1
Exhibit 4.7
================================================================================
CAPITAL SECURITIES GUARANTEE AGREEMENT
Summit Capital Trust I
Dated as of March 20, 1997
================================================================================
2
CROSS-REFERENCE TABLE*
----------------------
Section of Trust Indenture Act Section of Capital Securities
of 1939, as amended Guarantee Agreement
310(a)................................................................... 4.1(a)
310(b)................................................................... 4.1(c)
310(c)................................................................... Inapplicable
311(a)................................................................... 2.2(a)
311(b)................................................................... 2.2(b)
311(c)................................................................... Inapplicable
312(a)................................................................... 2.2(a)
312(b)................................................................... 2.2(b)
312(c)................................................................... 2.2(c)
313...................................................................... 2.3
314(a)................................................................... 2.4
314(b)................................................................... Inapplicable
314(c)................................................................... 2.5
314(d)................................................................... Inapplicable
314(e)................................................................... 2.5
314(f)................................................................... Inapplicable
315(a)................................................................... 3.1(b)
315(b)................................................................... 2.7
315(c)................................................................... 3.1(c)
315(d)................................................................... 3.1(d)
316(a)................................................................... 5.4(a), 2.6
318(a)................................................................... 2.1(c)
-------------
* This Cross-Reference Table does not constitute part of this Guarantee
Agreement and shall not affect the interpretation of any of its terms or
provisions.
i
3
TABLE OF CONTENTS
-----------------
Page
CROSS-REFERENCE TABLE*............................................................................................i
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation.......................................................................1
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application.....................................................................4
SECTION 2.2 Lists of Holders of the Securities...................................................................5
SECTION 2.3 Reports by the Guarantee Trustee.....................................................................5
SECTION 2.4 Periodic Reports to Guarantee Trustee................................................................5
SECTION 2.5 Evidence of Compliance with Conditions Precedent.....................................................5
SECTION 2.6 Events of Default; Waiver............................................................................6
SECTION 2.7 Events of Default; Notice............................................................................6
SECTION 2.8 Conflicting Interests................................................................................6
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Guarantee Trustee...........................................................6
SECTION 3.2 Certain Rights of Guarantee Trustee..................................................................8
SECTION 3.3 Not Responsible for Recitals or Issuance of the Capital Securities Guarantee........................10
ARTICLE IV
GUARANTEE TRUSTEE
SECTION 4.1 Guarantee Trustee; Eligibility......................................................................10
SECTION 4.2 Appointment, Removal and Resignation of Guarantee Trustee...........................................11
ARTICLE V
GUARANTEE
SECTION 5.1 Capital Securities Guarantee........................................................................12
SECTION 5.2 Waiver of Notice and Demand.........................................................................12
SECTION 5.3 Obligations Not Affected............................................................................12
SECTION 5.4 Rights of Holders...................................................................................13
SECTION 5.5 Guarantee of Payment................................................................................14
SECTION 5.6 Subrogation.........................................................................................14
ii
4
Page
SECTION 5.7 Independent Obligations.............................................................................14
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions..........................................................................14
SECTION 6.2 Ranking.............................................................................................15
ARTICLE VII
TERMINATION
SECTION 7.1 Termination.........................................................................................15
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1 Exculpation.........................................................................................16
SECTION 8.2 Indemnification.....................................................................................16
SECTION 8.3 Compensation; Reimbursement of Expenses.............................................................16
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns..............................................................................17
SECTION 9.2 Amendments..........................................................................................17
SECTION 9.3 Notices.............................................................................................17
SECTION 9.4 Benefit.............................................................................................18
SECTION 9.5 Governing Law.......................................................................................18
iii
5
CAPITAL SECURITIES GUARANTEE AGREEMENT
This CAPITAL SECURITIES GUARANTEE AGREEMENT (the "Capital
Securities Guarantee"), dated as of March 20, 1997, is executed and delivered by
Summit Bancorp., a New Jersey corporation (the "Guarantor"), and The First
National Bank of Chicago, a national banking association, 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 Summit Capital
Trust I, a Delaware statutory business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of Trust
(the "Declaration"), dated as of March 20, 1997, among the trustees and
administrators named therein of the Issuer, Summit Bancorp., 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 securities, having an aggregate
liquidation amount of up to $150,000,000, designated the 8.40% Capital Trust
Pass-through Securities(SM) (the "Initial Capital Securities") and may issue in
the future, pursuant to the Registration Rights Agreement (as defined in the
Declaration), securities solely to be exchanged for Initial Capital Securities,
with terms that are substantially identical to those of the Initial Capital
Securities (the "Exchange Capital Securities", and together with the Initial
Capital Securities, the "Capital Securities");
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 Capital Securities Guarantee, to pay to the Holders
of the Capital Securities the Guarantee Payments (as defined herein) and to make
certain other payments on the terms and conditions set forth herein; and
WHEREAS, the Guarantor is also executing and delivering a common
securities guarantee agreement (the "Common Securities Guarantee") for the
benefit of the holders of the Common Securities (as defined in the Declaration)
of the Issuer, the terms of which provide that if a Declaration Event of Default
(as defined in the Declaration) has occurred and is continuing, the rights of
holders of the Common Securities to receive payments under the Common Securities
Guarantee are subordinated to the rights of Holders of the Capital Securities to
receive Guarantee Payments under this Capital Securities Guarantee.
