the Capital
Securities will represent, subject to the qualifications set forth in paragraph
4 below, fully paid and nonassessable undivided beneficial interests in the
assets of the Trust and will entitle the holders thereof to the benefits of the
Declaration except to the extent that enforcement of the Declaration may be
limited by (1) bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights generally
and (2) general principles of equity regardless of whether enforcement is
considered in a proceeding in equity or at law.
4. The holders of the Capital Securities will be entitled to the
same limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the State
of Delaware. We bring to your attention, however, that the holders of the
Capital Securities may be obligated, pursuant to the Declaration, to (i) provide
indemnity and/or security in connection with, and pay taxes or governmental
charges arising from, transfers of Capital Securities and (ii) provide security
and indemnity in connection with requests of or directions to the Property
Trustee to exercise its rights and powers under the Declaration.
---------------------------
In providing this opinion we have assumed, without investigation, the
authenticity of documents submitted to us as originals, the conformity to the
originals of any document submitted to us as a copy, the authenticity of the
originals of such documents submitted to us as copies, the genuineness of all
signatures and the legal capacities of natural persons. In addition,
<PAGE>
we have assumed that each of the entities or persons other than the Company, the
Trust and their respective representatives executing the documents had the power
and authority to enter into and perform all of its obligations under such
documents, and have also assumed the due execution and delivery of these
documents by each such entity or person.
We hereby consent to the filing of this opinion with the Commission as
an exhibit to the Registration Statement. We also consent to the reference to
our firm under the caption "Validity of Securities" in the prospectus which
forms a part of the Registration Statement. In giving this consent, we do not
thereby admit that we are included in the category of persons whose consent is
required under Section 7 of the Act or the rules and regulations of the
Commission.
This opinion is expressed as of the date hereof, and we disclaim any
undertaking to advise you of any subsequent changes in the facts stated or
assumed herein or of any subsequent changes in applicable law.
Very truly yours,
<PAGE>
EXHIBIT 5.2
[LETTERHEAD OF RICHARDS, LAYTON & FINGER, P.A.]
October 22, 1999
Main Street Bancorp, Inc.
601 Penn Street
Reading, Pennsylvania 19601
Re: MBNK CAPITAL TRUST I
Ladies and Gentlemen:
We have acted as special Delaware counsel for Main Street Bancorp, Inc., a
Pennsylvania corporation (the "Company"), and MBNK Capital Trust I, a Delaware
business trust (the "Trust"), in connection with the matters set forth herein.
At your request, this opinion is being furnished to you.
For purposes of giving the opinions hereinafter set forth, our examination
of documents has been limited to the examination of originals or copies of the
following:
(a) The Certificate of Trust of the Trust, as filed with the Office of the
Secretary of State of the State of Delaware (the "Secretary of State") on
September 1, 1999;
(b) The Restated Certificate of Trust, as filed with the Secretary of State
on September ___, 1999; QUERY - WAS THIS EVER FINALIZED AND FILED? I HAVE A
DRAFT BUT NO FILED COPY.
(c) The Trust Agreement of the Trust, dated as of August 30, 1999, among
the Company and the trustees of the Trust named therein (the "Trustees");
<PAGE>
Main Street Bancorp, Inc.
October 22, 1999
Page 2
(d) The Registration Statement (the "Registration Statement") on Form S-3,
including a preliminary prospectus with respect to the Trust (the "Prospectus"),
relating to the Preferred Securities representing undivided beneficial interests
in the assets of the Trust (each, a "Preferred Security" and collectively, the
"Preferred Securities"), as filed by the Company and the Trust with the
Securities and Exchange Commission (the "SEC") on September ___, 1999, as
amended ny Amendment No. 1 thereto filed with the SEC on October 22, 1999;
(e) A form of Amended and Restated Trust Agreement for the Trust, to be
entered into between the Company, the trustees of the Trust named therein, and
the holders, from time to time, of the Preferred Securities (the "Trust
Agreement"), to be attached as an exhibit to the Registration Statement;
(f) A form of certificate evidencing the Preferred Securities (the
"Certificate"); and
(g) A Certificate of Good Standing for the Trust, dated October 22, 1999,
obtained from the Secretary of State.
