--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
EXHIBIT 4.1
COMMUNITY FIRST BANKSHARES, INC.,
AS ISSUER
TO
WILMINGTON TRUST COMPANY,
AS TRUSTEE
---------------------------------------------------
SUBORDINATED INDENTURE
---------------------------------------------------
Dated as of December __, 1997
___% Junior Subordinated Debentures
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
TABLE OF CONTENTS
PAGE
ARTICLE I
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II
DESCRIPTION, TERMS, CONDITIONS, REGISTRATION AND EXCHANGE OF THE JUNIOR
SUBORDINATED DEBENTURES . . . . . . . . . . . . . . . . . . . . . . 7
2.1 Designation and Principal Amount . . . . . . . . . . . . . . . 7
2.2 Maturity . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
2.3 Form and Payment . . . . . . . . . . . . . . . . . . . . . . . 8
2.4 Global Subordinated Debenture . . . . . . . . . . . . . . . . 8
2.5 Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
2.6 Execution, Authentication, Delivery and Dating . . . . . . . . 10
2.7 Registration and Transfer . . . . . . . . . . . . . . . . . . 11
2.8 Mutilated, Destroyed, Lost and Stolen Junior Subordinated
Debentures . . . . . . . . . . . . . . . . . . . . . . . . . 11
ARTICLE III
REDEMPTION OF JUNIOR SUBORDINATED DEBENTURES . . . . . . . . . . . . . 12
3.1 Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . 12
3.2 Special Event Redemption . . . . . . . . . . . . . . . . . . . 12
3.3 Optional Redemption by Company . . . . . . . . . . . . . . . . 12
3.4 Notice of Redemption . . . . . . . . . . . . . . . . . . . . . 13
3.5 Payment upon Redemption . . . . . . . . . . . . . . . . . . . 14
3.6 No Sinking Fund . . . . . . . . . . . . . . . . . . . . . . . 14
ARTICLE IV
EXTENSION OF INTEREST PAYMENT PERIOD . . . . . . . . . . . . . . . . . 14
4.1 Extension of Interest Payment Period . . . . . . . . . . . . . 14
4.2 Notice of Extension . . . . . . . . . . . . . . . . . . . . . 15
4.3 Limitation of Transactions During Extension. . . . . . . . . . 15
ARTICLE V
PARTICULAR COVENANTS OF THE COMPANY . . . . . . . . . . . . . . . . . . 15
5.1 Payment of Principal and Interest. . . . . . . . . . . . . . . 15
5.2 Maintenance of Agency . . . . . . . . . . . . . . . . . . . . 15
5.3 Paying Agents . . . . . . . . . . . . . . . . . . . . . . . . 16
5.4 Appointment to Fill Vacancy in Office of Trustee . . . . . . . 17
5.5 Compliance with Consolidation Provisions . . . . . . . . . . . 17
5.6 Restrictions on Certain Payments . . . . . . . . . . . . . . . 17
5.7 Covenants as to the Trust . . . . . . . . . . . . . . . . . . 17
ARTICLE VI
SECURITYHOLDERS' LISTS AND REPORTS . . . . . . . . . . . . . . . . . . 18
6.1 Company to Furnish Trustee Names and Addresses of
Securityholders . . . . . . . . . . . . . . . . . . . . . . 18
6.2 Preservation of Information; Communications with
Securityholders . . . . . . . . . . . . . . . . . . . . . . 18
6.3 Reports by the Company . . . . . . . . . . . . . . . . . . . . 18
6.4 Reports by the Trustee . . . . . . . . . . . . . . . . . . . . 19
i
ARTICLE VII
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ON EVENT OF DEFAULT . . . . 19
7.1 Events of Default . . . . . . . . . . . . . . . . . . . . . . 19
7.2 Collection of Indebtedness and Suits for Enforcement by
Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . 20
7.3 Application of Moneys Collected . . . . . . . . . . . . . . . 22
7.4 Limitation on Suits . . . . . . . . . . . . . . . . . . . . . 22
7.5 Rights and Remedies Cumulative; Delay or Omission Not
Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
7.6 Control by Securityholders . . . . . . . . . . . . . . . . . . 23
7.7 Undertaking to Pay Costs . . . . . . . . . . . . . . . . . . . 23
ARTICLE VIII
FORM OF JUNIOR SUBORDINATED DEBENTURE AND ORIGINAL ISSUE . . . . . . . 24
8.1 Form of Junior Subordinated Debenture . . . . . . . . . . . . 24
8.2 Original Issue of Junior Subordinated Debentures . . . . . . . 24
ARTICLE IX
CONCERNING THE TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . . 24
9.1 Certain Duties and Responsibilities of the Trustee . . . . . . 24
9.2 Certain Rights of Trustee . . . . . . . . . . . . . . . . . . 25
9.3 Trustee Not Responsible for Recitals or Issuance of the
Junior Subordinated Debentures . . . . . . . . . . . . . . . 26
9.4 May Hold Junior Subordinated Debentures . . . . . . . . . . . 26
9.5 Moneys Held in Trust . . . . . . . . . . . . . . . . . . . . . 26
9.6 Compensation and Reimbursement . . . . . . . . . . . . . . . . 26
9.7 Reliance on Officers' Certificate . . . . . . . . . . . . . . 27
9.8 Disqualification; Conflicting Interests . . . . . . . . . . . 27
9.9 Corporate Trustee Required; Eligibility . . . . . . . . . . . 27
9.10 Resignation and Removal; Appointment of Successor . . . . . . 27
9.11 Acceptance of Appointment by Successor . . . . . . . . . . . . 28
9.12 Merger, Conversion, Consolidation or Succession to
Business . . . . . . . . . . . . . . . . . . . . . . . . . . 29
9.13 Preferential Collection of Claims Against the Company . . . . 29
9.14 Appointment of Authenticating Agent . . . . . . . . . . . . . 29
ARTICLE X
CONCERNING THE SECURITYHOLDERS . . . . . . . . . . . . . . . . . . . . 30
10.1 Evidence of Action by Securityholders . . . . . . . . . . . . 30
10.2 Proof of Execution by Securityholders . . . . . . . . . . . . 31
10.3 Who May Be Deemed Owners . . . . . . . . . . . . . . . . . . . 31
10.4 Certain Junior Subordinated Debentures Owned by Company
Disregarded . . . . . . . . . . . . . . . . . . . . . . . . 31
10.5 Actions Binding on Future Securityholders . . . . . . . . . . 32
ARTICLE XI
SUPPLEMENTAL INDENTURES . . . . . . . . . . . . . . . . . . . . . . . . 32
11.1 Supplemental Indentures Without the Consent of
Securityholders . . . . . . . . . . . . . . . . . . . . . . 32
11.2 Supplemental Indentures with Consent of Securityholders . . . 33
11.3 Effect of Supplemental Indentures . . . . . . . . . . . . . . 33
11.4 Junior Subordinated Debentures Affected by Supplemental
Indentures . . . . . . . . . . . . . . . . . . . . . . . . . 33
11.5 Execution of Supplemental Indentures . . . . . . . . . . . . . 33
ii
ARTICLE XII
SUCCESSOR CORPORATION . . . . . . . . . . . . . . . . . . . . . . . . 34
12.1 Company May Consolidate, Etc. . . . . . . . . . . . . . . . . 34
12.2 Successor Substituted . . . . . . . . . . . . . . . . . . . . 34
12.3 Evidence of Consolidation, Etc., to Trustee . . . . . . . . . 34
ARTICLE XIII
SATISFACTION AND DISCHARGE . . . . . . . . . . . . . . . . . . . . . . 35
13.1 Satisfaction and Discharge of Indenture . . . . . . . . . . . 35
13.2 Discharge of Obligations . . . . . . . . . . . . . . . . . . 35
13.3 Deposited Moneys to Be Held in Trust . . . . . . . . . . . . 35
13.4 Payment of Monies Held by Paying Agents . . . . . . . . . . . 35
13.5 Repayment to Company . . . . . . . . . . . . . . . . . . . . 36
ARTICLE XIV
IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS . . . . . . . . . . . . . . . . . . . . . . . . 36
14.1 No Recourse . . . . . . . . . . . . . . . . . . . . . . . . . 36
ARTICLE XV
MISCELLANEOUS PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . 36
15.1 Effect on Successors and Assigns . . . . . . . . . . . . . . 36
15.2 Actions by Successor . . . . . . . . . . . . . . . . . . . . 36
15.3 Surrender of Company Powers . . . . . . . . . . . . . . . . . 36
15.4 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
15.5 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . 37
15.6 Treatment of Junior Subordinated Debentures as Debt . . . . . 37
15.7 Compliance Certificates and Opinions . . . . . . . . . . . . 37
15.8 Payments on Business Days . . . . . . . . . . . . . . . . . . 37
15.9 Conflict with Trust Indenture Act . . . . . . . . . . . . . . 38
15.10 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . 38
15.11 Separability . . . . . . . . . . . . . . . . . . . . . . . . 38
15.12 Assignment . . . . . . . . . . . . . . . . . . . . . . . . . 38
15.13 Acknowledgment of Rights . . . . . . . . . . . . . . . . . . 38
ARTICLE XVI
SUBORDINATION OF JUNIOR SUBORDINATED DEBENTURES . . . . . . . . . . . . 38
16.1 Agreement to Subordinate . . . . . . . . . . . . . . . . . . 38
16.2 Default on Senior and Subordinated Debt . . . . . . . . . . . 39
16.3 Liquidation; Dissolution; Bankruptcy . . . . . . . . . . . . 39
16.4 Subrogation . . . . . . . . . . . . . . . . . . . . . . . . . 40
16.5 Trustee to Effectuate Subordination . . . . . . . . . . . . . 41
16.6 Notice by the Company . . . . . . . . . . . . . . . . . . . . 41
16.7 Rights of the Trustee; Holders of Senior and Subordinated
Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
16.8 Subordination May Not Be Impaired . . . . . . . . . . . . . . 42
iii
COMMUNITY FIRST BANKSHARES, INC.
RECONCILIATION AND TIE BETWEEN TRUST INDENTURE ACT OF 1939, AS AMENDED
AND SUBORDINATED INDENTURE, DATED AS OF DECEMBER ___, 1997
Trust Indenture Act Subordinated
Section Indenture Section
------------------- -----------------
Section 310 . . . . . . . . . . . . . . . . . . . . . . . . . 15.9
Section 310 (b) . . . . . . . . . . . . . . . . . . . . . . . . . 9.8
Section 311 . . . . . . . . . . . . . . . . . . . . . . . . . 15.9
Section 311 (a) . . . . . . . . . . . . . . . . . . . . . . . . . 9.13
(b) . . . . . . . . . . . . . . . . . . . . . . . . . 9.13
Section 312 . . . . . . . . . . . . . . . . . . . . . . . . . 15.9
Section 312 (b) . . . . . . . . . . . . . . . . . . . . . . . . . 6.2
Section 313 . . . . . . . . . . . . . . . . . . . . . . . . . 15.9
Section 313 (a) . . . . . . . . . . . . . . . . . . . . . . . . . 6.4
(b) . . . . . . . . . . . . . . . . . . . . . . . . . 6.4
(c) . . . . . . . . . . . . . . . . . . . . . . . . . 6.4
Section 314 . . . . . . . . . . . . . . . . . . . . . . . . . 15.9
Section 315 . . . . . . . . . . . . . . . . . . . . . . . . . 15.9
Section 316 . . . . . . . . . . . . . . . . . . . . . . . . . 15.9
Section 317 . . . . . . . . . . . . . . . . . . . . . . . . . 15.9
----------------
NOTE: This reconciliation and tie shall not, for any purpose, be deemed
to be a part of the Subordinated Indenture.
SUBORDINATED INDENTURE (the "Indenture"), dated as of December ___,
1997, among Community First Bankshares, Inc., a Delaware corporation (the
"Company") and Wilmington Trust Company, a Delaware banking corporation, as
trustee (the "Trustee");
WHEREAS, for its lawful corporate purposes, the Company has duly
authorized the execution and delivery of this Indenture to provide for the
issuance of its securities to be known as its ___% Junior Subordinated
Debentures due 2027 (hereinafter referred to as the "Junior Subordinated
Debentures"), the form and substance of such Junior Subordinated Debentures
and the terms, provisions and conditions thereof to be set forth as provided
in this Indenture; and
WHEREAS, CFB Capital II, a Delaware statutory business trust (the
"Trust"), has offered to the public $40,000,000 aggregate liquidation amount
of its ____% Cumulative Capital Securities (the "Capital Securities"),
representing undivided beneficial interests in the assets of the Trust and
proposes to invest the proceeds from such offering, together with the
proceeds of the issuance and sale by the Trust to the Company of $___________
aggregate liquidation amount of its ___% Trust Common Securities, in
$_____________ aggregate principal amount of the Junior Subordinated
Debentures; and
WHEREAS, the Company has requested that the Trustee execute and deliver
this Indenture and all requirements necessary to make this Indenture a valid
instrument in accordance with its terms, and to make the Junior Subordinated
Debentures, when executed by the Company and authenticated and delivered by
the Trustee, the valid obligations of the Company; and
WHEREAS, to provide the terms and conditions upon which the Junior
Subordinated Debentures are to be authenticated, issued and delivered, the
Company has duly authorized the execution and delivery of this Indenture; 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, in consideration of the premises and the purchase of the
Junior Subordinated Debentures by the holders thereof, it is mutually
covenanted and agreed as follows for the equal and ratable benefit of the
holders of Junior Subordinated Debentures:
ARTICLE I
DEFINITIONS
The terms defined in this Section (except as in this Indenture otherwise
expressly provided or unless the context otherwise requires) for all purposes
of this Indenture and of any indenture supplemental hereto shall have the
respective meanings specified in this Section and shall include the plural as
well as the singular. All other terms used in this Indenture that are
defined in the Trust Indenture Act of 1939, as amended, or that are by
reference in said Trust Indenture Act defined in the Securities Act of 1933,
as amended (except as herein otherwise expressly provided or unless the
context otherwise requires), shall have the meanings assigned to such terms
in said Trust Indenture Act and in said Securities Act as in force at the
date of the execution of this Indenture.
"Accelerated Maturity Date" means, if the Company elects to accelerate
the Maturity Date in accordance with Section 2.2(c), the date selected by the
Company which is prior to the Scheduled Maturity Date, but is after December
15, 2002.
1
"Administrative Trustees" has the meaning set forth in the Trust
Agreement.
"Additional Sums" shall have the meaning set forth in Section 2.5.
"Affiliate" means, with respect to a specified Person, (a) any Person
directly or indirectly owning, controlling or holding with power to vote 10%
or more of the outstanding voting securities or other ownership interests of
the specified Person, (b) any Person 10% or more of whose outstanding voting
securities or other ownership interests are directly or indirectly owned,
controlled or held with power to vote by the specified Person, (c) any Person
directly or indirectly controlling, controlled by, or under common control
with the specified Person, (d) a partnership in which the specified Person is
a general partner, (e) any officer or director of the specified Person, and
(f) if the specified Person is an individual, any entity of which the
specified Person is an officer, director or general partner.
"Authenticating Agent" means an authenticating agent with respect to the
Junior Subordinated Debentures appointed by the Trustee pursuant to Section
9.14.
"Bankruptcy Law" means Title 11, U.S. Code, or any similar federal or
state law for the relief of debtors.
"Board of Directors" means the Board of Directors of the Company or any
duly authorized committee of such Board.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted
by the Board of Directors and to be in full force and effect on the date of
such certification.
"Business Day" means any day other than a day on which Federal or State
banking institutions in the State of Minnesota are authorized or obligated by
law, executive order or regulation to close or a day on which the Trustee is
closed.
"Capital Securities" means undivided beneficial interests in the assets
of the Trust which rank pari passu with Common Securities issued by the
Trust; provided, however, that upon the occurrence of an Event of Default,
the rights of holders of Common Securities to payment in respect of
distributions and payments upon liquidation, redemption and otherwise are
subordinated to the rights of holders of Capital Securities.
"Capital Securities Certificate" has the meaning set forth in the Trust
Agreement.
"Capital Securities Guarantee" means any guarantee that the Company may
enter into with the Property Trustee or other Persons that operates directly
or indirectly for the benefit of holders of Capital Securities of the Trust.
"Capital Treatment Event" means the reasonable determination by the
Company that, as a result of any amendment to, or change (including any
proposed change) in, the laws (or any 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 proposed change, pronouncement or decision is announced
on or after the date of issuance of the Capital Securities under the Trust
Agreement, there is more than an insubstantial risk of impairment of the
Company's ability to treat the Capital Securities (or any substantial portion
thereof) as "Tier I Capital" (or the then equivalent thereof) for purposes of
the capital adequacy guidelines of the Federal Reserve, as then in effect and
applicable to the Company.
2
"Certificate" means a certificate signed by the principal executive
officer, the principal financial officer or the principal accounting officer
of the Company. The Certificate need not comply with the provisions of
Section 15.7.
"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 Indenture 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" means undivided beneficial interests in the assets
of the Trust which rank pari passu with Capital Securities issued by the
Trust; provided, however, that upon the occurrence of an Event of Default,
the rights of holders of Common Securities to payment in respect of
distributions and payments upon liquidation, redemption and otherwise are
subordinated to the rights of holders of Capital Securities.
"Company" means Community First Bankshares, Inc., a corporation duly
organized and existing under the laws of the State of Delaware, and, subject
to the provisions of Article Twelve, shall also include its successors and
assigns.
"Compounded Interest" shall have the meaning set forth in Section 4.1.
"Corporate Trust Office" means the office of the Trustee at which, at
any particular time, its corporate trust business shall be principally
administered, which office at the date hereof is located at ▇▇▇▇▇▇ Square
North, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention:
Corporate Trust Administration.
"Custodian" means any receiver, trustee, assignee, liquidator, or
similar official under any Bankruptcy Law.
"Debt" means with respect to any Person, whether recourse is to all or a
portion of the assets of such Person and whether or not contingent, (i) every
obligation of such Person for money borrowed; (ii) every obligation of such
Person evidenced by bonds, debentures, notes or other similar instruments,
including obligations incurred in connection with the acquisition of
property, assets or businesses; (iii) every reimbursement obligation of such
Person with respect to letters of credit, bankers' acceptances or similar
facilities issued for the account of such Person; (iv) every obligation of
such Person issued or assumed as the deferred purchase price of property or
services (but excluding trade accounts payable or accrued liabilities arising
in the ordinary course of business); (v) every capital lease obligation of
such Person; and (vi) every obligation of the type referred to in clauses (i)
through (v) of another Person and all dividends of another Person the payment
of which, in either case, such Person has guaranteed or is responsible or
liable, directly or indirectly, as obligor or otherwise.
