GUARANTEE AGREEMENT by and between COMMUNITY BANCORP. and WILMINGTON TRUST COMPANY Dated as of October 31, 2007
Exhibit
10.1
_________________________________________________
by
and between
COMMUNITY
BANCORP.
and
WILMINGTON
TRUST COMPANY
Dated
as of October 31, 2007
_________________________________________________
This
GUARANTEE AGREEMENT (this
“Guarantee”), dated as of October 31, 2007, is executed and delivered by
Community Bancorp., a Vermont corporation (the “Guarantor”), and Wilmington
Trust Company, a Delaware banking corporation, as trustee (the “Guarantee
Trustee”), for the benefit of the Holders (as defined herein) from time to time
of the Capital Securities (as defined herein) of CMTV Statutory Trust I, a
Delaware statutory trust (the “Issuer”).
WHEREAS,
pursuant to an Amended and
Restated Declaration of Trust (the “Declaration”), dated as of the date hereof
among Wilmington Trust Company, not in its individual capacity but solely as
institutional trustee, the administrators of the Issuer named therein, the
Guarantor, as sponsor, and the holders from time to time of undivided beneficial
interests in the assets of the Issuer, the Issuer is issuing on the date hereof
those undivided beneficial interests, having an aggregate liquidation amount
of
$12,500,000.00 (the “Capital Securities”); and
WHEREAS,
as incentive for the Holders to purchase the Capital Securities, the Guarantor
desires irrevocably and unconditionally to agree, to the extent set forth in
this Guarantee, to pay to the Holders of Capital Securities the Guarantee
Payments (as defined herein) and to make certain other payments on the terms
and
conditions set forth herein;
NOW,
THEREFORE, in consideration of the purchase by each Holder of the Capital
Securities, which purchase the Guarantor hereby agrees shall benefit the
Guarantor, the Guarantor executes and delivers this Guarantee for the benefit
of
the Holders.
ARTICLE
I
DEFINITIONS
AND INTERPRETATION
Section
1.1. Definitions
and Interpretation.
In
this
Guarantee, unless the context otherwise requires:
(a) capitalized
terms used in this Guarantee but not defined in the preamble above have the
respective meanings assigned to them in this Section 1.1;
(b) a
term
defined anywhere in this Guarantee has the same meaning throughout;
(c) all
references to “the Guarantee” or “this Guarantee” are to this Guarantee as
modified, supplemented or amended from time to time;
(d) all
references in this Guarantee to “Articles” or “Sections” are to Articles or
Sections of this Guarantee, unless otherwise specified;
(e) terms
defined in the Declaration as at the date of execution of this Guarantee have
the same meanings when used in this Guarantee, unless otherwise defined in
this
Guarantee or unless the context otherwise requires; and
(f) a
reference to the singular includes the plural and vice versa.
“Affiliate”
has the same meaning as given to that term in Rule 405 of the Securities
Act of 1933, as amended, or any successor rule thereunder.
“Beneficiaries”
means any Person to whom the Issuer is or hereafter becomes indebted or
liable.
“Capital
Securities” has the meaning set forth in the recitals to this
Guarantee.
“Common
Securities” means the common securities issued by the Issuer to the
Guarantor pursuant to the Declaration.
“Corporate
Trust Office” means the office of the Guarantee Trustee at which the
corporate trust business of the Guarantee Trustee shall, at any particular
time,
be principally administered, which office at the date of execution of this
Guarantee is located at ▇▇▇▇▇▇ Square North, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Corporate
Trust Administration.
“Covered
Person” means any Holder of Capital Securities.
“Debentures”
means the debt securities of the Guarantor designated the Fixed/Floating Rate
Junior Subordinated Deferrable Interest Debentures due 2037 held by the
Institutional Trustee (as defined in the Declaration) of the
Issuer.
“Declaration
Event of Default” means an “Event of Default” as defined in the
Declaration.
“Event
of Default” has the meaning set forth in Section 2.4(a).
“Guarantee
Payments” means the following payments or distributions, without
duplication, with respect to the Capital Securities, to the extent not paid
or
made by the Issuer: (i) any accrued and unpaid Distributions (as
defined in the Declaration) which are required to be paid on such Capital
Securities to the extent the Issuer shall have funds available therefor,
(ii) the Redemption Price to the extent the Issuer has funds available
therefor, with respect to any Capital Securities called for redemption by the
Issuer, (iii) the Special Redemption Price to the extent the Issuer has
funds available therefor, with respect to Capital Securities redeemed upon
the
occurrence of a Special Event, and (iv) upon a voluntary or involuntary
liquidation, dissolution, winding-up or termination of the Issuer (other than
in
connection with the distribution of Debentures to the Holders of the Capital
Securities in exchange therefor as provided in the Declaration), the lesser
of
(a) the aggregate of the liquidation amount and all accrued and unpaid
Distributions on the Capital Securities to the date of payment, to the extent
the Issuer shall have funds available therefor, and (b) the amount of
assets of the Issuer remaining available for distribution to Holders in
liquidation of the Issuer (in either case, the “Liquidation
Distribution”).
“Guarantee
Trustee” means Wilmington Trust Company, until a Successor Guarantee Trustee
has been appointed and has accepted such appointment pursuant to the terms
of
this Guarantee and thereafter means each such Successor Guarantee
Trustee.