With respect to all documents examined by us, we have assumed (i) the
authenticity of all documents submitted to us as authentic originals, (ii) the
conformity with the originals of all documents submitted to us as copies or
forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the Trust Agreement
and the Certificate of Trust are in full force and effect and have not been
amended, (ii) except to the extent provided in paragraph 1 below, the due
organization or due formation, as the case may be, and valid existence in good
standing of each party to the documents examined by us under the laws of the
jurisdiction governing its creation, organization or formation, (iii) the legal
capacity of natural persons who are parties to the documents examined by us,
(iv) that each of the parties to the documents examined by us has the power and
authority to execute and deliver, and to perform its obligations under, such
documents, (v) the due authorization, execution and delivery by all parties
thereto of all documents examined by us, (vi) the receipt by each Person to whom
a Preferred Security is to be issued by the Trust (collectively, the "Preferred
Security Holders") of a Certificate for such Preferred Security and the payment
for such Preferred Security, in accordance with the Trust Agreement and the
Prospectus, and (vii) that the Preferred Securities are issued and sold to the
Preferred Security Holders in accordance with the Trust Agreement and the
Prospectus. We have not participated in the preparation of the Registration
Statement and assume no responsibility for its contents.
This opinion is limited to the laws of the State of Delaware, and we have
not considered and express no opinion on the laws of any other jurisdiction,
including
<PAGE>
Main Street Bancorp, Inc.
October 22, 1999
Page 3
federal laws and rules and regulations relating thereto. Our opinions are
rendered only with respect to Delaware laws and rules, regulations and orders
thereunder which are currently in effect.
<PAGE>
Main Street Bancorp, Inc.
October 22, 1999
Page 4
Based upon the foregoing, and upon our examination of such questions of law
and statutes of the State of Delaware as we have considered necessary or
appropriate, and subject to the assumptions, qualifications, limitations and
exceptions set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly existing in good standing
as a business trust under the Delaware Business Trust Act.
2. The Preferred Securities of the Trust will represent valid and, subject
to the qualifications set forth in paragraph 3 below, fully paid and
nonassessable undivided beneficial interests in the assets of the Trust.
3. The Preferred Security Holders, as beneficial owners of the Trust, will
be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware. We note that the Preferred Security
Holders may be obligated to make payments as set forth in the Trust Agreement.
We consent to the filing of this opinion with the Securities and Exchange
Commission as an exhibit to the Registration Statement. We hereby consent to the
use of our name under the heading "Validity of Securities" in the Prospectus. In
giving the foregoing consents, we do not thereby admit that we come within the
category of persons whose consent is required under Section 7 of the Securities
Act of 1933, as amended, or the rules and regulations of the Securities and
Exchange Commission thereunder.
Very truly yours,
DKD/rmc
<PAGE>
Exhibit 8
[Letterhead of Stevens & Lee]
Form of Tax Opinion
___________, 1999
Janney Montgomery Scott LLC
Wheat First Securities
901 East Byrd Street
Richmond, Virginia 23219
Re: _____ Preferred Securities of
MBNK Capital Trust I
- -----------------------------------
Ladies and Gentlemen:
We have acted as counsel for Main Street Bancorp, Inc., a
Pennsylvania corporation (the "Company"), and MBNK Capital Trust I, a
statutory business trust organized under the Business Trust Act of the State
of Delaware (12 Del. Code Ann., tit. 12, Sections 3801, et seq.) (the "Trust"
and, together with the Company, the "Offerors"), in connection with the sale
pursuant to a Purchase Agreement dated _________, 1999 among the Company, the
Trust and the purchasers (the "Purchasers") named therein (the "Purchase
Agreement") of 4,000,000 Preferred Securities (liquidation amount $10.00 per
preferred security) of the Trust (the "Preferred Securities"), representing
undivided beneficial interests in the assets of the Trust.