"Default" means any event, act or condition that with notice or lapse of
time, or both, would constitute an Event of Default.
"Deferred Interest" shall have the meaning set forth in Section 4.1.
"Depositary" means, with respect to Junior Subordinated Debentures
issued as a Global Subordinated Debenture, The Depository Trust Company, New
York, New York, another clearing agency, or any successor registered as a
clearing agency under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), or other applicable statute or regulation, which, in each
case, shall be designated by the Company pursuant to either Section 2.1 or
2.4.
3
"Dissolution Event" means that as a result of the occurrence and
continuation of a Special Event, the Trust is to be dissolved in accordance
with the Trust Agreement and the Junior Subordinated Debentures held by the
Property Trustee are to be distributed to the holders of the Trust Securities
issued by the Trust pro rata in accordance with the Trust Agreement.
"Distributions" shall have the meaning set forth in the Trust Agreement
"Event of Default" means any event specified in Section 7.1, continued
for the period of time, if any, therein designated.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Extended Interest Payment Period" shall have the meaning set forth in
Section 4.1.
"Federal Reserve" means the Board of Governors of the Federal Reserve
System.
"Global Subordinated Debenture" means a Junior Subordinated Debenture
executed by the Company and delivered by the Trustee to the Depositary or
pursuant to the Depositary's instruction, all in accordance with this
Indenture, which shall be registered in the name of the Depositary or its
nominee.
"Governmental Obligations" means securities that are (i) direct
obligations of the United States of America for the payment of which its full
faith and credit is pledged or (ii) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States
of America, the payment of which is unconditionally guaranteed as a full
faith and credit obligation by the United States of America that, in either
case, are not callable or redeemable at the option of the issuer thereof, and
shall also include a depositary receipt issued by a bank (as defined in
Section 3(a)(2) of the Securities Act of 1933, as amended) as custodian with
respect to any such Governmental Obligation or a specific payment of
principal of or interest on any such Governmental Obligation held by such
custodian for the account of the holder of such depositary receipt; provided,
however, that (except as required by law) such custodian is not authorized to
make any deduction from the amount payable to the holder of such depositary
receipt from any amount received by the custodian in respect of the
Governmental Obligation or the specific payment of principal of or interest
on the Governmental Obligation evidenced by such depositary receipt.
"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.
"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 in accordance with the terms hereof.
"Interest Payment Date," when used with respect to any installment of
interest on the Junior Subordinated Debentures, means the date specified in
the Junior Subordinated Debenture as the fixed date on which an installment
of interest with respect to the Junior Subordinated Debentures is due and
payable.
"Investment Company Act" means the Investment Company Act of 1940, as
amended.
"Investment Company Event" means the receipt by the Company and the
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
change in interpretation or application of law or regulation by any
legislative body, court, governmental agency or regulatory authority (a
"Change in Investment Company Act Law"), the Trust is or will be considered
an "investment company" that is required to be registered under the
Investment Company Act, which Change in
4
Investment Company Act Law becomes effective on or after the date of original
issuance of the Capital Securities under the Trust Agreement.
"Junior Subordinated Debentures" means the ____% Junior Subordinated
Debentures authenticated and delivered under this Indenture.
"Liquidation Amount" means the stated amount of $25 per Trust Security.
"Maturity Date" shall have the meaning set forth in Section 2.2.
"Non Book-Entry Capital Securities" shall have the meaning set forth in
Section 2.4.
"Officers' Certificate" means a certificate signed by the President or a
Vice President and by the Chief Financial Officer or the Controller or an
Assistant Controller or the Secretary or an Assistant Secretary of the
Company that is delivered to the Trustee in accordance with the terms hereof.
Each such certificate shall include the statements provided for in Section
15.7, if and to the extent required by the provisions thereof.
"Opinion of Counsel" means an opinion in writing of legal counsel, who
may be an employee of or counsel for the Company, that is delivered to the
Trustee in accordance with the terms hereof. Each such opinion shall include
the statements provided for in Section 15.7, if and to the extent required by
the provisions thereof.
"Outstanding," when used with reference to Junior Subordinated
Debentures means, subject to the provisions of Section 10.4, as of any
particular time, all Junior Subordinated Debentures theretofore authenticated
and delivered by the Trustee under this Indenture, except (a) Junior
Subordinated Debentures theretofore canceled by the Trustee or any paying
agent, or delivered to the Trustee or any paying agent for cancellation or
that have previously been canceled; (b) Junior Subordinated Debentures or
portions thereof for the payment or redemption of which moneys or
Governmental Obligations in the necessary amount shall have been deposited in
trust with the Trustee or with any paying agent (other than the Company) or
shall have been set aside and segregated in trust by the Company (if the
Company shall act as its own paying agent); provided, however, that if such
Junior Subordinated Debentures or portions of such Junior Subordinated
Debentures are to be redeemed prior to the maturity thereof, notice of such
redemption shall have been given as in Article Three provided, or provision
satisfactory to the Trustee shall have been made for giving such notice; and
(c) Junior Subordinated Debentures in lieu of or in substitution for which
other Junior Subordinated Debentures shall have been authenticated and
delivered pursuant to the terms of Section 2.8.
"Person" means any individual, corporation, partnership, joint venture,
joint-stock company, unincorporated organization or government or any agency
or political subdivision thereof.
"Predecessor Security" means every previous Junior Subordinated
Debenture evidencing all or a portion of the same debt and as that evidenced
by such particular Junior Subordinated Debenture; and, for the purposes of
this definition, any Junior Subordinated Debenture authenticated and
delivered under Section 2.8 in lieu of a lost, destroyed or stolen Junior
Subordinated Debenture shall be deemed to evidence the same debt as the lost,
destroyed or stolen Junior Subordinated Debenture.
"Property Trustee" has the meaning set forth in the Trust Agreement.
"Redemption Price" means the amount equal to 100% of the principal
amount of Junior Subordinated Debentures to be redeemed plus any accrued and
unpaid interest thereon to the date of the redemption of such Junior
Subordinated Debentures.
5
"Responsible Officer" when used with respect to the Trustee means the
Chairman of the Board of Directors, the President, any Vice President, the
Secretary, the Treasurer, any trust officer, any corporate trust officer or
any other officer or assistant officer of the Trustee customarily performing
functions similar to those performed by the Persons who at the time shall be
such officers, respectively, or to whom any corporate trust matter is
referred because of his or her knowledge of and familiarity with the
particular subject.
"Scheduled Maturity Date" means December 15, 2027.
"Securities Register" and "Securities Registrar" have the respective
meanings specified in Section 2.7.
"Securityholder," "Holder," "Holder of Securities," "Registered Holder,"
or other similar term, means the Person or Persons in whose name or names a
particular Junior Subordinated Debenture shall be registered in the
Securities Register.
"Senior and Subordinated Debt" means the principal of (and premium, if
any) and interest, if any (including interest accruing on or after the filing
of any petition in bankruptcy or for reorganization relating to the Company
whether or not such claim for post-petition interest is allowed in such
proceeding), on Debt, whether incurred on or prior to the date of this
Indenture or thereafter incurred, unless, in the instrument creating or
evidencing the same or pursuant to which the same is outstanding, it is
provided that such obligations are not superior in right of payment to the
Junior Subordinated Debentures or to other Debt which is pari passu with, or
subordinated to, the Junior Subordinated Debentures; provided, however, that
Senior and Subordinated Debt shall not be deemed to include (i) any Debt 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, (ii) any Debt of the Company to any of its
subsidiaries, (iii) any Debt to any employee of the Company, (iv) any Debt
which by its terms is subordinated to trade accounts payable or accrued
liabilities arising in the ordinary course of business to the extent that
payments made to the holders of such Debt by the holders of the Junior
Subordinated Debentures as a result of the subordination provisions of this
Indenture would be greater than they otherwise would have been as a result of
any obligation of such holders to pay amounts over to the obligees on such
trade accounts payable or accrued liabilities arising in the ordinary course
of business as a result of subordination provisions to which such Debt is
subject, (v) the Capital Securities Guarantee, and (vi) any other debt
securities issued pursuant to this Indenture.
"Special Event" means a Tax Event, an Investment Company Event or a
Capital Treatment Event.
"Subsidiary" means, with respect to any Person, (i) any corporation at
least a majority of whose outstanding Voting Stock shall at the time be
owned, directly or indirectly, by such Person, or by one or more of its
Subsidiaries, or by such Person and one or more of its Subsidiaries, (ii) any
general partnership, joint venture or similar entity, at least a majority of
whose outstanding partnership or similar interests shall at the time be owned
by such Person, or by one or more of its Subsidiaries, or by such Person and
one or more of its Subsidiaries and (iii) any limited partnership of which
such Person or any of its Subsidiaries is a general partner.
"Tax Event" means the receipt by the Company and the 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 administrative pronouncement or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
which pronouncement or decision is announced on or after the date of issuance
of the Junior Subordinated Debentures there is more than an insubstantial
risk that (i) interest payable by the Company on the Junior Subordinated
Debentures is not, or within 90 days after the date of such Opinion of
Counsel will not be, deductible by the Company, in whole or in part, for
United States federal income tax purposes; (ii) the Trust is, or will be
within
6
90 days after the date of such Opinion of Counsel, subject to United States
federal income tax with respect to income received or accrued on the Junior
Subordinated Debentures, or (iii) the Trust is, or will be within 90 days
after the date of such Opinion of Counsel, subject to more than a de minimis
amount of other taxes, duties, assessments or other governmental charges.
"Trust" means CFB Capital II, a Delaware statutory business trust
created for the purpose of issuing Trust Securities in connection with the
issuance of Junior Subordinated Debentures under this Indenture.
"Trust Agreement" means the Amended and Restated Trust Agreement, dated
as of December ___, 1997, of the Trust.
"Trustee" means Wilmington Trust Company and, subject to the provisions
of Article Nine, shall also include its successors and assigns, and, if at
any time there is more than one Person acting in such capacity hereunder,
"Trustee" shall mean each such Person.
"Trust Indenture Act," means the Trust Indenture Act of 1939 as in force
at the date of execution of this Indenture; provided, however, that in the
event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
"Trust Securities" means Common Securities and Capital Securities of the
Trust.
"Voting Stock," as applied to stock of any Person, means shares,
interests, participations or other equivalents in the equity interest
(however designated) in such Person having ordinary voting power for the
election of a majority of the directors (or the equivalent) of such Person,
other than shares, interests, participations or other equivalents having such
power only by reason of the occurrence of a contingency.
ARTICLE II
DESCRIPTION, TERMS, CONDITIONS, REGISTRATION AND
EXCHANGE OF THE JUNIOR SUBORDINATED DEBENTURES
2.1 DESIGNATION AND PRINCIPAL AMOUNT. There is hereby authorized a
series of Securities designated the "___% Junior Subordinated Debentures due
2027", limited in aggregate principal amount to $_________, which amount
shall be as set forth in any written order of the Company for the
authentication and delivery of Junior Subordinated Debentures pursuant to
Section 8.2 of this Indenture.
2.2 MATURITY.
(a) The Maturity Date will be either:
(i) the Scheduled Maturity Date; or
(ii) if the Company elects to accelerate the Maturity Date to be a
date prior to the Scheduled Maturity Date in accordance with Section
2.2(b), the Accelerated Maturity Date.
(b) The Company may, at any time before the day which is 90 days before
the Scheduled Maturity Date, elect to shorten the Maturity Date only once to
the Accelerated Maturity Date, provided that the Company has received the
prior approval of the Federal Reserve if then required under applicable
capital guidelines or policies of the Federal Reserve.
7
(c) If the Company elects to accelerate the Maturity Date in accordance
with Section 2.2(b), the Company shall give notice to the registered holders
of the Junior Subordinated Debentures, the Property Trustee and the Trust of
the acceleration of the Maturity Date and the Accelerated Maturity Date at
least 90 days before the Accelerated Maturity Date.
2.3 FORM AND PAYMENT. Except as provided in Section 2.4, the Junior
Subordinated Debentures shall be issued in fully registered certificated form
without interest coupons. Principal and interest on the Junior Subordinated
Debentures issued in certificated form will be payable, the transfer of such
Junior Subordinated Debentures will be registrable and such Junior
Subordinated Debentures will be exchangeable for Junior Subordinated
Debentures bearing identical terms and provisions at the office or agency of
the Trustee; provided, however, that payment of interest may be made at the
option of the Company by check mailed to the Holder at such address as shall
appear in the Securities Register. Notwithstanding the foregoing, so long as
the Holder of any Junior Subordinated Debentures is the Property Trustee, the
payment of the principal of and interest (including Compounded Interest and
Additional Sums, if any) on such Junior Subordinated Debentures held by the
Property Trustee will be made at such place and to such account as may be
designated by the Property Trustee.
2.4 GLOBAL SUBORDINATED DEBENTURE.
(a) In connection with a Dissolution Event,
(i) the Junior Subordinated Debentures in certificated form
may be presented to the Trustee by the Property Trustee in
exchange for a global Junior Subordinated Debenture in an
aggregate principal amount equal to the aggregate principal
amount of all outstanding Junior Subordinated Debentures (a
"Global Subordinated Debenture"), to be registered in the name of
the Depositary, or its nominee, and delivered by the Trustee to
the Depositary for crediting to the accounts of its participants
pursuant to the instructions of the Administrative Trustees. The
Company upon any such presentation shall execute a Global
Subordinated Debenture in such aggregate principal amount and
deliver the same to the Trustee for authentication and delivery
in accordance with this Indenture. Payments on the Junior
Subordinated Debentures issued as a Global Subordinated Debenture
will be made to the Depositary; and
(ii) if any Capital Securities are held in non book-entry
certificated form, the Junior Subordinated Debentures in
certificated form may be presented to the Trustee by the Property
Trustee and any Capital Securities Certificate which represents
Capital Securities other than Capital Securities held by the
Depositary or its nominee ("Non Book-Entry Capital Securities")
will be deemed to represent beneficial interests in Junior
Subordinated Debentures presented to the Trustee by the Property
Trustee having an aggregate principal amount equal to the
aggregate Liquidation Amount of the Non Book-Entry Capital
Securities until such Capital Securities Certificates are
presented to the Securities Registrar for transfer or reissuance
at which time such Capital Securities Certificates will be
canceled and a Junior Subordinated Debenture, registered in the
name of the holder of the Capital Securities Certificate or the
transferee of the holder of such Capital Securities Certificate,
as the case may be, with an aggregate principal amount equal to
the aggregate Liquidation Amount of the Capital Securities
Certificate canceled, will be executed by the Company and
delivered to the Trustee for authentication and delivery in
accordance with this Indenture. On issue of such Junior
Subordinated Debentures, Junior Subordinated Debentures with an
equivalent aggregate principal amount that were presented by the
Property Trustee to the Trustee will be deemed to have been
canceled.
8
(b) A Global Subordinated Debenture may be transferred, in whole but not
in part, only to another nominee of the Depositary, or to a successor
Depositary selected or approved by the Company or to a nominee of such
successor Depositary.
(c) If at any time the Depositary notifies the Company that it is
unwilling or unable to continue as Depositary or if at any time the
Depositary for such series shall no longer be registered or in good standing
under the Exchange Act or other applicable statute or regulation, and a
successor Depositary for such series is not appointed by the Company within
90 days after the Company receives such notice or becomes aware of such
condition, as the case may be, the Company will execute, and the Trustee,
upon written notice from the Company, will authenticate and deliver the
Junior Subordinated Debentures in definitive registered form without coupons,
in authorized denominations, and in an aggregate principal amount equal to
the principal amount of the Global Subordinated Debenture in exchange for
such Global Junior Subordinated Debenture. In addition, the Company may at
any time determine that the Junior Subordinated Debentures shall no longer be
represented by a Global Subordinated Debenture. In such event the Company
will execute, and the Trustee, upon receipt of an Officers' Certificate
evidencing such determination by the Company, will authenticate and deliver
the Junior Subordinated Debentures in definitive registered form without
coupons, in authorized denominations, and in an aggregate principal amount
equal to the principal amount of the Global Subordinated Debenture in
exchange for such Global Subordinated Debenture. Upon the exchange of the
Global Subordinated Debenture for such Junior Subordinated Debentures in
definitive registered form without coupons, in authorized denominations, the
Global Subordinated Debenture shall be canceled by the Trustee. Such Junior
Subordinated Debentures in definitive registered form issued in exchange for
the Global Subordinated Debenture shall be registered in such names and in
such authorized denominations as the Depositary, pursuant to instructions
from its direct or indirect participants or otherwise, shall instruct the
Trustee. The Trustee shall deliver such Junior Subordinated Debentures to
the Depositary for delivery to the Persons in whose names such Junior
Subordinated Debentures are so registered.
2.5 INTEREST.
(a) Each Junior Subordinated Debenture will bear interest at the rate of
8 7/8% per annum (the "Coupon Rate") from the original date of issuance until
the principal thereof becomes due and payable, and on any overdue principal
and (to the extent that payment of such interest is enforceable under
applicable law) on any overdue installment of interest at the Coupon Rate,
compounded quarterly, payable (subject to the provisions of Article Four)
quarterly in arrears on the 15th day of March, June, September, and December
in each year (each, an "Interest Payment Date"), commencing on March 15,
1998, to the Person in whose name such Junior Subordinated Debenture or any
predecessor Junior Subordinated Debenture is registered, at the close of
business on the regular record date for such interest installment, which, in
respect of (i) Junior Subordinated Debentures of which the Property Trustee
is the Holder and the Capital Securities are in book-entry only form or (ii)
a Global Subordinated Debenture, shall be the close of business on the
Business Day next preceding that Interest Payment Date. Notwithstanding the
foregoing sentence, if (i) the Junior Subordinated Debentures are held by the
Property Trustee and the Capital Securities are no longer in book-entry only
form or (ii) the Junior Subordinated Debentures are not represented by a
Global Subordinated Debenture, the record date for such interest installment
which shall be the 1st day of the month in which such payment is to be made.