“Guarantor”
means Community Bancorp. and each of its successors and assigns.
“Holder”
means any holder, as registered on the books and records of the Issuer, of
any
Capital Securities; provided, however, that, in determining
whether the Holders of the requisite percentage of Capital Securities have
given
any request, notice, consent or waiver hereunder, “Holder” shall not include the
Guarantor or any Affiliate of the Guarantor.
“Indemnified
Person” means the Guarantee Trustee, any Affiliate of the Guarantee Trustee,
or any officers, directors, shareholders, members, partners, employees,
representatives, nominees, custodians or agents of the Guarantee
Trustee.
“Indenture”
means the Indenture dated as of the date hereof between the Guarantor and
Wilmington Trust Company, not in its individual capacity but solely as trustee,
and any indenture supplemental thereto pursuant to which the Debentures are
to
be issued to the institutional trustee of the Issuer.
“Issuer”
has the meaning set forth in the opening paragraph to this
Guarantee.
“Liquidation
Distribution” has the meaning set forth in the definition of “Guarantee
Payments” herein.
“Majority
in liquidation amount of the Capital Securities” means Holder(s) of
outstanding Capital Securities, voting together as a class, but separately
from
the holders of Common Securities, of more than 50% of the aggregate liquidation
amount (including the stated amount that would be paid on redemption,
liquidation or otherwise, plus accrued and unpaid Distributions to the date
upon
which the voting percentages are determined) of all Capital Securities then
outstanding.
“Obligations”
means any costs, expenses or liabilities (but not including liabilities related
to taxes) of the Issuer other than obligations of the Issuer to pay to holders
of any Trust Securities the amounts due such holders pursuant to the terms
of
the Trust Securities.
“Officer’s
Certificate” means, with respect to any Person, a certificate signed by one
Authorized Officer of such Person. Any Officer’s Certificate delivered with
respect to compliance with a condition or covenant provided for in this
Guarantee shall include:
(a) a
statement that the officer signing the Officer’s Certificate has read the
covenant or condition and the definitions relating thereto;
(b) a
brief
statement of the nature and scope of the examination or investigation undertaken
by the officer in rendering the Officer’s Certificate;
(c) a
statement that the officer has made such examination or investigation as, in
such officer’s opinion, is necessary to enable such officer to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and
(d) a
statement as to whether, in the opinion of the officer, such condition or
covenant has been complied with.
“Person”
means a legal person, including any individual, corporation, estate,
partnership, joint venture, association, joint stock company, limited liability
company, trust, unincorporated association, or government or any agency or
political subdivision thereof, or any other entity of whatever
nature.
“Redemption
Price” has the meaning set forth in the Indenture.
“Responsible
Officer” means, with respect to the Guarantee Trustee, any officer within
the Corporate Trust Office of the Guarantee Trustee including any Vice
President, Assistant Vice President, Secretary, Assistant Secretary or any
other
officer of the Guarantee Trustee customarily performing functions similar to
those performed by any of the above designated officers and also, with respect
to a particular corporate trust matter, any other officer to whom such matter
is
referred because of that officer’s knowledge of and familiarity with the
particular subject.
“Special
Event” has the meaning set forth in the Indenture.
“Special
Redemption Price” has the meaning set forth in the Indenture.
“Successor
Guarantee Trustee” means a successor Guarantee Trustee possessing the
qualifications to act as Guarantee Trustee under Section 3.1.
“Trust
Securities” means the Common Securities and the Capital
Securities.
ARTICLE
II
POWERS,
DUTIES AND RIGHTS OF
GUARANTEE
TRUSTEE
Section
2.1. Powers
and Duties of the Guarantee Trustee.
(a) This
Guarantee shall be held by the Guarantee Trustee for the benefit of the Holders
of the Capital Securities, and the Guarantee Trustee shall not transfer this
Guarantee to any Person except a Holder of Capital Securities exercising his
or
her rights pursuant to Section 4.4(b) or to a Successor Guarantee Trustee on
acceptance by such Successor Guarantee Trustee of its appointment to act as
Successor Guarantee Trustee. The right, title and interest of the
Guarantee Trustee shall automatically vest in any Successor Guarantee Trustee,
and such vesting and cessation of title shall be effective whether or not
conveyancing documents have been executed and delivered pursuant to the
appointment of such Successor Guarantee Trustee.
(b) If
an
Event of Default actually known to a Responsible Officer of the Guarantee
Trustee has occurred and is continuing, the Guarantee Trustee shall enforce
this
Guarantee for the benefit of the Holders of the Capital Securities.
(c) The
Guarantee Trustee, before the occurrence of any Event of Default and after
curing all Events of Default that may have occurred, shall undertake to perform
only such duties as are specifically set forth in this Guarantee, and no implied
covenants shall be read into this Guarantee against the Guarantee
Trustee. In case an Event of Default has occurred (that has not been
waived pursuant to Section 2.4) and is actually known to a Responsible
Officer of the Guarantee Trustee, the Guarantee Trustee shall exercise such
of
the rights and powers vested in it by this Guarantee, and use the same degree
of
care and skill in its exercise thereof, as a prudent person would exercise
or
use under the circumstances in the conduct of his or her own
affairs.