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 Capital Securities
Guarantee for the benefit of the Holders.
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation
In this Capital Securities Guarantee, unless the context otherwise
requires:
6
(a) capitalized terms used in this Capital Securities 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 Capital Securities Guarantee
has the same meaning throughout;
(c) all references to the "Capital Securities Guarantee" or "this
Capital Securities Guarantee" are to this Capital Securities Guarantee as
modified, supplemented or amended from time to time;
(d) all references in this Capital Securities Guarantee to Articles
and Sections are to Articles and Sections of this Capital Securities
Guarantee, unless otherwise specified;
(e) terms defined in the Declaration as at the date of execution of
this Capital Securities Guarantee or in the Trust Indenture Act, as the
case may be, have the same meanings when used in this Capital Securities
Guarantee, unless otherwise defined in this Capital Securities Guarantee or
unless the context otherwise requires; and
(f) a reference to the singular includes the plural and vice versa.
"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 Agreement is located at Xxx Xxxxx Xxxxxxxx Xxxxx,
Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000-0000.
"Covered Person" means any Holder of the Capital Securities.
"Debentures" means the junior subordinated debentures of the Summit
Bancorp., designated the 8.40% Junior Subordinated Deferrable Interest
Debentures due 2027, 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 2.6.
"Guarantee Payments" means the following payments, 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, including all accrued and unpaid Distributions to the date of redemption
(the "Redemption Price"), to the extent the Issuer has funds available therefor,
with respect to any Capital Securities called for redemption by the Issuer, and
(iii) 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
2
7
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 of the Capital Securities in liquidation of the Issuer (in either case,
the "Liquidation Distribution").
"Guarantees" means the Common Securities Guarantee and this Capital
Securities Guarantee, collectively.
"Guarantee Trustee" means The First National Bank of Chicago, a
national banking association, until a Successor Guarantee Trustee has been
appointed and has accepted such appointment pursuant to the terms of this
Capital Securities Guarantee and thereafter means each such Successor Guarantee
Trustee.
"Holder" shall mean 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 other than an
Affiliate which becomes a Holder (i) due to foreclosure proceedings instituted
in connection with a debt previously contracted, or (ii) in a fiduciary or other
representative capacity.
"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 March 20, 1997,
between the Guarantor and The First National Bank of Chicago, 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.
"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 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.
"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 Capital Securities Guarantee shall include:
(a) a statement that each officer signing the Officer's Certificate
has read the covenant or condition and the definitions relating thereto;
3
8
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Officer's
Certificate;
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such
officer to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such officer,
such condition or covenant has been complied with.
"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 definition of "
Guarantee Payments" herein.
"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.
"Successor Guarantee Trustee" means a successor Guarantee Trustee
possessing the qualifications to act as Guarantee Trustee under Section 4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended.
