Exhibit 10.5(iv)
AMERICAN COMMUNITY BANCSHARES, INC.
AND
WILMINGTON TRUST COMPANY, AS TRUSTEE
SUPPLEMENTAL INDENTURE
9 %
DEFERRABLE INTEREST
JUNIOR SUBORDINATED DEBENTURES
DUE MARCH 1, 2032
DATED AS OF MARCH 1, 2002
SUPPLEMENTAL INDENTURE
SUPPLEMENTAL INDENTURE, dated as of March 1, 2002, between AMERICAN
COMMUNITY BANCSHARES, INC., a North Carolina Corporation (the "Corporation") and
WILMINGTON TRUST COMPANY, a Delaware banking corporation (the "Trustee").
RECITALS
WHEREAS, the Corporation and the Trustee executed that certain Indenture,
dated as of December 31, 2001, to provide for the issuance of unsecured
securities to be known as its 9 % Deferrable Interest Junior Subordinated
Debentures, due December 31, 2031 (the "Debentures"); and
WHEREAS, American Community Capital Trust I, a Delaware statutory business
trust (the "Trust") invested the proceeds from its sale of Two Million Dollars
($2,000,000) aggregate liquidation amount of its Preferred Securities (as
defined in the Indenture) and the sale of Sixty-One Thousand Eight Hundred Sixty
Dollars ($61,860) aggregate liquidation amount of its Common Securities (as
defined in the Indenture) in Two Million Sixty-One Thousand Eight Hundred Sixty
Dollars ($2,061,860) aggregate liquidation amount of the Debentures; and
WHEREAS, for its lawful corporate purposes, the Corporation has duly
authorized the execution and delivery of this Supplemental Indenture to provide
for the issuance of additional Debentures to the Trust in an aggregate principal
amount of up to One Million Five Hundred Forty-Six Thousand Four Hundred Dollars
($1,546,400), such that the aggregate liquidation amount of all Debentures
outstanding hereunder is Three Million Six Hundred Eight Thousand Two Hundred
Sixty Dollars ($3,608,260); and
WHEREAS, the Trust intends to invest the proceeds from its sale of One
Million Five Hundred Thousand Dollars ($1,500,000) aggregate liquidation amount
of its Preferred Securities and the sale of Forty-Six Thousand Four Hundred
Dollars ($46,400) aggregate liquidation amount of its Common Securities in One
Million Five Hundred Forty-Six Thousand Four Hundred Dollars ($1,546,400)
aggregate liquidation amount of the Corporation's Debentures; and
WHEREAS, the form and substance of such Debentures and the terms and
conditions thereof are as set forth as provided in the Indenture as modified by
this Supplemental Indenture, which modification shall include the alteration of
certain terms of the Debentures, including, but not limited to, the extension of
the Maturity Date (as defined in the Indenture); and
WHEREAS, the Corporation has requested that the Trustee execute and deliver
this Indenture; and
WHEREAS, all requirements necessary to make this Supplemental Indenture and
the Indenture, when together taken as a whole, a valid instrument in accordance
with their terms, and to make the Debentures, when executed by the Corporation
and authenticated and delivered by the trustee, the valid obligations of the
Corporation, have been performed, and the execution and delivery of this
Supplemental Indenture has been duly authorized in all respects; and
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WHEREAS, all things necessary to make the Indenture and the Supplemental
Indenture, when taken together as a whole, a valid agreement of the Corporation,
in accordance with its terms, have been done.
NOW, THEREFORE, in consideration of these premises and the purchase of
additional Debentures by the Trust, the terms and conditions of that certain
Indenture, executed by and between the Corporation and the Trustee and dated as
of December 31, 2001, are hereby modified as provided in this Supplemental
Indenture, the sections of which shall replace and supercede the sections of
corresponding number in the Indenture:
SECTION 1.1 DEFINITION OF TERMS.
"Scheduled Maturity Date" means March 1, 2032.
SECTION 2.1 DESIGNATION AND PRINCIPAL AMOUNT
There are hereby authorized Debentures designated the "9% Deferrable
Interest Junior Subordinated Debentures due March 1, 2032," limited in aggregate
principal amount to not more than Three Million Six Hundred Eight Thousand Two
Hundred Sixty Dollars ($3,608,260) which amount shall be as set forth in any
written order of the Corporation for the authentication and delivery of
Debentures pursuant to Section 2.5.
SECTION 2.1 MATURITY.
(a) The Maturity Date shall be either:
(i) The Scheduled Maturity Date; or
(ii) if the Corporation elects to accelerate the Maturity Date to be a
date prior to the Scheduled Maturity Date in accordance with Section 2.2(c), the
Accelerated Maturity Date.
(b) The Corporation may at any time before the day which is 90 days before
the Scheduled Maturity Date and after March 1, 2007, elect to shorten the
Maturity Date only once to the Accelerated Maturity Date provided that the
Corporation has received the prior approval of the Federal Reserve, if then
required under applicable capital guidelines, policies or regulations of the
Federal Reserve.