(d) No
provision of this Guarantee shall be construed to relieve the Guarantee Trustee
from liability for its own negligent action, its own negligent failure to act,
or its own willful misconduct, except that:
(i) prior
to
the occurrence of any Event of Default and after the curing or waiving of all
such Events of Default that may have occurred:
(A) the
duties and obligations of the Guarantee Trustee shall be determined solely
by
the express provisions of this Guarantee, and the Guarantee Trustee shall not
be
liable except for the performance of such duties and obligations as are
specifically set forth in this Guarantee, and no implied covenants or
obligations shall be read into this Guarantee against the Guarantee Trustee;
and
(B) in
the
absence of bad faith on the part of the Guarantee Trustee, the Guarantee Trustee
may conclusively rely, as to the truth of the statements and the correctness
of
the opinions expressed therein, upon any certificates or opinions furnished
to
the Guarantee Trustee and conforming to the requirements of this Guarantee;
but
in the case of any such certificates or opinions that by any provision hereof
are specifically required to be furnished to the Guarantee Trustee, the
Guarantee Trustee shall be under a duty to examine the same to determine whether
or not they conform to the requirements of this Guarantee;
(ii) the
Guarantee Trustee shall not be liable for any error of judgment made in good
faith by a Responsible Officer of the Guarantee Trustee, unless it shall be
proved that such Responsible Officer of the Guarantee Trustee or the Guarantee
Trustee was negligent in ascertaining the pertinent facts upon which such
judgment was made;
(iii) the
Guarantee Trustee shall not be liable with respect to any action taken or
omitted to be taken by it in good faith in accordance with the written direction
of the Holders of not less than a Majority in liquidation amount of the Capital
Securities relating to the time, method and place of conducting any proceeding
for any remedy available to the Guarantee Trustee, or relating to the exercise
of any trust or power conferred upon the Guarantee Trustee under this Guarantee;
and
(iv) no
provision of this Guarantee shall require the Guarantee Trustee to expend or
risk its own funds or otherwise incur personal financial liability in the
performance of any of its duties or in the exercise of any of its rights or
powers, if the Guarantee Trustee shall have reasonable grounds for believing
that the repayment of such funds is not reasonably assured to it under the
terms
of this Guarantee or security and indemnity, reasonably satisfactory to the
Guarantee Trustee, against such risk or liability is not reasonably assured
to
it.
Section
2.2. Certain
Rights of Guarantee Trustee.
(a) Subject
to the provisions of Section 2.1:
(i) The
Guarantee Trustee may conclusively rely, and shall be fully protected in acting
or refraining from acting upon, any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed, sent or presented by
the
proper party or parties.
(ii) Any
direction or act of the Guarantor contemplated by this Guarantee shall be
sufficiently evidenced by an Officer’s Certificate.
(iii) Whenever,
in the administration of this Guarantee, the Guarantee Trustee shall deem it
desirable that a matter be proved or established before taking, suffering or
omitting any action hereunder, the Guarantee Trustee (unless other evidence
is
herein specifically prescribed) may, in the absence of bad faith on its part,
request and conclusively rely upon an Officer’s Certificate of the Guarantor
which, upon receipt of such request, shall be promptly delivered by the
Guarantor.
(iv) The
Guarantee Trustee shall have no duty to see to any recording, filing or
registration of any instrument (or any re-recording, refiling or re-registration
thereof).
(v) The
Guarantee Trustee may consult with counsel of its selection, and the advice
or
opinion of such counsel with respect to legal matters shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted
by it hereunder in good faith and in accordance with such advice or opinion.
Such counsel may be counsel to the Guarantor or any of its Affiliates and may
include any of its employees. The Guarantee Trustee shall have the
right at any time to seek instructions concerning the administration of this
Guarantee from any court of competent jurisdiction.
(vi) The
Guarantee Trustee shall be under no obligation to exercise any of the rights
or
powers vested in it by this Guarantee at the request or direction of any Holder,
unless such Holder shall have provided to the Guarantee Trustee such security
and indemnity, reasonably satisfactory to the Guarantee Trustee, against the
costs, expenses (including attorneys’ fees and expenses and the expenses of the
Guarantee Trustee’s agents, nominees or custodians) and liabilities that might
be incurred by it in complying with such request or direction, including such
reasonable advances as may be requested by the Guarantee Trustee;
provided, however, that nothing contained in this Section
2.2(a)(vi) shall relieve the Guarantee Trustee, upon the occurrence of an Event
of Default, of its obligation to exercise the rights and powers vested in it
by
this Guarantee.
(vii) The
Guarantee Trustee shall not be bound to make any investigation into the facts
or
matters stated in any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note,
other
evidence of indebtedness or other paper or document, but the Guarantee Trustee,
in its discretion, may make such further inquiry or investigation into such
facts or matters as it may see fit.
(viii) The
Guarantee Trustee may execute any of the trusts or powers hereunder or perform
any duties hereunder either directly or by or through agents, nominees,
custodians or attorneys, and the Guarantee Trustee shall not be responsible
for
any misconduct or negligence on the part of any agent or attorney appointed
with
due care by it hereunder.
(ix) Any
action taken by the Guarantee Trustee or its agents hereunder shall bind the
Holders of the Capital Securities, and the signature of the Guarantee Trustee
or
its agents alone shall be sufficient and effective to perform any such
action. No third party shall be required to inquire as to the
authority of the Guarantee Trustee to so act or as to its compliance with any
of
the terms and provisions of this Guarantee, both of which shall be conclusively
evidenced by the Guarantee Trustee’s or its agent’s taking such
action.
