AGREEMENT (this “Guarantee”), dated as of July 28, 2006, is executed and delivered by Enterprise
Financial Services Corp., a Delaware corporation (the “Guarantor”), and Wilmington Trust Company, a
Delaware banking corporation, 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 EFSC Statutory Trust V, a
Delaware statutory trust (the “Issuer”).
pursuant to an Amended and Restated Declaration of Trust (the “Declaration”), dated as of the date
hereof among Wilmington Trust Company, not in its individual capacity but solely as institutional trustee, the
administrators 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 those
undivided beneficial interests, having an aggregate liquidation amount of $4,000,000.00 (the “Capital
incentive for the Holders to purchase the Capital Securities, the Guarantor desires irrevocably and
unconditionally to agree, to the extent set forth in this Guarantee, to pay to the Holders of Capital Securities
the Guarantee Payments (as defined herein) and to make certain other payments on the terms and conditions set
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 Guarantee for the benefit of the
DEFINITIONS AND INTERPRETATION
1.1.Definitions and Interpretation. In this
Guarantee, unless the context otherwise requires:
terms used in this 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 Guarantee has the same meaning throughout;
references to “the Guarantee” or “this Guarantee” are to this Guarantee as modified,
supplemented or amended from time to time;
references in this Guarantee to “Articles” or “Sections” are to Articles or Sections of this
Guarantee, unless otherwise specified;
(e) terms defined
in the Declaration as at the date of execution of this Guarantee have the same meanings when used in this
Guarantee, unless otherwise defined in this Guarantee or unless the context otherwise requires; and
(f) a reference
to the singular includes the plural and vice versa.
“Affiliate” has the same
meaning as given to that term in Rule 405 of the Securities Act of 1933, as amended, or any successor rule
“Beneficiaries” means any
Person to whom the Issuer is or hereafter becomes indebted or liable.
“Capital Securities” has the
meaning set forth in the recitals to this Guarantee.
Securities” means the common securities issued by the Issuer to the Guarantor pursuant to the
“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 is
located at Rodney Square North, 1100 North Market Street, Wilmington, Delaware 19890-1600, Attention:
Corporate Trust Administration.
“Covered Person” means any
Holder of Capital Securities.
“Debentures” means the debt
securities of the Guarantor designated the Floating Rate Junior Subordinated Deferrable Interest Debentures due
2036 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.
of Default” has the meaning set forth in Section 2.4(a).
“Guarantee Payments” means
the following payments or distributions, 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 to the extent the Issuer has funds available therefor, with respect
to any Capital Securities called for redemption by the Issuer, (iii) the Special Redemption Price to the extent
the Issuer has funds available therefor, with respect to Capital Securities redeemed upon the occurrence of a
Special Event, and (iv) 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 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 in liquidation of the Issuer (in either case, the “Liquidation
“Guarantee Trustee” means
Wilmington Trust Company, until a Successor Guarantee Trustee has been appointed and has accepted such
appointment pursuant to the terms of this Guarantee and thereafter means each such Successor Guarantee
“Holder” means 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
“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 the date hereof between the Guarantor and Wilmington Trust Company, 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.
“Issuer” has the meaning set
forth in the opening paragraph to this Guarantee.
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 stated 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
“Obligations” means any
costs, expenses or liabilities (but not including liabilities related to taxes) of the Issuer other than
obligations of the Issuer to pay to holders of any Trust Securities the amounts due such holders pursuant to the
terms of the Trust Securities.
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
Guarantee shall include:
(a) a statement
that the officer signing the Officer’s Certificate has read the covenant or condition and the definitions
(b) a brief
statement of the nature and scope of the examination or investigation undertaken by the officer in rendering
the Officer’s Certificate;
(c) a statement
that the 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 the 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 Indenture.
“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.
“Special Event” has the
meaning set forth in the Indenture.
“Special Redemption Price”
has the meaning set forth in the Indenture.
“Successor Guarantee Trustee”
means a successor Guarantee Trustee possessing the qualifications to act as Guarantee Trustee under Section
Securities” means the Common Securities and the Capital Securities.
