Exhibit 4(w)
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GUARANTEE AGREEMENT
by and between
COMPASS BANCSHARES, INC.,
As Guarantor
and
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ BANK,
As Guarantee Trustee
Relating to
COMPASS TRUST
Dated as of March [___], 2002
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CROSS REFERENCE TABLE(1)
Section of Trust
Indenture Act of Section of
1939, as Amended Agreement
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310(a)...................................................................4.1(a)
310(b)..............................................................2.8; 4.1(c)
310(c).............................................................Inapplicable
311(a)...................................................................2.2(b)
311(b)...................................................................2.2(b)
311(c).............................................................Inapplicable
312(a)..............................................................2.2(a); 2.9
312(b)..............................................................2.2(b); 2.9
312(c)......................................................................2.9
313(a)......................................................................2.3
313(b)......................................................................2.3
313(c)......................................................................2.3
313(d)......................................................................2.3
314(a)......................................................................2.4
314(b).............................................................Inapplicable
314(c)......................................................................2.5
314(d).............................................................Inapplicable
314(e)......................................................................2.5
314(f).............................................................Inapplicable
315(a).............................................................1(d); 3.2(a)
315(b)...................................................................2.7(a)
315(c)...................................................................3.1(c)
315(d)...................................................................3.1(d)
316(a)..............................................................2.6; 5.4(a)
316(b)......................................................................5.3
316(c).............................................................Inapplicable
317(a).....................................................................2.10
317(b).............................................................Inapplicable
318(a)...................................................................2.1(b)
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(1) This Cross-Reference Table does not constitute part of the Agreement and
shall not have any bearing upon the interpretation of any of its terms or
provisions.
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TABLE OF CONTENTS
ARTICLE 1 - INTERPRETATION AND DEFINITIONS..................................................1
SECTION 1.1. INTERPRETATION AND DEFINITIONS..............................................1
ARTICLE 2 - TRUST INDENTURE ACT.............................................................4
SECTION 2.1. TRUST INDENTURE ACT; APPLICATION............................................4
SECTION 2.2. LISTS OF HOLDERS OF SECURITIES..............................................5
SECTION 2.3. REPORTS BY GUARANTEE TRUSTEE................................................5
SECTION 2.4. PERIODIC REPORTS TO GUARANTEE TRUSTEE.......................................5
SECTION 2.5. EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT............................5
SECTION 2.6. GUARANTEE EVENT OF DEFAULT; WAIVER..........................................5
SECTION 2.7. GUARANTEE EVENT OF DEFAULT; NOTICE..........................................6
SECTION 2.8. CONFLICTING INTERESTS.......................................................6
SECTION 2.9. DISCLOSURE OF INFORMATION...................................................6
SECTION 2.10. GUARANTEE TRUSTEE MAY FILE PROOFS OF CLAIM.................................6
ARTICLE 3 - POWERS, DUTIES AND RIGHTS OF GUARANTEE TRUSTEE..................................6
SECTION 3.1. POWERS AND DUTIES OF GUARANTEE TRUSTEE......................................6
SECTION 3.2. CERTAIN RIGHTS OF GUARANTEE TRUSTEE.........................................8
ARTICLE 4 - GUARANTEE TRUSTEE..............................................................10
SECTION 4.1. GUARANTEE TRUSTEE; ELIGIBILITY.............................................10
SECTION 4.2. APPOINTMENT, REMOVAL AND RESIGNATION OF GUARANTEE TRUSTEE..................10
ARTICLE 5 - GUARANTEE......................................................................11
SECTION 5.1. GUARANTEE..................................................................11
SECTION 5.2. WAIVER OF NOTICE AND DEMAND................................................11
SECTION 5.3. OBLIGATIONS NOT AFFECTED...................................................12
SECTION 5.4. RIGHTS OF HOLDERS..........................................................13
SECTION 5.5. GUARANTEE OF PAYMENT.......................................................13
SECTION 5.6. SUBROGATION................................................................13
SECTION 5.7. INDEPENDENT OBLIGATIONS....................................................13
ARTICLE 6 - LIMITATION OF TRANSACTIONS; SUBORDINATION......................................14
SECTION 6.1. LIMITATION OF TRANSACTIONS.................................................14
SECTION 6.2. RANKING....................................................................14
SECTION 6.3. SUBORDINATION OF COMMON SECURITIES.........................................14
ARTICLE 7 - TERMINATION....................................................................14
SECTION 7.1. TERMINATION................................................................14
ARTICLE 8 - INDEMNIFICATION................................................................15
SECTION 8.1. INDEMNIFICATION............................................................15
ARTICLE 9 - MISCELLANEOUS..................................................................15
SECTION 9.1. SUCCESSORS AND ASSIGNS.....................................................15
SECTION 9.2. AMENDMENTS.................................................................15
SECTION 9.3. NOTICES....................................................................15
SECTION 9.4. BENEFIT....................................................................16
SECTION 9.5. GOVERNING LAW..............................................................16
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GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT (this "Guarantee"), dated as of March [___], 2002,
is executed and delivered by COMPASS BANCSHARES, INC., a Delaware corporation
(the "Guarantor"), and ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ BANK, 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 Securities (as defined herein) of COMPASS TRUST
[_____], a Delaware statutory business trust (the "Trust").