(x) Whenever
in the administration of this Guarantee the Guarantee Trustee shall deem it
desirable to receive instructions with respect to enforcing any remedy or right
or taking any other action hereunder, the Guarantee Trustee (i) may request
instructions from the Holders of a Majority in liquidation amount of the Capital
Securities, (ii) may refrain from enforcing such remedy or right or taking
such other action until such instructions are received, and (iii) shall be
protected in conclusively relying on or acting in accordance with such
instructions.
(xi) The
Guarantee Trustee shall not be liable for any action taken, suffered, or omitted
to be taken by it in good faith, without negligence, and reasonably believed
by
it to be authorized or within the discretion or rights or powers conferred
upon
it by this Guarantee.
(b) No
provision of this Guarantee shall be deemed to impose any duty or obligation
on
the Guarantee Trustee to perform any act or acts or exercise any right, power,
duty or obligation conferred or imposed on it, in any jurisdiction in which
it
shall be illegal or in which the Guarantee Trustee shall be unqualified or
incompetent in accordance with applicable law to perform any such act or acts
or
to exercise any such right, power, duty or obligation. No permissive
power or authority available to the Guarantee Trustee shall be construed to
be a
duty.
Section
2.3. Not
Responsible for Recitals or Issuance of
Guarantee.
The
recitals contained in this Guarantee shall be taken as the statements of the
Guarantor, and the Guarantee Trustee does not assume any responsibility for
their correctness. The Guarantee Trustee makes no representation as
to the validity or sufficiency of this Guarantee.
Section
2.4. Events
of Default; Waiver.
(a) An
Event
of Default under this Guarantee will occur upon the failure of the Guarantor
to
perform any of its payment or other obligations hereunder.
(b) The
Holders of a Majority in liquidation amount of the Capital Securities may,
voting or consenting as a class, on behalf of the Holders of all of the Capital
Securities, waive any past Event of Default and its
consequences. Upon such waiver, any such Event of Default shall cease
to exist, and shall be deemed to have been cured, for every purpose of this
Guarantee, but no such waiver shall extend to any subsequent or other default
or
Event of Default or impair any right consequent thereon.
Section
2.5. Events
of Default; Notice.
(a) The
Guarantee Trustee shall, within 90 days after the occurrence of an Event of
Default, transmit by mail, first class postage prepaid, to the Holders of the
Capital Securities and the Guarantor, notices of all Events of Default actually
known to a Responsible Officer of the Guarantee Trustee, unless such defaults
have been cured before the giving of such notice, provided,
however, that the Guarantee Trustee shall be protected in withholding
such notice if and so long as a Responsible Officer of the Guarantee Trustee
in
good faith determines that the withholding of such notice is in the interests
of
the Holders of the Capital Securities.
(b) The
Guarantee Trustee shall not be deemed to have knowledge of any Event of Default
unless the Guarantee Trustee shall have received written notice from the
Guarantor or a Holder of the Capital Securities (except in the case of a payment
default), or a Responsible Officer of the Guarantee Trustee charged with the
administration of this Guarantee shall have obtained actual knowledge
thereof.
ARTICLE
III
GUARANTEE
TRUSTEE
Section
3.1. Guarantee
Trustee; Eligibility.
(a) There
shall at all times be a Guarantee Trustee which shall:
(i) not
be an
Affiliate of the Guarantor, and
(ii) be
a
corporation organized and doing business under the laws of the United States
of
America or any State or Territory thereof or of the District of Columbia, or
Person authorized under such laws to exercise corporate trust powers, having
a
combined capital and surplus of at least 50 million U.S. dollars
($50,000,000), and subject to supervision or examination by Federal, State,
Territorial or District of Columbia authority. If such corporation
publishes reports of condition at least annually, pursuant to law or to the
requirements of the supervising or examining authority referred to above, then,
for the purposes of this Section 3.1(a)(ii), the combined capital and surplus
of
such corporation shall be deemed to be its combined capital and surplus as
set
forth in its most recent report of condition so published.
(b) If
at any
time the Guarantee Trustee shall cease to be eligible to so act under
Section 3.1(a), the Guarantee Trustee shall immediately resign in the
manner and with the effect set out in Section 3.2(c).
(c) If
the
Guarantee Trustee has or shall acquire any “conflicting interest” within the
meaning of Section 310(b) of the Trust Indenture Act, the Guarantee Trustee
shall either eliminate such interest or resign to the extent and in the manner
provided by, and subject to this Guarantee.
Section
3.2. Appointment,
Removal and Resignation of Guarantee Trustee.
(a) Subject
to Section 3.2(b), the Guarantee Trustee may be appointed or removed without
cause at any time by the Guarantor except during an Event of
Default.
(b) The
Guarantee Trustee shall not be removed in accordance with Section 3.2(a) until
a
Successor Guarantee Trustee has been appointed and has accepted such appointment
by written instrument executed by such Successor Guarantee Trustee and delivered
to the Guarantor.
(c) The
Guarantee Trustee appointed to office shall hold office until a Successor
Guarantee Trustee shall have been appointed or until its removal or
resignation. The Guarantee Trustee may resign from office (without
need for prior or subsequent accounting) by an instrument in writing executed
by
the Guarantee Trustee and delivered to the Guarantor, which resignation shall
not take effect until a Successor Guarantee Trustee has been appointed and
has
accepted such appointment by an instrument in writing executed by such Successor
Guarantee Trustee and delivered to the Guarantor and the resigning Guarantee
Trustee.