The Preferred Securities are guaranteed (the "Preferred Securities
Guarantee") by the Company with respect to distributions and payments upon
liquidation, redemption, and otherwise pursuant to the Preferred Guarantee
Agreement, dated as of ______________, 1999 (the "Guarantee Agreement"),
between the Company and The Bank of New York, as Guarantee Trustee, for the
benefit of the holders of the Preferred Securities.
In connection with the issuance of the Preferred Securities, the Trust
is also issuing 123,712 ____% common securities (liquidation amount of $10.00
per common security) (the "Common Securities"), representing undivided
beneficial interests in the assets of the Trust.
The entire proceeds from the sale of the Preferred Securities and the
Common Securities are to be used by the Trust to purchase an aggregate
principal amount of $41,237,120 of
<PAGE>
Sandler O'Neill & Partners, L.P.
Janney Montgomery Scott Inc.
c/o Sandler O'Neill & Partners, L.P.
June 5, 1997
Page 2
Junior Subordinated Deferrable Interest Debentures due , 2029 (the
"Junior Subordinated Debentures"), to be issued by the Company. The Preferred
Securities and the Common Securities are to be issued pursuant to the Amended
and Restated Trust Agreement, dated as of , 1999 (the "Declaration"),
among the Company, as the Depositor, The Bank of New York (Delaware), as
Delaware trustee (the "Delaware Trustee"), and The Bank of New York, as
property trustee (the "Property Trustee"), and Nelson R. Oswald, Robert D.
McHugh, Jr. and Donna Rickert, as administrators. The Junior Subordinated
Debentures are to be issued pursuant to an indenture, to be dated as ,
1999 (the "Indenture"), between the Company and The Bank of New York, as
Debenture Trustee.
In connection with this opinion, we have reviewed originals or copies,
certified or otherwise identified to our satisfaction of, (i) the
Registration Statement on Form S-3 (File No. 333-86943) and the prospectus
forming a part thereof (the "Prospectus"); (ii) the Certificate of Trust
filed by the Delaware Trustee with the Secretary of State of the State of
Delaware as of September 1, 1999 as amended October 21, 1999; (iii) an
executed copy of the Declaration, including the designation of the terms of
the Preferred Securities; (iv) the form of Preferred Securities and a
specimen certificate thereof; (v) an executed copy of the Guarantee
Agreement; (vi) an executed copy of the Indenture; (vii) the form of Junior
Subordinated Debentures and a specimen certificate thereof; (viii) the form
of Common Securities and a specimen certificate thereof; and (ix)
representations set forth in a certificate from an officer of the Company
dated , 1999.
In our review, we have assumed the legal capacity of all natural persons,
the genuineness of all signatures, the authenticity of all documents
submitted to us as originals, the conformity to original documents of all
documents submitted to us as certified, conformed or photostatic copies, and
the authenticity of the originals of such latter documents. In making our
review of documents executed, or to be executed by
<PAGE>
parties other than the Company or the Trust, we have assumed that such
parties had, or will have, the power, corporate or other, to enter into and
perform all obligations thereunder and have also assumed the due
authorization by all requisite action, corporate or other, and execution and
delivery by such parties of such documents and that such documents
constitute, or will constitute, valid and binding obligations of such
parties. As to any facts material to the opinions expressed herein which were
not independently established or verified, we have relied upon oral or
written statements and representations of officers, trustees and other
representatives of the Company, the Trust and others. Our opinion is
conditioned on, among other things, the initial and continuing accuracy of
the facts, assumptions, information, covenants, and representations set forth
in the documents referred to above and the statements and representations
made by the Company and the Trust and others referenced above.
In providing our opinion, we have considered the provisions of the
Internal Revenue Code of 1986, as amended, Treasury regulations (proposed,
temporary and final) promulgated thereunder, judicial decisions, and Internal
Revenue Service rulings all as of the date hereof, and all of which are
subject to change, which changes may be retroactively applied. A change in
the authorities upon which our opinion is based could affect our conclusions.
There can be no assurances, moreover, that any of the opinions expressed
herein will be accepted by the Internal Revenue Service or, if challenged, by
a court.