RECITALS
WHEREAS, pursuant to the Trust Agreement (as defined herein), the Trust may
issue up to $300,000,000 aggregate liquidation amount of capital securities,
having a liquidation amount of $25 per security and designated the "[_____]%
Capital Securities" of the Trust (the "Capital Securities") and up to
$[_________] aggregate liquidation amount of common securities, having a
liquidation amount of $[___] per security and designated the "[_____]% Common
Securities" of the Trust (the "Common Securities" and, together with the Capital
Securities, the "Securities");
WHEREAS, as incentive for the Holders to purchase the Securities, the
Guarantor desires irrevocably and unconditionally to agree, to the extent set
forth in this Guarantee, to pay to the Holders of the Securities the Guarantee
Payments (as defined herein) and to make certain other payments on the terms and
conditions set forth herein; and
WHEREAS, if a Trust Enforcement Event (as defined herein) has occurred and
is continuing, the rights of holders of the Common Securities to receive
Guarantee Payments (as defined herein) under this Guarantee are subordinated to
the rights of Holders of Capital Securities to receive Guarantee Payments under
this Guarantee;
NOW, THEREFORE, in consideration of the purchase by each Holder of
Securities, which purchase the Guarantor hereby agrees shall benefit the
Guarantor, the Guarantor executes and delivers this Guarantee for the benefit of
the Holders.
ARTICLE 1 - INTERPRETATION AND DEFINITIONS
SECTION 1.1. INTERPRETATION AND DEFINITIONS. In this Guarantee, unless the
context otherwise requires:
(a) capitalized terms used in this Guarantee but not defined in the
preamble above have the respective meanings assigned to them in this Section
1.1;
(b) a term defined anywhere in this Guarantee has the same meaning
throughout;
(c) all references to "the Guarantee" or "this Guarantee" are to this
Guarantee as modified, supplemented or amended from time to time;
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(d) all references in this Guarantee to Articles, Sections and Recitals are
to Articles, Sections and Recitals of this Guarantee, unless otherwise
specified;
(e) unless otherwise defined in this Guarantee, a term defined in the Trust
Indenture Act has the same meaning when used in this Guarantee;
(f) a reference to the singular includes the plural and vice versa and a
reference to any masculine form of a term shall include the feminine form of a
term, as applicable; and
(g) the following terms have the following meanings:
"Affiliate" has the same meaning as given to that term in Rule 405 of the
Securities Act of 1933, as amended, or any successor rule thereunder.
"Business Day" has the meaning specified in the Trust Agreement.
"Capital Securities" has the meaning specified in the Recitals hereto.
"Common Securities" has the meaning specified in the Recitals hereto.
"Common Stock" means the common stock, par value $2 per share, of the
Guarantor.
"Corporate Trust Office" means the principal office of the Guarantee
Trustee at which at any particular time its corporate trust business shall be
administered, which office at the date of execution of this Guarantee is located
at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇.
"Debt Securities" means the series of junior subordinated debt securities
to be issued by Compass Bancshares, Inc. designated the "[_____]% Junior
Subordinated Debt Securities due [March 15], 2032", held by the Property Trustee
as defined in the Trust Agreement.
"Global Security" means a fully registered, global Capital Security, as
defined in the Indenture, representing the Capital Securities.
"Guarantee Event of Default" means a default by the Guarantor on any of its
payment or other obligations under this Guarantee.
