EXHIBIT 10.4
FORM OF DIVIDEND RESTRICTION AGREEMENT
THIS DIVIDEND RESTRICTION AGREEMENT (this "AGREEMENT") is made and entered
into effective as of the ____ day of ________________, 2004, by and between
CAPITAL CROSSING BANK, a Massachusetts-chartered trust company (the "BANK"), and
CAPITAL CROSSING PREFERRED CORPORATION, a Massachusetts corporation (the
"COMPANY").
BACKGROUND
WHEREAS, the Company is a majority-owned subsidiary of the Bank;
WHEREAS, in order to raise capital in the Company that will be treated as
Tier 1 or Tier 2 capital of the Bank for regulatory purposes, the Company will
issue and sell a class of preferred stock designated as ____ % Non-cumulative
Exchangeable Preferred Stock, Series D (the "SERIES D PREFERRED STOCK") in a
registered public offering; and
WHEREAS, to facilitate the sale of the Series D Preferred Stock the Bank
has agreed to refrain from declaring, paying or setting aside dividends or other
distributions on its capital stock to the extent described herein in the event
that the Company fails to make dividend payments to the holders of the Series D
Preferred Stock.
AGREEMENT
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby expressly acknowledged, the parties hereto,
intending to be legally bound, hereby agree as follows:
1. RESTRICTION ON DIVIDEND PAYMENTS. So long as any shares of Series D
Preferred Stock are outstanding, the Bank will not declare, pay or set aside for
payment any dividends or other distributions on any of its outstanding common or
preferred stock (other than dividends or distributions paid in shares of, or
options, warrants or rights to subscribe for or purchase shares of, such common
or preferred stock, as the case may be) or repurchase or redeem any of its
outstanding common or preferred stock, whenever, in each case full dividends on
all of the outstanding shares of Series D Preferred Stock have not been
declared, paid or irrevocably set aside for payment, when due, for any dividend
period, until dividends for at least four consecutive dividend periods have been
fully paid or set aside for payment on the outstanding shares of Series D
Preferred Stock; PROVIDED, HOWEVER, that this provision will not apply to
dividends or other distributions declared, paid or set aside for payment on the
preferred shares of the Bank issued in exchange for the Company's preferred
stock.
2. AMENDMENT. This Agreement may not be amended by the parties hereto in
the absence of the approval of the holders representing at least two-thirds
(2/3) of the issued and outstanding shares of Series D Preferred Stock. This
Agreement may be amended without the consent of the holders of Series D
Preferred Stock to (a) cure any ambiguity, (b) correct or supplement any
provision in this Agreement that may be defective or inconsistent with any other
provision of this Agreement or (c) add to the covenants, restrictions or
obligations of the Bank. Any amendment hereof in accordance with this Section 6
shall be binding on all the Holders.
3. THIRD-PARTY BENEFICIARIES. Nothing herein expressed or implied is
intended or shall be construed to confer upon or give to any person or entity
other than the parties hereto and their successors or permitted assigns, any
rights or remedies under or by reason of this Agreement, except that the holders
from time to time of the shares of Series D Preferred Stock are expressly made
third-party beneficiaries of and shall be entitled to enforce the provisions of
this Agreement.
4. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of Massachusetts.
[SIGNATURE PAGE TO FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date and year first above written.
THE BANK:
CAPITAL CROSSING BANK, a Massachusetts-
chartered trust company
By:
-----------------------------------------
Name:
Title:
THE COMPANY:
CAPITAL CROSSING PREFERRED
CORPORATION, a Massachusetts corporation
By:
-----------------------------------------
Name:
Title:
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