"Trust Securities" means the Common Securities and the Capital
Securities.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application
(a) This Capital Securities Guarantee is subject to the provisions
of the Trust Indenture Act that would be required to be part of this
Capital Securities Guarantee if this Capital Securities Guarantee were
qualified under the Trust Indenture Act and shall, to the extent
applicable, be governed by such provisions;
(b) This Capital Securities Guarantee will be qualified under the
Trust Indenture Act upon effectiveness of a Registration Statement with
respect to the Capital Securities; and
4
9
(c) If and to the extent that any provision of this Capital
Securities Guarantee limits, qualifies or conflicts with the duties imposed
by Sections 310 to 317, inclusive, of the Trust Indenture Act, such imposed
duties shall control.
SECTION 2.2 Lists of Holders of the Securities
(a) The Guarantor shall provide the Guarantee Trustee, unless the
Capital Securities Guarantee is the registrar of the Capital Securities,
(i) within 14 days after each record date for payment of Distributions, a
list, in such form as the Guarantee Trustee may reasonably require, of the
names and addresses of the Holders of the Capital Securities ("List of
Holders") as of such record date, provided that the Guarantor shall not be
obligated to provide such List of Holders at any time the List of Holders
does not differ from the most recent List of Holders given to the Guarantee
Trustee by the Guarantor, and (ii) at any other time within 30 days of
receipt by the Guarantor of a written request for a List of Holders as of a
date no more than 14 days before such List of Holders is given to the
Guarantee Trustee. The Guarantee Trustee may destroy any List of Holders
previously given to it on receipt of a new List of Holders.
(b) The Guarantee Trustee shall comply with its obligations under
Sections 311(a), 311(b) and Section 312(b) of the Trust Indenture Act.
SECTION 2.3 Reports by the Guarantee Trustee
Within 60 days after May 15 of each year, the Guarantee Trustee
shall provide to the Holders of the Capital Securities such reports as are
required by Section 313(a) of the Trust Indenture Act, if any, in the form and
in the manner provided by Section 313 of the Trust Indenture Act. The Guarantee
Trustee shall also comply with the requirements of Sections 313(b), 313(c) and
313(d) of the Trust Indenture Act.
SECTION 2.4 Periodic Reports to Guarantee Trustee
The Guarantor shall provide to the Guarantee Trustee such
documents, reports and information (if any) as required by Section 314 of the
Trust Indenture Act and the compliance certificate required by Section 314 of
the Trust Indenture Act in the form, in the manner and at the times required by
Section 314 of the Trust Indenture Act, provided that such compliance
certificate shall be delivered on or before 120 days after the end of the fiscal
year of the Guarantor.
SECTION 2.5 Evidence of Compliance with Conditions Precedent
The Guarantor shall provide to the Guarantee Trustee such evidence
of compliance with any conditions precedent provided for in this Capital
Securities Guarantee that relate to any of the matters set forth in Section
314(c) of the Trust Indenture Act. Any certificate or opinion required to be
given by an officer pursuant to Section 314(c)(1) of the Trust Indenture Act may
be given in the form of an Officer's Certificate.
5
10
SECTION 2.6 Events of Default; Waiver
(a) An Event of Default under this Capital Securities 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 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 Capital Securities
Guarantee, but no such waiver shall extend to any subsequent or other default or
Event of Default or impair any right consequent thereon.
SECTION 2.7 Events of Default; Notice
(a) The Guarantee Trustee shall, within 90 days after the
occurrence of an Event of Default actually known to a Responsible Officer
of the Guarantee Trustee, transmit by mail, first class postage prepaid, to
the Holders of the Capital Securities, notices of all such Events of
Default unless such Events of Default 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 thereof 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
Capital Securities Guarantee shall have obtained actual knowledge thereof.
SECTION 2.8 Conflicting Interests
The Indenture, the Debentures issued or to be issued thereunder,
the Declaration, the Trust Securities issued or to be issued thereunder and the
Capital Securities Guarantee and the Common Securities Guarantee in connection
therewith shall be deemed to be specifically described in this Capital
Securities Guarantee for the purposes of clause (i) of the proviso contained in
Section 310(b)(1) of the Trust Indenture Act.
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Guarantee Trustee
(a) This Capital Securities Guarantee shall be held by the
Guarantee Trustee for the benefit of the Holders of the Capital Securities,
and the Guarantee Trustee shall not
6
11
transfer this Capital Securities Guarantee to any Person except a Holder of
the Capital Securities exercising his or her rights pursuant to Section
5.4(b) or to a Successor Guarantee Trustee on acceptance by such Successor
Guarantee Trustee of its appointment to act as Successor Guarantee Trustee.