"Guarantee Payments" means the following payments or distributions, without
duplication, with respect to the Securities, to the extent not paid by or on
behalf of the Trust: (i) any accumulated and unpaid Distributions (as defined in
the Trust Agreement) that are required to be paid on such Securities to the
extent the Trust has sufficient funds available therefor at the time, (ii) the
redemption price, including all accumulated and unpaid Distributions to the date
of redemption, with respect to any Securities called for redemption by the
Trust, to the extent the Trust shall have sufficient funds available therefor at
the time or (iii) upon a voluntary or involuntary dissolution, winding-up or
termination of the Trust (other than in connection with the distribution of Debt
Securities to the Holders in exchange for Securities as provided in the Trust
Agreement), the lesser of (a) the aggregate of the liquidation amount and all
accumulated and
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unpaid Distributions on the Securities to the date of payment, to the extent the
Trust has sufficient funds available therefor and (b) the amount of assets of
the Trust remaining available for distribution to Holders in liquidation of the
Trust (in either case, the "Liquidation Distribution").
"Guarantee Trustee" means ▇▇ ▇▇▇▇▇▇ Chase Bank, until a Successor Guarantee
Trustee has been appointed and has accepted such appointment pursuant to the
terms of this Guarantee and thereafter means each such Successor Guarantee
Trustee.
"Holder" means any holder of Securities, as registered on the books and
records of the Trust; 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 or any Affiliate of the Guarantor or any other obligor on the Capital
Securities.
"Indenture" means the Junior Subordinated Indenture, dated as of the date
hereof, by and between Compass Bancshares, Inc. and JPMorgan Chase Bank, as
Trustee, and any indenture supplemental thereto pursuant to which the Debt
Securities are to be issued to the Property Trustee, as defined in the Trust
Agreement.
"List of Holders" has the meaning assigned to it in Section 2.2 hereof.
"Majority in Liquidation Amount" means, except as provided in the terms of
the Capital Securities or by the Trust Indenture Act, Holder(s) of outstanding
Securities, voting together as a single class, or, as the context may require,
Holders of outstanding Capital Securities or Holders of outstanding Common
Securities, voting separately as a class, who are the record owners of more than
50% of the aggregate liquidation amount (including the stated amount that would
be paid on redemption, liquidation or otherwise, plus accumulated and unpaid
Distributions to the date upon which the voting percentages are determined) of
all outstanding Securities of the relevant class. In determining whether the
Holders of the requisite amount of Securities have voted, Securities which are
owned by the Guarantor or any Affiliate of the Guarantor or any other obligor on
the Securities shall be disregarded for the purpose of any such determination.
"Officers' Certificate" means, with respect to any Person, a certificate
signed on behalf of such Person by two Authorized Officers (as defined in the
Trust Agreement) of such Person. Any Officers' Certificate delivered with
respect to compliance with a condition or covenant provided for in this
Guarantee shall include:
(i) a statement that each officer signing the Officers' Certificate
has read the covenant or condition and the definitions relating thereto;
(ii) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer on behalf of such Person in
rendering the Officers' Certificate;
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(iii) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such
officer on behalf of such Person to express an informed opinion as to
whether or not such covenant or condition has been complied with; and
(iv) a statement as to whether, in the opinion of each such officer
acting on behalf of such Person, 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 Price" has the meaning specified in the Trust Agreement.
"Responsible Officer" means, with respect to the Guarantee Trustee, any
officer with direct responsibility for the administration of this Guarantee and
also means, with respect to a particular corporate trust matter, any other
officer to whom such matter is referred because of that officer's knowledge of
and familiarity with the particular subject.
"Securities" has the meaning specified in the Recitals hereto.
"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 as
of the date hereof, as amended, modified or supplemented from time to time,
among the trustees of the Trust named therein, the Guarantor, as sponsor, and
the Holders, from time to time, of undivided beneficial ownership interests in
the assets of the Trust.
"Trust Enforcement Event" in respect of the Securities means an Indenture
Event of Default (as defined in the Indenture) has occurred and is continuing in
respect of the Debt Securities.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended
from time to time, or any successor legislation.
ARTICLE 2 - TRUST INDENTURE ACT
SECTION 2.1. TRUST INDENTURE ACT; APPLICATION.
(a) This Guarantee is subject to the provisions of the Trust Indenture Act
that are required to be part of this Guarantee and shall, to the extent
applicable, be governed by such provisions.
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(b) If and to the extent that any provision of this Guarantee limits,
qualifies or conflicts with the duties imposed by Sections 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.
SECTION 2.2. LISTS OF HOLDERS OF SECURITIES.