Based solely upon the foregoing, it is our opinion that:
1. Under current United States federal income tax law, the Trust will be
classified as a grantor trust and not as an association taxable as a
corporation. Accordingly, for United States federal income tax
purposes, each holder of Preferred Securities will generally be
considered the owner of an undivided interest in the Junior
Subordinated Debentures; and
2. Although the discussion set forth in the prospectus under the heading
"MATERIAL UNITED STATES FEDERAL INCOME TAX CONSEQUENCES" does not
purport to discuss all possible United States federal income tax
consequences
<PAGE>
of the purchase, ownership, and disposition of the Preferred
Securities, in our opinion such discussion constitutes, in
all material respects, a fair and accurate discussion as of
the date of the Prospectus of the material United States
federal income tax consequences of the purchase, ownership, and
disposition of Preferred Securities under current law.
Except as set forth above, we express no opinion to any party as to the
tax consequences, whether federal, state, local or foreign, of the issuance
of the Junior Subordinated Debentures, the Preferred Securities, the Common
Securities or any transactions related to or contemplated by such issuance.
This opinion may not be relied upon by any party other than the addressees
hereof.
The opinion is expressed as of the date hereof unless otherwise expressly
stated, and we disclaim any undertaking to advise you of changes of the facts
stated or assumed herein or any subsequent changes in applicable law.
Very truly yours,
STEVENS & LEE
<PAGE>
Exhibit 12
MAIN STREET SELECTED FINANCIAL DATA
Computations of Consolidated Ratios of Earnings
to Fixed Charges
<TABLE>
<CAPTION>
At or for the Six
Months ended June 30,
---------------------
1999 1998
---------- ---------
<S> <C> <C>
Excluding interest of deposits:
Net income $ 4,383 $ 5,095
Income taxes (benefit) -665 1,951
Fixed charges, excluding preferred
stock dividends and capitalized interest 7,372 2,426
---------- ---------
(a) Earnings $11,090 $ 9,472
========== =========
Interest, excluding interest on deposits: 7,103 2,339
One-half rental charges 269 87
Preferred stock dividends
Capitalized interest
---------- ---------
(b) Fixed charges 7,372 2,426
========== =========
Consolidated ratios of earnings to fixed charges
excluding interest on deposits(a/b) 1.50 3.90
Including interest on deposits:
Net income $ 4,383 $ 5,095
Income taxes -$665 $ 1,951
Fixed charges, excluding preferred
stock dividends and capitalized interest 23,181 14,849
---------- ---------
(c) Earnings $26,899 $21,895
========== =========
Interest, including interest on deposits: 22,912 14,762
One-half rental charges 269 87
Preferred stock dividends
Capitalized interest
---------- ---------
(d) Fixed charges $23,181 $14,849
========== =========
Consolidated ratios of earnings to fixed charges
including interest on deposits(c/d) 1.16 1.47
<CAPTION>
At or for the Year ended December 31,
-------------------------------------------
1998 1997 1996 1995 1994
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Excluding interest of deposits:
Net income $11,743 $ 9,329 $ 6,883 $ 4,311 $ 5,078
Income taxes (benefit) 3,711 3,317 2,428 1,890 2,013
Fixed charges, excluding preferred
stock dividends and capitalized interest 6,190 5,033 2,094 1,373 1,648
------- ------- ------- ------- -------
(a) Earnings $21,644 $17,679 $11,405 $ 7,574 $ 8,739
======= ======= ======= ======= =======
Interest, excluding interest on deposits: 5,996 4,859 1,914 1,213 1,543
One-half rental charges 194 174 180 160 105
Preferred stock dividends
Capitalized interest
------- ------- ------- ------- -------
(b) Fixed charges 6,190 5,033 2,094 1,373 1,648
======= ======= ======= ======= =======
Consolidated ratios of earnings to fixed charges
excluding interest on deposits(a/b) 3.50 3.51 5.45 5.52 5.30
Including interest on deposits:
Net income $11,743 $ 9,329 $ 6,883 $ 4,311 $ 5,078
Income taxes 3,711 3,317 2,428 1,890 2,013
Fixed charges, excluding preferred
stock dividends and capitalized interest 33,458 26,152 18,834 15,963 12,624
------- ------- ------- ------- -------
(c) Earnings $48,912 $38,798 $28,145 $22,164 $19,715
======= ======= ======= ======= =======
Interest, including interest on deposits: 33,264 25,978 18,654 15,803 12,519
One-half rental charges 194 174 180 160 105
Preferred stock dividends
Capitalized interest
------- ------- ------- ------- -------
(d) Fixed charges $33,458 $26,152 $18,834 $15,963 $12,624
======= ======= ======= ======= =======
Consolidated ratios of earnings to fixed charges
including interest on deposits(c/d) 1.46 1.48 1.49 1.39 1.56
</TABLE>
<PAGE>
EXHIBIT 23.1
CONSENT OF BEARD & COMPANY, INC.