The amount of each interest payment due with respect to the Junior
Subordinated Debentures will include amounts accrued through the date the
interest payment is due.
(b) The amount of interest payable for any period will be
computed on the basis of a 360-day year of twelve 30-day months.
Except as provided in the following sentence, the amount of interest
payable for any period shorter than a full quarterly period for which
interest is computed will be computed on the basis of the actual
number of days elapsed in such a quarterly period. In the event that
any date on which interest is payable on the Junior Subordinated
Debentures is not a Business Day, then payment of interest payable on
such date will
9
be made on the next succeeding day which is a Business Day (and without any
interest or other payment in respect of any such delay), 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 such date.
(c) If, at any time while the Property Trustee is the Holder of any
Junior Subordinated Debentures, the Trust or the Property Trustee is required
to pay any taxes, duties, assessments or governmental charges of whatever
nature (other than withholding taxes) imposed by the United States, or any
other taxing authority, then, in any case, the Company will pay as additional
interest ("Additional Sums") on the Junior Subordinated Debentures held by
the Property Trustee such additional amounts as shall be required so that the
net amounts received and retained by the Trust and the Property Trustee after
paying such taxes, duties, assessments or other governmental charges will be
equal to the amounts the Trust and the Property Trustee would have received
had no such taxes, duties, assessments or other government charges been
imposed.
2.6 EXECUTION, AUTHENTICATION, DELIVERY AND DATING. The Junior
Subordinated Debentures shall be executed on behalf of the Company by its
President or any Vice President and attested by its Secretary or Assistant
Secretary. The signature of any of these officers on the Subordinated
Debentures may be manual or facsimile.
Junior Subordinated Debentures 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
Junior Subordinated Debentures or did not hold such offices at the date of
such Junior Subordinated Debentures.
At any time and from time to time after the execution and delivery of
this Indenture, the Company may deliver Junior Subordinated Debentures
executed by the Company to the Trustee for authentication, together with a
Company order for the authentication and delivery of such Junior Subordinated
Debentures. The Trustee in accordance with such Company order shall
authenticate and deliver such Junior Subordinated Debentures as in this
Indenture provided and not otherwise.
Upon the initial issuance, each Junior Subordinated Debentures shall be
dated December , 1997, and thereafter Junior Subordinated Debentures
issued hereunder shall be dated the date of their authentication.
No Junior Subordinated Debenture shall be entitled to any benefit under
this Indenture or be valid or obligatory for any purpose unless there appears
on such Junior Subordinated Debenture a certificate of authentication
substantially in the form provided for herein executed by the Trustee by
manual signature, and such certificate upon any Junior Subordinated Debenture
shall be conclusive evidence, and the only evidence, that such Junior
Subordinated Debenture has been duly authenticated and delivered hereunder
and is entitled to the benefits of this Indenture.
2.7 REGISTRATION AND TRANSFER. The Company shall cause to be kept at
the Corporate Trust Office of the Trustee a register (the register maintained
in such office or any other office or agency pursuant to Section 5.2 being
herein sometimes referred to as the "Securities Register") in which, subject
to such reasonable regulations as it may prescribe, the Company shall provide
for the registration of the Junior Subordinated Debentures and of transfers
of the Junior Subordinated Debentures. The Trustee is hereby appointed
"Securities Registrar" for the purpose of registering the Junior Subordinated
Debentures and transfers of the Junior Subordinated Debentures as herein
provided.
Upon surrender for registration of transfer of any Junior Subordinated
Debenture at an office or agency of the Company designated pursuant to
Section 5.2 for such purpose, the Company shall execute, and the Trustee
10
shall authenticate and deliver, in the name of the designated transferee or
transferees, a new Junior Subordinated Debenture of the authorized
denomination.
All Junior Subordinated Debentures issued upon any registration of
transfer of Junior Subordinated Debentures shall be valid obligations of the
Company, evidencing the same debt and entitled to the same benefits under
this Indenture as the Junior Subordinated Debentures surrendered upon such
registration of transfer.
Every Junior Subordinated Debenture presented or surrendered for
registration of transfer shall be duly endorsed for transfer (if so required
by the Company or the Trustee), or shall 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 for any registration of transfer of
Junior Subordinated Debentures, 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 registration of transfer of Junior Subordinated
Debentures.
The Company shall not be required to issue or register the transfer of
any Junior Subordinated Debenture during a period beginning at the opening of
business 15 days before the day of the mailing of a notice of redemption of
Junior Subordinated Debentures selected for redemption pursuant to Article
Three and ending at the close of business on the day of such mailing.
2.8 MUTILATED, DESTROYED, LOST AND STOLEN JUNIOR SUBORDINATED
DEBENTURES. If any mutilated Junior Subordinated Debenture is surrendered to
the Trustee, the Company shall execute and the Trustee shall authenticate and
deliver in exchange therefor a new Junior Subordinated Debenture of like
tenor and principal amount and bearing a number not contemporaneously
outstanding.
If there shall be delivered to the Company and the Trustee (i) evidence
to their satisfaction of the destruction, loss or theft of any Junior
Subordinated Debenture 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 Junior Subordinated Debenture 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 Junior Subordinated Debenture, a new Junior
Subordinated Debenture of like tenor and principal amount and bearing a
number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Junior Subordinated
Debenture has become or is about to become due and payable, the Company in
its discretion may, instead of issuing a new Junior Subordinated Debenture,
pay such Junior Subordinated Debenture.
Upon the issuance of any new Junior Subordinated Debenture under this
Section, the Company may require the payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in relation thereto and
any other expenses (including the fees and expenses of the Trustee) connected
therewith.
Every new Junior Subordinated Debenture issued pursuant to this Section
in lieu of any destroyed, lost or stolen Junior Subordinated Debenture shall
constitute an original additional contractual obligation of the Company,
whether or not the destroyed, lost or stolen Junior Subordinated Debenture
shall be at any time enforceable by anyone, and shall be entitled to all of
the benefits of this Indenture.
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 Junior Subordinated
Debentures.
11
ARTICLE III
REDEMPTION OF JUNIOR SUBORDINATED DEBENTURES
3.1 REDEMPTION. Subject to the Company having received prior approval
of the Federal Reserve, if then required under the applicable capital
guidelines or policies of the Federal Reserve, the Company may redeem the
Junior Subordinated Debentures in accordance with this Article Three.
3.2 SPECIAL EVENT REDEMPTION. Subject to the Company having received
the prior approval of the Federal Reserve, if then required under the
applicable capital guidelines or policies of the Federal Reserve, if a
Special Event has occurred and is continuing, then, notwithstanding Section
3.3, the Company shall have the right upon not less than 30 days nor more
than 60 days notice to the Holders of the Junior Subordinated Debentures to
redeem the Junior Subordinated Debentures, in whole but not in part, for cash
within 90 days following the occurrence of such Special Event (the "90-Day
Period") at the Redemption Price, provided that if at the time there is
available to the Company the opportunity to eliminate, within the 90-Day
Period, the Tax Event by taking some ministerial action ("Ministerial
Action"), such as filing a form or making an election, or pursuing some other
similar reasonable measure which has no adverse effect on the Company, the
Trust or the Holders of the Trust Securities issued by the Trust, the Company
shall pursue such Ministerial Action in lieu of redemption, and, provided,
further, that the Company shall have no right to redeem the Junior
Subordinated Debentures while the Trust is pursuing any Ministerial Action
pursuant to its obligations under the Trust Agreement. The Redemption Price
shall be paid prior to 2:00 p.m., Minneapolis time, on the date of such
redemption or such earlier time as the Company determines, provided that the
Company shall deposit with the Trustee an amount sufficient to pay the
Redemption Price by 12:00 noon, Minneapolis time, on the date such Redemption
Price is to be paid.
3.3 OPTIONAL REDEMPTION BY COMPANY.
(a) Except as otherwise may be specified in this Indenture, the Company
shall have the right to redeem the Junior Subordinated Debentures, in whole
or in part, from time to time, on or after December 15, 2002, at the
Redemption Price. Any redemption pursuant to this Section 3.3 will be made
upon not less than 30 days nor more than 60 days notice to the Holder of the
Junior Subordinated Debentures, at the Redemption Price. If the Junior
Subordinated Debentures are only partially redeemed pursuant to this Section
3.3, the Junior Subordinated Debentures will be redeemed pro rata or by lot
or by any other method utilized by the Trustee; provided, that if at the time
of redemption the Junior Subordinated Debentures are registered as a Global
Subordinated Debenture, the Depositary shall determine, in accordance with
its procedures, the principal amount of such Junior Subordinated Debentures
held by each Holder of Junior Subordinated Debentures to be redeemed. The
Redemption Price shall be paid prior to 2:00 p.m., Minneapolis time, on the
date of such redemption or at such earlier time as the Company determines
provided that the Company shall deposit with the Trustee an amount sufficient
to pay the Redemption Price by 12:00 noon, Minneapolis time, on the date such
Redemption Price is to be paid.
(b) If a partial redemption of the Junior Subordinated Debentures would
result in the delisting of the Capital Securities issued by the Trust from
the Nasdaq National Market or any national securities exchange or other
organization on which the Capital Securities may then be listed, if any, the
Company shall not be permitted to effect such partial redemption and may only
redeem the Junior Subordinated Debentures in whole.
3.4 NOTICE OF REDEMPTION.
(a) In case the Company shall desire to exercise such right to redeem
all or, as the case may be, a portion of the Junior Subordinated Debentures
in accordance with the right reserved so to do, the Company shall, or shall
cause the Trustee to, give notice of such redemption to Holders of the Junior
Subordinated Debentures
12
to be redeemed by mailing, first class postage prepaid, a notice of such
redemption not less than 30 days and not more than 60 days before the date
fixed for redemption to such Holders at their last addresses as they shall
appear upon the Securities Register. Any notice that is mailed in the manner
herein provided shall be conclusively presumed to have been duly given,
whether or not the registered Holder receives the notice. In any case,
failure duly to give such notice to the Holder of any Junior Subordinated
Debenture designated for redemption in whole or in part, or any defect in the
notice, shall not affect the validity of the proceedings for the redemption
of any other Junior Subordinated Debentures. In the case of any redemption
of Junior Subordinated Debentures prior to the expiration of any restriction
on such redemption provided elsewhere in this Indenture, the Company shall
furnish the Trustee with an Officers' Certificate evidencing compliance with
any such restriction.
Each such notice of redemption shall specify the date fixed for
redemption and the Redemption Price, and shall state that payment of the
Redemption Price of such Junior Subordinated Debentures to be redeemed will
be made at the office or agency of the Company in Fargo, North Dakota, upon
presentation and surrender of such Junior Subordinated Debentures, that
interest accrued to the date fixed for redemption will be paid as specified
in said notice, that from and after said date interest will cease to accrue.
If less than all the Junior Subordinated Debentures are to be redeemed, the
notice to the Holders of Junior Subordinated Debentures to be redeemed in
whole or in part shall specify the particular Junior Subordinated Debentures
to be so redeemed. In case any Junior Subordinated Debenture is to be
redeemed in part only, the notice that relates to such Junior Subordinated
Debenture shall state the portion of the principal amount thereof to be
redeemed, and shall state that on and after the redemption date, upon
surrender of such Junior Subordinated Debenture, a new Junior Subordinated
Debenture or Junior Subordinated Debentures in principal amount equal to the
unredeemed portion thereof shall be issued to the Holder.
(b) If less than all the Junior Subordinated Debentures are to be
redeemed, the Company shall give the Trustee at least 45 days' notice in
advance of the date fixed for redemption as to the aggregate principal amount
of Junior Subordinated Debentures to be redeemed, and thereupon the Trustee
shall select, by lot or in such other manner as it shall deem appropriate and
fair in its discretion and that may provide for the selection of a portion or
portions (equal to twenty-five U.S. dollars ($25) or any integral multiple
thereof), the Junior Subordinated Debentures to be redeemed and shall
thereafter promptly notify the Company in writing of the numbers of the
Junior Subordinated Debentures to be redeemed, in whole or in part.
The Company may, if and whenever it shall so elect, by delivery of
instructions signed on its behalf by its President or any Vice President,
instruct the Trustee or any paying agent to call all or any part of the
Junior Subordinated Debentures for redemption and to give notice of
redemption in the manner set forth in this Section, such notice to be in the
name of the Company or in the name of the Trustee or the paying agent, as the
Trustee or such paying agent may deem advisable. In any case in which notice
of redemption is to be given by the Trustee or any such paying agent, the
Company shall deliver or cause to be delivered to, or permit to remain with,
the Trustee or such paying agent, as the case may be, such Securities
Register, transfer books or other records, or suitable copies or extracts
therefrom, sufficient to enable the Trustee or such paying agent to give any
notice by mail that may be required under the provisions of this Section.
3.5 PAYMENT UPON REDEMPTION.
(a) If the giving of notice of redemption shall have been completed as
above provided, the Junior Subordinated Debentures or portions of Junior
Subordinated Debentures to be redeemed specified in such notice shall become
due and payable on the date and at the place stated in such notice at the
Redemption Price (which includes interest accrued to the date fixed for
redemption) and interest on such Junior Subordinated Debentures or portions
of Junior Subordinated Debentures shall cease to accrue on and after the date
fixed for redemption, unless the Company shall default in the payment of such
Redemption Price with respect to any such Junior Subordinated Debenture or
portion thereof. On presentation and surrender of such Junior Subordinated
13
Debentures on or after the date fixed for redemption at the place of payment
specified in the notice, such Junior Subordinated Debentures shall be paid
and redeemed at the Redemption Price (which includes the interest accrued
thereon to the date fixed for redemption) (but if the date fixed for
redemption is an Interest Payment Date, the interest installment payable on
such date shall be payable to the registered Holder at the close of business
on the applicable record date pursuant to Section 2.5(a)).
(b) Upon presentation of any Junior Subordinated Debenture that is to be
redeemed in part only, the Company shall execute and the Trustee shall
authenticate and the office or agency where the Junior Subordinated Debenture
is presented shall deliver to the Holder thereof, at the expense of the
Company, a new Junior Subordinated Debenture or Junior Subordinated
Debentures of authorized denominations in principal amount equal to the
unredeemed portion of the Junior Subordinated Debenture so presented.
3.6 NO SINKING FUND. The Junior Subordinated Debentures are not
entitled to the benefit of any sinking fund.
ARTICLE IV
EXTENSION OF INTEREST PAYMENT PERIOD
4.1 EXTENSION OF INTEREST PAYMENT PERIOD. So long as no Event of
Default has occurred and is continuing, the Company shall have the right, at
any time and from time to time during the term of the Junior Subordinated
Debentures, to defer payments of interest by extending the interest payment
period of such Junior Subordinated Debentures for a period not exceeding 20
consecutive quarters (the "Extended Interest Payment Period"), during which
Extended Interest Payment Period no interest shall be due and payable;
provided that no Extended Interest Payment Period may extend beyond the
Maturity Date. To the extent permitted by applicable law, interest, the
payment of which has been deferred because of the extension of the interest
payment period pursuant to this Section 4.1, will bear interest thereon at
the Coupon Rate compounded quarterly for each quarter of the Extended
Interest Payment Period ("Compounded Interest"). At the end of the Extended
Interest Payment Period, the Company shall pay all interest accrued and
unpaid on the Junior Subordinated Debentures, including any Additional Sums
and Compounded Interest (together, "Deferred Interest") that shall be payable
to the Holders of the Junior Subordinated Debentures in whose names the
Subordinated Debentures are registered in the Securities Register on the
first record date after the end of the Extended Interest Payment Period.
Before the termination of any Extended Interest Payment Period, the Company
may further extend such period, provided that such period together with all
such further extensions thereof shall not exceed 20 consecutive quarters, or
extend beyond the Maturity Date. Upon the termination of any Extended
Interest Payment Period and upon the payment of all Deferred Interest then
due, the Company may commence a new Extended Interest Payment Period, subject
to the foregoing requirements. No interest shall be due and payable during
an Extended Interest Payment Period, except at the end thereof, but the
Company may prepay at any time all or any portion of the interest accrued
during an Extended Interest Payment Period.
4.2 NOTICE OF EXTENSION.
(a) If the Property Trustee is the only registered Holder of the Junior
Subordinated Debentures at the time the Company selects an Extended Interest
Payment Period, the Company shall give written notice to the Administrative
Trustees, the Property Trustee and the Trustee of its selection of such
Extended Interest Payment Period one Business Day before the earlier of (i)
the next succeeding date on which Distributions are payable, or (ii) the date
the Trust is required to give notice of the record date, or the date such
Distributions are payable, to the Capital Securities holders or to the Nasdaq
National Market or other applicable self regulatory organization, if any, but
in any event at least one Business Day before such record date.
14
(b) If the Property Trustee is not the only Holder of the Junior
Subordinated Debentures at the time the Company selects an Extended Interest
Payment Period, the Company shall give the Holders of the Junior Subordinated
Debentures and the Trustee written notice of its selection of such Extended
Interest Payment Period at least one Business Day before the earlier of (i)
the next succeeding Interest Payment Date, or (ii) the date the Company is
required to give notice of the record or payment date of such interest
payment to the Holders of the Junior Subordinated Debentures or to the Nasdaq
National Market or other applicable self regulatory organization, if any.
(c) The quarter in which any notice is given pursuant to paragraph (a)
or paragraph (b) of this Section 4.2 shall be counted as one of the 20
quarters permitted in the maximum Extended Interest Payment Period permitted
under Section 4.1.
4.3 LIMITATION OF TRANSACTIONS DURING EXTENSION. If: (i) the Company
shall exercise its right to defer payment of interest as provided in Section
4.1; or (ii) there shall have occurred any Event of Default, then the Company
shall be subject to the restrictions on payments set forth under Section 5.6.
ARTICLE V
PARTICULAR COVENANTS OF THE COMPANY
5.1 PAYMENT OF PRINCIPAL AND INTEREST. The Company will duly and
punctually pay or cause to be paid the principal of and interest on the
Junior Subordinated Debentures at the time and place and in the manner
provided herein and established with respect to such Junior Subordinated
Debentures.