POWERS, DUTIES AND RIGHTS OF GUARANTEE TRUSTEE
2.1.Powers and Duties of the Guarantee
Guarantee shall be held by the Guarantee Trustee for the benefit of the Holders of the Capital Securities, and
the Guarantee Trustee shall not transfer this Guarantee to any Person except a Holder of Capital Securities
exercising his or her rights pursuant to Section 4.4(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 Guarantee for the benefit of the Holders of the Capital
(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 Guarantee, and no
implied covenants shall be read into this Guarantee against the Guarantee Trustee. In case an Event of
Default has occurred (that has not been waived pursuant to Section 2.4) 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 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 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
(A) the duties
and obligations of the Guarantee Trustee shall be determined solely by the express provisions of this
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 Guarantee, and no implied covenants or obligations shall be
read into this 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 Guarantee; but in the
case of any such certificates or opinions that by any provision hereof are specifically required to be furnished to the Guarantee Trustee, the Guarantee Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this 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 written direction of the Holders of not less than 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 relating to the exercise of any trust or power conferred upon the Guarantee Trustee
under this Guarantee; and
(iv) no provision of
this 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 Guarantee or security and indemnity, reasonably satisfactory to
the Guarantee Trustee, against such risk or liability is not reasonably assured to it.
2.2.Certain Rights of Guarantee Trustee.
(a) Subject to the provisions of Section 2.1:
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.
direction or act of the Guarantor contemplated by this Guarantee shall be sufficiently evidenced by an
(iii) Whenever, in
the administration of this 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 of the Guarantor which, upon receipt of such request,
shall be promptly delivered by the Guarantor.
(iv) The Guarantee
Trustee shall have no duty to see to any recording, filing or registration of any instrument (or any
re-recording, refiling or re-registration thereof).
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. 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 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 2.2(a)(vi) shall 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 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
(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. 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 Guarantee, both of which shall be
conclusively evidenced by the Guarantee Trustee’s or its agent’s taking such action.
(x) Whenever in
the administration of this 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.
(xi) The Guarantee
Trustee shall not be liable for any action taken, suffered, or omitted to be taken by it in good faith, without
negligence, and reasonably believed by it to be authorized or within the discretion or rights or powers
conferred upon it by this Guarantee.
(b) No provision
of this 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.
2.3.Not Responsible for Recitals or Issuance of
Guarantee. The recitals contained in this 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 Guarantee.
2.4.Events of Default; Waiver.
(a) An Event of
Default under this Guarantee will occur upon the failure of the Guarantor to perform any of its payment or other
(b) The Holders
of a Majority in liquidation amount of the 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 Guarantee, but no such waiver shall extend to any subsequent or other default or Event of Default
or impair any right consequent thereon.
2.5.Events of Default; Notice.
(a) The Guarantee
Trustee shall, within 90 days after the occurrence of an Event of Default, transmit by mail, first class postage
prepaid, to the Holders of the Capital Securities and the Guarantor, notices of all Events of Default actually
known to a Responsible Officer of the Guarantee Trustee, unless such defaults 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 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 Guarantee
shall have obtained actual knowledge thereof.
3.1.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 authorized under such laws to exercise corporate
trust powers, having a combined capital and surplus of 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 3.1(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.
If at any time the Guarantee Trustee shall cease to be eligible to so act under
Section 3.1(a), the Guarantee Trustee shall immediately resign in the manner and with the effect set out in
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 shall either eliminate
such interest or resign to the extent and in the manner provided by, and subject to this Guarantee.
Appointment, Removal and Resignation of Guarantee Trustee.
(a) Subject to
Section 3.2(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 3.2(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.
If no Successor Guarantee Trustee shall have been appointed and accepted
appointment as provided in this Section 3.2 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.
(f) Upon termination of this Guarantee or removal or resignation of the Guarantee
Trustee pursuant to this Section 3.2, the Guarantor shall pay to the Guarantee Trustee all amounts owing to the
Guarantee Trustee under Sections 7.2 and 7.3 accrued to the date of such termination, removal or
(a) 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 the defense of
payment by the Issuer), right of set-off or counterclaim that 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.
(b) The Guarantor
hereby also agrees to assume any and all Obligations of the Issuer and in the event any such Obligation is not so
assumed, subject to the terms and conditions hereof, the Guarantor hereby irrevocably and unconditionally
guarantees to each Beneficiary the full payment, when and as due, of any and all Obligations to such
Beneficiaries. This Guarantee is intended to be for the benefit of, and to be enforceable by, all such
Beneficiaries, whether or not such Beneficiaries have received notice hereof.
4.2.Waiver of Notice and Demand. The
Guarantor hereby waives notice of acceptance of this 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.
4.3.Obligations Not Affected. The
obligations, covenants, agreements and duties of the Guarantor under this 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
(b) the extension
of time for the payment by the Issuer of all or any portion of the Distributions, Redemption Price, Special
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, Special
Redemption Price, Liquidation Distribution or other sum payable that results from the extension of any interest
payment period on the Debentures or any extension of the maturity date of the Debentures permitted by the
(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 4.3 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.