We consent to the reference to our firm under the caption "Experts" in
Amendment No. 1 to the Registration Statement (Form S-3) and related prospectus
of Main street Capital Trust I and to the incorporation by reference therein of
our report dated January 29, 1999, with respect to the consolidated financial
statements of Main Street Bancorp, Inc. included in its annual Report (Form
10-K) for the year ended December 31, 1998 filed with the Securities and
Exchange Commission.
/s/ BEARD & COMPANY, INC.
Reading, Pennsylvania
October 20, 1999
<PAGE>
Exhibit 25.1
------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) |__|
---------------------------
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
One Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
---------------------------
MBNK Capital Trust I
(Exact name of obligor as specified in its charter)
Delaware Applied for
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
White Clay Center
Route 271
Newark, Delaware 19711
(Address of principal executive offices) (Zip code)
---------------------------
Preferred Securities
(Title of the indenture securities)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
1. GENERAL INFORMATION. FURNISH THE FOLLOWING INFORMATION AS TO THE
TRUSTEE:
(a) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING AUTHORITY TO
WHICH IT IS SUBJECT.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------- --------------------------------------------
Name Address
- ---------------------------------------------------------------- --------------------------------------------
<S> <C>
Superintendent of Banks of the State of 2 Rector Street, New York, N.Y.
New York 10006, and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York, N.Y.
10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
</TABLE>
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION,
ARE INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO
RULE 7a-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17
C.F.R. 229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which
contains the authority to commence business and a grant of
powers to exercise corporate trust powers. (Exhibit 1 to
Amendment No. 1 to Form T-1 filed with Registration Statement
No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with
Registration Statement No. 33-21672 and Exhibit 1 to Form T-1
filed with Registration Statement No.
33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to
Form T-1 filed with Registration Statement No. 33-31019.)
6. The consent of the Trustee required by Section 321(b) of the
Act. (Exhibit 6 to Form T-1 filed with Registration Statement
No. 33-44051.)
7. A copy of the latest report of condition of the Trustee
published pursuant to law or to the requirements of its
supervising or examining authority.
-2-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, a corporation organized and existing under the laws of the State of New
York, has duly caused this statement of eligibility to be signed on its behalf
by the undersigned, thereunto duly authorized, all in The City of New York, and
State of New York, on the 21st day of October, 1999.
