-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Qz36J66YYAYRHZ8PeIF0fGIXLXEuRvOiCTad3b4G0w6OCZTqnmu+xquPlY2Wpb1g lluK/hfZYHTrjQ2l+MLe4g== 0000912057-99-002547.txt : 19991029 0000912057-99-002547.hdr.sgml : 19991029 ACCESSION NUMBER: 0000912057-99-002547 CONFORMED SUBMISSION TYPE: S-3 PUBLIC DOCUMENT COUNT: 15 FILED AS OF DATE: 19991028 FILER: COMPANY DATA: COMPANY CONFORMED NAME: INDEPENDENT BANK CORP CENTRAL INDEX KEY: 0000776901 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 042870273 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-3 SEC ACT: SEC FILE NUMBER: 333-89835 FILM NUMBER: 99735997 BUSINESS ADDRESS: STREET 1: 288 UNION STREET CITY: ROCKLAND STATE: MA ZIP: 02370 BUSINESS PHONE: 6178786100 MAIL ADDRESS: STREET 1: 288 UNION STREET CITY: ROCKLAND STATE: MA ZIP: 02370 FILER: COMPANY DATA: COMPANY CONFORMED NAME: INDEPENDENT CAPITAL TRUST II CENTRAL INDEX KEY: 0001097697 STANDARD INDUSTRIAL CLASSIFICATION: [] FILING VALUES: FORM TYPE: S-3 SEC ACT: SEC FILE NUMBER: 333-89835-01 FILM NUMBER: 99735998 BUSINESS ADDRESS: STREET 1: 288 UNION STREET CITY: ROCKLAND STATE: MA ZIP: 62370 BUSINESS PHONE: 6178786100 S-3 1 FORM S-3 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 28, 1999 REGISTRATION NO. 333- 333- 01 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ------------------ INDEPENDENT BANK CORP INDEPENDENT CAPITAL TRUST II (Exact name of Registrant as (Exact name of Registrant as specified in its charter) specified in its trust agreement) MASSACHUSETTS DELAWARE (State or other jurisdiction of (State or other jurisdiction of incorporation or organization) incorporation or organization) - ------------------------------- ------------------------------- 6022 6719 (Primary Standard Industrial (Primary Standard Industrial Classification Code Number) Classification Code Number) 04-2870273 04-6901632 (I.R.S. Employer (I.R.S. Employer Identification No.) Identification No.)
---------------------------------- 288 UNION STREET ROCKLAND, MASSACHUSETTS 02370 (617) 878-6100 (Address, including zip code, and telephone number, including area code, of Registrants' principal executive offices) ---------------------------------- RICHARD J. SEAMAN CHIEF FINANCIAL OFFICER INDEPENDENT BANK CORP. 288 UNION STREET ROCKLAND, MASSACHUSETTS 02370 (617) 878-6100 (Name, address, including zip code, and telephone number, including area code, of agents for service) ---------------------------------- COPIES TO: NORMAN B. ANTIN, ESQ. RICHARD A. SCHABERG, ESQ. JEFFREY D. HAAS, ESQ. THACHER PROFFITT & WOOD ELIAS, MATZ, TIERNAN & HERRICK L.L.P. 1700 PENNSYLVANIA AVENUE 734 15TH STREET, N.W. WASHINGTON, D.C. 20006 WASHINGTON, D.C. 20005
---------------------------------- Approximate Date of Commencement of Proposed Sale to the Public: As soon as practicable after this Registration Statement becomes effective. If the only securities being registered on this form are being offered pursuant to dividend interest reinvestment plans, please check the following box. / / If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. / / If this form is filed to register additional securities for an offering pursuant to Rule 462 under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. / / ________ If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier registration statement for the same offering. / / ________ If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. / / ---------------------------------- CALCULATION OF REGISTRATION FEE
AMOUNT PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF TITLE OF EACH CLASS OF SECURITIES TO BE OFFERING PRICE AGGREGATE REGISTRATION TO BE REGISTERED REGISTERED PER UNIT(1) OFFERING PRICE(1) FEE(2) Trust Preferred Securities of Independent Capital Trust II........................... $23,000,000 100% $23,000,000 $6,394 Junior Subordinated Deferrable Interest Debentures of Independent Bank Corp.(2).... $23,000,000 100% $23,000,000 N/A Independent Bank Corp. Guarantee with respect to the Trust Preferred Securities(3)....... N/A N/A N/A N/A Total........................................ $23,000,000(4) 100% $23,000,000(4) $6,394
(1) Estimated solely for the purpose of computing the registration fee. (2) No separate consideration will be received for the Junior Subordinated Deferrable Interest Debentures of Independent Bank Corp. (the "Junior Subordinated Debentures") distributed upon any liquidation of Independent Capital Trust II. (3) No separate consideration will be received for the Independent Bank Corp. Guarantee. (4) Such amount represents the liquidation amount of the Independent Capital Trust II Trust Preferred Securities and the principal amount of Junior Subordinated Debentures that may be distributed to holders of such Trust Preferred Securities upon any liquidation of Independent Capital Trust II. ---------------------------------- THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The information in this prospectus is not complete and may be changed. We