(d) If
no
Successor Guarantee Trustee shall have been appointed and accepted appointment
as provided in this Section 3.2 within 60 days after delivery of an
instrument of removal or resignation, the Guarantee Trustee resigning or being
removed may petition any court of competent jurisdiction for appointment of
a
Successor Guarantee Trustee. Such court may thereupon, after
prescribing such notice, if any, as it may deem proper, appoint a Successor
Guarantee Trustee.
(e) No
Guarantee Trustee shall be liable for the acts or omissions to act of any
Successor Guarantee Trustee.
(f) Upon
termination of this Guarantee or removal or resignation of the Guarantee Trustee
pursuant to this Section 3.2, the Guarantor shall pay to the Guarantee Trustee
all amounts owing to the Guarantee Trustee under Sections 7.2 and 7.3
accrued to the date of such termination, removal or resignation.
ARTICLE
IV
GUARANTEE
Section
4.1. Guarantee.
(a) The
Guarantor irrevocably and unconditionally agrees to pay in full to the Holders
the Guarantee Payments (without duplication of amounts theretofore paid by
the
Issuer), as and when due, regardless of any defense (except the defense of
payment by the Issuer), right of set-off or counterclaim that the Issuer may
have or assert. The Guarantor’s obligation to make a Guarantee
Payment may be satisfied by direct payment of the required amounts by the
Guarantor to the Holders or by causing the Issuer to pay such amounts to the
Holders.
(b) The
Guarantor hereby also agrees to assume any and all Obligations of the Issuer
and
in the event any such Obligation is not so assumed, subject to the terms and
conditions hereof, the Guarantor hereby irrevocably and unconditionally
guarantees to each Beneficiary the full payment, when and as due, of any and
all
Obligations to such Beneficiaries. This Guarantee is intended to be
for the benefit of, and to be enforceable by, all such Beneficiaries, whether
or
not such Beneficiaries have received notice hereof.
Section
4.2. Waiver
of Notice and Demand.
The
Guarantor hereby waives notice of acceptance of this Guarantee and of any
liability to which it applies or may apply, presentment, demand for payment,
any
right to require a proceeding first against the Issuer or any other Person
before proceeding against the Guarantor, protest, notice of nonpayment, notice
of dishonor, notice of redemption and all other notices and
demands.
Section
4.3. Obligations
Not Affected.
The
obligations, covenants, agreements and duties of the Guarantor under this
Guarantee shall in no way be affected or impaired by reason of the happening
from time to time of any of the following:
(a) the
release or waiver, by operation of law or otherwise, of the performance or
observance by the Issuer of any express or implied agreement, covenant, term
or
condition relating to the Capital Securities to be performed or observed by
the
Issuer;
(b) the
extension of time for the payment by the Issuer of all or any portion of the
Distributions, Redemption Price, Special Redemption Price, Liquidation
Distribution or any other sums payable under the terms of the Capital Securities
or the extension of time for the performance of any other obligation under,
arising out of or in connection with, the Capital Securities (other than an
extension of time for payment of Distributions, Redemption Price, Special
Redemption Price, Liquidation Distribution or other sum payable that results
from the extension of any interest payment period on the Debentures or any
extension of the maturity date of the Debentures permitted by the
Indenture);
(c) any
failure, omission, delay or lack of diligence on the part of the Holders to
enforce, assert or exercise any right, privilege, power or remedy conferred
on
the Holders pursuant to the terms of the Capital Securities, or any action
on
the part of the Issuer granting indulgence or extension of any
kind;
(d) the
voluntary or involuntary liquidation, dissolution, sale of any collateral,
receivership, insolvency, bankruptcy, assignment for the benefit of creditors,
reorganization, arrangement, composition or readjustment of debt of, or other
similar proceedings affecting, the Issuer or any of the assets of the
Issuer;
(e) any
invalidity of, or defect or deficiency in, the Capital Securities;
(f) the
settlement or compromise of any obligation guaranteed hereby or hereby incurred;
or
(g) any
other
circumstance whatsoever that might otherwise constitute a legal or equitable
discharge or defense of a guarantor, it being the intent of this
Section 4.3 that the obligations of the Guarantor hereunder shall be
absolute and unconditional under any and all circumstances.
There
shall be no obligation of the Holders to give notice to, or obtain consent
of,
the Guarantor with respect to the happening of any of the
foregoing.
Section
4.4. Rights
of Holders.
(a) The
Holders of a Majority in liquidation amount of the Capital Securities have
the
right to direct the time, method and place of conducting any proceeding for
any
remedy available to the Guarantee Trustee in respect of this Guarantee or to
direct the exercise of any trust or power conferred upon the Guarantee Trustee
under this Guarantee; provided, however, that (subject to
Section 2.1) the Guarantee Trustee shall have the right to decline to
follow any such direction if the Guarantee Trustee being advised by counsel
determines that the action or proceeding so directed may not lawfully be taken
or if the Guarantee Trustee in good faith by its board of directors or trustees,
executive committees or a trust committee of directors or trustees and/or
Responsible Officers shall determine that the action or proceedings so directed
would involve the Guarantee Trustee in personal liability.