THE BANK OF NEW YORK
By /s/ MICHAEL CULHANE
--------------------------------
Name: MICHAEL CULHANE
Title: VICE PRESIDENT
-3-
<PAGE>
- --------------------------------------------------------------------------------
Exhibit 7 to Form T-1
---------------------
Consolidated Report of Condition of
THE BANK OF NEW YORK
of One Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business June 30, 1999,
published in accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
ASSETS In Thousands
<S> <C>
Cash and balances due from depository
institutions:
Noninterest-bearing balances and currency
and coin........................................... $5,597,807
Interest-bearing balances........................... 4,075,775
Securities:
Held-to-maturity securities......................... 785,167
Available-for-sale securities....................... 4,159,891
Federal funds sold and Securities purchased under
agreements to resell................................ 2,476,963
Loans and lease financing receivables:
Loans and leases, net of unearned
income............................................ 38,028,772
LESS: Allowance for loan and
lease losses...................................... 568,617
LESS: Allocated transfer risk
reserve........................................... 16,352
Loans and leases, net of unearned income,
allowance, and reserve............................ 37,443,803
Trading Assets......................................... 1,563,671
Premises and fixed assets (including capitalized
leases)............................................. 683,587
Other real estate owned................................ 10,995
Investments in unconsolidated subsidiaries and
associated companies................................ 184,661
Customers' liability to this bank on acceptances
outstanding......................................... 812,015
Intangible assets...................................... 1,135,572
Other assets........................................... 5,607,019
----------------
Total assets........................................... $64,536,926
----------------
----------------
</TABLE>
<PAGE>
<TABLE>
<S> <C>
LIABILITIES
Deposits:
In domestic offices................................. $26,488,980
Noninterest-bearing................................. 10,626,811
Interest-bearing.................................... 15,862,169
In foreign offices, Edge and Agreement
subsidiaries, and IBFs............................ 20,655,414
Noninterest-bearing................................. 156,471
Interest-bearing.................................... 20,498,943
Federal funds purchased and Securities sold under
agreements to repurchase............................ 3,729,439
Demand notes issued to the U.S.Treasury................ 257,860
Trading liabilities.................................... 1,987,450
Other borrowed money:
With remaining maturity of one year or less......... 496,235
With remaining maturity of more than one year
through three years............................... 465
With remaining maturity of more than three years.... 31,080
Bank's liability on acceptances executed and
outstanding......................................... 822,455
Subordinated notes and debentures...................... 1,308,000
Other liabilities...................................... 2,846,649
----------------
Total liabilities...................................... 58,624,027
----------------
----------------
EQUITY CAPITAL
Common stock........................................... 1,135,284
Surplus................................................ 815,314
Undivided profits and capital reserves................. 4,001,767
Net unrealized holding gains (losses) on
available-for-sale securities....................... (7,956)
Cumulative foreign currency translation adjustments....
(31,510)
Total equity capital................................... 5,912,899
Total liabilities and equity capital................... $64,536,926
----------------
----------------
</TABLE>
<PAGE>
I, Thomas J. Mastro, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of
Governors of the Federal Reserve System and is true to the best of my
knowledge and belief.
Thomas J. Mastro
We, the undersigned directors, attest to the correctness of this Report
of Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
Thomas A. Reyni )
Alan R. Griffith ) Directors
Gerald L. Hassell )
- --------------------------------------------------------------------------------
<PAGE>
EXHIBIT 25.2
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) |__|
---------------------------
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
One Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
---------------------------
Main Street Bancorp, Inc.
(Exact name of obligor as specified in its charter)
Pennsylvania 23-2960905
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
601 Penn Street
Reading, Pennsylvania 19601
(Address of principal executive offices) (Zip code)
---------------------------
Junior Subordinated Deferrable Interest Debentures
(Title of the indenture securities)
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
<PAGE>
1. GENERAL INFORMATION. FURNISH THE FOLLOWING INFORMATION AS TO THE TRUSTEE:
(A) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING AUTHORITY TO WHICH
IT IS SUBJECT.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------- --------------------------------------------
Name Address
- ---------------------------------------------------------------- --------------------------------------------
<S> <C>
Superintendent of Banks of the State of New York 2 Rector Street, New York, N.Y. 10006,
and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York, N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
</TABLE>
(B) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION, ARE
INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO RULE
7a-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17 C.F.R.
229.10(d).
1. A copy of the Organization Certificate of The Bank of New York (formerly
Irving Trust Company) as now in effect, which contains the authority to
commence business and a grant of powers to exercise corporate trust powers.
(Exhibit 1 to Amendment No. 1 to Form T-1 filed with Registration Statement
No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with Registration
Statement No. 33-21672 and Exhibit 1 to Form T-1 filed with Registration
Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1 filed
with Registration Statement No. 33-31019.)
6. The consent of the Trustee required by Section 321(b) of the Act. (Exhibit
6 to Form T-1 filed with Registration Statement No. 33-44051.)