may not sell these securities until the Securities and Exchange Commission declares our registration statement effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED OCTOBER 28, 1999 2,000,000 TRUST PREFERRED SECURITIES INDEPENDENT CAPITAL TRUST II % CUMULATIVE TRUST PREFERRED SECURITIES (LIQUIDATION AMOUNT $10 PER TRUST PREFERRED SECURITY) [LOGO] FULLY AND UNCONDITIONALLY GUARANTEED, AS DESCRIBED HEREIN, BY INDEPENDENT BANK CORP. --------------------- INDEPENDENT BANK CORP.: We are a bank holding company that offers, through our subsidiary Rockland Trust Company, a full range of commercial and retail banking and trust services to our customers in Southeastern Massachusetts. INDEPENDENT CAPITAL TRUST II: Independent Capital Trust II is a subsidiary of Independent Bank Corp. and a statutory business trust created under Delaware law. THE OFFERING: In connection with this offering, the Trust will sell Trust Preferred Securities to the public and Common Securities to us; use the proceeds from these sales to buy an equivalent principal amount of % Junior Subordinated Debentures due , 2029 issued by us, and distribute the future cash payments it receives on the Junior Subordinated Debentures to the holders of the Trust Preferred Securities and Common Securities. - For each Trust Preferred Security that you own, you will receive cumulative cash distributions at an annual rate of % on March 31, June 30, September 30 and December 31 of each year, beginning , 1999. Distribution payments to you may be deferred for up to 20 consecutive calendar quarters. - The Trust Preferred Securities mature on , 2029. - The Trust may redeem the Trust Preferred Securities, at a redemption price of $10 per Trust Preferred Security on or after , 2004, plus accrued and unpaid distributions, and under certain other circumstances. - A brief description of the Trust Preferred Securities can be found under "Summary" in this prospectus. - We intend to apply for listing of the Trust Preferred Securities on the Nasdaq National Market under the symbol "INDBO." -------------------------- THERE ARE CERTAIN RISKS YOU SHOULD CONSIDER BEFORE INVESTING IN THE TRUST PREFERRED SECURITIES. SEE "RISK FACTORS" BEGINNING ON PAGE 10. --------------------------
PER SECURITY TOTAL ------------ -------- Public Offering Price....................................... $10.00 $ Proceeds to the Trust....................................... $10.00 $
In view of the fact that the proceeds of the sale of the Trust Preferred Securities will be invested in the Junior Subordinated Debentures, we, Independent Bank Corp., as issuer of the Junior Subordinated Debentures, have agreed to pay the underwriter $ per Trust Preferred Security (or $ ($ if the underwriter's over-allotment option is exercised in full) in the aggregate) as compensation. We and the Trust have granted the underwriter a 30-day option to purchase up to 300,000 additional Trust Preferred Securities on the same terms and conditions discussed above solely to cover over-allotments, if any. If this option is exercised in full, the total Public Offering Price and Proceeds to the Trust will be $ and $ . NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OF ANYONE'S INVESTMENT IN THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. THESE SECURITIES ARE NOT SAVINGS ACCOUNTS, DEPOSITS OR OBLIGATIONS OF ANY BANK AND ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY. The Trust Preferred Securities will be ready for delivery in book-entry form through The Depository Trust Company on or about , 1999. -------------------------- Legg Mason Wood Walker Incorporated The date of this prospectus is , 1999 [MAP] TABLE OF CONTENTS
PAGE -------- Forward Looking Statements.................................. Where You Can Find More Information......................... Summary..................................................... Summary Consolidated Financial and Other Data............... Risk Factors................................................ Ratios of Earnings to Fixed Charges......................... Use of Proceeds............................................. Capitalization.............................................. Independent Capital Trust II................................ Description of Trust Preferred Securities................... Description of Junior Subordinated Debentures............... Description of Guarantee.................................... Book-Entry Issuance......................................... Relationship Among the Trust Preferred...................... Securities, the Junior Subordinated......................... Debentures and the Guarantee................................ Certain Federal Income Tax Consequences..................... ERISA Considerations........................................ Underwriting................................................ Legal Matters............................................... Experts.....................................................