(a) The Guarantor shall provide the Guarantee Trustee (i) except while the
Capital Securities are represented by one or more Global Securities, at least
two (2) Business Days prior to the date for payment of Distributions, a list, in
such form as the Guarantee Trustee may reasonably require, of the names and
addresses of the Holders of the Securities ("List of Holders") as of the record
date relating to the payment of such Distributions, and (ii) at any other time,
within thirty (30) days of receipt by the Guarantor of a written request from
the Guarantee Trustee for a List of Holders as of a date no more than fifteen
(15) days before such List of Holders is given to the Guarantee Trustee;
provided that the Guarantor shall not be obligated to provide such List of
Holders at any time the List of Holders does not differ from the most recent
List of Holders given to the Guarantee Trustee by the Guarantor. The Guarantee
Trustee shall preserve, in as current a form as is reasonably practicable, all
information contained in Lists of Holders given to it, provided that the
Guarantee Trustee may destroy any List of Holders previously given to it on
receipt of a new List of Holders.
(b) The Guarantee Trustee shall comply with its obligations under Sections
311(a), 311(b) and 312(b) of the Trust Indenture Act.
SECTION 2.3. REPORTS BY GUARANTEE TRUSTEE. Within sixty (60) days after
[June 15] of each year (commencing with the year of the first anniversary of the
issuance of the Securities), the Guarantee Trustee shall provide to the Holders
of the Securities such reports as are required by Section 313 of the Trust
Indenture Act (if any) in the form and in the manner provided by Section 313 of
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 GUARANTEE TRUSTEE. The Guarantor shall
provide to the Guarantee Trustee such documents, reports and information as
required by Section 314(a) (if any) of the Trust Indenture Act 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(a) of the Trust
Indenture Act, but in no event later than 120 days after the end of each
calendar year.
SECTION 2.5. EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT. The
Guarantor shall provide to the Guarantee Trustee such evidence of compliance
with any conditions precedent, if any, provided for in this Guarantee 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. GUARANTEE EVENT OF DEFAULT; WAIVER. The Holders of a Majority
in Liquidation Amount of the Capital Securities may, by vote or written consent,
on behalf of the Holders of all of the Securities, waive any past Guarantee
Event of Default and its consequences. Upon such waiver, any such Guarantee
Event of Default shall cease to exist, and any Guarantee
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Event of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Guarantee, but no such waiver shall extend to any subsequent or
other default or Guarantee Event of Default or impair any right consequent
thereon.
SECTION 2.7. GUARANTEE EVENT OF DEFAULT; NOTICE.
(a) The Guarantee Trustee shall, within ninety (90) days after the
occurrence of a Guarantee Event of Default actually known to a Responsible
Officer of the Guarantee Trustee, transmit by mail, first class postage prepaid,
to the Holders of the Securities, notices of all such Guarantee Events of
Default, unless such defaults have been cured before the giving of such notice;
provided, that the Guarantee Trustee shall be protected in withholding such
notice if and so long as a Responsible Officer of the Guarantee Trustee in good
faith determines that the withholding of such notice is in the interests of the
Holders of the Securities.
(b) The Guarantee Trustee shall not be deemed to have knowledge of any
Guarantee Event of Default unless the Guarantee Trustee shall have received
written notice thereof or a Responsible Officer of the Guarantee Trustee charged
with the administration of this Guarantee Agreement shall have obtained actual
knowledge thereof.
SECTION 2.8. CONFLICTING INTERESTS. The Trust Agreement shall be deemed to
be specifically described in this Guarantee for the purposes of clause (i) of
the first proviso contained in Section 310(b) of the Trust Indenture Act.
SECTION 2.9. DISCLOSURE OF INFORMATION. The disclosure of information as to
the names and addresses of the Holders of the 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 Guarantee 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 2.10. GUARANTEE TRUSTEE MAY FILE PROOFS OF CLAIM. Upon the
occurrence of a Guarantee Event of Default, the Guarantee Trustee is hereby
authorized to (a) recover judgment, in its own name and as trustee of an express
trust, against the Guarantor for the whole amount of any Guarantee Payments
remaining unpaid and (b) file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have its claims and those of the
Holders of the Securities allowed in any judicial proceedings relative to the
Guarantor, its creditors or its property.
ARTICLE 3 - POWERS, DUTIES AND RIGHTS OF GUARANTEE TRUSTEE
SECTION 3.1. POWERS AND DUTIES OF GUARANTEE TRUSTEE.