(b) Any
Holder of Capital Securities may institute a legal proceeding directly against
the Guarantor to enforce the Guarantee Trustee’s rights under this Guarantee,
without first instituting a legal proceeding against the Issuer, the Guarantee
Trustee or any other Person. The Guarantor waives any right or remedy
to require that any such action be brought first against the Issuer, the
Guarantee Trustee or any other Person before so proceeding directly against
the
Guarantor.
Section
4.5. Guarantee
of Payment.
This
Guarantee creates a guarantee of payment and not of collection.
Section
4.6. Subrogation.
The
Guarantor shall be subrogated to all (if any) rights of the Holders of Capital
Securities against the Issuer in respect of any amounts paid to such Holders
by
the Guarantor under this Guarantee; provided, however, that the
Guarantor shall not (except to the extent required by mandatory provisions
of
law) be entitled to enforce or exercise any right that it may acquire by way
of
subrogation or any indemnity, reimbursement or other agreement, in all cases
as
a result of payment under this Guarantee, if, after giving effect to any such
payment, any amounts are due and unpaid under this Guarantee. If any
amount shall be paid to the Guarantor in violation of the preceding sentence,
the Guarantor agrees to hold such amount in trust for the Holders and to pay
over such amount to the Holders.
Section
4.7. Independent
Obligations.
The
Guarantor acknowledges that its obligations hereunder are independent of the
obligations of the Issuer with respect to the Capital Securities and that the
Guarantor shall be liable as principal and as debtor hereunder to make Guarantee
Payments pursuant to the terms of this Guarantee notwithstanding the occurrence
of any event referred to in subsections (a) through (g), inclusive, of Section
4.3 hereof.
Section
4.8. Enforcement
by a Beneficiary.
A
Beneficiary may enforce the obligations of the Guarantor contained in Section
4.1(b) directly against the Guarantor and the Guarantor waives any right or
remedy to require that any action be brought against the Issuer or any other
person or entity before proceeding against the Guarantor. The
Guarantor shall be subrogated to all rights (if any) of any Beneficiary against
the Issuer in respect of any amounts paid to the Beneficiaries by the Guarantor
under this Guarantee; provided, however, that the Guarantor shall
not (except to the extent required by mandatory provisions of law) be entitled
to enforce or exercise any rights that it may acquire by way of subrogation
or
any indemnity, reimbursement or other agreement, in all cases as a result of
payment under this Guarantee, if at the time of any such payment, and after
giving effect to such payment, any amounts are due and unpaid under this
Guarantee.
ARTICLE
V
LIMITATION
OF TRANSACTIONS; SUBORDINATION
Section
5.1. Limitation
of Transactions.
So
long
as any Capital Securities remain outstanding, if (a) there shall have
occurred and be continuing an Event of Default or a Declaration Event of Default
or (b) the Guarantor shall have selected an Extension Period as provided in
the Declaration and such period, or any extension thereof, shall have commenced
and be continuing, then the Guarantor shall not and shall not permit any
Affiliate to (x) declare or pay any dividends or distributions on, or
redeem, purchase, acquire, or make a liquidation payment with respect to, any
of
the Guarantor’s or such Affiliate’s capital stock (other than payments of
dividends or distributions to the Guarantor or payments of dividends from direct
or indirect subsidiaries of the Guarantor to their parent corporations, which
also shall be direct or indirect subsidiaries of the Guarantor) or make any
guarantee payments with respect to the foregoing or (y) make any payment of
principal of or interest or premium, if any, on or repay, repurchase or redeem
any debt securities of the Guarantor or any Affiliate that rank pari passu
in all respects with or junior in interest to the Debentures (other
than,
with respect to clauses (x) and (y) above, (i) repurchases, redemptions or
other acquisitions of shares of capital stock of the Guarantor in connection
with any employment contract, benefit plan or other similar arrangement with
or
for the benefit of one or more employees, officers, directors or consultants,
in
connection with a dividend reinvestment or stockholder stock purchase plan
or in
connection with the issuance of capital stock of the Guarantor (or securities
convertible into or exercisable for such capital stock) as consideration in
an
acquisition transaction entered into prior to the occurrence of the Event of
Default, Declaration Event of Default or Extension Period, as applicable,
(ii) as a result of any exchange or conversion of any class or series of
the Guarantor’s capital stock (or any capital stock of a subsidiary of the
Guarantor) for any class or series of the Guarantor’s capital stock or of any
class or series of the Guarantor’s indebtedness for any class or series of the
Guarantor’s capital stock, (iii) the purchase of fractional interests in
shares of the Guarantor’s capital stock pursuant to the conversion or exchange
provisions of such capital stock or the security being converted or exchanged,
(iv) any declaration of a dividend in connection with any stockholders’
rights plan, or the issuance of rights, stock or other property under any
stockholders’ rights plan, or the redemption or repurchase of rights pursuant
thereto, (v) any dividend in the form of stock, warrants, options or other
rights where the dividend stock or the stock issuable upon exercise of such
warrants, options or other rights is the same stock as that on which the
dividend is being paid or ranks pari passu with or junior to such stock
and any cash payments in lieu of fractional shares issued in connection
therewith, (vi) payments of principal or interest on debt securities or
payments of cash dividends or distributions on any capital stock issued by
an
Affiliate that is not, in whole or in part, a subsidiary of the Guarantor (or
any redemptions, repurchases or liquidation payments on such stock or
securities), or (vii) payments under this Guarantee).