(c) If the Corporation elects to accelerate the Maturity Date in accordance
with Section 2.2(b), the Corporation shall give notice to the Trustee and the
Trust (unless the Trust is not the holder of the Debentures, in which case the
trustee will give notice to the holders of the Debentures) of the acceleration
of the Maturity Date and the Accelerated Maturity Date; provided, however, that
nothing provided in this Section 2.2 shall limit the Corporation's rights, as
provided in Article III hereof, to redeem all or a portion of the Debentures at
such time or
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times on or after December 31, 2001, as the Corporation may so determine, or at
any time upon the occurrence of Special Event.
SECTION 2.4 INTEREST.
(a) Each Debenture shall bear interest at the Coupon Rate from December 31,
2001 until the principal thereof becomes due and payable, and on any overdue
principal and (to the extent that payment of such interest is enforceable under
applicable law) on any overdue installment of interest at the Coupon Rate,
compounded quarterly, payable (subject to the provisions of Article IV)
quarterly in arrears on March 31, June 30, September 30 and December 31 of each
year (each, an "Interest Payment Date," commencing on March 31, 2002), to the
Person in whose name such Debenture or any Predecessor Debenture is registered
at the close of business on the Regular Record Date next preceding such Interest
Payment Date.
SECTION 3.3 OPTIONAL REDEMPTION BY CORPORATION.
Except as otherwise may be specified in this Indenture but not in
limitation of Section 3.2, the Corporation shall have the right to redeem the
Debentures, in whole or in part, from time to time, on or after March 1, 2007 at
a Redemption Price equal to 100% of the principal amount to be redeemed plus any
accrued and unpaid interest thereon to the date of such redemption. Any
redemption pursuant to this Section 3.3 shall be (i) made in multiples of $1,000
and (ii) made upon not less than 30 days nor more than 60 days notice to the
holder of the Debentures, at the Redemption Price. If the Debentures are only
partially redeemed pursuant to this Section 3.3, the Debentures shall be
redeemed pro rata or by lot or in such other manner as the Trustee shall deem
appropriate and fair in its discretion. The Redemption Price shall be paid prior
to 12:00 noon, Monroe, North Carolina time, on the date of such redemption or at
such earlier time as the Corporation determines provided that the Corporation
shall deposit with the Trustee an amount sufficient to pay the Redemption Price
by 10:00 a.m., Monroe, North Carolina time, on the date such Redemption Price is
to be paid.
SECTION 3.4 NOTICE OF REDEMPTION.
(a) In case the Corporation shall desire to exercise such right to redeem
all or a portion of the Debentures in accordance with the right reserved so to
do, the Corporation shall, or shall cause the Trustee to, upon receipt of 45
days written notice from the Corporation, give notice of such redemption to
holders of the Debentures to be redeemed by mailing, first class postage
prepaid, a notice of such redemption not less than 30 days and not more than 60
days before the date fixed for redemption to such holders at their last
addresses as they shall appear upon the Debenture Register unless a shorter
period is specified in the Debentures to be redeemed. Any notice that is mailed
in the manner herein provided shall be conclusively presumed to have been duly
given, whether or not the registered holder receives the notice. In any case,
failure to duly give such notice to the holder of any Debenture designated for
redemption in whole or in part, or any defect in the notice, shall not affect
the validity of the proceedings for the redemption of any other Debentures. In
the case of any redemption of Debentures prior to the expiration of any
restriction on such redemption provided in the terms of such Debentures or
elsewhere in this Indenture, the Corporation shall furnish the Trustee with an
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Officers' Certificate evidencing compliance with any such restriction. Each such
notice of redemption shall identify the Debenture to be redeemed and shall
specify the date fixed for redemption and the Redemption Price and shall state
that payment of the Redemption Price shall be made at the office or agency of
the Corporation or at the Corporate Trust Office, upon presentation and
surrender of such Debentures, that interest accrued to the date fixed for
redemption shall be paid as specified in said notice and that from and after
said date interest shall cease to accrue. If less than all the Debentures are to
be redeemed, the notice to the holders of the Debentures shall specify the
particular Debentures to be redeemed. If any Debenture is to be redeemed in part
only, the notice shall state the portion of the principal amount thereof to be
redeemed (which shall be $10 or a multiple thereof) and shall state that on and
after the redemption date, upon surrender of such Debenture, a new Debenture or
Debentures in principal amount equal to the unredeemed portion thereof shall be
issued.
SECTION 5.8 COVENANTS AS TO PURCHASES
Prior to March 1, 2007, the Corporation shall not purchase any Debentures,
in whole or in part, from the Trust, except as otherwise permitted by Section
3.2.
SECTION 8.2 ISSUE OF DEBENTURES.
Debentures in an aggregate principal amount of up to Three Million Six
Hundred Eight Thousand Two Hundred Sixty Dollars ($3,608,260) may, upon
execution of this Indenture, be executed by the Corporation and delivered to the
Trustee for authentication, and the Trustee shall thereupon authenticate and
make available for delivery said Debentures upon the written order of the
Corporation, signed by its Chairman, its President, or any Vice President and
its Treasurer, an Assistant Treasurer, its Secretary or Assistant Secretary
without any further action by the Corporation.
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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed all as of the day and year first written above.
AMERICAN COMMUNITY BANCSHARES, INC.
By: /s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx
-----------------------------
Title: President and CEO
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WILMINGTON TRUST COMPANY, AS TRUSTEE
By: /s/ Xxxx X. St. Xxxxx
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Name: Xxxx X. St. Amand
-----------------------------
Title: Senior Vice President
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