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COMMON SECURITIES GUARANTEE AGREEMENT
UNITED NATIONAL BANCORP
Dated as of March 21, 1997
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TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1. Definitions Interpretation................................. 1
ARTICLE II
GUARANTEE
SECTION 2.1. Guarantee.................................................. 2
SECTION 2.2. Waiver of Notice and Demand................................ 2
SECTION 2.3. Obligations Not Affected................................... 2
SECTION 2.4. Rights of Holders.......................................... 3
SECTION 2.5. Guarantee of Payment....................................... 3
SECTION 2.6. Subrogation................................................ 3
SECTION 2.7. Independent Obligations.................................... 4
ARTICLE III
LIMITATIONS OF TRANSACTIONS; SUBORDINATION
SECTION 3.1. Limitation of Transactions................................. 4
SECTION 3.2. Ranking.................................................... 4
ARTICLE IV
TERMINATION
SECTION 4.1. Termination................................................ 5
ARTICLE V
MISCELLANEOUS
SECTION 5.1. Successors and Assigns..................................... 5
SECTION 5.2. Amendments................................................. 5
SECTION 5.3. Notices.................................................... 5
SECTION 5.4. Benefit.................................................... 6
SECTION 5.5. Governing Law.............................................. 6
COMMON SECURITIES GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT (the "Common Securities Guarantee"), dated as of
March 21, 1997, is executed and delivered by UNITED NATIONAL BANCORP, a New
Jersey corporation (the "Guarantor"), for the benefit of the Holders (as defined
herein) from time to time of the Common Securities (as defined herein) of UNB
Capital Trust I, a Delaware business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of Trust (the
"Declaration"), dated as of March 21, 1997, among the Trustees 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 619 common securities designated the 10.01% Common
Securities (the "Common Securities"), having an aggregate stated liquidation
amount of $619,000;
WHEREAS, as incentive for the Holders to purchase the Common Securities,
the Guarantor desires to irrevocably and unconditionally agree, to the extent
set forth in this Common Securities Guarantee, to pay to the Holders of the
Common 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 guarantee
agreement (the "Series A Capital Securities Guarantee") for the benefit of the
holders of the Series A Capital Securities (as defined in the Declaration) and
upon consummation of the Exchange Offer (as defined in the Declaration) will
execute and deliver a guarantee agreement (the "Series B Capital Securities
Guarantee") for the benefit of the holders of the Series B Capital Securities
(as defined in the Declaration), each in substantiallyidentical terms to this
Common Securities Guarantee, except that if an Event of Default (as defined in
the Declaration) has occurred and is continuing, the rights of Holders of the
Common Securities to receive Guarantee Payments under this Common Securities
Guarantee are subordinated to the rights of holders of Capital Securities to
receive Guarantee Payments under the Series A Capital Securities Guarantee and
the Series B Capital Securities Guarantee, as the case may be.
NOW, THEREFORE, in consideration of the purchase by each Holder of Common
Securities, which purchase the Guarantor hereby acknowledges shall benefit the
Guarantor, the Guarantor executes and delivers this Common Securities Guarantee
for the benefit of the Holders.
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1. Definitions Interpretation
In this Common Securities Guarantee, unless the context otherwise requires:
(a) Capitalized terms used in this Common Securities Guarantee but not
defined in the preamble above have the respective meanings assigned to them in
this Section 1.1;
(b) Terms defined in the Declaration as at the date of execution of this
Common Securities Guarantee have the same meaning when used in this Common
Securities Guarantee unless otherwise defined in this Common Securities
Guarantee;
(c) a term defined anywhere in this Common Securities Guarantee has the
same meaning throughout;
(d) all references to "the Common Securities Guarantee" or "this Common
Securities Guarantee" are to this Common Securities Guarantee as modified,
supplemented or amended from time to time;
(e) all references in this Common Securities Guarantee to Articles and
Sections are to Articles and Sections of this Common Securities Guarantee unless
otherwise specified; and
(f) a reference to the singular includes the plural and vice versa.