(a) This Guarantee shall be held by the Guarantee Trustee on behalf of the
Trust for the benefit of the Holders of the Securities, and the Guarantee
Trustee shall not transfer this Guarantee to any Person except a Holder of
Securities exercising his or her rights pursuant to
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Section 5.4(b) or to a Successor Guarantee Trustee on acceptance by such
Successor Guarantee Trustee of its appointment to act as Successor Guarantee
Trustee. The right, title and interest of the Guarantee Trustee in and to this
Guarantee shall automatically vest in any Successor Guarantee Trustee, and such
vesting and succession of title shall be effective whether or not conveyance
documents have been executed and delivered pursuant to the appointment of such
Successor Guarantee Trustee.
(b) If a Responsible Officer of the Guarantee Trustee receives written
notice that a Guarantee Event of Default has occurred and is continuing, the
Guarantee Trustee shall enforce this Guarantee for the benefit of the Holders of
the Securities.
(c) The Guarantee Trustee, before the occurrence of any Guarantee Event of
Default and after the curing of all Guarantee Events of Default that may have
occurred, shall undertake to perform only such duties as are specifically set
forth in this Guarantee, and no implied covenants shall be read into this
Guarantee against the Guarantee Trustee. In case a Guarantee Event of Default
has occurred (that has not been cured or waived pursuant to Section 2.6) and is
actually known to a Responsible Officer of the Guarantee Trustee, the Guarantee
Trustee shall exercise such of the rights and powers vested in it by this
Guarantee, 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 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 Guarantee Event of Default and
after the curing or waiving of all such Guarantee 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, 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, and no implied covenants or obligations shall be read into
this Guarantee against the Guarantee Trustee; 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; but in
the case of any such certificates or opinions that by any provision
hereof 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;
(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
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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 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; and
(iv) no provision of this Guarantee 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 reasonably assured to it under the terms of this Guarantee
or if the Guarantee Trustee shall have reasonable grounds for believing
that an indemnity, reasonably satisfactory to the Guarantee Trustee,
against such risk or liability is not reasonably assured to it under the
terms of this Guarantee.
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 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 shall be sufficiently evidenced by an Officers' Certificate;
(iii) Whenever, in the administration of this Guarantee, the Guarantee
Trustee shall deem it desirable that a matter be proved or established
before taking, suffering or omitting 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, shall be
promptly delivered by the Guarantor;
(iv) The Guarantee Trustee shall have no duty to see to any recording,
filing or registration or any instrument (or any rerecording, refiling or
re-registration thereof);
(v) The Guarantee Trustee may consult with counsel, and the advice or
opinion of such counsel with respect to legal matters 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 accordance with
such advice or opinion. Such counsel may
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be counsel to the Guarantor or any of its Affiliates and may include any of
its employees. The Guarantee Trustee shall have the right at any time to
seek instructions concerning the administration of this Guarantee from any
court of competent jurisdiction;
(vi) The Guarantee Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Guarantee at the request
or direction of any Holder, unless such Holder shall have provided to the
Guarantee Trustee such security and indemnity, reasonably satisfactory to
the Guarantee Trustee, against the costs, expenses (including attorneys'
fees and expenses and the expenses of the Guarantee Trustee's agents,
nominees or custodians) 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;
(vii) 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;
(viii) The Guarantee Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents, nominees, custodians or attorneys, and the Guarantee 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;
(ix) Any action taken by the Guarantee Trustee or its agents hereunder
shall bind the Holders, and the signature of the Guarantee Trustee or its
agents alone shall be sufficient and effective to perform any such action.
No third party shall be required to inquire as to the authority of the
Guarantee Trustee to so act or as to its compliance with any of the terms
and provisions of this Guarantee, both of which shall be conclusively
evidenced by the Guarantee Trustee's or its agent's taking such action; and
(x) Whenever in the administration of this Guarantee, 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 (i) may request written instructions from the Holders of
a Majority in Liquidation Amount of the Securities, (ii) may refrain from
enforcing such remedy or right or taking such other action until such
written instructions are received and (iii) shall be protected in
conclusively relying on or acting in accordance with such written
instructions.
(b) No provision of this Guarantee 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 to act in accordance with applicable
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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.
ARTICLE 4 - GUARANTEE TRUSTEE
SECTION 4.1. GUARANTEE TRUSTEE; ELIGIBILITY.