Section
5.2. Ranking.
This
Guarantee will constitute an unsecured obligation of the Guarantor and will
rank
subordinate and junior in right of payment to all present and future Senior
Indebtedness (as defined in the Indenture) of the Guarantor. By their
acceptance thereof, each Holder of Capital Securities agrees to the foregoing
provisions of this Guarantee and the other terms set forth herein.
The
right
of the Guarantor to participate in any distribution of assets of any of its
subsidiaries upon any such subsidiary’s liquidation or reorganization or
otherwise is subject to the prior claims of creditors of that subsidiary, except
to the extent the Guarantor may itself be recognized as a creditor of that
subsidiary. Accordingly, the Guarantor’s obligations under this
Guarantee will be effectively subordinated to all existing and future
liabilities of the Guarantor’s subsidiaries, and claimants should look only to
the assets of the Guarantor for payments hereunder. This Guarantee
does not limit the incurrence or issuance of other secured or unsecured debt
of
the Guarantor, including Senior Indebtedness of the Guarantor, under any
indenture that the Guarantor may enter into in the future or
otherwise.
ARTICLE
VI
TERMINATION
Section
6.1. Termination.
This
Guarantee shall terminate as to the Capital Securities (i) upon full
payment of the Redemption Price or Special Redemption Price of all Capital
Securities then outstanding, (ii) upon the distribution of all of the
Debentures to the Holders of all of the Capital Securities or (iii) upon
full payment of the amounts payable in accordance with the Declaration upon
dissolution of the Issuer. This Guarantee will continue to be
effective or will be reinstated, as the case may be, if at any time any Holder
of Capital Securities must restore payment of any sums paid under the Capital
Securities or under this Guarantee.
ARTICLE
VII
INDEMNIFICATION
Section
7.1. Exculpation.
(a) No
Indemnified Person shall be liable, responsible or accountable in damages or
otherwise to the Guarantor or any Covered Person for any loss, damage or claim
incurred by reason of any act or omission performed or omitted by such
Indemnified Person in good faith in accordance with this Guarantee and in a
manner that such Indemnified Person reasonably believed to be within the scope
of the authority conferred on such Indemnified Person by this Guarantee or
by
law, except that an Indemnified Person shall be liable for any such loss, damage
or claim incurred by reason of such Indemnified Person’s negligence or willful
misconduct with respect to such acts or omissions.
(b) An
Indemnified Person shall be fully protected in relying in good faith upon the
records of the Issuer or the Guarantor and upon such information, opinions,
reports or statements presented to the Issuer or the Guarantor by any Person
as
to matters the Indemnified Person reasonably believes are within such other
Person’s professional or expert competence and who, if selected by such
Indemnified Person, has been selected with reasonable care by such Indemnified
Person, including information, opinions, reports or statements as to the value
and amount of the assets, liabilities, profits, losses, or any other facts
pertinent to the existence and amount of assets from which Distributions to
Holders of Capital Securities might properly be paid.
Section
7.2. Indemnification.
(a) The
Guarantor agrees to indemnify each Indemnified Person for, and to hold each
Indemnified Person harmless against, any and all loss, liability, damage, claim
or expense incurred without negligence or willful misconduct on the part of
the
Indemnified Person, arising out of or in connection with the acceptance or
administration of the trust or trusts hereunder, including, but not limited
to,
the costs and expenses (including reasonable legal fees and expenses) of the
Indemnified Person defending itself against, or investigating, any claim or
liability in connection with the exercise or performance of any of the
Indemnified Person’s powers or duties hereunder. The obligation to
indemnify as set forth in this Section 7.2 shall survive the resignation or
removal of the Guarantee Trustee and the termination of this
Guarantee.
(b) Promptly
after receipt by an Indemnified Person under this Section 7.2 of notice of
the commencement of any action, such Indemnified Person will, if a claim in
respect thereof is to be made against the Guarantor under this Section 7.2,
notify the Guarantor in writing of the commencement thereof; but the failure
so
to notify the Guarantor (i) will not relieve the Guarantor from liability
under paragraph (a) above unless and to the extent that the Guarantor did
not otherwise learn of such action and such failure results in the forfeiture
by
the Guarantor of substantial rights and defenses and (ii) will not, in any
event, relieve the Guarantor from any obligations to any Indemnified Person
other than the indemnification obligation provided in paragraph (a)
above. The Guarantor shall be entitled to appoint counsel of the
Guarantor’s choice at the Guarantor’s expense to represent the Indemnified
Person in any action for which indemnification is sought (in which case the
Guarantor shall not thereafter be responsible for the fees and expenses of
any
separate counsel retained by the Indemnified Person or Persons except as set
forth below); provided, however, that such counsel shall be
reasonably satisfactory to the Indemnified Person. Notwithstanding
the Guarantor’s election to appoint counsel to represent the Guarantor in an
action, the Indemnified Person shall have the right to employ separate counsel
(including local counsel), and the Guarantor shall bear the reasonable fees,
costs and expenses of such separate counsel if (i) the use of counsel
chosen by the Guarantor to represent the Indemnified Person would present such
counsel with a conflict of interest, (ii) the actual or potential
defendants in, or targets of, any such action include both the Indemnified
Person and the Guarantor and the Indemnified Person shall have reasonably
concluded that there may be legal defenses available to it and/or other
Indemnified Person(s) which are different from or additional to those available
to the Guarantor, (iii) the Guarantor shall not have employed counsel
satisfactory to the Indemnified Person to represent the Indemnified Person
within a reasonable time after notice of the institution of such action or
(iv) the Guarantor shall authorize the Indemnified Person to employ
separate counsel at the expense of the Guarantor. The Guarantor will
not, without the prior written consent of the Indemnified Persons, settle or
compromise or consent to the entry of any judgment with respect to any pending
or threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not the
Indemnified Persons are actual or potential parties to such claim or action)
unless such settlement, compromise or consent includes an unconditional release
of each Indemnified Person from all liability arising out of such claim, action,
suit or proceeding.