5.2 MAINTENANCE OF AGENCY. So long as any Junior Subordinated
Debentures remain Outstanding, the Company agrees to maintain an office or
agency in Fargo, North Dakota, or at such other location or locations as may
be designated as provided in this Section 5.2, where (i) Junior Subordinated
Debentures may be presented for payment, (ii) Junior Subordinated Debentures
may be presented as hereinabove authorized for registration of transfer and
exchange, and (iii) notices and demands to or upon the Company in respect of
the Junior Subordinated Debentures and this Indenture may be given or served,
such designation to continue with respect to such office or agency until the
Company shall, by written notice signed by its President or a Vice President
and delivered to the Trustee, designate some other office or agency for such
purposes or any of them. If at any time the Company shall fail to maintain
any such required office or agency or shall fail to furnish the Trustee with
the address thereof, such presentations, 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, notices
and demands.
5.3 PAYING AGENTS.
(a) If the Company shall appoint one or more paying agents for the
Junior Subordinated Debentures, other than the Trustee, the Company will
cause each such paying agent to execute and deliver to the Trustee an
instrument in which such agent shall agree with the Trustee, subject to the
provisions of this Section:
(i) that it will hold all sums held by it as such agent for
the payment of the principal of or interest on the Junior
Subordinated Debentures (whether such sums have been paid to it
by the Company or by any other obligor) in trust for the benefit
of the Persons entitled thereto;
(ii) that it will give the Trustee notice of any failure by
the Company (or by any other obligor) to make any payment of the
principal of or interest on the Junior Subordinated Debentures
when the same shall be due and payable;
15
(iii) that it will, at any time during the continuance
of any failure referred to in the preceding paragraph (a)(ii)
above, upon the written request of the Trustee, forthwith pay to
the Trustee all sums so held in trust by such paying agent; and
(iv) that it will perform all other duties of paying agent
as set forth in this Indenture.
(b) If the Company shall act as its own paying agent with respect to the
Junior Subordinated Debentures, it will on or before each due date of the
principal of or interest on Junior Subordinated Debentures, set aside,
segregate and hold in trust for the benefit of the Persons entitled thereto a
sum sufficient to pay such principal or 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 such action, or any failure
(by it or any other obligor) to take such action. Whenever the Company shall
have one or more paying agents for the Junior Subordinated Debentures, it
will, prior to each due date of the principal of or interest on the Junior
Subordinated Debentures, deposit with the paying agent a sum sufficient to
pay the principal or interest so becoming due, such sum to be held in trust
for the benefit of the Persons entitled to such principal or interest, and
(unless such paying agent is the Trustee) the Company will promptly notify
the Trustee of this action or failure so to act.
(c) Notwithstanding anything in this Section to the contrary, (i) the
agreement to hold sums in trust as provided in this Section is subject to the
provisions of Section 13.5, and (ii) 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 direct any paying agent to pay, to the Trustee all
sums held in trust by the Company or such paying agent, such sums to be held
by the Trustee upon the same terms and conditions 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.
5.4 APPOINTMENT TO FILL VACANCY IN OFFICE OF TRUSTEE. The Company,
whenever necessary to avoid or fill a vacancy in the office of Trustee, will
appoint, in the manner provided in Section 9.10, a Trustee, so that there
shall at all times be a Trustee hereunder.
5.5 COMPLIANCE WITH CONSOLIDATION PROVISIONS. The Company will not,
while any of the Junior Subordinated Debentures remain Outstanding,
consolidate with, or merge into, or merge into itself, or sell or convey all
or substantially all of its property to any other company unless the
provisions of Article Twelve hereof are complied with.
5.6 RESTRICTIONS ON CERTAIN PAYMENTS. If at any time (i) there shall
have occurred any event of which the Company has actual knowledge that (a)
with the giving of notice or the lapse of time, or both, would constitute an
Event of Default and (b) in respect to which the Company shall not have taken
reasonable steps to cure, or (ii) the Company shall have given notice of its
election of an Extended Interest Payment Period as provided herein with
respect to the Junior Subordinated Debentures and shall not have rescinded
such notice, or such Extended Interest Payment Period, or any extension
thereof, shall be continuing; or (iii) while the Junior Subordinated
Debentures are held by the Trust, the Company shall be in default with
respect to its payment of any obligation under the Capital Securities
Guarantee, then the Company will not (1) 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 (2) make any payment
of principal, interest or premium, if any, on or repay, repurchase or redeem
any debt securities of the Company (including the Junior Subordinated
Debentures) that rank pari passu with or junior in interest to the Junior
Subordinated Debentures or make any guarantee payments with respect to any
guarantee by the Company of the debt securities of any subsidiary of the
Company if such guarantee ranks pari passu or junior in interest to the
Junior Subordinated Debentures (other than (a) dividends or distributions in
common stock, (b) any declaration of a dividend in connection with the
implementation of a shareholders' rights plan, or the issuance of stock under
any such plan in the future or the redemption or
16
repurchase of any such rights pursuant thereto, (c) payments under the
Capital Securities Guarantee and (d) purchases of common stock related to the
issuance of common stock or rights under any of the Company's benefit plans
for its directors, officers or employees).
5.7 COVENANTS AS TO THE TRUST. For so long as the Trust
Securities of the Trust remain outstanding, the Company will (i)
maintain 100% direct or indirect ownership of the Common Securities of
the Trust; provided, however, that any permitted successor of the
Company under this Indenture may succeed to the Company's ownership of
the Common Securities, (ii) use its reasonable efforts to cause the
Trust (a) to remain a business trust, except in connection with a
distribution of Securities, the redemption of all of the Trust
Securities of the Trust or certain mergers, consolidations or
amalgamations, each as permitted by the Trust Agreement, and (b) to
otherwise continue not to be treated as an association taxable as a
corporation or partnership for United States federal income tax
purposes and (iii) to use its reasonable efforts to cause each Holder
of Trust Securities to be treated as owning an individual beneficial
interest in the Securities.
If the Junior Subordinated Debentures are to be issued as a
Global Subordinated Debenture in connection with the distribution of
the Junior Subordinated Debentures to the holders of the Capital
Securities issued by the Trust upon a Dissolution Event, the Company
will use its best efforts to list such Junior Subordinated Debentures
on the Nasdaq National Market or on such other exchange as the Capital
Securities may then be listed.
ARTICLE VI
SECURITYHOLDERS' LISTS AND REPORTS
BY THE COMPANY AND THE TRUSTEE
6.1 COMPANY TO FURNISH TRUSTEE NAMES AND ADDRESSES OF
SECURITYHOLDERS. The Company will furnish or cause to be furnished to
the Trustee (a) on a monthly basis on each regular record date (as
defined in Section 2.5(a)) a list, in such form as the Trustee may
reasonably require, of the names and addresses of the Holders as of
such regular record date, provided that the Company shall not be
obligated to furnish or cause to furnish such list at any time that
the list shall not differ in any respect from the most recent list
furnished to the Trustee by the Company 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 more than 15 days prior to the time such list is
furnished; provided, however, that, in either case, no such list need
be furnished if the Trustee shall be the Security Registrar.
6.2 PRESERVATION OF INFORMATION; COMMUNICATIONS WITH
SECURITYHOLDERS.
(a) The Trustee shall preserve, in as current a form as is
reasonably practicable, all information as to the names and addresses
of the Holders contained in the most recent list furnished to it as
provided in Section 6.1 and as to the names and addresses of Holders
received by the Trustee in its capacity as Security Registrar (if
acting in such capacity).
(b) The Trustee may destroy any list furnished to it as provided
in Section 6.1 upon receipt of a new list so furnished.
(c) Securityholders may communicate as provided in Section
312(b) of the Trust Indenture Act with other Securityholders with
respect to their rights under this Indenture or under the Junior
Subordinated Debentures.
17
6.3 REPORTS BY THE COMPANY.
(a) The Company covenants and agrees to file with the Trustee, within 15
days after the Company is required to file the same with the Commission,
copies of the annual reports and of the information, documents and other
reports (or copies of such portions of any of the foregoing as the Commission
may from time to time by rules and regulations prescribe) that the Company
may be required to file with the Commission pursuant to Section 13 or Section
15(d) of the Exchange Act; or, if the Company is not required to file
information, documents or reports pursuant to either of such sections, then
to file with the Trustee and the Commission, in accordance with the rules and
regulations prescribed from time to time by the Commission, such of the
supplementary and periodic information, documents and reports that may be
required pursuant to any applicable rules and regulations of the Commission.
(b) The Company covenants and agrees to file with the Trustee and the
Commission, in accordance with the rules and regulations prescribed from to
time by the Commission, such additional information, documents and reports
with respect to compliance by the Company with the conditions and covenants
provided for in this Indenture as may be required from time to time by such
rules and regulations.
(c) The Company covenants and agrees to transmit by mail, first-class
postage prepaid, or reputable over-night delivery service that provides for
evidence of receipt, to the Securityholders, as their names and addresses
appear upon the Securities Register, within 30 days after the filing thereof
with the Trustee, such summaries of any information, documents and reports
required to be filed by the Company pursuant to subsections (a) and (b) of
this Section as may be required by rules and regulations prescribed from time
to time by the Commission.
6.4 REPORTS BY THE TRUSTEE.
(a) On or before January 31 in each year in which any of the Junior
Subordinated Debentures are Outstanding, the Trustee shall transmit by mail,
first class postage prepaid, to the Securityholders, as their names and
addresses appear upon the Securities Register, a brief report dated as of the
preceding December 31, if and to the extent required under Section 313(a) of
the Trust Indenture Act.
(b) The Trustee shall comply with Section 313(b) and 313(c) of the Trust
Indenture Act.
(c) A copy of each such report shall, at the time of such transmission
to Securityholders, be filed by the Trustee with the Company, and also with
the Commission.
ARTICLE VII
REMEDIES OF THE TRUSTEE AND
SECURITYHOLDERS ON EVENT OF DEFAULT
7.1 EVENTS OF DEFAULT.
(a) Whenever used herein, "Event of Default" means any one or
more of the following events that has occurred and is continuing:
(i) the Company defaults in the payment of any installment
of interest upon any of the Junior Subordinated Debentures, as
and when the same shall become due and payable, and continuance
of such default for a period of 30 days; provided, however, that
a valid extension of an interest payment
18
period by the Company in accordance with the terms of this Indenture
shall not constitute a default in the payment of interest for this
purpose;
(ii) the Company defaults in the payment of the principal of
any of the Junior Subordinated Debentures as and when the same
shall become due and payable whether at maturity, upon
redemption, by declaration or otherwise;
(iii) the Company fails to observe or perform any other
of its covenants or agreements hereunder with respect to the
Junior Subordinated Debentures for a period of 90 days after the
date on which written notice of such failure, requiring the same
to be remedied and stating that such notice is a "Notice of
Default" hereunder, 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 principal amount of
the Junior Subordinated Debentures at the time Outstanding;
(iv) the Company pursuant to or within the meaning of any
Bankruptcy Law (1) commences a voluntary case, (2) consents to
the entry of an order for relief against it in an involuntary
case, (3) consents to the appointment of a custodian of it or for
all or substantially all of its property or (4) makes a general
assignment for the benefit of its creditors;
(v) a court of competent jurisdiction enters an order under
any Bankruptcy Law that (1) is for relief against the Company in
an involuntary case, (2) appoints a custodian of the Company for
all or substantially all of its property, or (3) orders the
liquidation of the Company, and the order or decree remains
unstayed and in effect for 90 days; or
(vi) in the event Junior Subordinated Debentures are issued
to the Trust or a trustee of the Trust in connection with the
issuance of Trust Securities by the Trust, the Trust shall have
voluntarily or involuntarily dissolved, wound-up its business or
otherwise terminated its existence, except in connection with (1)
the distribution of Junior Subordinated Debentures to holders of
Trust Securities in liquidation of their interests in the Trust,
(2) the redemption of all of the outstanding Trust Securities of
the Trust or (3) certain mergers, consolidations or
amalgamations, each as permitted by the Trust Agreement.
(b) In each and every such case, unless the principal of all the Junior
Subordinated Debentures shall have already become due and payable, either the
Trustee or the Holders of not less than 25% in aggregate principal amount of
the Junior Subordinated Debentures then Outstanding hereunder, by notice in
writing to the Company (and to the Trustee if given by such Securityholders)
may declare the principal of all the Junior Subordinated Debentures to be due
and payable immediately, and upon any such declaration the same shall become
and shall be immediately due and payable, notwithstanding anything contained
in this Indenture or in the Junior Subordinated Debentures to the contrary.
(c) At any time after the principal of the Junior Subordinated
Debentures shall have been so declared due and payable, and before any
judgment or decree for the payment of the moneys due shall have been obtained
or entered as hereinafter provided, the Holders of a majority in aggregate
principal amount of the Junior Subordinated Debentures then Outstanding, by
written notice to the Company and the Trustee, may rescind and annul such
declaration and its consequences if: (i) the Company has paid or deposited
with the Trustee a sum sufficient to pay all matured installments of interest
upon all the Junior Subordinated Debentures and the principal of any and all
Junior Subordinated Debentures that shall have become due otherwise than by
acceleration (with interest upon such principal and, to the extent that such
payment is enforceable under applicable law, upon overdue installments of
interest, at the rate per annum expressed in the Junior Subordinated
Debentures to the date of such payment or deposit) and the amount payable to
the Trustee under Section 9.6, and
19
(ii) any and all Events of Default under this Indenture, other than the
nonpayment of principal on Junior Subordinated Debentures that shall not
have become due by their terms, shall have been remedied or waived as
provided in Section 7.6. Should the Holders fail to annul such declaration
and waive such default, then the holders of a majority in aggregate
Liquidation Amount of the Capital Securities shall have such right.
No such rescission and annulment shall extend to or shall affect any
subsequent default or impair any right consequent thereon.
(d) In case the Trustee shall have proceeded to enforce any right with
respect to Junior Subordinated Debentures under this Indenture and such
proceedings shall have been discontinued or abandoned because of such
rescission or annulment or for any other reason or shall have been determined
adversely to the Trustee, then and in every such case the Company and the
Trustee shall be restored respectively to their former positions and rights
hereunder, and all rights, remedies and powers of the Company and the Trustee
shall continue as though no such proceedings had been taken.
7.2 COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY TRUSTEE.
(a) The Company covenants that (i) in case it shall default in the
payment of any installment of interest on any of the Junior Subordinated
Debentures as and when the same shall have become due and payable, and such
default shall have continued for a period of 90 Business Days, or (ii) in
case it shall default in the payment of the principal of any of the Junior
Subordinated Debentures when the same shall have become due and payable,
whether upon maturity of the Junior Subordinated Debentures or upon
redemption or upon declaration or otherwise, then, upon demand of the
Trustee, the Company will pay to the Trustee, for the benefit of the Holders
of the Junior Subordinated Debentures, the whole amount that then shall have
become due and payable on all such Junior Subordinated Debentures for
principal or interest, or both, as the case may be, with interest upon the
overdue principal and (to the extent that payment of such interest is
enforceable under applicable law and, if the Junior Subordinated Debentures
are held by the Trust or a trustee of the Trust, without duplication of any
other amounts paid by the Trust or trustee in respect thereof) upon overdue
installments of interest at the rate per annum expressed in the Junior
Subordinated Debentures; and, in addition thereto, such further amount as
shall be sufficient to cover the costs and expenses of collection, and the
amount payable to the Trustee under Section 9.6.
(b) If the Company shall fail to pay such amounts forthwith upon such
demand, the Trustee, in its own name and as trustee of an express trust,
shall be entitled and empowered to institute any action or proceedings at law
or in equity for the collection of the sums so due and unpaid, and may
prosecute any such action or proceeding to judgment or final decree, and may
enforce any such judgment or final decree against the Company or other
obligor upon the Junior Subordinated Debentures and collect the moneys
adjudged or decreed to be payable in the manner provided by law out of the
property of the Company or other obligor upon the Junior Subordinated
Debentures, wherever situated.
(c) In case of any receivership, insolvency, liquidation, bankruptcy,
reorganization, readjustment, arrangement, composition or judicial
proceedings affecting the Company or the creditors or property of either, the
Trustee shall have power to intervene in such proceedings and take any action
therein that may be permitted by the court and shall (except as may be
otherwise provided by law) be entitled to file such proofs of claim and other
papers and documents as may be necessary or advisable in order to have the
claims of the Trustee and of the Holders of Junior Subordinated Debentures
allowed for the entire amount due and payable by the Company under this
Indenture at the date of institution of such proceedings and for any
additional amount that may become due and payable by the Company after such
date, and to collect and receive any moneys or other property payable or
deliverable on any such claim, and to distribute the same after the deduction
of the amount payable to the Trustee under Section 9.6; and any receiver,
assignee or trustee in bankruptcy or reorganization is hereby
20
authorized by each of the Holders to make such payments to the Trustee, and,
in the event that the Trustee shall consent to the making of such payments
directly to such Securityholders, to pay to the Trustee any amount due it
under Section 9.6.
(d) All rights of action and of asserting claims under this Indenture
may be enforced by the Trustee without the possession of any of the Junior
Subordinated Debentures, or the production thereof at any trial or other
proceeding relative thereto, and any such suit or proceeding instituted by
the Trustee shall be brought in its own name as trustee of an express trust,
and any recovery of judgment shall, after provision for payment to the
Trustee of any amounts due under Section 9.6, be for the ratable benefit of
the Holders of the Junior Subordinated Debentures.
In case of an Event of Default hereunder, the Trustee may in its
discretion proceed to protect and enforce the rights vested in it by this
Indenture by such appropriate judicial proceedings as the Trustee shall deem
most effectual to protect and enforce any of such rights, either at law or in
equity or in bankruptcy or otherwise, whether for the specific enforcement of
any covenant or agreement contained in this Indenture or in aid of the
exercise of any power granted in this Indenture, or to enforce any other
legal or equitable right vested in the Trustee by this Indenture or by law.
Nothing contained herein shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Securityholder
any plan of reorganization, arrangement, adjustment or composition affecting
the Junior Subordinated Debentures or the rights of any Holder thereof or to
authorize the Trustee to vote in respect of the claim of any Securityholder
in any such proceeding.