7. A copy of the latest report of condition of the Trustee published pursuant
to law or to the requirements of its supervising or examining authority.
-2-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New York,
a corporation organized and existing under the laws of the State of New York,
has duly caused this statement of eligibility to be signed on its behalf by the
undersigned, thereunto duly authorized, all in The City of New York, and State
of New York, on the 21st day of October, 1999.
THE BANK OF NEW YORK
By /s/ MICHAEL CULHANE
----------------------------------
Name: MICHAEL CULHANE
Title: VICE PRESIDENT
-3-
<PAGE>
- -------------------------------------------------------------------------------
EXHIBIT 7 TO FORM T-1
Consolidated Report of Condition of
THE BANK OF NEW YORK
of One Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries, a member of the Federal Reserve
System, at the close of business June 30, 1999, published in accordance with a
call made by the Federal Reserve Bank of this District pursuant to the
provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
In Thousands
<S> <C>
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin.. $5,597,807
Interest-bearing balances........................... 4,075,775
Securities:
Held-to-maturity securities......................... 785,167
Available-for-sale securities....................... 4,159,891
Federal funds sold and Securities purchased under
agreements to resell................................ 2,476,963
Loans and lease financing receivables:
Loans and leases, net of unearned
income...............38,028,772
LESS: Allowance for loan and
lease losses............568,617
LESS: Allocated transfer risk
reserve........................16,352
Loans and leases, net of unearned income,
allowance, and reserve............................ 37,443,803
Trading Assets......................................... 1,563,671
Premises and fixed assets (including capitalized
leases)............................................. 683,587
Other real estate owned................................ 10,995
Investments in unconsolidated subsidiaries and
associated companies................................ 184,661
Customers' liability to this bank on acceptances
outstanding......................................... 812,015
Intangible assets...................................... 1,135,572
Other assets........................................... 5,607,019
-----------
Total assets........................................... $64,536,926
-----------
-----------
</TABLE>
<PAGE>
<TABLE>
<S> <C>
LIABILITIES
Deposits:
In domestic offices................................. $26,488,980
Noninterest-bearing................................. 10,626,811
Interest-bearing.................................... 15,862,169
In foreign offices, Edge and Agreement
subsidiaries, and IBFs............................ 20,655,414
Noninterest-bearing................................. 156,471
Interest-bearing.................................... 20,498,943
Federal funds purchased and Securities sold under
agreements to repurchase............................ 3,729,439
Demand notes issued to the U.S.Treasury................ 257,860
Trading liabilities.................................... 1,987,450
Other borrowed money:
With remaining maturity of one year or less......... 496,235
With remaining maturity of more than one year
through three years............................... 465
With remaining maturity of more than three years.... 31,080
Bank's liability on acceptances executed and
outstanding......................................... 822,455
Subordinated notes and debentures...................... 1,308,000
Other liabilities...................................... 2,846,649
-----------
Total liabilities...................................... 58,624,027
-----------
-----------
EQUITY CAPITAL
Common stock........................................... 1,135,284
Surplus................................................ 815,314
Undivided profits and capital reserves................. 4,001,767
Net unrealized holding gains (losses) on
available-for-sale securities....................... (7,956)
Cumulative foreign currency translation adjustments....
(31,510)
-----------
Total equity capital................................... 5,912,899
-----------
Total liabilities and equity capital................... $64,536,926
-----------
-----------
</TABLE>
<PAGE>
I, Thomas J. Mastro, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of
Governors of the Federal Reserve System and is true to the best of my
knowledge and belief.
Thomas J. Mastro
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
Thomas A. Reyni )
Alan R. Griffith ) Directors
Gerald L. Hassell )
- -------------------------------------------------------------------------------
<PAGE>
EXHIBIT 25.3
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) |__|
---------------------------
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
One Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
---------------------------
Main Street Bancorp, Inc.