(a) There shall be at all times a Guarantee Trustee which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business under the laws of
the United States of America or any state or territory thereof or of the
District of Columbia, or a corporation or other Person permitted by the
Securities and Exchange Commission to act as an institutional trustee under
the Trust Indenture Act, authorized under such laws to exercise corporate
trust powers, having a combined capital and surplus of at least
$50,000,000, and subject to supervision or examination by federal, state,
territorial or District of Columbia authority. If such corporation
publishes reports of condition at least annually, pursuant to law or to the
requirements of the supervising or examining authority referred to above,
then, for the purposes of this Section 4.1(a)(ii), the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published.
(b) If at any time the Guarantee Trustee shall cease to be eligible to so
act under Section 4.1(a), the Guarantee Trustee shall immediately resign in the
manner and with the effect set out in Section 4.2(c).
(c) If the Guarantee Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture Act, the
Guarantee Trustee 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 GUARANTEE TRUSTEE.
(a) Subject to Section 4.2(b), unless a Guarantee Event of Default shall
have occurred and be continuing, the Guarantee Trustee may be appointed or
removed with or without cause at any time by the Guarantor.
(b) The Guarantee Trustee shall not be removed in accordance with Section
4.2(a) until a Successor Guarantee Trustee has been appointed and has accepted
such appointment by written instrument executed by such Successor Guarantee
Trustee and delivered to the Guarantor.
(c) The Guarantee Trustee appointed to office shall hold such office until
a Successor Guarantee Trustee shall have been appointed or until its removal or
resignation. The Guarantee Trustee may resign from office (without need for
prior or subsequent accounting) by an instrument in writing executed by the
Guarantee Trustee and delivered to the Guarantor, which
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resignation shall not take effect until a Successor Guarantee Trustee has been
appointed and has accepted such appointment by instrument in writing executed by
such Successor Guarantee Trustee and delivered to the Guarantor and the
resigning Guarantee Trustee.
(d) If no Successor Guarantee Trustee shall have been appointed and
accepted appointment as provided in this Section 4.2 within sixty (60) days
after delivery to the Guarantor of an instrument of removal or resignation, the
removed or resigning Guarantee Trustee may petition any court of competent
jurisdiction for appointment of a Successor Guarantee Trustee. Such court may
thereupon, after prescribing such notice, if any, as it may deem proper, appoint
a Successor Guarantee Trustee.
(e) No Guarantee Trustee shall be liable for the acts or omissions to act
of any Successor Guarantee Trustee.
(f) Upon termination of this Guarantee or removal or resignation of the
Guarantee Trustee pursuant to this Section 4.2, the Guarantor shall pay to the
Guarantee Trustee all amounts owing for fees and reimbursement of expenses which
have accrued to the date of such termination, removal or resignation.
ARTICLE 5 - 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 the Trust), as and when due, regardless of any defense, right of set-off or
counterclaim that the Trust may have or assert. 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 Trust to pay such
amounts to the Holders. Notwithstanding anything to the contrary herein, the
Guarantor retains all of its rights under the Indenture to extend the interest
payment period on the Debt Securities pursuant to Section 3.11 thereof and the
Guarantor shall not be obligated hereunder to make any Guarantee Payments during
any Extension Period (as defined in the certificate evidencing the Debt
Securities) with respect to the Distributions (as defined in the Trust
Agreement) on the Securities.
SECTION 5.2. WAIVER OF NOTICE AND DEMAND.
The Guarantor hereby waives notice of acceptance of this Guarantee and of
any liability to which it applies or may apply, presentment, demand for payment,
any right to require a proceeding first against the 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.
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SECTION 5.3. OBLIGATIONS NOT AFFECTED.
The obligations, covenants, agreements and duties of the Guarantor under
this Guarantee shall be absolute and unconditional and shall remain in full
force and effect until the entire liquidation amount of all outstanding
Securities shall have been paid and such obligation shall in no way be affected
or impaired by reason of the happening from time to time of any event, including
without limitation, the following, whether or not with notice to, or the consent
of, the Guarantor:
(a) The release or waiver, by operation of law or otherwise, of the
performance or observance by the Trust of any express or implied agreement,
covenant, term or condition relating to the Securities to be performed or
observed by the Trust;
(b) The extension of time for the payment by the Trust of all or any
portion of the Distributions, Redemption Price, Liquidation Distribution or any
other sums payable under the terms of the Securities or the extension of time
for the performance of any other obligation under, arising out of, or in
connection with the Securities (other than an extension of time for payment of
Distributions, Redemption Price, Liquidation Distribution or other sum payable
that results from the extension of any interest payment period on the Debt
Securities);
(c) Any failure, omission, delay or lack of diligence on the part of the
Property Trustee or the Holders to enforce, assert or exercise any right,
privilege, power or remedy conferred on the Property Trustee or the Holders
pursuant to the terms of the Securities, or any action on the part of the 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 Trust or any of the assets of the
Trust;
(e) Any invalidity of, or defect or deficiency in, the 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, 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 Guarantee Trustee or the Holders to
give notice to, or obtain consent of the Guarantor or any other Person with
respect to the happening of any of the foregoing.
No setoff, counterclaim, reduction or diminution of any obligation, or any
defense of any kind or nature that the Guarantor has or may have against any
Holder shall be available
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hereunder to the Guarantor against such Holder to reduce the payments to it
under this Guarantee.
SECTION 5.4. RIGHTS OF HOLDERS.
(a) The Holders of at least a Majority in Liquidation Amount of the
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 or to direct the exercise of any trust or power conferred upon the
Guarantee Trustee under this Guarantee.
(b) If the Guarantee Trustee fails to enforce this Guarantee, then any
Holder of Securities may, subject to the subordination provisions of Section
6.2, institute a legal proceeding directly against the Guarantor to enforce the
Guarantee Trustee's rights under this Guarantee without first instituting a
legal proceeding against the Trust, the Guarantee Trustee or any other person or
entity. In addition, if the Guarantor has failed to make a Guarantee Payment, a
Holder of Securities may, subject to the subordination provisions of Section
6.2, directly institute a proceeding against the Guarantor for enforcement of
the Guarantee for such payment to the Holder of the Securities of the principal
of or interest on the Debt Securities on or after the respective due dates
specified in the Debt Securities, and the amount of the payment will be based on
the Holder's pro rata share of the amount due and owing on all of the
Securities. The Guarantor hereby waives any right or remedy to require that any
action on this Guarantee be brought first against the Trust or any other person
or entity before proceeding directly against the Guarantor.
SECTION 5.5. GUARANTEE OF PAYMENT.
This Guarantee creates a guarantee of payment and not of collection.
SECTION 5.6. SUBROGATION.
The Guarantor shall be subrogated to all (if any) rights of the Holders of
Securities against the Trust in respect of any amounts paid to such Holders by
the Guarantor under this Guarantee; provided, however, that the Guarantor shall
not (except to the extent required by mandatory provisions of law) be entitled
to enforce or exercise any right that 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, if at the time of any such payment, any amounts
are due and unpaid under this Guarantee. 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
Guarantee Trustee for the benefit of the Holders.
SECTION 5.7. INDEPENDENT OBLIGATIONS.
The Guarantor acknowledges that its obligations hereunder are independent
of the obligations of the Trust with respect to the Securities, and that the
Guarantor shall be liable as principal and as debtor hereunder to make Guarantee
Payments pursuant to the terms of this
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Guarantee notwithstanding the occurrence of any event referred to in subsections
5.3(a) through 5.3(g), inclusive, hereof.
ARTICLE 6 - LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1. LIMITATION OF TRANSACTIONS.
So long as any Securities remain outstanding, if (i) there shall have occurred
an Indenture Event of Default with respect to the Debt Securities, (ii) there
shall be a Guarantee Event of Default or (iii) the Guarantor shall have given
notice of its election of an Extension Period as provided in the certificate
evidencing the Debt Securities and shall not have rescinded such notice, or such
Extension Period or any extension thereof shall be continuing, then the
Guarantor shall not, and shall not permit any subsidiary of the Guarantor, to
(x) declare or pay any dividends or distributions on, or redeem, purchase,
acquire or make a liquidation payment with respect to, any of the Guarantor's
capital stock or (y) make any payment of principal, interest or premium, if any,
on or repay, repurchase or redeem any debt securities of the Guarantor that rank
pari passu with or junior in interest to the Debt Securities or make any
guarantee payments with respect to any guarantee by the Guarantor of the debt
securities of any subsidiary of the Guarantor if such guarantee ranks pari passu
with or junior in interest to the Debt Securities (other than (a) dividends or
distributions in Common Stock of the Guarantor, (b) any declaration of a
dividend in connection with the implementation of a rights plan or the issuance
of stock under any such plan or the redemption or repurchase of any such rights
pursuant thereto, (c) payments under this Guarantee and (d) purchases of Common
Stock related to the issuance of Common Stock or rights under any of the
Company's benefits plans for its directors, officers or employees).