7.3 APPLICATION OF MONEYS COLLECTED. Any moneys collected by the
Trustee pursuant to this Article with respect to the Junior Subordinated
Debentures shall be applied in the following order, at the date or dates
fixed by the Trustee and, in case of the distribution of such moneys on
account of principal or interest, upon presentation of the Junior
Subordinated Debentures, and notation thereon the payment, if only partially
paid, and upon surrender thereof if fully paid:
FIRST: To the payment of costs and expenses of collection and of all
amounts payable to the Trustee under Section 9.6;
SECOND: To the payment of all Senior and Subordinated Debt of the
Company if and to the extent required by Article Sixteen; and
THIRD: To the payment of the amounts then due and unpaid upon Junior
Subordinated Debentures for principal and 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 Junior Subordinated Debentures for principal and interest,
respectively.
7.4 LIMITATION ON SUITS. No Holder shall have any right by virtue of or
by availing any provision of this Indenture to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this
Indenture or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless (i) such Holder previously shall have given to the
Trustee written notice of an Event of Default and of the continuance thereof;
(ii) the Holders of not less than 25% in aggregate principal amount of the
Junior Subordinated Debentures then Outstanding shall have made written
request upon the Trustee to institute such action, suit or proceeding in its
own name as trustee hereunder; (iii) such Holder or Holders shall have
offered to the Trustee such reasonable indemnity as it may require against
the costs, expenses and liabilities to be incurred therein or thereby; and
(iv) the Trustee for 60 days after its receipt of such notice, request and
offer of indemnity shall have failed to institute
21
any such action, suit or proceeding; and (v) during such 60 day period, the
Holders of a majority in principal amount of the Junior Subordinated
Debentures do not give the Trustee a direction inconsistent with the request.
Notwithstanding any other provisions of this Indenture to the contrary,
the right of any Holder to receive payment of the principal of and interest
on the Junior Subordinated Debentures on or after the respective due dates
(or in the case of redemption, on the redemption date), or to institute suit
for the enforcement of any such payment on or after such respective dates or
redemption date, shall not be impaired or affected without the consent of
such Holder; and by accepting a Junior Subordinated Debenture hereunder it is
expressly understood, intended and covenanted by the Holder thereof with
every other such Holder and the Trustee, that no one or more Holders shall
have any right in any manner whatsoever by virtue of or by availing any
provision of this Indenture to affect, disturb or prejudice the rights of any
other Holders, or to obtain or seek to obtain priority over or preference to
any such other Holders, or to enforce any right under this Indenture, except
in the manner herein provided and for the equal, ratable and common benefit
of all Holders of Junior Subordinated Debentures. For the protection and
enforcement of the provisions of this Section, each and every Securityholder
and the Trustee shall be entitled to such relief as can be given either at
law or in equity.
7.5 RIGHTS AND REMEDIES CUMULATIVE; DELAY OR OMISSION NOT WAIVER.
(a) Except as otherwise provided in Section 7.2, all powers and remedies
given by this Article to the Trustee or to the Securityholders shall, to the
extent permitted by law, be deemed cumulative and not exclusive of any other
powers and remedies available to the Trustee or the Holders of the Junior
Subordinated Debentures, by judicial proceedings or otherwise, to enforce the
performance or observance of the covenants and agreements contained in this
Indenture or otherwise established with respect to such Junior Subordinated
Debentures.
(b) No delay or omission of the Trustee or of any Holder of any of the
Junior Subordinated Debentures to exercise any right or power accruing upon
any Event of Default occurring and continuing as aforesaid shall impair any
such right or power, or shall be construed to be a waiver of any such default
or on acquiescence therein; and, subject to the provisions of Section 7.4,
every power and remedy given by this Article or by law to the Trustee or the
Securityholders may be exercised from time to time, and as often as shall be
deemed expedient, by the Trustee or by the Securityholders.
7.6 CONTROL BY SECURITYHOLDERS. The Holders of a majority in aggregate
principal amount of the Junior Subordinated Debentures at the time
Outstanding, determined in accordance with Section 10.4, shall have the right
to direct the time, method and place of conducting any proceeding for any
remedy available to the Trustee, or exercising any trust or power conferred
on the Trustee; provided, however, that such direction shall not be in
conflict with any rule of law or with this Indenture. Subject to the
provisions of Section 9.1, the Trustee shall have the right to decline to
follow any such direction if the Trustee in good faith shall, by a
Responsible Officer or Officers of the Trustee, determine that the proceeding
so directed would involve the Trustee in personal liability. The Holders of
a majority in aggregate principal amount of the Junior Subordinated
Debentures at the time Outstanding affected thereby, determined in accordance
with Section 10.4, may on behalf of the Holders of all of the Junior
Subordinated Debentures waive any past default in the performance of any of
the covenants contained herein and its consequences, except (i) a default in
the payment of the principal of or interest on any of the Junior Subordinated
Debentures as and when the same shall become due by its terms otherwise than
by acceleration (unless such default has been cured and a sum sufficient to
pay all matured installments of interest and principal has been deposited
with the Trustee (in accordance with Section 7.1(c)), (ii) a default in the
covenants contained in Section 5.6 or (iii) in respect of a covenant or
provision hereof which under Article Eleven cannot be modified or amended
without the consent of the Holder of each Outstanding Junior Subordinated
Debenture affected; provided, however, that if the Junior Subordinated
Debentures are held by the Trust or a Trustee of the Trust, such waiver or
modification to such waiver shall not be effective until the Holders of a
22
majority in Liquidation Amount of Trust Securities of the Trust shall have
consented to such waiver or modification to such waiver; provided further,
that if the consent of the Holder of each Outstanding Junior Subordinated
Debentures is required, such waiver shall not be effective until each Holder
of the Trust Securities of the Trust shall have consented to such waiver.
Upon any such waiver, the default covered thereby shall be deemed to be cured
for all purposes of this Indenture and the Company, the Trustee and the
Holders of the Junior Subordinated Debentures shall be restored to their
former positions and rights hereunder, respectively; but no such waiver shall
extend to any subsequent or other default or impair any right consequent
thereon.
7.7 UNDERTAKING TO PAY COSTS. All parties to this Indenture agree, and
each Holder of any Junior Subordinated Debentures by such Holder's 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 Securityholder, or group of
Securityholders, holding more than 10% in aggregate principal amount of the
Outstanding Junior Subordinated Debentures, or to any suit instituted by any
Securityholder for the enforcement of the payment of the principal of or
interest on the Junior Subordinated Debentures on or after the due dates
thereof.
ARTICLE VIII
FORM OF JUNIOR SUBORDINATED DEBENTURE AND ORIGINAL ISSUE
8.1 FORM OF JUNIOR SUBORDINATED DEBENTURE. The Junior Subordinated
Debenture and the Trustee's Certificate of Authentication to be endorsed
thereon are to be substantially in the forms contained as Exhibit A to this
Indenture, attached hereto and incorporated herein by reference.
8.2 ORIGINAL ISSUE OF JUNIOR SUBORDINATED DEBENTURES. Junior
Subordinated Debentures in the aggregate principal amount of $
may, upon execution of this Indenture, be executed by the Company and
delivered to the Trustee for authentication, and the Trustee shall thereupon
authenticate and deliver the Junior Subordinated Debentures to or upon the
written order of the Company, signed by its Chairman, its Vice Chairman, its
President, any Vice President or its Chief Financial Officer, without any
further action by the Company.
ARTICLE IX
CONCERNING THE TRUSTEE
9.1 CERTAIN DUTIES AND RESPONSIBILITIES OF THE TRUSTEE.
(a) The Trustee, prior to the occurrence of an Event of Default and
after the curing of all Events of Default that may have occurred, shall
undertake to perform with respect to the Junior Subordinated Debentures such
duties and only such duties as are specifically set forth in this Indenture,
and no implied covenants shall be read into this Indenture against the
Trustee. In case an Event of Default has occurred (that has not been cured
or waived), 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 man would exercise or use under the circumstances in
the conduct of his own affairs.
23
(b) 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:
(i) prior to the occurrence of an 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 Trustee shall be
determined solely by the express provisions of this Indenture, and
the Trustee shall not be liable except for the performance of such
duties and obligations 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 the part of the Trustee,
the 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 Trustee and
conforming to the requirements of this Indenture; but in the case
of any such certificates or opinions that by any provision hereof
are specifically required to be furnished to the Trustee, the
Trustee shall be under a duty to examine the same to determine
whether or not they conform to the requirement of this Indenture;
(ii) the Trustee shall not be liable for any error of judgment made
in good faith by a Responsible Officer or Responsible Officers of the
Trustee, unless it shall be proved that the Trustee was negligent in
ascertaining the pertinent facts;
(iii) the Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with the
direction of the Holders of not less than a majority in principal amount
of the Junior Subordinated Debentures at the time Outstanding 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; and
(iv) none of the provisions contained in this Indenture shall
require the 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 there is reasonable
ground for believing that the repayment of such funds or liability is
not reasonably assured to it under the terms of this Indenture or
adequate indemnity against such risk is not reasonably assured to it.
9.2 CERTAIN RIGHTS OF TRUSTEE. Except as otherwise provided in
Section 9.1:
(a) The Trustee may rely and shall be protected in acting or refraining
from acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, consent, order, approval, bond, 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;
(b) Any request, direction, order or demand of the Company mentioned
herein shall be sufficiently evidenced by a Board Resolution or an instrument
signed in the name of the Company by the President or any Vice President and
by the Secretary or an Assistant Secretary or the Chief Financial Officer
thereof (unless other evidence in respect thereof is specifically prescribed
herein);
(c) The Trustee may consult with counsel and the written advice of such
counsel or any Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken or suffered or omitted
hereunder in good faith and in reliance thereon;
24
(d) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Securityholders, pursuant to the provisions of this
Indenture, unless such Securityholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
that may be incurred therein or thereby; nothing contained herein shall,
however, relieve the Trustee of the obligation, upon the occurrence of an
Event of Default (that has not been cured or waived) to exercise such of the
rights and powers vested in it by this Indenture, and to use the same degree
of care and skill in their exercise as a prudent man would exercise or use
under the circumstances in the conduct of his own affairs;
(e) The Trustee shall not be liable for any action taken or omitted to
be taken by it in good faith and believed by it to be authorized or within
the discretion or rights or powers conferred upon it by this Indenture;
(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, consent, order, approval, bond,
security, or other papers or documents, unless requested in writing so to do
by the Holders of not less than a majority in principal amount of the
Outstanding Junior Subordinated Debentures (determined as provided in Section
10.4); provided, however, that if the payment within a reasonable time to the
Trustee of the costs, expenses or liabilities likely to be incurred by it in
the making of such investigation is, in the opinion of the Trustee, not
reasonably assured to the Trustee by the security afforded to it by the terms
of this Indenture, the Trustee may require reasonable indemnity against such
costs, expenses or liabilities as a condition to so proceeding. The
reasonable expense of every such examination shall be paid by the Company or,
if paid by the Trustee, shall be repaid by the Company upon demand; and
(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.
9.3 TRUSTEE NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF THE JUNIOR
SUBORDINATED DEBENTURES.
(a) The recitals contained herein and in the Junior Subordinated
Debentures shall be taken as the statements of the Company and the Trustee
assumes no responsibility for the correctness of the same.
(b) The Trustee makes no representations as to the validity or
sufficiency of this Indenture or of the Junior Subordinated Debentures.
(c) The Trustee shall not be accountable for the use or application by
the Company of any of the Junior Subordinated Debentures or of the proceeds
of such Junior Subordinated Debentures, or for the use or application of any
moneys paid over by the Trustee in accordance with any provision of this
Indenture, or for the use or application of any moneys received by any paying
agent other than the Trustee.
9.4 MAY HOLD JUNIOR SUBORDINATED DEBENTURES. The Trustee or any paying
agent or Securities Registrar, in its individual or any other capacity, may
become the owner or pledgee of Junior Subordinated Debentures with the same
rights it would have if it were not Trustee, paying agent or Securities
Registrar.
9.5 MONEYS HELD IN TRUST. Subject to the provisions of Section 13.5,
all moneys received by the Trustee shall, until used or applied as herein
provided, be held in trust for the purposes for which they were received, but
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 moneys received
by it hereunder except such as it may agree with the Company to pay thereon.
25
9.6 COMPENSATION AND REIMBURSEMENT.
(a) The Company covenants and agrees to pay to the Trustee, and the
Trustee shall be entitled to, such reasonable compensation (which shall not
be limited by any provision of law in regard to the compensation of a trustee
of an express trust), as the Company and the Trustee may from time to time
agree in writing, for all services rendered by it in the execution of the
trusts hereby created and in the exercise and performance of any of the
powers and duties hereunder of the Trustee, and, except as otherwise
expressly provided herein, the Company will pay or reimburse the Trustee upon
its request for all reasonable expenses, disbursements and advances incurred
or made by the Trustee in accordance with any of the provisions of this
Indenture (including the reasonable compensation and the expenses and
disbursements of its counsel and of all Persons not regularly in its employ)
except any such expense, disbursement or advance as may arise from its
negligence or bad faith. The Company also covenants to indemnify the Trustee
(and its officers, agents, directors and employees) for, and to hold it
harmless against, any loss, liability or expense incurred without negligence
or bad faith on the part of the Trustee and arising out of or in connection
with the acceptance or administration of this trust, including the costs and
expenses of defending itself against any claim of liability in the premises.
(b) The obligations of the Company under this Section to compensate and
indemnify the Trustee and to pay or reimburse the Trustee for expenses,
disbursements and advances shall constitute additional indebtedness
hereunder. Such additional indebtedness shall be secured by a lien prior to
that of the Junior Subordinated Debentures upon all property and funds held
or collected by the Trustee as such, except funds held in trust for the
benefit of the Holders of the Junior Subordinated Debentures.
9.7 RELIANCE ON OFFICERS' CERTIFICATE. Except as otherwise provided in
Section 9.1, whenever in the administration of the provisions of this
Indenture the Trustee shall deem it necessary or desirable that a matter be
proved or established prior to taking or suffering or omitting to take any
action hereunder, such matter (unless other evidence in respect thereof be
herein specifically prescribed) may, in the absence of negligence or bad
faith on the part of the Trustee, be deemed to be conclusively proved and
established by an Officers' Certificate delivered to the Trustee and such
certificate, in the absence of negligence or bad faith on the part of the
Trustee, shall be full warrant to the Trustee for any action taken, suffered
or omitted to be taken by it under the provisions of this Indenture upon the
faith thereof.
9.8 DISQUALIFICATION; CONFLICTING INTERESTS. If the Trustee has or
shall acquire any "conflicting interest" within the meaning of Section 310(b)
of the Trust Indenture Act, the Trustee and the Company shall in all respects
comply with the provisions of Section 310(b) of the Trust Indenture Act.
9.9 CORPORATE TRUSTEE REQUIRED; ELIGIBILITY. There shall at all times
be a Trustee with respect to the Junior Subordinated Debentures issued
hereunder which shall at all times 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 to act as trustee by the Commission, 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 aforesaid supervising or examining authority,
then for the purposes of this Section, 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. The Company
may not, nor may any Person directly or indirectly controlling, controlled
by, or under common control with the Company, serve as Trustee. In case at
any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section, the Trustee shall resign immediately in the
manner and with the effect specified in Section 9.10.
26
9.10 RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.
(a) The Trustee, or any successor hereafter appointed, may at any time
resign by giving written notice thereof to the Company and by transmitting
notice of resignation by mail, first-class postage prepaid, to the
Securityholders, as their names and addresses appear upon the Securities
Register. Upon receiving such notice of resignation, the Company shall
promptly appoint a successor trustee by written instrument, in duplicate,
executed by order of the Board of Directors, one copy of which instrument
shall be delivered to the resigning Trustee and one copy to the successor
trustee. If no successor trustee shall have been so appointed and have
accepted appointment within 30 days after the mailing of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee, or any
Securityholder who has been a bona fide Holder of Junior Subordinated
Debentures for at least six months may, subject to the provisions of Section
7.7, on behalf of such Securityholder and all other Holders, petition any
such court for the appointment of a successor trustee. Such court may
thereupon, after such notice, if any, as it may deem proper and prescribe,
appoint a successor trustee.
(b) In case at any time any one of the following shall occur:
(i) the Trustee shall fail to comply with the provisions of
Section 9.8 after written request therefor by the Company or by any
Securityholder who has been a bona fide Holder of Junior Subordinated
Debentures for at least six months; or
(ii) the Trustee shall cease to be eligible in accordance with the
provisions of Section 9.9 and shall fail to resign after written request
therefor by the Company or by any such Securityholder; or
(iii) the Trustee shall become incapable of acting, or shall be
adjudged a bankrupt or insolvent, or commence a voluntary bankruptcy
proceeding, or a receiver of the Trustee or of its property shall be
appointed or consented to, 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, then, in any such case, the
Company may remove the Trustee and appoint a successor trustee by
written instrument, in duplicate, executed by order of the Board of
Directors, one copy of which instrument shall be delivered to the
Trustee so removed and one copy to the successor trustee, or, subject to
the provisions of Section 7.7, unless the Trustee's duty to resign is
stayed as provided herein, any Securityholder who has been a bona fide
Holder of Junior Subordinated Debentures for at least six months may, on
behalf of that Holder and all other Holders, petition any court of
competent jurisdiction for the removal of the Trustee and the
appointment of a successor trustee. Such court may thereupon after such
notice, if any, as it may deem proper and prescribe, remove the Trustee
and appoint a successor trustee.
(c) The Holders of a majority in aggregate principal amount of the
Junior Subordinated Debentures at the time Outstanding may at any time remove
the Trustee by so notifying the Trustee and the Company and may appoint a
successor Trustee with the consent of the Company.
(d) Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section shall
become effective upon acceptance of appointment by the successor trustee as
provided in Section 9.11.
9.11 ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.
(a) In case of the appointment hereunder of a successor trustee, 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
27
effective and such successor trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Trustee; but, on the request of the Company or the
successor trustee, such retiring Trustee shall, upon payment of its charges,
execute and deliver an instrument transferring to such successor trustee all
the rights, powers, and trusts of the retiring Trustee and shall duly assign,
transfer and deliver to such successor trustee all property and money held by
such retiring Trustee hereunder.
(b) Upon request of any such successor trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor trustee all such rights, powers and trusts
referred to in paragraph (a) of this Section.
(c) No successor trustee shall accept its appointment unless at the time
of such acceptance such successor trustee shall be qualified and eligible
under this Article.