Section
7.3. Compensation;
Reimbursement of Expenses.
The
Guarantor agrees:
(a) to
pay to
the Guarantee Trustee from time to time such compensation for all services
rendered by it hereunder as the parties shall agree to from time to time (which
compensation shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust); and
(b) except
as
otherwise expressly provided herein, to reimburse the Guarantee Trustee upon
request for all reasonable expenses, disbursements and advances incurred or
made
by it in accordance with any provision of this Guarantee (including the
reasonable compensation and the expenses and disbursements of its agents and
counsel), except any such expense, disbursement or advance as may be
attributable to its negligence or willful misconduct.
For
purposes of clarification, this Section 7.3 does not contemplate the
payment by the Guarantor of acceptance or annual administration fees owing
to
the Guarantee Trustee for services to be provided by the Guarantee Trustee
under
this Guarantee or the fees and expenses of the Guarantee Trustee’s counsel in
connection with the closing of the transactions contemplated by this
Guarantee. The provisions of this Section 7.3 shall survive the
resignation or removal of the Guarantee Trustee and the termination of this
Guarantee.
ARTICLE
VIII
MISCELLANEOUS
Section
8.1. Successors
and Assigns.
All
guarantees and agreements contained in this Guarantee shall bind the successors,
assigns, receivers, trustees and representatives of the Guarantor and shall
inure to the benefit of the Holders of the Capital Securities then
outstanding. Except in connection with any merger or consolidation of
the Guarantor with or into another entity or any sale, transfer or lease of
the
Guarantor’s assets to another entity, in each case, to the extent permitted
under the Indenture, the Guarantor may not assign its rights or delegate its
obligations under this Guarantee without the prior approval of the Holders
of at
least a Majority in liquidation amount of the Capital Securities.
Section
8.2. Amendments.
Except
with respect to any changes that do not adversely affect the rights of Holders
of the Capital Securities in any material respect (in which case no consent
of
Holders will be required), this Guarantee may be amended only with the prior
approval of the Holders of not less than a Majority in liquidation amount of
the
Capital Securities. The provisions of the Declaration with respect to
amendments thereof apply to the giving of such approval.
Section
8.3. Notices.
All
notices provided for in this Guarantee shall be in writing, duly signed by
the
party giving such notice, and shall be delivered, telecopied or mailed by first
class mail, as follows:
(a) If
given
to the Guarantee Trustee, at the Guarantee Trustee’s mailing address set forth
below (or such other address as the Guarantee Trustee may give notice of to
the
Holders of the Capital Securities and the Guarantor):
Wilmington
Trust Company
▇▇▇▇▇▇
Square North
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Corporate
Trust Administration
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
(b) If
given
to the Guarantor, at the Guarantor’s mailing address set forth below (or such
other address as the Guarantor may give notice of to the Holders of the Capital
Securities and to the Guarantee Trustee):
Community
Bancorp.
▇▇▇▇
▇.▇.
▇▇▇▇▇ #▇
▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
(c) If
given
to any Holder of the Capital Securities, at the address set forth on the books
and records of the Issuer.
All
such
notices shall be deemed to have been given when received in person, telecopied
with receipt confirmed, or mailed by first class mail, postage prepaid, except
that if a notice or other document is refused delivery or cannot be delivered
because of a changed address of which no notice was given, such notice or other
document shall be deemed to have been delivered on the date of such refusal
or
inability to deliver.
Section
8.4. Benefit.
This
Guarantee is solely for the benefit of the Beneficiaries and, subject to Section
2.1(a), is not separately transferable from the Capital Securities.
Section
8.5. Governing
Law.
THIS
GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS
PRINCIPLES THEREOF (OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW).
Section
8.6. Counterparts.
This
Guarantee may be executed in one or more counterparts, each of which shall
be an
original, but all of which taken together shall constitute one and the same
instrument.
Section
8.7. Separability.
In
case
one or more of the provisions contained in this Guarantee 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
Guarantee, but this Guarantee shall be construed as if such invalid or illegal
or unenforceable provision had never been contained herein.
Signatures
appear on the following page
THIS
GUARANTEE is executed as of the day and year first above written.
COMMUNITY
BANCORP., as Guarantor
|
By:
|
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
|
|
Name:
|
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ |
|
Title:
|
Chairman & CEO |
WILMINGTON
TRUST COMPANY, as Guarantee Trustee
|
By:
|
/s/ ▇. ▇. ▇▇▇▇▇▇, ▇▇ |
|
Name:
|
W. ▇▇▇▇▇▇ ▇▇▇▇▇▇, II |
|
Title:
|
Assistant Vice President |