"Guarantee Payments" means the following payments or distributions, without
duplication, with respect to the Common Securities, to the extent not paid or
made by the Issuer:
(i) any accrued and unpaid Distributions that are required to be paid
on such Common Securities to the extent the Issuer has funds on hand
legally available therefor at such time,
(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 on hand legally available therefor at such
time, with respect to any Common Securities called for redemption by the
Issuer, and
(iii) upon a voluntary or involuntary termination and liquidation of
the Issuer (other than in connection with the distribution of Debentures to
the Holders in exchange for Common Securities as provided in the
Declaration), the lesser of (a) the aggregate of the liquidation amount and
all accumulated and unpaid Distributions on the Common Securities to the
date of payment, to the extent the Issuer has funds on hand legally
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"). If an Event of Default has
occurred and is continuing, no Guarantee Payments with respect to the
Common Securities shall be made until holders of Capital Securities shall
be paid in full the Guarantee Payments to which they are entitled under the
Series A Capital Securities Guarantee and the Series B Capital Securities
Guarantee.
"Holder" means any holder, as registered on the books and records of the
Issuer, of any Common Securities.
"Other Guarantees" means all guarantees to be issued by the Guarantor with
respect to common securities (if any) similar to the Common Securities issued by
other trusts to be established by the Guarantor (if any), in each case similar
to the Issuer.
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ARTICLE II
GUARANTEE
SECTION 2.1. Guarantee
The Guarantor irrevocably and unconditionally agrees to pay in full to the
Holders the Guarantee Payments (without duplication of amounts theretofore paid
by the Issuer), as and when due, regardless of any defense, right of set-off or
counterclaim which 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.
SECTION 2.2. Waiver of Notice and Demand
The Guarantor hereby waives notice of acceptance of this Common 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 2.3. Obligations Not Affected
The obligations, covenants, agreements and duties of the Guarantor under
this Common 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 Common 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 Common Securities or the extension of
time for the performance of any other obligation under, arising out of, or in
connection with, the Common Securities (other than an extension of time for
payment of Distributions, Redemption Price, Liquidation Distribution or other
sum payable that results from the extension of any interest payment period on
the 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 Common 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 Common 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 2.3 that the obligations of the Guarantor with respect to the
Guarantee Payments shall be obsolete 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.
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SECTION 2.4. Rights of Holders
The Guarantor expressly acknowledges that any Holder may institute a legal
proceeding directly against the Guarantor to enforce its rights under this
Common Securities Guarantee, without first instituting a legal proceeding
against the Issuer or any other Person.
SECTION 2.5. Guarantee of Payment
This Common Securities Guarantee creates a guarantee of payment and not of
collection.
SECTION 2.6. Subrogation
The Guarantor shall be subrogated to all (if any) rights of the Holders
against the Issuer in respect of any amounts paid to such Holders by the
Guarantor under this Common 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 rights which it may acquire by way
of subrogation or any indemnity, reimbursement or other agreement, in all cases
as a result of payment under this Common Securities Guarantee, if, at the time
of any such payment, any amounts are due and unpaid under this Common 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.
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SECTION 2.7. Independent Obligations
The Guarantor acknowledges that its obligations hereunder are independent
of the obligations of the Issuer with respect to the Common Securities and that
the Guarantor shall be liable as principal and as debtor hereunder to make
Guarantee Payments pursuant to the terms of this Common Securities Guarantee
notwithstanding the occurrence of any event referred to in subsections (a)
through (g), inclusive, of Section 2.3 hereof.
ARTICLE III
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 3.1. Limitation of Transactions
So long as any Common Securities remain outstanding, the Guarantor will not
(i) declare or pay any dividends or distribution on, or redeem, purchase,
acquire or make a liquidation payment with respect to any of the Guarantor's
capital stock (which includes common stock and preferred stock) or (ii) make any
payment of principal, interest or premium, if any, on or repay, repurchase or
redeem any debt securities of the Guarantor (including Other Debentures) that
rank pari passu with or junior in right of payment to the Debentures or (iii)
make any guarantee payments with respect to any guarantee by the Guarantor of
the debt securities of any subsidiary of the Guarantor (including under Other
Guarantees) if such guarantee ranks pari passu or junior in right of payment to
the Debentures (other than (a) dividends or distributions in shares of, or
options, warrants or rights to subscribe for or purchase shares of, common stock
of the Guarantor, (b) any declaration of a dividend in connection with the
implementation of a stockholder's 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, (c) payments under the Capital Securities Guarantee, (d) as a
result of a reclassification of the Guarantor's capital stock or the exchange or
the conversion of one class or series of the Guarantor's capital stock for
another class or series of the Guarantor's capital stock, (e) 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, and (f) purchases of common stock related to the
issuance of common stock or rights under any of the Guarantor's benefit plans
for its directors, officers or employees or any of the Guarantor's dividend
reinvestment plans) if at such time (i) there shall have occurred any event of
which the Guarantor has actual knowledge that (a) is, or with the giving of
notice or the lapse of time, or both, would be, an Event of Default and (b) in
respect of which the Guarantor shall not have taken reasonable steps to cure,
(ii) if such Debentures are held by the Property Trustee, the Guarantor shall be
in default with respect to its payment of any obligations under the Capital
Securities Guarantee or (iii) the Guarantor shall have given notice of its
election of the exercise of its right to extend the interest payment period
pursuant to Section 16.01 of the Indenture and any such extension shall be
continuing.
SECTION 3.2. Ranking
This Common Securities Guarantee will constitute an unsecured obligation of
the Guarantor and will rank (i) subordinate and junior in right of payment to
Senior Indebtedness (as defined in the Indenture), to the same extent and in the
same manner that the Debentures are subordinated to Senior Indebtedness pursuant
to the Indenture, it being understood that the terms of Article XV of the
Indenture shall apply to the obligations of the Guarantor under this Common
Securities Guarantee as if (x) such Article XV were set forth herein in full and
(y) such obligations were substituted for the term "Securities" appearing in
such Article XV, (ii) pari passu with the Debentures and with the most senior
preferred or preference stock now or hereafter issued by the Guarantor and with
any Other Guarantee and any guarantee now or hereafter entered into by the
Guarantor in respect of any preferred or preference stock of any Affiliate of
the Guarantor, and (iii) senior to the Guarantor's common stock.
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ARTICLE IV
TERMINATION
SECTION 4.1. Termination
This Common Securities Guarantee shall terminate (i) upon full payment of
the Redemption Price of all Common Securities, (ii) upon the distribution of the
Debentures to all the Holders or (iii) upon full payment of the amounts payable
in accordance with the Declaration upon liquidation of the Issuer.
Notwithstanding the foregoing, this Common Securities Guarantee will continue to
be effective or will be reinstated, as the case may be, if at any time any
Holder must restore payment of any sums paid under the Common Securities or
under this Common Securities Guarantee.
ARTICLE V
MISCELLANEOUS
SECTION 5.1. Successors and Assigns
All guarantees and agreements contained in this Common Securities Guarantee
shall bind the successors, assigns, receivers, trustees and representatives of
the Guarantor and shall inure to the benefit of the Holders then outstanding.
SECTION 5.2. Amendments
Except with respect to any changes which do not adversely affect the rights
of Holders (in which case no consent of Holders will be required), this Common
Securities Guarantee may only be amended with the prior approval of the Holders
of at least a majority in liquidation amount of all the outstanding Common
Securities. The provisions of Section 12.2 of the Declaration with respect to
meetings of Holders apply to the giving of such approval.
SECTION 5.3. Notices
All notices provided for in this Common Securities Guarantee shall be in
writing, duly signed by the party giving such notice, and shall be delivered,
telecopied or mailed by registered or certified mail, as follows:
(a) if given to the Issuer, in care of the Administrative Trustee at the
Issuer's mailing address set forth below (or such other address as the Issuer
may give notice of to the Holders):
UNB Capital Trust I
x/x XXXXXX XXXXXXXX XXXXXXX
X.X. Xxx 0000
0000 Xxxxx 00 Xxxx
Xxxxxxxxxxx, Xxx Xxxxxx 00000
Attention: Chief Executive Officer
Telecopy: (000) 000-0000
(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):
UNITED NATIONAL BANCORP
0000 Xxxxx 00 Xxxx
X.X. Xxx 0000
Xxxxxxxxxxx, Xxx Xxxxxx 00000
Attention: Chief Executive Officer
Telecopy: (000) 000-0000
(c) if given to any Holder, 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.
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SECTION 5.4. Benefit
This Common Securities Guarantee is solely for the benefit of the Holders
of the Common Securities and is not separately transferable from the Common
Securities.
SECTION 5.5. Governing Law
THIS COMMON SECURITIES GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REGARD TO CONFLICTS OF LAWS PRINCIPLES THEREOF.
THIS COMMON SECURITIES GUARANTEE is executed as of the day and year first
above written.
UNITED NATIONAL BANCORP
By: /S/ XXXXX X. XXXXX, XX.
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Name: Xxxxx X. Xxxxx, Xx.
Title: Vice President & Corporate Secretary
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