4.4.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 Guarantee or to
direct the exercise of any trust or power conferred upon the Guarantee Trustee under this Guarantee; provided,
however, that (subject to Section 2.1) the Guarantee Trustee shall have the right to decline to follow any such
direction if the Guarantee Trustee being advised by counsel determines that the action or proceeding so directed
may not lawfully be taken or if the Guarantee 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
(b) Any Holder of
Capital Securities may institute a legal proceeding directly against the Guarantor to enforce the Guarantee
Trustee’s rights under this 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.
4.5.Guarantee of Payment. This Guarantee
creates a guarantee of payment and not of collection.
4.6.Subrogation. The Guarantor shall be
subrogated to all (if any) rights of the Holders of Capital Securities against the Issuer in respect of any
amounts paid to such Holders by the Guarantor under this 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 Guarantee, if, after giving effect to any such payment, any amounts are due and
unpaid under this 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
4.7.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 Guarantee notwithstanding the occurrence of any event referred to in
subsections (a) through (g), inclusive, of Section 4.3 hereof.
4.8.Enforcement by a Beneficiary. A
Beneficiary may enforce the obligations of the Guarantor contained in Section 4.1(b) directly against the
Guarantor and the Guarantor waives any right or remedy to require that any action be brought against the Issuer
or any other person or entity
before proceeding against the Guarantor. The Guarantor shall be
subrogated to all rights (if any) of any Beneficiary against the Issuer in respect of any amounts paid to the
Beneficiaries by the Guarantor under this 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
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 Guarantee, if at the time of any such payment, and after giving effect to such
payment, any amounts are due and unpaid under this Guarantee.
LIMITATION OF TRANSACTIONS; SUBORDINATION
5.1.Limitation of Transactions. So long as
any Capital Securities remain outstanding, if (a) there shall have occurred and be continuing an Event of Default
or a Declaration Event of Default or (b) the Guarantor shall have selected an Extension Period as provided in the
Declaration and such period, or any extension thereof, shall have commenced and be continuing, then the Guarantor
shall not and shall not permit any Affiliate to (x) declare or pay any dividends or distributions on, or redeem,
purchase, acquire, or make a liquidation payment with respect to, any of the Guarantor’s or such
Affiliate’s capital stock (other than payments of dividends or distributions to the Guarantor) or make any
guarantee payments with respect to the foregoing or (y) make any payment of principal of or interest or premium,
if any, on or
repay, repurchase or redeem any debt securities of the Guarantor or any Affiliate that rank pari passu in
all respects with or junior in interest to the Debentures (other than, with respect to clauses (x) and (y) above,
(i) repurchases, redemptions or other acquisitions of shares of capital stock of the Guarantor in connection with
any employment contract, benefit plan or other similar arrangement with or for the benefit of one or more
employees, officers, directors or consultants, in connection with a dividend reinvestment or stockholder stock
purchase plan or in connection with the issuance of capital stock of the Guarantor (or securities convertible
into or exercisable for such capital stock) as consideration in an acquisition transaction entered into prior to
the occurrence of the Event of Default, Declaration Event of Default or Extension Period, as applicable, (ii) as
a result of any exchange or conversion of any class or series of the Guarantor’s capital stock (or any
of a subsidiary of the Guarantor) for any class or series of the Guarantor’s capital stock or of any class
or series of the Guarantor’s indebtedness for any class or series of the Guarantor’s capital 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) any
declaration of a dividend in connection with any stockholders’ rights plan, or the issuance of rights, stock
or other property under any stockholders’ rights plan, or the redemption or repurchase of rights pursuant
thereto, (v) any dividend in the form of stock, warrants, options or other rights where the dividend stock or the
stock issuable upon exercise of such warrants, options or other rights is the same stock as that on which the
dividend is being paid or ranks pari passu with or junior to such stock and any cash payments in lieu of
shares issued in connection therewith, or (vi) payments under this Guarantee).
5.2.Ranking. This Guarantee will constitute
an unsecured obligation of the Guarantor and will rank subordinate and junior in right of payment to all present
and future Senior Indebtedness (as defined in the Indenture) of the Guarantor. By their acceptance thereof,
each Holder of Capital Securities agrees to the foregoing provisions of this Guarantee and the other terms set
The right of
the Guarantor to participate in any distribution of assets of any of its subsidiaries upon any such
subsidiary’s liquidation or reorganization or otherwise is subject to the prior claims of creditors of that
subsidiary, except to the extent the Guarantor may itself be recognized as a creditor of that subsidiary.
Accordingly, the Guarantor’s obligations under this Guarantee will be effectively
subordinated to all existing and future liabilities of the Guarantor’s
subsidiaries, and claimants should look only to the assets of the Guarantor for payments hereunder. This
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.