(Exact name of obligor as specified in its charter)
Pennsylvania 23-2960905
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
601 Penn Street
Reading, Pennsylvania 19601
(Address of principal executive offices) (Zip code)
---------------------------
Guarantee of Preferred Securities of MBNK Capital Trust I
(Title of the indenture securities)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
1. GENERAL INFORMATION. FURNISH THE FOLLOWING INFORMATION AS TO THE TRUSTEE:
(A) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING AUTHORITY TO WHICH
IT IS SUBJECT.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------- --------------------------------------------
Name Address
- ---------------------------------------------------------------- --------------------------------------------
<S> <C>
Superintendent of Banks of the State of New York 2 Rector Street, New York, N.Y. 10006,
and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York, N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
</TABLE>
(B) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION, ARE
INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO RULE
7a-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17 C.F.R.
229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which contains the
authority to commence business and a grant of powers to exercise
corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1
filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to
Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1
to Form T-1 filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No.
33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
-2-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New York,
a corporation organized and existing under the laws of the State of New York,
has duly caused this statement of eligibility to be signed on its behalf by the
undersigned, thereunto duly authorized, all in The City of New York, and State
of New York, on the 21st day of October, 1999.
THE BANK OF NEW YORK
By /S/ MICHAEL CULHANE
----------------------------------
Name: MICHAEL CULHANE
Title: VICE PRESIDENT
-3-
<PAGE>
- -------------------------------------------------------------------------------
EXHIBIT 7 TO FORM T-1
Consolidated Report of Condition of
THE BANK OF NEW YORK
of One Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries, a member of the Federal Reserve
System, at the close of business June 30, 1999, published in accordance with a
call made by the Federal Reserve Bank of this District pursuant to the
provisions of the Federal Reserve Act.
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Dollar Amounts
In Thousands
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ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin.. $5,597,807
Interest-bearing balances........................... 4,075,775
Securities:
Held-to-maturity securities......................... 785,167
Available-for-sale securities....................... 4,159,891
Federal funds sold and Securities purchased under
agreements to resell................................ 2,476,963
Loans and lease financing receivables:
Loans and leases, net of unearned
income...............38,028,772
LESS: Allowance for loan and
lease losses............568,617
LESS: Allocated transfer risk
reserve........................16,352
Loans and leases, net of unearned income,
allowance, and reserve............................ 37,443,803
Trading Assets......................................... 1,563,671
Premises and fixed assets (including capitalized
leases)............................................. 683,587
Other real estate owned................................ 10,995
Investments in unconsolidated subsidiaries and
associated companies................................ 184,661
Customers' liability to this bank on acceptances
outstanding......................................... 812,015
Intangible assets...................................... 1,135,572
Other assets........................................... 5,607,019
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Total assets........................................... $64,536,926
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LIABILITIES
Deposits:
In domestic offices................................. $26,488,980
Noninterest-bearing................................. 10,626,811
Interest-bearing.................................... 15,862,169
In foreign offices, Edge and Agreement
subsidiaries, and IBFs............................ 20,655,414
Noninterest-bearing................................. 156,471
Interest-bearing.................................... 20,498,943
Federal funds purchased and Securities sold under
agreements to repurchase............................ 3,729,439
Demand notes issued to the U.S.Treasury................ 257,860
Trading liabilities.................................... 1,987,450
Other borrowed money:
With remaining maturity of one year or less......... 496,235
With remaining maturity of more than one year
through three years............................... 465
With remaining maturity of more than three years.... 31,080
Bank's liability on acceptances executed and
outstanding......................................... 822,455
Subordinated notes and debentures...................... 1,308,000
Other liabilities...................................... 2,846,649
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Total liabilities...................................... 58,624,027
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EQUITY CAPITAL
Common stock........................................... 1,135,284
Surplus................................................ 815,314
Undivided profits and capital reserves................. 4,001,767
Net unrealized holding gains (losses) on
available-for-sale securities....................... (7,956)
Cumulative foreign currency translation adjustments....
(31,510)
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Total equity capital................................... 5,912,899
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Total liabilities and equity capital................... $64,536,926
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I, Thomas J. Mastro, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of
Governors of the Federal Reserve System and is true to the best of my
knowledge and belief.
Thomas J. Mastro
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
Thomas A. Reyni )
Alan R. Griffith ) Directors
Gerald L. Hassell )
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