The right, title and interest of the Guarantee Trustee 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 Capital Securities 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 Capital Securities Guarantee, and no implied covenants shall be
read into this Capital Securities Guarantee against the Guarantee Trustee.
In case an Event of Default has occurred (that has not been cured or waived
pursuant to Section 2.6) and is actually known to a Responsible Officer of
the Guarantee Trustee, the Guarantee Trustee shall exercise such of the
rights and powers vested in it by this Capital Securities 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 Capital Securities 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 Capital Securities 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
Capital Securities Guarantee, and no implied covenants or
obligations shall be read into this Capital Securities
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 Capital Securities Guarantee; but in
the case of any such certificates or opinions furnished to the
Guarantee Trustee, the Guarantee Trustee shall be under a duty
to examine the same to determine
7
12
whether or not they conform to the requirements of this
Capital Securities 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 direction of the Holders of a Majority in
liquidation amount of the Capital Securities relating to the time,
method and place of conducting any proceeding for any remedy available
to the Guarantee Trustee, or exercising any trust or power conferred
upon the Guarantee Trustee under this Capital Securities Guarantee; and
(iv) no provision of this Capital Securities 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 Capital Securities Guarantee or indemnity, reasonably
satisfactory to the Guarantee Trustee, against such risk or liability
is not reasonably assured to it.
SECTION 3.2 Certain Rights of Guarantee Trustee
(a) Subject to the provisions of Section 3.1:
(i) the Guarantee Trustee may conclusively rely, and shall be
fully protected in acting or refraining from acting, upon any
resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document 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 Capital Securities Guarantee shall be sufficiently evidenced
by an Officer's Certificate;
(iii) whenever, in the administration of this Capital
Securities 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 which, upon receipt of such request, shall be
promptly delivered by the Guarantor;
8
13
(iv) the Guarantee Trustee shall have no duty to see to any
recording, filing or registration of any instrument (or any
rerecording, refiling or 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; and 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 Capital
Securities 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 3.2(a) (vi) shall be taken to 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
Capital Securities 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; and 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 Capital Securities Guarantee, both of
which shall be
9
14
conclusively evidenced by the Guarantee Trustee's or its agent's
taking such action;
(x) whenever in the administration of this Capital Securities
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; and
(xi) the Guarantee Trustee shall not be liable for any action
taken, suffered, or omitted to be taken by it in good faith and
reasonably believed by it to be authorized or within the discretion
or rights or powers conferred upon it by this Capital Securities
Guarantee.
(b) No provision of this Capital Securities 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 3.3 Not Responsible for Recitals or Issuance of the Capital Securities
Guarantee
The recitals contained in this Capital Securities 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 Capital Securities
Guarantee.
ARTICLE IV
GUARANTEE TRUSTEE
SECTION 4.1 Guarantee Trustee; Eligibility
(a) There shall at all times be a Guarantee Trustee which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a 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 permitted by the
Securities and Exchange Commission to act as an institutional
trustee under the Trust Indenture Act, authorized under such laws
to exercise corporate trust powers, having a combined capital and
surplus of
10
15
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 4.1(a) (ii), the
combined capital and surplus of such corporation shall be deemed to
be its combined capital and surplus as set forth in its most recent
report of condition so published.
(b) If at any time the Guarantee Trustee shall cease to be eligible
to so act under Section 4.1(a), the Guarantee Trustee shall immediately
resign in the manner and with the effect set out in Section 4.2(c).
(c) If the Guarantee Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture Act,
the Guarantee Trustee and Guarantor shall in all respects comply with the
provisions of Section 310(b) of the Trust Indenture Act.
SECTION 4.2 Appointment, Removal and Resignation of Guarantee Trustee
(a) Subject to Section 4.2(b), 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 4.2(a) until a Successor Guarantee Trustee has been appointed and
has accepted such appointment by written instrument executed by such
Successor Guarantee Trustee and delivered to the Guarantor.
(c) The Guarantee Trustee appointed to office shall hold 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 4.2 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.