(d) Upon acceptance of appointment by a successor trustee as provided in
this Section, the Company shall transmit notice of the succession of such
trustee hereunder by mail, first-class postage prepaid, to the
Securityholders, as their names and addresses appear upon the Securities
Register. If the Company fails to transmit such notice within ten days after
acceptance of appointment by the successor trustee, the successor trustee
shall cause such notice to be transmitted at the expense of the Company.
9.12 MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS. Any
corporation into which the Trustee may be merged or converted or with which
it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to the corporate trust business of the Trustee, shall
be the successor of the Trustee hereunder, provided that such corporation
shall be qualified and eligible under the provisions of this Article Nine,
without the execution or filing of any paper or any further act on the part
of any of the parties hereto, anything herein to the contrary
notwithstanding. In case any Junior Subordinated Debentures 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 Junior Subordinated
Debentures so authenticated with the same effect as if such successor Trustee
had itself authenticated such Junior Subordinated Debentures.
9.13 PREFERENTIAL COLLECTION OF CLAIMS AGAINST THE COMPANY. The Trustee
shall comply with Section 311(a) of the Trust Indenture Act, excluding any
creditor relationship described in Section 311(b) of the Trust Indenture Act.
A Trustee who has resigned or been removed shall be subject to Section
311(a) of the Trust Indenture Act to the extent included therein.
9.14 APPOINTMENT OF AUTHENTICATING AGENT. At any time when any of the
Junior Subordinated Debentures remain Outstanding, the Trustee may appoint an
Authenticating Agent or Agents which shall be authorized to act on behalf of
the Trustee to authenticate Junior Subordinated Debentures issued upon
original issuance, exchange, registration of transfer or partial redemption
thereof or pursuant to Section 2.8, and Junior Subordinated Debentures 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 Junior Subordinated Debentures 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 and a certificate of authentication executed on behalf
of the Trustee by an Authenticating Agent. Each Authenticating Agent shall
be acceptable to the Company and shall at all times be a corporation
organized and doing business under the laws of the United States of America,
any State thereof or the District of Columbia, authorized under such laws to
act as Authenticating Agent, having a combined capital and surplus of not
less than $10,000,000 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 such supervision
or examining authority, for the purposes of this Section, the combined
capital
28
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 corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating
Agent shall be a party, or any corporation succeeding to the corporate agency
or corporate trust business of an Authenticating Agent, shall continue to be
an Authenticating Agent, provided such corporation 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
notice of resignation or upon such 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 mail
written notice of such appointment by first-class mail, postage prepaid, to
all Securityholders as their names and addresses appear in the Securities
Register. Any successor Authenticating Agent upon acceptance of its
appointment hereunder shall become vested with all the rights, powers and
duties of its predecessor hereunder, with the like effect as if originally
named as an Authenticating Agent herein. No successor Authenticating Agent
shall be appointed unless eligible under the provisions of this Section.
The Trustee 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 payments, subject to the
provisions of Section 9.6.
If an appointment is made pursuant to this Section, the Junior
Subordinated Debentures may have endorsed thereon, in lieu of the form of
certificate of authentication set forth in Section 8.1, a certificate of
authentication in the following form:
"This is one of the Junior Subordinated Debentures described in the
within mentioned Indenture."
-----------------------------------------
As Trustee
By
--------------------------------------
As Authenticating Agent
By
--------------------------------------
Authorized Signature
29
ARTICLE X
CONCERNING THE SECURITYHOLDERS
10.1 EVIDENCE OF ACTION BY SECURITYHOLDERS. Whenever in this Indenture
it is provided that the Holders of a majority or specified percentage in
aggregate principal amount of the Junior Subordinated Debentures may take any
action (including the making of any demand or request, the giving of any
notice, consent or waiver or the taking of any other action), the fact that
at the time of taking any such action the Holders of such majority or
specified percentage have joined therein may be evidenced by any instrument
or any number of instruments of similar tenor executed by such Holders in
Person or by agent or proxy appointed in writing.
If the Company shall solicit from the Securityholders any request,
demand, authorization, direction, notice, consent, waiver or other action,
the Company may, at its option, as evidenced by an Officers' Certificate, fix
in advance a record date for the determination of Securityholders entitled to
give such request, demand, authorization, direction, notice, consent, waiver
or other action, but the Company shall have no obligation to do so. If such
a record date is fixed, such request, demand, authorization, direction,
notice, consent, waiver or other action may be given before or after the
record date, but only the Securityholders of record at the close of business
on the record date shall be deemed to be Securityholders for the purposes of
determining whether Securityholders of the requisite proportion of
Outstanding Junior Subordinated Debentures have authorized or agreed or
consented to such request, demand, authorization, direction, notice, consent,
waiver or other action, and for that purpose the Outstanding Junior
Subordinated Debentures shall be computed as of the record date; provided,
however, that no such authorization, agreement or consent by such
Securityholders on the record date shall be deemed effective unless it shall
become effective pursuant to the provisions of this Indenture not later than
six months after the record date.
10.2 PROOF OF EXECUTION BY SECURITYHOLDERS. Subject to the provisions of
Section 6.1, proof of the execution of any instrument by a Securityholder
(such proof will not require notarization) or his agent or proxy and proof of
the holding by any Person of any of the Junior Subordinated Debentures shall
be sufficient if made in the following manner:
(a) The fact and date of the execution by any such Person of any
instrument may be proved in any reasonable manner acceptable to the Trustee.
(b) The ownership of Junior Subordinated Debentures shall be proved by
the Securities Register or by a certificate of the Securities Registrar
thereof.
(c) The Trustee may require such additional proof of any matter referred
to in this Section as it shall deem necessary.
10.3 WHO MAY BE DEEMED OWNERS. Prior to the due presentment for
registration of transfer of any Junior Subordinated Debenture, the Company,
the Trustee, any paying agent and any Securities Registrar may deem and treat
the Person in whose name such Junior Subordinated Debenture shall be
registered upon the books of the Company as the absolute owner of such Junior
Subordinated Debenture (whether or not such Junior Subordinated Debenture
shall be overdue and notwithstanding any notice of ownership or writing
thereon made by anyone other than the Securities Registrar) for the purpose
of receiving payment of or on account of the principal of and (subject to
Section 2.3) interest on such Junior Subordinated Debenture and for all other
purposes; and neither the Company nor the Trustee nor any paying agent nor
any Securities Registrar shall be affected by any notice to the contrary.
10.4 CERTAIN JUNIOR SUBORDINATED DEBENTURES OWNED BY COMPANY DISREGARDED.
In determining whether the Holders of the requisite aggregate principal
amount of Junior Subordinated Debentures
30
have concurred in any direction, consent or waiver under this Indenture, the
Junior Subordinated Debentures that are owned by the Company or any other
obligor on the Junior Subordinated Debentures or by any Person directly or
indirectly controlling or controlled by or under common control with the
Company or any other obligor on the Junior Subordinated Debentures shall be
disregarded and deemed not to be Outstanding for the purpose of any such
determination, except that for the purpose of determining whether the Trustee
shall be protected in relying on any such direction, consent or waiver, only
Junior Subordinated Debentures that the Trustee actually knows are so owned
shall be so disregarded. The Junior Subordinated Debentures so owned that
have been pledged in good faith may be regarded as Outstanding for the
purposes of this Section, if the pledgee shall establish to the satisfaction
of the Trustee the pledgee's right with respect to such Junior Subordinated
Debentures and that the pledgee is not a Person directly or indirectly
controlling or controlled by or under direct or indirect common control with
the Company or any such other obligor. In case of a dispute as to such
right, any decision by the Trustee taken upon the advice of counsel shall be
full protection to the Trustee.
10.5 ACTIONS BINDING ON FUTURE SECURITYHOLDERS. At any time prior to
(but not after) the evidencing to the Trustee, as provided in Section 10.1,
of the taking of any action by the Holders of the majority or percentage in
aggregate principal amount of the Junior Subordinated Debentures specified in
this Indenture in connection with such action, any Holder who is shown by the
evidence to have consented to such action may, by filing written notice with
the Trustee, and upon proof of holding as provided in Section 10.2, revoke
such action so far as concerns such Holder's Junior Subordinated Debentures.
Except as aforesaid any such action taken by the Holder shall be conclusive
and binding upon such Holder and upon all future Holders and owners of such
Holder's Junior Subordinated Debentures, and of any Junior Subordinated
Debentures issued in exchange therefor, on registration of transfer thereof
or in place thereof, irrespective of whether or not any notation in regard
thereto is made upon such Junior Subordinated Debentures. Any action taken by
the Holders of the majority or percentage in aggregate principal amount of
the Junior Subordinated Debentures specified in this Indenture in connection
with such action shall be conclusively binding upon the Company, the Trustee
and the Holders of all the Junior Subordinated Debentures.
ARTICLE XI
SUPPLEMENTAL INDENTURES
11.1 SUPPLEMENTAL INDENTURES WITHOUT THE CONSENT OF SECURITYHOLDERS. In
addition to any supplemental indenture otherwise authorized by this
Indenture, the Company and the Trustee may from time to time and at any time
enter into an indenture or indentures supplemental hereto (which shall
conform to the provisions of the Trust Indenture Act as then in effect),
without the consent of the Securityholders, for one or more of the following
purposes:
(a) to cure any ambiguity, defect, or inconsistency herein, or in the
Junior Subordinated Debentures, provided that any such action does not
materially adversely affect the interests of the Holders or the holders of
the Capital Securities so long as they remain outstanding;
(b) to comply with Article Twelve;
(c) to provide for uncertificated Junior Subordinated Debentures in
addition to or in place of certificated Junior Subordinated Debentures;
(d) to add to the covenants of the Company for the benefit of the
Holders or to surrender any right or power herein conferred upon the Company;
31
(e) to add to, delete from, or revise the conditions, limitations, and
restrictions on the authorized amount, terms, or purposes of issue,
authentication, and delivery of Junior Subordinated Debentures, as herein set
forth;
(f) to make any change that does not adversely affect the rights of any
Securityholder in any material respect; or
(g) to establish the form of any certifications required to be furnished
pursuant to the terms of this Indenture or to add to the rights of the
Holders.
The Trustee is hereby authorized to join with the Company in the
execution of any such supplemental indenture, and to make any further
appropriate agreements and stipulations that may be therein contained, but
the Trustee 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.
Any supplemental indenture authorized by the provisions of this Section
may be executed by the Company and the Trustee without the consent of the
Holders of any of the Junior Subordinated Debentures at the time Outstanding,
notwithstanding any of the provisions of Section 11.2.
11.2 SUPPLEMENTAL INDENTURES WITH CONSENT OF SECURITYHOLDERS. With the
consent (evidenced as provided in Section 10.1) of the Holders of not less
than a majority in aggregate principal amount of the Junior Subordinated
Debentures at the time Outstanding, the Company, when authorized by Board
Resolutions, and the Trustee may from time to time and at any time enter into
an indenture or indentures supplemental hereto (which shall conform to the
provisions of the Trust Indenture Act as then in effect) for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of any supplemental indenture or of modifying
in any manner not covered by Section 11.1 the rights of the Holders of the
Junior Subordinated Debentures under this Indenture; provided, however, that
no such supplemental indenture shall without the consent of the Holders of
each Junior Subordinated Debenture then Outstanding, (i) change the stated
maturity of the Junior Subordinated Debentures, or reduce the principal
amount thereof, or reduce the rate or extend the time of payment of interest
thereon, or (ii) reduce the percentage of principal amount of Junior
Subordinated Debentures, the Holders of which are required to consent to any
such supplemental indenture; provided, further, that if the Junior
Subordinated Debentures are held by the Trust or a trustee of the Trust, such
supplemental indenture shall not be effective until the holders of a majority
in aggregate Liquidation Amount of Capital Securities shall have consented to
such supplemental indenture; provided further, that if the consent of the
Holder of each Outstanding Junior Subordinated Debenture is required, such
supplemental indenture shall not be effective until each Holder of the Trust
Securities shall have consented to such supplemental indenture.
It shall not be necessary for the consent of the Securityholders to
approve the particular form of any proposed supplemental indenture, but it
shall be sufficient if such consent shall approve the substance thereof.
11.3 EFFECT OF SUPPLEMENTAL INDENTURES. Upon the execution of any
supplemental indenture pursuant to the provisions of this Article or of
Section 12.1, this Indenture shall be and be deemed to be modified and
amended in accordance therewith.
11.4 JUNIOR SUBORDINATED DEBENTURES AFFECTED BY SUPPLEMENTAL INDENTURES.
Junior Subordinated Debentures, affected by a supplemental indenture,
authenticated and delivered after the execution of such supplemental
indenture pursuant to the provisions of this Article or of Section 12.1, may
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
Junior Subordinated Debentures so modified as to conform, in the opinion of
the Board of Directors, to any modification of this Indenture contained in
any such supplemental indenture may be prepared
32
by the Company, authenticated by the Trustee and delivered in exchange for
the Junior Subordinated Debentures then Outstanding.
11.5 EXECUTION OF SUPPLEMENTAL INDENTURES. Upon the request of the
Company, accompanied by Board Resolutions authorizing the execution of any
such supplemental indenture, and upon the filing with the Trustee of evidence
of the consent of Securityholders required to consent thereto as aforesaid,
the Trustee shall join with the Company in the execution of such supplemental
indenture unless such supplemental indenture affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise, in which case
the Trustee may in its discretion but shall not be obligated to enter into
such supplemental indenture. The Trustee, subject to the provisions of
Section 9.1, may receive an Opinion of Counsel as conclusive evidence that
any supplemental indenture executed pursuant to this Article is authorized or
permitted by, and conforms to, the terms of this Article and that it is
proper for the Trustee under the provisions of this Article to join in the
execution thereof.
Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of this Section, the
Trustee shall transmit by mail, first-class postage prepaid, a notice,
setting forth in general terms the substance of such supplemental indenture,
to the Securityholders as their names and addresses appear upon the
Securities Register. Any failure of the Trustee to mail such notice, or any
defect therein, shall not, however, in any way impair or affect the validity
of any such supplemental indenture.
ARTICLE XII
SUCCESSOR CORPORATION
12.1 COMPANY MAY CONSOLIDATE, ETC. 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 (i) in case the Company consolidates with or merges into
another Person or conveys or transfers its properties and assets
substantially as an entirety to any Person, the successor Person is organized
under the laws of the United States or any state or the District of Columbia,
and such successor Person expressly assumes the Company's obligations on the
Junior Subordinated Debentures issued under this Indenture; (ii) immediately
after giving effect thereto, no Event of Default, and no event which, after
notice or lapse of time or both, would become an Event of Default, shall have
occurred and be continuing; and (iii) such successor Person expressly assumes
the due and punctual performance and observance of all the covenants and
conditions of this Indenture to be kept and performed by the Company by
executing and delivering a supplemental indenture in form and substance
satisfactory to the Trustee.
12.2 SUCCESSOR SUBSTITUTED.
(a) In case of any such consolidation, merger, sale, conveyance,
transfer or other disposition and upon the assumption by the successor Person
by supplemental indenture, executed and delivered to the Trustee and
satisfactory in form to the Trustee, of the due and punctual payment of the
principal of and interest on all of the Junior Subordinated Debentures
Outstanding and the due and punctual performance of all of the covenants and
conditions of this Indenture to be performed by the Company, such successor
Person shall succeed to and be substituted for the Company, with the same
effect as if it had been named as the Company herein, and thereupon the
predecessor corporation shall be relieved of all obligations and covenants
under this Indenture and the Junior Subordinated Debentures.
(b) In case of any such consolidation, merger, sale, conveyance,
transfer or other disposition such changes in phraseology and form (but not
in substance) may be made in the Junior Subordinated Debentures thereafter to
be issued as may be appropriate.
33
12.3 EVIDENCE OF CONSOLIDATION, ETC., TO TRUSTEE. The Trustee, subject
to the provisions of Section 9.1, may receive an Opinion of Counsel as
conclusive evidence that any such consolidation, merger, sale, conveyance,
transfer or other disposition, and any such assumption, comply with the
provisions of this Article.
ARTICLE XIII
SATISFACTION AND DISCHARGE
13.1 SATISFACTION AND DISCHARGE OF INDENTURE. If at any time: (a) the
Company shall have delivered to the Trustee for cancellation all Junior
Subordinated Debentures theretofore authenticated (other than any Junior
Subordinated Debentures that shall have been destroyed, lost or stolen and
that shall have been replaced or paid as provided in Section 2.8) and Junior
Subordinated Debentures for whose payment money or Governmental Obligations
have theretofore been deposited in trust or segregated and held in trust by
the Company (and thereupon repaid to the Company or discharged from such
trust, as provided in Section 13.5); or (b) all such Junior Subordinated
Debentures not theretofore delivered to the Trustee for cancellation shall
have become due and payable, or are by their terms to become due and payable
within one year or are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of
redemption, and the Company shall deposit or cause to be deposited with the
Trustee as trust funds the entire amount in moneys or Governmental
Obligations sufficient or a combination thereof sufficient, in the opinion of
a nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, to pay at maturity or
upon redemption all Junior Subordinated Debentures not theretofore delivered
to the Trustee for cancellation, including principal and interest due or to
become due to such date of maturity or date fixed for redemption, as the case
may be, and if the Company shall also pay or cause to be paid all other sums
payable hereunder by the Company; then this Indenture shall thereupon cease
to be of further effect except for the provisions of Sections 2.2, 2.3, 2.4,
2.5, 4.1, 4.2, 4.3 and 9.10, that shall survive until the date of maturity or
redemption date, as the case may be, and Sections 9.6 and 13.5, that shall
survive to such date and thereafter, and the Trustee, on demand of the
Company and at the cost and expense of the Company, shall execute proper
instruments acknowledging satisfaction of and discharging this Indenture.
13.2 DISCHARGE OF OBLIGATIONS. If at any time all such Junior
Subordinated Debentures not theretofore delivered to the Trustee for
cancellation or that have not become due and payable as described in Section
13.1 shall have been paid by the Company by depositing irrevocably with the
Trustee as trust funds moneys or an amount of Governmental Obligations
sufficient to pay at maturity or upon redemption all such Junior Subordinated
Debentures not theretofore delivered to the Trustee for cancellation,
including principal and interest due or to become due to such date of
maturity or date fixed for redemption, as the case may be, and if the Company
shall also pay or cause to be paid all other sums payable hereunder by the
Company, then after the date such moneys or Governmental Obligations, as the
case may be, are deposited with the Trustee the obligations of the Company
under this Indenture shall cease to be of further effect except for the
provisions of Sections 2.2, 2.3, 2.4, 2.5, 4.1, 4.2, 4.3, 9.6, 9.10 and 13.5
hereof that shall survive until such Junior Subordinated Debentures shall
mature and be paid. Thereafter, Sections 9.6 and 13.5 shall survive.