6.1.Termination. This Guarantee shall
terminate as to the Capital Securities (i) upon full payment of the Redemption Price or Special Redemption Price
of all Capital Securities then outstanding, (ii) upon the distribution of all 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 Guarantee will continue to be effective or will be
reinstated, as the case may be, if at any time any Holder of Capital Securities must restore payment of any sums
paid under the Capital Securities or under this Guarantee.
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 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 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.
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 Capital Securities might properly be
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 willful misconduct 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, but not limited to, 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 7.2
shall survive the resignation or removal of the Guarantee Trustee and the termination of this
(b) Promptly after receipt by an Indemnified Person under this Section 7.2 of notice
of the commencement of any action, such Indemnified Person will, if a claim in respect thereof is to be made
against the Guarantor under this Section 7.2, notify the Guarantor in writing of the commencement thereof; but
the failure so to notify the Guarantor (i) will not relieve the Guarantor from liability under paragraph (a)
above unless and to the extent that the Guarantor did not otherwise learn of such action and such failure results
in the forfeiture by the Guarantor of substantial rights and defenses and (ii) will not, in any event, relieve
the Guarantor from any obligations to any Indemnified Person other than the indemnification obligation provided
in paragraph (a) above. The Guarantor shall be entitled to appoint counsel of the Guarantor’s choice
at the Guarantor’s
expense to represent the Indemnified Person in any action for which indemnification is sought (in which case the
Guarantor shall not thereafter be responsible for the fees and expenses of any separate counsel retained by the
Indemnified Person or Persons except as set forth below); provided, however, that such counsel shall be
reasonably satisfactory to the Indemnified Person. Notwithstanding the Guarantor’s election to appoint
counsel to represent the Guarantor in an action, the Indemnified Person shall have the right to employ separate
counsel (including local counsel), and the Guarantor shall bear the reasonable fees, costs and expenses of such
separate counsel if (i) the use of counsel chosen by the Guarantor to represent the Indemnified Person would
present such counsel with a conflict of interest, (ii) the actual or potential defendants in, or targets of, any
such action include both the Indemnified Person and the Guarantor and the Indemnified Person shall have
that there may be legal defenses available to it and/or other Indemnified Person(s) which are different from or
additional to those available to the Guarantor, (iii) the Guarantor shall not have employed counsel satisfactory
to the Indemnified Person to represent the Indemnified Person within a reasonable time after notice of the
institution of such action or (iv) the Guarantor shall authorize the Indemnified Person to employ separate
counsel at the expense of the Guarantor. The Guarantor will not, without the prior written consent of the
Indemnified Persons, settle or compromise or consent to the entry of any judgment with respect to any pending or
threatened claim, action, suit or proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the Indemnified Persons are actual or potential parties to such claim or action) unless
such settlement, compromise or consent includes an unconditional release of each Indemnified Person from all
out of such claim, action, suit or proceeding.
7.3.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 as the parties
shall agree to from time to time (which compensation shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust); and
(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 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 willful misconduct.
For purposes of
clarification, this Section 7.3 does not contemplate the payment by the Guarantor of acceptance or annual
administration fees owing to the Guarantee Trustee for services to be provided by the Guarantee Trustee under
this Guarantee or the fees and expenses of the Guarantee Trustee’s counsel in connection with the closing of
the transactions contemplated by this Guarantee. The provisions of this Section 7.3 shall survive the
resignation or removal of the Guarantee Trustee and the termination of this Guarantee.
8.1.Successors and Assigns. All guarantees
and agreements contained in this 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, transfer or lease 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 Guarantee without the prior approval of the Holders of at least a Majority in liquidation amount of the
8.2.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 Guarantee may be amended only with the prior approval of
the Holders of not less than 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.
8.3.Notices. All notices provided for in this
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 and the Guarantor):
Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890-1600
Attention: Corporate Trust Administration
(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):
(c) If given to
any Holder of the Capital Securities, at the address set forth on the books and records of the Issuer.
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.
8.4.Benefit. This Guarantee is solely for the
benefit of the Beneficiaries and, subject to Section 2.1(a), is not separately transferable from the Capital
8.5.Governing Law. THIS GUARANTEE SHALL BE
GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK, WITHOUT REGARD
TO CONFLICT OF LAWS PRINCIPLES THEREOF (OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS
8.6.Counterparts. This Guarantee may be
executed in one or more counterparts, each of which shall be an original, but all of which taken together shall
constitute one and the same instrument.
Separability. In case one or more of the provisions contained in
this Guarantee shall for any reason be held to be invalid, illegal or unenforceable in any respect, such
invalidity, illegality or unenforceability shall not affect any other provisions of this Guarantee, but this
Guarantee shall be construed as if such invalid or illegal or unenforceable provision had never been contained
Signatures appear on the following page
is executed as of the day and year first above written.