11
16
(f) Upon termination of this Capital Securities Guarantee or
removal or resignation of the Guarantee Trustee pursuant to this Section
4.2, the Guarantor shall pay to the Guarantee Trustee all amounts owing to
the Guarantee Trustee under Sections 8.2 and 8.3 accrued to the date of
such termination, removal or resignation.
ARTICLE V
GUARANTEE
SECTION 5.1 Capital Securities Guarantee
The Guarantor irrevocably and unconditionally agrees to pay in full
to the Holders the Guarantee Payments (without duplication of amounts
theretofore paid by the Issuer), as and when due, regardless of any defense
(except as defense of payment by the Issuer), right of set-off or counterclaim
that the Issuer may have or assert. Such obligations will not be discharged
except by payment of the Guarantee Payments in full. 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 of the Capital Securities or by causing
the Issuer to pay such amounts to such Holders. The Guarantee Payments shall
rank pari passu with any payments made in respect of the Common Securities;
provided, however, if a Declaration Event of Default has occurred and is
continuing, the rights of holders of the Common Securities to receive payments
under the Common Securities Guarantee are subordinated to the right of Holders
of the Capital Securities to receive any Guarantee Payments under this Capital
Securities Guarantee.
SECTION 5.2 Waiver of Notice and Demand
The Guarantor hereby waives notice of acceptance of this Capital
Securities 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 5.3 Obligations Not Affected
The obligations, covenants, agreements and duties of the Guarantor
under this Capital Securities 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, 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,
12
17
Liquidation Distribution or other sum payable that results from the
extension of any interest payment period on 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 5.3 that the obligations of the
Guarantor hereunder shall be absolute and unconditional under any and all
circumstances.
There shall be no obligation of the Holders to give notice to, or
obtain consent of, the Guarantor with respect to the happening of any of the
foregoing.
SECTION 5.4 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 Capital Securities Guarantee or to direct the exercise
of any trust or power conferred upon the Guarantee Trustee under this
Capital Securities Guarantee; provided however, that (subject to Section
3.1) the Guarantee Trustee shall have the right to decline to follow any
such direction if the Guarantee Trustee shall determine that the actions so
directed would be unjustly prejudicial to the Holders not taking part in
such direction or if the Guarantee Trustee being advised by counsel
determines that the action or proceeding so directed may not lawfully be
taken or if the Guarantor 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) If the Guarantee Trustee fails to enforce the Guarantor's
obligations under this Capital Securities Guarantee, any Holder of the
Capital Securities may institute a legal proceeding directly against the
Guarantor to enforce the Guarantee Trustee's rights under
13
18
this Capital Securities 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 5.5 Guarantee of Payment
This Capital Securities Guarantee creates a guarantee of payment
and not of collection.
SECTION 5.6 Subrogation
The Guarantor shall be subrogated to all (if any) rights of the
Holders of the Capital Securities against the Issuer in respect of any amounts
paid to such Holders by the Guarantor under this Capital Securities 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 Capital
Securities Guarantee, if, at the time of any such payment, any amounts are due
and unpaid under this Capital Securities 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 5.7 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 Capital
Securities Guarantee notwithstanding the occurrence of any event referred to in
subsections (a) through (g), inclusive, of Section 5.3 hereof.
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions
So long as any Capital Securities remain outstanding, if (i) the
Guarantor shall be in default with respect to its Guarantee Payments or other
obligations hereunder, (ii) there shall have occurred and be continuing an Event
of Default or a Declaration Event of Default or (iii) the Guarantor shall have
selected an Extension Period as provided in the Declaration and such period, or
any extension thereof, shall be continuing, then (a) the Guarantor shall not
declare or pay any dividend on, make any distributions with respect to, or
redeem, purchase, or make a liquidation payment with respect to, any of the
Guarantor's capital stock or rights to acquire such capital stock (other than
(i) purchases or acquisitions of shares of the Guarantor's capital stock or
rights to acquire such capital stock in connection with the satisfaction by the
Guarantor of its obligations under any of the Guarantor's benefit plan for
directors, officers or employees or
14
19
under the Guarantor's dividend reinvestment and stock purchase plan, (ii) as a
result of a reclassification of the Guarantor's capital stock or rights to
acquire such capital stock or the exchange or conversion of one class or series
of the Guarantor's capital stock or rights to acquire such capital stock for
another class or series of the Guarantor's capital stock or rights to acquire
any such 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) dividends
and distributions made on the Guarantor's capital stock or rights to acquire
such capital stock with the Guarantor's capital stock or rights to acquire such
capital stock, or (v) any declaration of a dividend in connection with the
implementation of a shareholder rights plan, or the issuance of stock under any
such plan in the future, or the redemption or repurchase of any such rights
pursuant thereto), or make any guarantee payments (other than payments under
this Capital Securities Guarantee and the Common Securities Guarantee) with
respect to the foregoing and (b) the Guarantor shall not make any payment of
interest, principal or premium, if any, on or repay, repurchase or redeem any
debt securities issued by the Guarantor which rank pari passu with or junior to
the Debentures.