13.3 DEPOSITED MONEYS TO BE HELD IN TRUST. All monies or Governmental
Obligations deposited with the Trustee pursuant to Sections 13.1 or 13.2
shall be held in trust and shall be available for payment as due, either
directly or through any paying agent (including the Company acting as its own
paying agent), to the Holders of the Junior Subordinated Debentures for the
payment or redemption of which such moneys or Governmental Obligations have
been deposited with the Trustee.
13.4 PAYMENT OF MONIES HELD BY PAYING AGENTS. In connection with the
satisfaction and discharge of this Indenture all moneys or Governmental
Obligations then held by any paying agent under the provisions of
34
this Indenture shall, upon demand of the Company, be paid to the Trustee and
thereupon such paying agent shall be released from all further liability with
respect to such moneys or Governmental Obligations.
13.5 REPAYMENT TO COMPANY. Any monies or Governmental Obligations
deposited with any paying agent or the Trustee, or then held by the Company
in trust for payment of principal of or interest on the Junior Subordinated
Debentures that are not applied but remain unclaimed by the Holders of such
Junior Subordinated Debentures for at least two years after the date upon
which the principal of or interest on such Junior Subordinated Debentures
shall have respectively become due and payable, shall be repaid to the
Company on February 1 of each year or (if then held by the Company) shall be
discharged from such trust; and thereupon the paying agent and the Trustee
shall be released from all further liability with respect to such moneys or
Governmental Obligations, and the Holder of any of the Junior Subordinated
Debentures entitled to receive such payment shall thereafter, as an unsecured
general creditor, look only to the Company for the payment thereof.
ARTICLE XIV
IMMUNITY OF INCORPORATORS,
STOCKHOLDERS, OFFICERS AND DIRECTORS
14.1 NO RECOURSE. No recourse under or upon any obligation, covenant or
agreement of this Indenture, or of any Junior Subordinated Debenture, or for
any claim based thereon or otherwise in respect thereof, shall be had against
any incorporator, stockholder, officer or director as such, past, present or
future, of the Company or of any predecessor or successor corporation, either
directly or through the Company or any such predecessor or successor
corporation, whether by virtue of any constitution, statute or rule of law,
or by the enforcement of any assessment or penalty or otherwise; it being
expressly understood that this Indenture and the obligations issued hereunder
are solely corporate obligations, and that no such personal liability
whatever shall attach to, or is or shall be incurred by, the incorporators,
stockholders, officers or directors as such, of the Company or of any
predecessor or successor corporation, or any of them, because of the creation
of the indebtedness hereby authorized, or under or by reason of the
obligations, covenants or agreements contained in this Indenture or in any of
the Junior Subordinated Debentures or implied therefrom; and that any and all
such personal liability of every name and nature, either at common law or in
equity or by constitution or statute, of, and any and all such rights and
claims against, every such incorporator, stockholder, officer or director as
such, because of the creation of the indebtedness hereby authorized, or under
or by reason of the obligations, covenants or agreements contained in this
Indenture or in any of the Junior Subordinated Debentures or implied
therefrom, are hereby expressly waived and released as a condition of, and as
a consideration for, the execution of this Indenture and the issuance of such
Junior Subordinated Debentures.
ARTICLE XV
MISCELLANEOUS PROVISIONS
15.1 EFFECT ON SUCCESSORS AND ASSIGNS. All the covenants, stipulations,
promises and agreements in this Indenture contained by or on behalf of the
Company or the Trustee shall bind their respective successors and assigns,
whether so expressed or not.
15.2 ACTIONS BY SUCCESSOR. Any act or proceeding by any provision of
this Indenture authorized or required to be done or performed by any board,
committee or officer of the Company shall and may be done and performed with
like force and effect by the corresponding board, committee or officer of any
corporation that shall at the time be the lawful sole successor of the
Company.
35
15.3 SURRENDER OF COMPANY POWERS. The Company by instrument in writing
executed by authority of 2/3 (two-thirds) of its Board of Directors and
delivered to the Trustee may surrender any of the powers reserved to the
Company, and thereupon such power so surrendered shall terminate both as to
the Company and as to any successor corporation.
15.4 NOTICES. Except as otherwise expressly provided herein any notice
or demand that by any provision of this Indenture is required or permitted to
be given or served by the Trustee or by the Holders of Junior Subordinated
Debentures to or on the Company may be given or served by being deposited
first-class postage prepaid in a post-office letterbox addressed (until
another address is filed in writing by the Company with the Trustee), as
follows: c/o Community First Bankshares, Inc., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇-▇▇▇▇, Attention: Chief Financial Officer. Any notice, election,
request or demand by the Company or any Securityholder to or upon the Trustee
shall be deemed to have been sufficiently given or made, for all purposes, if
given or made in writing at the Corporate Trust Office of the Trustee.
15.5 GOVERNING LAW. This Indenture and each Junior Subordinated
Debenture shall be deemed to be a contract made under the internal laws of
the State of Minnesota and for all purposes shall be construed in accordance
with the laws of said State; provided that the immunities and the standard of
care of the Trustee shall be governed by Delaware law.
15.6 TREATMENT OF JUNIOR SUBORDINATED DEBENTURES AS DEBT. It is intended
that the Junior Subordinated Debentures will be treated as indebtedness and
not as equity for federal income tax purposes. The provisions of this
Indenture shall be interpreted to further this intention.
15.7 COMPLIANCE CERTIFICATES AND OPINIONS.
(a) Upon any application or demand by the Company to the Trustee to take
any action under any of the provisions of this Indenture, the Company shall
furnish to the Trustee an Officers' Certificate stating that all conditions
precedent 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 have been complied with, except
that in the case of any such application or demand as to which the furnishing
of such documents is specifically required by any provision of this Indenture
relating to such particular application or demand, no additional certificate
or opinion need be furnished.
(b) Every certificate or opinion delivered to the Trustee with respect
to compliance with a condition or covenant in this Indenture shall include
(1) a statement that the Person making such certificate or opinion has read
such covenant or condition; (2) a brief statement as to the nature and scope
of the examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based; (3) a statement that, in
the opinion of such Person, such Person has made such examination or
investigation as is necessary to enable such Person 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 or not, in the opinion of such
Person, such condition or covenant has been complied with.
15.8 PAYMENTS ON BUSINESS DAYS. In any case where the date of maturity
of interest or principal of the Junior Subordinated Debentures or the date of
redemption of the Junior Subordinated Debentures shall not be a Business Day,
then payment of interest or principal will be made on the next succeeding
Business Day (without any additional interest or other payment in respect of
any such delay), 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
date such payment was originally payable.
36
15.9 CONFLICT WITH TRUST INDENTURE ACT. If and to the extent that any
provision of this Indenture limits, qualifies or conflicts with the duties
imposed by Sections 310 to 317, inclusive, of the Trust Indenture Act, such
imposed duties shall control.
15.10 COUNTERPARTS. This Indenture may be executed in any number of
counterparts, each of which shall be an original, but such counterparts shall
together constitute but one and the same instrument.
15.11 SEPARABILITY. In case any one or more of the provisions contained
in this Indenture or in the Junior Subordinated Debentures shall for any
reason be held to be invalid, illegal or unenforceable in any respect, such
invalidity, illegality or unenforceability shall not affect any other
provisions of this Indenture or of the Junior Subordinated Debentures, but
this Indenture and the Junior Subordinated Debentures shall be construed as
if such invalid or illegal or unenforceable provision had never been
contained herein or therein.
15.12 ASSIGNMENT. The Company will have the right at all times to assign
any of its respective rights or obligations under this Indenture to a direct
or indirect wholly-owned Subsidiary of the Company, provided that, in the
event of any such assignment, the Company will remain liable for all such
obligations. Subject to the foregoing, this Indenture is binding upon and
inures to the benefit of the parties thereto and their respective successors
and assigns. This Indenture may not otherwise be assigned by the parties
hereto.
15.13 ACKNOWLEDGMENT OF RIGHTS. The Company acknowledges that, with
respect to any Junior Subordinated Debentures held by the Trust or a trustee
of the Trust, if the Property Trustee of the Trust fails to enforce its
rights under this Indenture as the Holder of the Junior Subordinated
Debentures held as the assets of the Trust, any holder of Capital Securities
may institute legal proceedings directly against the Company to enforce such
Property Trustee's rights under this Indenture without first instituting any
legal proceedings against such Property Trustee or any other person or
entity. Notwithstanding the foregoing, if an Event of Default has occurred
and is continuing and such event is attributable to the failure of the
Company to pay interest or principal on the Junior Subordinated Debentures on
the date such interest or principal is otherwise payable (or in the case of
redemption, on the redemption date), the Company acknowledges that a holder
of Capital Securities may directly institute a proceeding for enforcement of
payment to such holder of the principal of or interest on the Junior
Subordinated Debentures having a principal amount equal to the aggregate
Liquidation Amount of the Capital Securities of such holder on or after the
respective due date specified in the Junior Subordinated Debentures. This
Section 15.13 may not be amended without the prior written consent of the
holders of all of the Capital Securities.
ARTICLE XVI
SUBORDINATION OF JUNIOR SUBORDINATED DEBENTURES
16.1 AGREEMENT TO SUBORDINATE. The Company covenants and agrees, and
each Holder of Junior Subordinated Debentures issued hereunder by such
Holder's acceptance thereof likewise covenants and agrees, that all Junior
Subordinated Debentures shall be issued subject to the provisions of this
Article Sixteen; and each Holder, whether upon original issue or upon
transfer or assignment thereof, accepts and agrees to be bound by such
provisions.
The payment by the Company of the principal of and interest on all Junior
Subordinated Debentures issued hereunder shall, to the extent and in the
manner hereinafter set forth, be subordinated and junior in right of payment
to the prior payment in full of all Senior and Subordinated Debt, whether
outstanding at the date of this Indenture or thereafter incurred.
37
No provision of this Article Sixteen shall prevent the occurrence of any
default or Event of Default hereunder.
16.2 DEFAULT ON SENIOR AND SUBORDINATED DEBT. In the event and during
the continuation of any default by the Company in the payment of principal,
premium, interest or any other payment due on any Senior and Subordinated
Debt of the Company or in the event that the maturity of any Senior and
Subordinated Debt of the Company has been accelerated because of a default,
then, in either case, no payment shall be made by the Company with respect to
the principal of or interest on the Junior Subordinated Debentures.
In the event that, notwithstanding the foregoing, any payment shall be
received by the Trustee when such payment is prohibited by the preceding
paragraph of this Section 16.2, such payment shall be held in trust for the
benefit of, and shall be paid over or delivered to, the holders of Senior and
Subordinated Debt or their respective representatives, or to the trustee or
trustees under any indenture pursuant to which any of such Senior and
Subordinated Debt may have been issued, as their respective interests may
appear, but only to the extent that the holders of the Senior and
Subordinated Debt (or their representative or representatives or a trustee)
notify the Trustee in writing within 90 days of such payment of the amounts
then due and owing on the Senior and Subordinated Debt and only the amounts
specified in such notice to the Trustee shall be paid to the holders of
Senior and Subordinated Debt.
16.3 LIQUIDATION; DISSOLUTION; BANKRUPTCY. Upon any payment by the
Company or distribution of assets of the Company of any kind or character,
whether in cash, property or securities, to creditors upon any dissolution or
winding-up or liquidation or reorganization of the Company, whether voluntary
or involuntary or in bankruptcy, insolvency, receivership or other
proceedings, all amounts due upon all Senior and Subordinated Debt of the
Company shall first be paid in full, or payment thereof provided for in money
in accordance with its terms, before any payment is made by the Company on
account of the principal or interest on the Junior Subordinated Debentures;
and upon any such dissolution or winding-up or liquidation or reorganization,
any payment by the Company, or distribution of assets of the Company of any
kind or character, whether in cash, property or securities, to which the
Holders or the Trustee would be entitled to receive from the Company, except
for the provisions of this Article Sixteen, shall be paid by the Company or
by any receiver, trustee in bankruptcy, liquidating trustee, agent or other
Person making such payment or distribution, or by the Holders or by the
Trustee under the Indenture if received by them or it, directly to the
holders of Senior and Subordinated Debt of the Company (pro rata to such
holders on the basis of the respective amounts of Senior and Subordinated
Debt held by such holders, as calculated by the Company) or their
representative or representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing such Senior and
Subordinated Debt may have been issued, as their respective interests may
appear, to the extent necessary to pay such Senior and Subordinated Debt in
full, in money or money's worth, after giving effect to any concurrent
payment or distribution to or for the holders of such Senior and Subordinated
Debt, before any payment or distribution is made to the Holders or to the
Trustee.
In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in
cash, property or securities, prohibited by the foregoing, shall be received
by the Trustee before all Senior and Subordinated Debt of the Company is paid
in full, or provision is made for such payment in money in accordance with
its terms, such payment or distribution shall be held in trust for the
benefit of and shall be paid over or delivered to the holders of such Senior
and Subordinated Debt or their representative or representatives, or to the
trustee or trustees under any indenture pursuant to which any instruments
evidencing such Senior and Subordinated Debt may have been issued, and their
respective interests may appear, as calculated by the Company, for
application to the payment of all Senior and Subordinated Debt of the
Company, as the case may be, remaining unpaid to the extent necessary to pay
such Senior and Subordinated Debt in full in money in accordance with its
terms, after giving effect to any concurrent payment or distribution to or
for the benefit of the holders of such Senior and Subordinated Debt.
38
For purposes of this Article Sixteen, the words "cash, property or
securities" shall not be deemed to include shares of stock of the Company as
reorganized or readjusted, or securities of the Company or any other
corporation provided for by a plan of reorganization or readjustment, the
payment of which is subordinated at least to the extent provided in this
Article Sixteen with respect to the Junior Subordinated Debentures to the
payment of all Senior and Subordinated Debt of the Company, as the case may
be, that may at the time be outstanding, provided that (i) such Senior and
Subordinated Debt is assumed by the new corporation, if any, resulting from
any such reorganization or readjustment, and (ii) the rights of the holders
of such Senior and Subordinated Debt are not, without the consent of such
holders, altered by such reorganization or readjustment. The consolidation
of the Company with, or the merger of the Company into, another corporation
or the liquidation or dissolution of the Company following the conveyance or
transfer of its property as an entirety, or substantially as an entirety, to
another corporation upon the terms and conditions provided for in Article
Twelve of this Indenture shall not be deemed a dissolution, winding-up,
liquidation or reorganization for the purposes of this Section 16.3 if such
other corporation shall, as a part of such consolidation, merger, conveyance
or transfer, comply with the conditions stated in Article Twelve of this
Indenture. Nothing in Section 16.2 or in this Section 16.3 shall apply to
claims of, or payments to, the Trustee under or pursuant to Section 9.6 of
this Indenture.
16.4 SUBROGATION. Subject to the payment in full of all Senior and
Subordinated Debt of the Company, the rights of the Holders of the Junior
Subordinated Debentures shall be subrogated to the rights of the holders of
such Senior and Subordinated Debt to receive payments or distributions of
cash, property or securities of the Company, as the case may be, applicable
to such Senior and Subordinated Debt until the principal of and interest on
the Junior Subordinated Debentures shall be paid in full; and, for the
purposes of such subrogation, no payments or distributions to the holders of
such Senior and Subordinated Debt of any cash, property or securities to
which the Holders of the Junior Subordinated Debentures or the Trustee would
be entitled except for the provisions of this Article Sixteen, and no payment
over pursuant to the provisions of this Article Sixteen to or for the benefit
of the holders of such Senior and Subordinated Debt by Holders of the Junior
Subordinated Debentures or the Trustee, shall, as between the Company, its
creditors other than holders of Senior and Subordinated Debt of the Company,
and the Holders of the Junior Subordinated Debentures, be deemed to be a
payment by the Company to or on account of such Senior and Subordinated Debt.
It is understood that the provisions of this Article Sixteen are and are
intended solely for the purposes of defining the relative rights of the
Holders of the Junior Subordinated Debentures, on the one hand, and the
holders of such Senior and Subordinated Debt on the other hand.
Nothing contained in this Article Sixteen or elsewhere in this Indenture
or in the Junior Subordinated Debentures is intended to or shall impair, as
between the Company, its creditors other than the holders of Senior and
Subordinated Debt of the Company, and the Holders of the Junior Subordinated
Debentures, the obligation of the Company, which is absolute and
unconditional, to pay to the Holders of the Junior Subordinated Debentures
the principal of and interest on the Junior Subordinated Debentures as and
when the same shall become due and payable in accordance with their terms, or
is intended to or shall affect the relative rights of the Holders of the
Junior Subordinated Debentures and creditors of the Company, other than the
holders of Senior and Subordinated Debt of the Company, nor shall anything
herein or therein prevent the Trustee or the Holder of any Junior
Subordinated Debenture from exercising all remedies otherwise permitted by
applicable law upon default under this Indenture, subject to the rights, if
any, under this Article Sixteen of the holders of such Senior and
Subordinated Debt in respect of cash, property or securities of the Company,
as the case may be, received upon the exercise of any such remedy.
Upon any payment or distribution of assets of the Company referred to in
this Article Sixteen, the Trustee, subject to the provisions of Section 9.1,
and the Holders of the Junior Subordinated Debentures shall be entitled to
conclusively rely upon any order or decree made by any court of competent
jurisdiction in which such dissolution, winding-up, liquidation or
reorganization proceedings are pending, or a certificate of the receiver,
trustee in bankruptcy, liquidation trustee, agent or other Person making such
payment or distribution,
39
delivered to the Trustee or to the Holders of the Junior Subordinated
Debentures, for the purposes of ascertaining the Persons entitled to
participate in such distribution, the holders of Senior and Subordinated Debt
and other indebtedness of the Company, as the case may be, the amount thereof
or payable thereon, the amount or amounts paid or distributed thereon and all
other facts pertinent thereto or to this Article Sixteen.
16.5 TRUSTEE TO EFFECTUATE SUBORDINATION. Each Holder of Junior
Subordinated Debentures by such Holder's acceptance thereof authorizes and
directs the Trustee on such Holder's behalf to take such action as may be
necessary or appropriate to effectuate the subordination provided in this
Article Sixteen and appoints the Trustee such Holder's attorney-in-fact for
any and all such purposes.
16.6 NOTICE BY THE COMPANY. 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 of monies to or by the Trustee in
respect of the Junior Subordinated Debentures pursuant to the provisions of
this Article Sixteen. Notwithstanding the provisions of this Article Sixteen
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 of monies to or by the Trustee in respect of the Junior
Subordinated Debentures pursuant to the provisions of this Article Sixteen,
unless and until a Responsible Officer of the Trustee shall have received
written notice thereof from the Company or a holder or holders of Senior and
Subordinated Debt or from any trustee therefor; and before the receipt of any
such written notice, the Trustee, subject to the provisions of Section 9.1,
shall be entitled in all respects to assume that no such facts exist;
provided, however, that if the Trustee shall not have received the notice
provided for in this Section 16.6 at least two Business Days prior to the
date upon which by the terms hereof any money may become payable for any
purpose (including, without limitation, the payment of the principal of or
interest on any Junior Subordinated Debenture), then, anything herein
contained to the contrary notwithstanding, the Trustee shall have full power
and authority to receive such money and to apply the same to the purposes 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.
The Trustee, subject to the provisions of Section 9.1, shall be entitled
to conclusively rely on the delivery to it of a written notice by a Person
representing himself to be a holder of Senior and Subordinated Debt of the
Company (or a trustee on behalf of such holder), to establish that such
notice has been given by a holder of such Senior and Subordinated Debt or a
trustee on behalf of any such holder or holders. In the event that the
Trustee determines in good faith that further evidence is required with
respect to the right of any Person as a holder of such Senior and
Subordinated Debt to participate in any payment or distribution pursuant to
this Article Sixteen, the Trustee may request such Person to furnish evidence
to the reasonable satisfaction of the Trustee as to the amount of such Senior
and Subordinated Debt held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such Person under this Article Sixteen, 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.
16.7 RIGHTS OF THE TRUSTEE; HOLDERS OF SENIOR AND SUBORDINATED DEBT. The
Trustee in its individual capacity shall be entitled to all the rights set
forth in this Article Sixteen in respect of any Senior and Subordinated Debt
at any time held by it, to the same extent as any other holder of Senior and
Subordinated Debt, and nothing in this Indenture shall deprive the Trustee of
any of its rights as such holder.
With respect to the holders of Senior and Subordinated Debt of the
Company, the Trustee undertakes to perform or to observe only such of its
covenants and obligations as are specifically set forth in this Article
Sixteen, and no implied covenants or obligations with respect to the holders
of such Senior and Subordinated Debt shall be read into this Indenture
against the Trustee. The Trustee shall not be deemed to owe any fiduciary
duty to the holders of such Senior and Subordinated Debt and, subject to the
provisions of Section 9.1, the Trustee shall not be liable to any holder of
such Senior and Subordinated Debt if it shall pay over or deliver to
40
Holders of Junior Subordinated Debentures, the Company or any other Person
money or assets to which any holder of such Senior and Subordinated Debt
shall be entitled by virtue of this Article Sixteen or otherwise.
16.8 SUBORDINATION MAY NOT BE IMPAIRED. No right of any present or
future holder of any Senior and Subordinated Debt of the Company 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 otherwise be charged with.
Without in any way limiting the generality of the foregoing paragraph,
the holders of Senior and Subordinated Debt of the Company may, at any time
and from time to time, without the consent of or notice to the Trustee or the
Holders of the Junior Subordinated Debentures, without incurring
responsibility to the Holders of the Junior Subordinated Debentures and
without impairing or releasing the subordination provided in this Article
Sixteen or the obligations hereunder of the Holders of the Junior
Subordinated Debentures to the holders of such Senior and Subordinated Debt,
do any one or more of the following: (i) change the manner, place or terms of
payment or extend the time of payment of, or renew or alter, such Senior and
Subordinated Debt, or otherwise amend or supplement in any manner such Senior
and Subordinated Debt or any instrument evidencing the same or any agreement
under which such Senior and Subordinated Debt is outstanding; (ii) sell,
exchange, release or otherwise deal with any property pledged, mortgaged or
otherwise securing such Senior and Subordinated Debt; (iii) release any
Person liable in any manner for the collection of such Senior and
Subordinated Debt; and (iv) exercise or refrain from exercising any rights
against the Company and any other Person.
41
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed as of the day and year first above written.
COMMUNITY FIRST BANKSHARES, INC.
By:
------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: President and Chief Executive Officer
WILMINGTON TRUST COMPANY,
AS TRUSTEE
By:
------------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
STATE OF NORTH DAKOTA )
) ss:
COUNTY OF___________ )
On the _______ day of December, 1997, before me personally came ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇, to me known, who, being by me duly sworn, did depose and say that
he is the President and Chief Executive Officer of COMMUNITY FIRST
BANKSHARES, INC., one of the corporations described in and which executed the
above instrument; and that he signed his name thereto on behalf of said
corporation by authority of the Board of Directors of said corporation.
---------------------------------------------
NOTARY PUBLIC
STATE OF DELAWARE )
) ss:
COUNTY OF ________ )
On the _______ day of December, 1997, before me personally came
______________________, to me known, who, being by me duly sworn, did depose
and say that he/she is the _______________________ of WILMINGTON TRUST
COMPANY, one of the corporations described in and which executed the above
instrument; and that he/she signed his/her name thereto on behalf of said
corporation by authority of the Board of Directors of said corporation.
---------------------------------------------
NOTARY PUBLIC
42
EXHIBIT A
(FORM OF FACE OF JUNIOR SUBORDINATED DEBENTURE)
This Junior Subordinated Debenture is a Global Subordinated Debenture
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 Junior
Subordinated Debenture is exchangeable for Junior Subordinated Debentures
registered in the name of a person other than the Depositary or its nominee
only in the limited circumstances described in the Indenture, and no transfer
of this Junior Subordinated Debenture (other than a transfer of this Junior
Subordinated Debenture 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) may be registered except in such limited
circumstances.
Unless this Junior Subordinated Debenture is presented by an authorized
representative of Wilmington Trust Company (▇▇▇▇▇▇ Square North, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇) to the issuer or its agent
for registration of transfer, exchange or payment, and any Junior
Subordinated Debenture issued is registered in the name of Cede & Co. or such
other name as requested by an authorized representative of Wilmington Trust
Company (and any payment hereon is made to Cede & Co. or to such other entity
as is requested by an authorized representative of Wilmington Trust Company),
ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL inasmuch the registered owner hereof, Cede & Co., has an
interest herein.
Registered Principal Amount:
Registered No. _______________________ $________________________
CUSIP No.______________________________
1
COMMUNITY FIRST BANKSHARES, INC.
___% JUNIOR SUBORDINATED DEBENTURE
DUE DECEMBER____, 2027
Community First Bankshares, Inc., a Delaware corporation (the "Company",
which term includes any successor corporation under the Indenture hereinafter
referred to), for value received, hereby promises to pay to ______________ or
registered assigns, the principal sum of _____________ Dollars ($___________)
on December 15, 2027, which date may be shortened as provided in the
Indenture (such date, as it may be shortened, the "Stated Maturity"), and to
pay interest on said principal sum from March 15, 1998, or from the most
recent interest payment date (each such date, an "Interest Payment Date") to
which interest has been paid or duly provided for, quarterly (subject to
deferral as set forth herein) in arrears on the 15th day of March, June,
September, and December in each year commencing March 15, 1998, at the rate
of % per annum until the principal hereof shall have become due and
payable, and on any overdue principal and (without duplication and to the
extent that payment of such interest is enforceable under applicable law) on
any overdue installment of interest at the same rate per annum compounded
quarterly. The amount of each interest payment due with respect to the
Junior Subordinated Debentures will include amounts accrued through the date
the interest payment is due. The amount of interest payable on any Interest
Payment Date shall be computed on the basis of a 360-day year of twelve
30-day months. In the event that any date on which interest is payable on
this Junior Subordinated Debenture is not a business day, then payment of
interest 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 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 such
date. The interest installment 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 Junior Subordinated
Debenture (or one or more Predecessor Securities, as defined in the
Indenture) is registered at the close of business on the regular record date
for such interest installment, which shall be the close of business on the
business day next preceding such Interest Payment Date unless otherwise
provided in the Indenture. The principal of and the interest on this Junior
Subordinated Debenture shall be payable at the office or agency of the
Trustee (as defined in the Indenture) maintained for that purpose in any coin
or currency of the United States of America that at the time of payment is
legal tender for payment of public and private debts; provided, however, that
payment of interest may be made at the option of the Company by check mailed
to the registered Holder (as defined in the Indenture) at such address as
shall appear in the Securities Register (as defined in the Indenture).
Notwithstanding the foregoing, so long as the Holder of this Junior
Subordinated Debenture is the Property Trustee (as defined in the Indenture),
the payment of the principal of and interest on this Junior Subordinated
Debenture will be made at such place and to such account as may be designated
by the Property Trustee.
The Stated Maturity may be shortened at any time by the Company to any
date not earlier than December 15, 2002, subject to the Company having
received prior approval of the Federal Reserve (as defined in the Indenture)
if then required under applicable capital guidelines or policies of the
Federal Reserve.
2
The indebtedness evidenced by this Junior Subordinated Debenture is, to
the extent provided in the Indenture, subordinate and junior in right of
payment to the prior payment in full of all Senior and Subordinated Debt (as
defined in the Indenture), and this Junior Subordinated Debenture is issued
subject to the provisions of the Indenture with respect thereto. Each Holder
of this Junior Subordinated Debenture, 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 action as may be necessary or appropriate
to acknowledge or 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, hereby waives all notice of
the acceptance of the subordination provisions contained herein and in the
Indenture by each holder of Senior and Subordinated Debt, whether now
outstanding or hereafter incurred, and waives reliance by each such holder
upon said provisions.
This Junior Subordinated Debenture shall not be entitled to any benefit
under the Indenture, be valid or become obligatory for any purpose until the
Certificate of Authentication hereon shall have been signed by or on behalf
of the Trustee.
The provisions of this Junior Subordinated Debenture are continued on the
reverse side hereof and such continued provisions shall for all purposes have
the same effect as though fully set forth at this place.
IN WITNESS WHEREOF, the Company has caused this instrument to be executed.
Dated: _____________________ COMMUNITY FIRST BANKSHARES, INC.
By:
----------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: President and Chief Executive Officer
Attest: By:
----------------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Secretary
3
[FORM OF CERTIFICATE OF AUTHENTICATION]
CERTIFICATE OF AUTHENTICATION
This is one of the Junior Subordinated Debentures described in the
within-mentioned Indenture.
Dated:_________________________ WILMINGTON TRUST COMPANY, as Trustee
By:
---------------------------------------
Authorized Signature
1
[FORM OF REVERSE OF JUNIOR SUBORDINATED DEBENTURE]
____% JUNIOR SUBORDINATED DEBENTURE
(CONTINUED)
This Junior Subordinated Debenture is one of the junior subordinated
debentures of the Company (herein sometimes referred to as the "Junior
Subordinated Debentures"), specified in the Indenture, all issued under and
pursuant to a Subordinated Indenture dated as of December _______, 1997 (the
"Indenture") duly executed and delivered between the Company and Wilmington
Trust Company, as Trustee (the "Trustee"), to which Indenture reference is
hereby made for a description of the rights, limitations of rights,
obligations, duties and immunities thereunder of the Trustee, the Company and
the Holders of the Junior Subordinated Debentures. The Junior Subordinated
Debentures are limited in aggregate principal amount as specified in the
Indenture.
Because of the occurrence and continuation of a Special Event (as defined
in the Indenture), in certain circumstances, this Junior Subordinated
Debenture may become due and payable at the option of the Company at the
principal amount together with any interest accrued thereon (the "Redemption
Price"). The Redemption Price shall be paid prior to 2:00 p.m. Fargo Time on
the date of such redemption or at such earlier time as the Company determines.
The Company shall have the right to redeem this Junior Subordinated
Debenture at the option of the Company, in whole or in part, from time to
time, on or after December 15, 2002, at a redemption price equal to 100% of
the principal amount to be redeemed plus any accrued but unpaid interest
thereon to the date of such redemption. Any redemption pursuant to this
paragraph will be made upon not less than 30 days nor more than 60 days
notice. If the Junior Subordinated Debentures are only partially redeemed by
the Company pursuant to this paragraph, the Junior Subordinated Debentures
will be redeemed pro rata or by lot or by any other method utilized by the
Trustee; provided that if, at the time of redemption, the Junior Subordinated
Debentures are registered as a Global Subordinated Debenture (as defined in
the Indenture), the Depositary (as defined in the Indenture) shall determine
the principal amount of such Junior Subordinated Debentures held by each
Junior Subordinated Debenture Holder to be redeemed in accordance with its
procedures.
In the event of redemption of this Junior Subordinated Debenture in part
only, a new Junior Subordinated Debenture for the unredeemed portion hereof
will be issued in the name of the Holder hereof upon the cancellation hereof.
In case an Event of Default (as defined in the Indenture), shall have
occurred and be continuing, the principal of all of the Junior Subordinated
Debentures may be declared, and upon such declaration shall become, due and
payable, in the manner, with the effect and subject to the conditions
provided in the Indenture.
The Indenture contains provisions permitting the Company and the Trustee,
with the consent of the Holders of not less than a majority in aggregate
principal amount of the Junior Subordinated Debentures at the time
Outstanding, as defined in the Indenture, to execute supplemental indentures
for the purpose of adding any provisions to or changing in any manner or
eliminating any of the
2
provisions of the Indenture or of any supplemental indenture or of modifying
in any manner the rights of the Holders of the Junior Subordinated
Debentures; provided, however, that no such supplemental indenture shall (i)
extend the fixed maturity of the Junior Subordinated Debentures except as
provided in the Indenture, or reduce the principal amount thereof, or reduce
the rate or extend the time of payment of interest thereon, without the
consent of the Holder of each Junior Subordinated Debenture so affected, or
(ii) reduce the aforesaid percentage of Junior Subordinated Debentures, the
Holders of which are required to consent to any such supplemental indenture,
without the consent of the Holders of each Junior Subordinated Debenture then
Outstanding and affected thereby. The Indenture also contains provisions
permitting the Holders of a majority in aggregate principal amount of the
Junior Subordinated Debentures at the time Outstanding, on behalf of all of
the Holders of the Junior Subordinated Debentures, to waive any past default
in the performance of any of the covenants contained in the Indenture, or
established pursuant to the Indenture, and its consequences, except a default
in the payment of the principal of or interest on any of the Junior
Subordinated Debentures. Any such consent or waiver by the registered Holder
of this Junior Subordinated Debenture (unless revoked as provided in the
Indenture) shall be conclusive and binding upon such Holder and upon all
future Holders and owners of this Junior Subordinated Debenture and of any
Junior Subordinated Debenture issued in exchange herefor or in place hereof
(whether by registration of transfer or otherwise), irrespective of whether
or not any notation of such consent or waiver is made upon this Junior
Subordinated Debenture.
No reference herein to the Indenture and no provision of this Junior
Subordinated Debenture or of the Indenture shall alter or impair the
obligation of the Company, which is absolute and unconditional, to pay the
principal of and interest on this Junior Subordinated Debenture at the time
and place and at the rate and in the money herein prescribed.
The Company shall have the right at any time during the term of the
Junior Subordinated Debentures and from time to time to extend the interest
payment period of such Junior Subordinated Debentures for up to 20
consecutive quarters (an "Extended Interest Payment Period"), at the end of
which period the Company shall pay all interest then accrued and unpaid
(together with interest thereon at the rate specified for the Junior
Subordinated Debentures to the extent that payment of such interest is
enforceable under applicable law). Before the termination of any such
Extended Interest Payment Period, the Company may further extend such
Extended Interest Payment Period, provided that such Extended Interest
Payment Period together with all such further extensions thereof shall not
exceed 20 consecutive quarters or extend beyond the Stated Maturity. At the
termination of any such Extended Interest Payment Period and upon the payment
of all accrued and unpaid interest and any additional amounts then due, the
Company may commence a new Extended Interest Payment Period.
As provided in the Indenture and subject to certain limitations therein
set forth, this Junior Subordinated Debenture is transferable by the
registered Holder hereof on the Securities Register of the Company, upon
surrender of this Junior Subordinated Debenture for registration of transfer
at the office or agency of the Trustee accompanied by a written instrument or
instruments of transfer in form satisfactory to the Company or the Trustee
duly executed by the registered Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Junior Subordinated
Debentures of authorized denominations and for the same aggregate principal
amount will be issued to the designated transferee or transferees. No
service charge will be made for any such
3
transfer, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in relation thereto.
Prior to due presentment for registration of transfer of this Junior
Subordinated Debenture, the Company, the Trustee, any paying agent and the
Securities Registrar (as defined in the Indenture) may deem and treat the
registered holder hereof as the absolute owner hereof (whether or not this
Junior Subordinated Debenture shall be overdue and notwithstanding any notice
of ownership or writing hereon made by anyone other than the Securities
Registrar) for the purpose of receiving payment of or on account of the
principal hereof and interest due hereon and for all other purposes, and
neither the Company nor the Trustee nor any paying agent nor any Securities
Registrar shall be affected by any notice to the contrary.
No recourse shall be had for the payment of the principal of or the
interest on this Junior Subordinated Debenture, or for any claim based
hereon, or otherwise in respect hereof, or based on or in respect of the
Indenture, against any incorporator, stockholder, officer or director, past,
present or future, as such, of the Company or of any predecessor or successor
corporation, whether by virtue of any constitution, statute or rule of law,
or by the enforcement of any assessment or penalty or otherwise, all such
liability being, by the acceptance hereof and as part of the consideration
for the issuance hereof, expressly waived and released.
The Junior Subordinated Debentures are issuable only in registered form
without coupons in denominations of $25 and any integral multiple thereof.
This Global Subordinated Debenture is exchangeable for Junior Subordinated
Debentures in definitive form only under certain limited circumstances set
forth in the Indenture. Junior Subordinated Debentures so issued are
issuable only in registered form without coupons in denominations of $25 and
any integral multiple thereof.
4