SECTION 6.2. RANKING.
This Guarantee will constitute an unsecured obligation of the Guarantor and
will rank subordinate and junior in right of payment to all Senior and
Subordinated Debt (as defined in the Indenture) of the Guarantor in the same
manner and to the same extent as set forth in Article XIII of the Indenture.
SECTION 6.3. SUBORDINATION OF COMMON SECURITIES.
If a Trust Enforcement Event has occurred and is continuing under the Trust
Agreement, the rights of the holders of the Common Securities to receive
Guarantee Payments hereunder shall be subordinated to the rights of the Holders
of the Capital Securities to receive Guarantee Payments under this Guarantee.
ARTICLE 7 - TERMINATION
SECTION 7.1. TERMINATION.
This Guarantee shall terminate upon (i) full payment of the Redemption
Price of all Securities, (ii) distribution of the Debt Securities to the Holders
of all the Securities or (iii) full payment of the amounts payable in accordance
with the Trust Agreement upon liquidation of the
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Trust. Notwithstanding the foregoing, this Guarantee will continue to be
effective or will be reinstated, as the case may be, if at any time any Holder
of Securities must restore payment of any sums paid under the Securities or
under this Guarantee.
ARTICLE 8 - INDEMNIFICATION
SECTION 8.1. INDEMNIFICATION.
The Guarantor agrees to indemnify each indemnified person for, and to hold
each indemnified person harmless against any loss, liability or expense incurred
without negligence or bad faith on its part, arising out of or in connection
with the acceptance or administration of the trust or trusts hereunder,
including the reasonable costs and expenses of defending itself against, or
investigating, any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder. The provisions of this
Section 8.1 shall survive the termination of this Guarantee or the resignation
or removal of the Guarantee Trustee.
ARTICLE 9 - MISCELLANEOUS
SECTION 9.1. SUCCESSORS AND ASSIGNS.
All guarantees and agreements contained in this Guarantee shall bind the
successors, assigns, receivers, trustees and representatives of the Guarantor
and shall inure to the benefit of the Holders of the Securities then
outstanding. Except in connection with a consolidation, merger or sale involving
the Guarantor that is permitted under Article VIII of the Indenture and
pursuant to which the successor or assignee agrees in writing to perform the
Guarantor's obligations hereunder, the Guarantor shall not assign its
obligations hereunder.
SECTION 9.2. 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 may not be amended without the prior approval of the
Holders of at least a Majority in Liquidation Amount of the Securities. The
provisions of Section 11.2 of the Trust Agreement with respect to meetings of,
and action by written consent of, the Holders of the Securities apply to the
giving of such approval.
SECTION 9.3. NOTICES.
All notices provided for in this Guarantee shall be in writing, duly signed
by the party giving such notice, and shall be delivered by hand, telecopied or
mailed by registered or certified mail, as follows:
(a) If given to the Guarantee Trustee, at the Guarantee Trustee's mailing
address set forth below (or such other address as the Guarantee Trustee may give
notice of to the Guarantor and the Holders of the Securities):
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▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ Bank
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
Compass Trust [____]
c/o Compass Bancshares, Inc.
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Secretary
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
(b) If given to the Guarantor, at the Guarantor's mailing addresses set
forth below (or such other address as the Guarantor may give notice of to the
Guarantee Trustee and the Holders of the Securities):
Compass Bancshares, Inc.
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Secretary
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
(c) If given to any Holder of Securities, at the address set forth on the
books and records of the Trust.
All such notices 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 9.4. BENEFIT.
This Guarantee is solely for the benefit of the Holders of the Securities
and, subject to Section 3.1(a), is not separately transferable from the
Securities.
SECTION 9.5. GOVERNING LAW. THIS GUARANTEE SHALL BE GOVERNED BY AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK.
[SIGNATURES APPEAR ON THE FOLLOWING PAGE(S)]
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IN WITNESS WHEREOF, this Guarantee is executed as of the day and year first
above written.
COMPASS BANCSHARES, INC., as Guarantor
By:
----------------------------------------
Name:
--------------------------------------
Title:
-------------------------------------
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ BANK, as Guarantee Trustee
By:
----------------------------------------
Name:
--------------------------------------
Title:
-------------------------------------
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