SECTION 6.2 Ranking
This Capital Securities Guarantee will constitute an unsecured
obligation of the Guarantor and will rank subordinate and junior in right of
payment to the Allocable Amounts (as defined in the Indenture) in respect of all
present and future Senior Indebtedness (as defined in the Indenture) of the
Guarantor. By their acceptance thereof, each Holder of the Capital Securities
agrees to the foregoing provisions of this Capital Securities Guarantee and the
other terms set forth herein.
This Capital Securities 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.
If a Declaration Event of Default has occurred and is continuing,
the rights of holders of the Common Securities of the Issuer to receive payments
under the Common Securities Guarantee are subordinated to the rights of Holders
of the Capital Securities to receive Guarantee Payments under this Capital
Securities Guarantee.
ARTICLE VII
TERMINATION
SECTION 7.1 Termination
This Capital Securities Guarantee shall terminate and be of no
further force and effect (i) upon full payment of the Redemption Price of all
Capital Securities, (ii) upon the distribution 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
Capital Securities Guarantee will continue to be effective or will be
reinstated, as the case may be, if at any time any Holder of the Capital
Securities must restore payment of any sums paid under the Capital Securities or
under this Capital Securities Guarantee.
15
20
Exhibit 4.6
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1 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 Capital Securities 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 Capital Securities
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 the Capital
Securities might properly be paid.
SECTION 8.2 Indemnification
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 bad faith 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 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 8.2 shall survive the resignation or removal of the Guarantee Trustee
and the termination of this Capital Securities Guarantee.
SECTION 8.3 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 (which compensation shall
not be limited by any provision of law in regard to the compensation of a
trustee of an express trust) in an amount mutually agreed upon; and
16
21
(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 Capital
Securities 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 bad faith.
The provisions of this Section 8.3 shall survive the resignation or
removal of the Guarantee Trustee and the termination of this Capital Securities
Guarantee.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns
All guarantees and agreements contained in this Capital Securities
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,
conveyance, transfer, lease or other disposition 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
Capital Securities Guarantee without the prior approval of the Holders of a
Majority in liquidation amount of the Capital Securities.
SECTION 9.2 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 Capital Securities Guarantee
may be amended only with the prior approval of the Holders of 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 9.3 Notices
All notices provided for in this Capital Securities 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):
The First National Bank of Chicago
Xxx Xxxxx Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Corporate Trust Services Division
Telecopy: (000) 000-0000
17
22
(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):
Summit Bancorp.
000 Xxxxxxxx Xxxxxx
X.X. Xxx 0000
Xxxxxxxxx, Xxx Xxxxxx 00000-0000
Attention: Corporate Secretary
Telecopy: (000) 000-0000
(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 9.4 Benefit
This Capital Securities Guarantee is solely for the benefit of the
Holders of the Capital Securities and, subject to Section 3.1(a), is not
separately transferable from the Capital Securities.
SECTION 9.5 Governing Law
THIS CAPITAL SECURITIES GUARANTEE SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK,
WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF.
18
23
THIS CAPITAL SECURITIES GUARANTEE is executed as of the day and
year first above written.
SUMMIT BANCORP.,
as Guarantor
By:_______________________________
Name:
Title:
THE FIRST NATIONAL BANK OF CHICAGO,
as Guarantee Trustee
By:_______________________________
Name:
Title:
