EXECUTION COPY
CONTINGENT SUPPORT AGREEMENT
CONTINGENT SUPPORT AGREEMENT, dated as of December 5,
1997, between BANQUE NATIONALE DE PARIS, a French limited
liability corporation (societe anonyme) (the "Bank") and BNP U.S.
FUNDING L.L.C., a Delaware limited liability company (the
"Company").
W I T N E S S E T H:
WHEREAS, the Company is a subsidiary of the Bank;
WHEREAS, the Company proposes to issue and sell 50,000
Noncumulative Preferred Securities, Series A (subject to the
provisions in Section 8 hereof concerning Additional Preferred
Securities (as defined therein), the "Series A Preferred
Securities"), with an aggregate liquidation preference of
$500,000,000; and
WHEREAS, the Bank has agreed to enter into this
Contingent Support Agreement in order to induce the Company to
issue the Series A Preferred Securities;
NOW, THEREFORE, for valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, and in
consideration of the mutual promises contained in this Contingent
Support Agreement, the parties agree as follows:
SECTION 1. Definitions. Terms not defined herein shall
have the meanings specified in the Amended and Restated Limited
Liability Company Agreement of the Company, dated as of December
5, 1997 and as from time to time amended, modified or
supplemented (the "Company's Charter").
SECTION 2. Maintenance of Ownership. So long as any
Series A Preferred Securities are outstanding, the Bank shall
continue to own, directly or indirectly, 100% of the outstanding
Common Securities of the Company.
SECTION 3. Obligations Following Shift Events. The
Bank hereby agrees to take the actions set forth below following
the occurrence of a Shift Event, whether or not a Shift Period
remains in effect.
(a) The Bank shall deliver to the Company, so long as
any Series A Preferred Securities are outstanding, the
Capital Adequacy Certificates as specified and at the times
indicated in Section 7.3(c)(iv)(A) of the Company's
Charter.
(b) If the Bank declares a dividend with respect to
any capital stock of the Bank constituting Tier 1 capital
("Tier 1 Capital Stock"), the Bank will (i) acquire for
cash additional Common Securities in an amount sufficient
to ensure that the Company will have cash available to pay
the full amount of dividends on the Series A Preferred
Securities for the Series A Dividend Period during which
the above declaration of a dividend on the Bank's Tier 1
Capital Stock is made and the two immediately subsequent
Series A Dividend Periods (provided, that the Bank will not
be required to acquire additional Common Securities with
respect to any Series A Dividend Period in an amount
greater than (x) the amount available for distribution to
holders of the Bank's Tier 1 Capital Stock (determined as
of the date on which the relevant dividend on the Bank's
Tier 1 Capital Stock is declared and without giving effect
to the declaration of such dividend) or (y) if the Special
Dividend has been paid pursuant to Section 7.3(c)(ii) of
the Company's Charter, the amount thereof) and (ii) procure
payment by the Company to the Series A Preferred
Securityholders of dividends in the amounts, for the Series
A Dividend Periods and under the circumstances set forth in
this Section 3.2(b).
(c) Upon any liquidation of the Bank, if the
liquidator of the Bank determines, in consultation with the
French Banking Commission, that all of the Bank's
liabilities (including any debt instruments, such as titres
participatifs and prets participatifs, constituting Tier 2
risk-based capital) have been or will be paid in full,
before making any distribution to holders of its Tier 1
Capital Stock, the Bank will acquire additional Common
Securities for cash in an amount equal to the lowest of:
(i) the amount remaining to the Bank after payment of all
such liabilities, (ii) the difference, if any, between the
aggregate liquidation preference of the outstanding Series
A Preferred Securities and the net assets of the Company
immediately prior to the acquisition of such additional
Common Securities, and (iii) the aggregate amount
previously received by the Bank upon (x) the redemption of
Common Securities pursuant to Section 7.3 (c)(i)(C) of the
Company's Charter, (y) as a Special Dividend pursuant to
Section 7.3(c)(ii) of the Company's Charter and (z) a
liquidation of the Company pursuant to Section 15.2(c) of
the Company's Charter.
SECTION 4. Full Effect; Waiver of Claim. The Bank or
any successor to the Bank shall take such actions as the Company
shall reasonably request in order to give full effect to the
undertaking of the Bank set forth in Section 3(c) hereof and the
Company shall take such actions as the Bank or any successor to
the Bank shall reasonably request in order to give full effect
thereto. In particular, the Company hereby agrees to waive
(remise de dette), when appropriate to give full effect to
Section 3(c) hereof any potential claim against the Bank under
Section 3(c) hereof to the extent that the Bank's liabilities as
described in Section 3(c) hereof are not paid in full.
SECTION 5. Enforcement. The Company shall have the
sole right to enforce this Contingent Support Agreement by
instituting a suit for that purpose or otherwise and shall do so
promptly if directed by at least a majority of the Independent
Directors. Neither holders of Series A Preferred Securities, nor
holders of any other series of preferred securities or of Common
Securities of the Company, whether outstanding as of the date
hereof or issued hereafter, shall have any direct rights
whatsoever under this Contingent Support Agreement.
Neither holders of Series A Preferred Securities nor
holders of any other series of preferred securities or of Common
Securities of the Company, whether outstanding as of the date
hereof or issued hereafter, nor creditors of the Company nor any
other persons are third party
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beneficiaries of this Contingent Support Agreement or have any
direct right to enforce this Contingent Support Agreement. The
Bank and the Company do not intend to create any third party
beneficiaries, whether creditor, donee or otherwise, by entering
into this Contingent Support Agreement and do not intend that
this Contingent Support Agreement provide benefits, material or
otherwise, to anyone besides the Bank and the Company. The rights
of the Company under this Contingent Support Agreement and any
payments made to the Company pursuant hereto are not held in
trust or as agent for any persons including holders of Series A
Preferred Securities, holders of any other series of preferred
securities of the Company, if issued, and creditors of the
Company.
SECTION 6. Representations and Warranties. The Bank
and the Company (each a "Representing Party") each hereby
represents and warrants to the other party as follows:
(a) The Representing Party is duly incorporated or
formed and validly existing under the laws of the jurisdiction of
its incorporation or formation (as applicable), has all requisite
corporate or limited liability company (as applicable) power to
carry on its business as now being conducted and has all
requisite corporate or limited liability company (as applicable)
power and authority to enter into this Contingent Support
Agreement and to perform its obligations under this Contingent
Support Agreement.
(b) The execution, delivery and performance of this
Contingent Support Agreement by the Representing Party have been
duly authorized by all necessary corporate or limited liability
company (as applicable) action on the part of the Representing
Party, and this Contingent Support Agreement constitutes the
legal, valid and binding obligation of the Representing Party
enforceable against it in accordance with its terms.
(c) The execution, delivery and performance of this
Contingent Support Agreement by the Representing Party do not and
will not conflict with or violate any provision of the
Representing Party's charter or business statutes and do not and
will not conflict with, violate, result in a breach of or cause a
material default under (i) any provision of law or regulation in
The Republic of France or the United States relating to the
business or material assets of the Representing Party, (ii) any
provision of any order, arbitration award, judgment or decree of
any or other authority by which the Representing Party is bound
or by which the Representing Party or its assets may be affected,
(iii) any material provision of any material agreement or
instrument to which the Representing Party is a party or by which
the Representing Party or its assets are bound or affected or
(iv) any other restriction of any kind or character to which the
Representing Party is subject, which conflicts, violations,
breaches or defaults in each of clauses (i), (ii), (iii) and (iv)
above would, individually or in the aggregate, prohibit, delay or
restrict the transactions contemplated by this Contingent Support
Agreement or have a material adverse effect on the business,
financial condition or results of operations of the Representing
Party and its consolidated subsidiaries (in the case of the Bank)
taken as a whole.
(d) Except for prior consultation with the French
Banking Commission under certain circumstances, no approval or
consent ot, or filing or registration with, any governmental
body, or other regulatory authority (domestic or foreign) is
required in connection with the execution, delivery and
performance by the Bank of this Contingent Support Agreement.
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SECTION 7. Consent to Jurisdiction. The provisions of
this Section 7 are subject to the limitations on enforcement of
this Contingent Support Agreement set forth in Section 5 hereof,
and the Bank consents to the limitation of its rights as provided
in this Section 7 only as they relate to enforcement of this
Contingent Support Agreement by the Company. In the case of
attempts at enforcement of this Contingent Support Agreement by
any Persons other than the Company, such as holders of Series A
Preferred Securities, holders of any other series of preferred
securities of the Company, whether outstanding as of the date
hereof or issued hereafter, or creditors of the Company, this
Section 7 shall be inapplicable and shall be void with respect to
such attempt at enforcement. The Bank hereby submits to the
non-exclusive jurisdiction of any Federal District Court sitting
in the State of New York over any action or proceeding arising
out of a breach of or relating to the enforcement of this
Contingent Support Agreement, and the Bank hereby irrevocably
agrees that, at such time, all claims in respect of such action
or proceeding may be heard and determined in such Federal
District Court. The Bank hereby agrees to irrevocably waive, at
such time, to the fullest extent it may effectively do so, the
defense of an inconvenient forum to the maintenance of such
action or proceeding. If the Bank ceases to operate a branch in
The City of New York, the Bank hereby agrees at or prior to such
time to irrevocably designate and appoint for the term of this
Contingent Support Agreement CT Corporation System as the agent
of the Bank to receive on its behalf service of all process
brought against the Bank with respect to any such proceeding in
any such court, such service being hereby acknowledged by the
Bank to be effective and binding service on it in every respect
whether or not the Bank shall then be doing business in the State
of New York. A copy of such process so served shall, if permitted
by law, be sent by registered mail to the Bank and delivered to
it at its address in Section 11 hereof If such agent shall cease
to act, the Bank covenants that it shall appoint without delay
another such agent satisfactory to the Company. Nothing herein
shall affect the right to serve process in any other manner
permitted by any law or limit the right to institute proceedings
against the Bank in the courts of any other jurisdiction or
jurisdictions.
SECTION 8. Extension of Contingent Support Agreement.
This Contingent Support Agreement shall cover and shall apply to
each series of Preferred Securities of the Company which are
Parity Securities and which are issued subsequently to the
issuance of the Series A Preferred Securities to which this
Contingent Support Agreement initially applies (the "Additional
Preferred Securities") as if initially drafted in such manner so
that the term "Series A Preferred Securities" used herein refers
in a like manner to the Series A Preferred Securities and the
Additional Preferred Securities, if such coverage and application
is consented to by the Bank pursuant to a "Consent to Extension"
substantially in the form attached hereto as Annex A or such
other form as shall be agreed to by the parties. Such extension
of the coverage of this Contingent Support Agreement pursuant to
this Section shall not be considered a modification, amendment or
termination of this Contingent Support Agreement for purposes of
Section 9 hereof or otherwise.
SECTION 9. Modification, Amendment and Termination.
Except as otherwise provided in this Section 9, this Contingent
Support Agreement may be modified, amended or terminated only by
the written agreement of the parties. No such modification,
amendment or termination shall be effective for so long as any
Series A Preferred Security is outstanding unless the holders of
two-thirds of the Series A Preferred Securities by Liquidation
Preference voting as a class consent to the terms of such
modification, amendment or termination.
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This Contingent Support Agreement shall automatically terminate
on the date that all Series A Preferred Securities shall cease to
be outstanding.
SECTION 10. Continuing Contingent Support Agreement.
This Contingent Support Agreement is a continuing Contingent
Support Agreement and shall (a) remain in full force and effect
as long as any of the Series A Preferred Securities are
outstanding, and (b) be mutually binding upon, and inure to the
mutual benefit of, the Bank and the Company and their successors.
SECTION 11. Notices. All notices and other
communications to be given in connection herewith shall be
delivered in person sent by telex with answerback received, by
telecopy or communicated by telephone (subject in the case of
communication by telephone or telecopy to confirmation within
twenty-four hours by telex with answerback received) to the
relevant party as follows:
The Bank: Banque Nationale de Paris
Direction de la Gestion Actif/Passif
Attention: Group Treasurer
Telecopy No.: 000-0000-0000
Telephone No.: 000-0000-0000
The Company: BNP U.S. Funding L.L.C.
Attention: Secretary
Telecopy No.: (000) 000-0000
Telephone No.: (000) 000-0000
or to any other address of which such party shall have notified
the other in writing. Any notice hereunder given by telecopy
shall be deemed to be served when it would be received in the
ordinary course of transmission, subject to confirmation as
aforesaid.
SECTION 12. GOVERNING LAW. THIS CONTINGENT SUPPORT
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK.
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IN WITNESS WHEREOF, the parties hereto have caused
this Contingent Support Agreement to be executed by their
attorney-in-fact or officers thereunto duly authorized as of the
date first above written.
BANQUE NATIONALE DE PARIS BNP U.S. FUNDING L.L.C.
By: /s/ Xxxxxxxxx Xxxxx By: /s/ Xxxx Xxxxxx
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Name: Xxxxxxxxx Xxxxx Name: Xxxx Xxxxxx
Title:Senior Executive Title: President and Director
Vice President
By: /s/ Xxxx Xxxxxx Xxxx
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Name: Xxxx Xxxxxx Xxxx
Title: Director
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Annex A
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FORM OF CONSENT TO EXTENSION
BNP U.S. FUNDING L.L.C.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
BANQUE NATIONALE DE PARIS (the "Bank") hereby consents to the
coverage of and application of the contingent support agreement,
dated December 5, 1997 and as heretofore amended, modified or
supplemented (the "Contingent Support Agreement"), between the
Bank and BNP U.S. FUNDING L.L.C. (the "Company") pursuant to
Section 8 thereof to Noncumulative Preferred Securities, Series __,
with an aggregate liquidation preference of $_____ issued by the
Company pursuant to Article VII of the Amended and Restated
Limited Liability Company Agreement of BNP US. FUNDING L.L.C.
dated December 5, 1997 (the "Additional Preferred Securities").
References to "Series A Preferred Securities" in the Contingent
Support Agreement shall be understood to refer to the Company's
Noncumulative Preferred Securities, Series A, as well as to
Additional Preferred Securities.
BANQUE NATIONALE DE PARIS
By:_______________________________
Name:
Title:
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