------------------------ FORWARD LOOKING STATEMENTS This document contains and incorporates by reference certain forward looking statements regarding our financial condition, results of operations and business. These statements are not historical facts and include statements about our - confidence, - strategies about earnings, - new and existing programs and products, - relationships, - opportunities, - technology, and - market conditions. You may identify these statements by looking for - forward-looking terminology, like "expect," "believe" or "anticipate;" - expressions of confidence like "strong" or "on-going;" or - similar statements or variations of those terms. i These forward-looking statements involve certain risks and uncertainties. Actual results may differ materially from the results the forward-looking statements contemplate because of, among others, the following possibilities: - competitive pressure in the banking and financial services industry increases significantly; - changes occur in the interest rate environment; - our Year 2000 compliance program does not effectively address Year 2000 computer problems; and - general economic conditions, either nationally, in New England or in the state of Massachusetts, are less favorable than expected. ------------------------ WHERE YOU CAN FIND MORE INFORMATION We file annual, quarterly and special reports, proxy statements and other information with the Securities and Exchange Commission (the "SEC"). Our SEC filings are available to the public over the Internet at the SEC's web site at http://www.sec.gov. You may also read and copy any documents we file with the SEC at its public reference facilities at 450 Fifth Street, NW, Washington, DC 20549, 7 World Trade Center, Suite 1300, New York, New York 10048 and Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511. You can also obtain copies of the documents at prescribed rates by writing to the Public Reference Section of the SEC at 450 Fifth Street, NW, Washington, DC 20549. Please call the SEC at 1-800-SEC-0330 for further information on the operation of the public reference facilities. Our SEC filings are also available at the office of the Nasdaq National Market. For further information on obtaining copies of our public filings at the Nasdaq National Market, you should call (212) 656-5060. The Trust is not currently subject to the information reporting requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The Trust will become subject to such requirements upon the effectiveness of the registration statement that contains this prospectus, although it intends to seek and expects to receive an exemption therefrom. We and the Trust have filed with the SEC a registration statement on Form S-3 (together with all amendments thereto, the "registration statement"), of which this prospectus is a part, under the Securities Act of 1933, as amended (the "Securities Act") with respect to the Trust Preferred Securities, the Junior Subordinated Debentures and the Guarantee, each of which is discussed in this prospectus. This prospectus does not contain all of the information set forth in the registration statement, certain portions of which have been omitted as permitted by the rules and regulations of the SEC. For further information with respect to us, the Trust, the Trust Preferred Securities, the Junior Subordinated Debentures and the Guarantee, reference is made to the registration statement, including its exhibits. The registration statement may be inspected without charge at the principal office of the SEC in Washington, D.C., and copies of all or part of it may be obtained from the SEC upon payment of the prescribed fees. We "incorporate by reference" into this prospectus the information we file with the SEC, which means that we can disclose important information to you by referring you to those documents. The information incorporated by reference is an important part of this prospectus and information that we file subsequently with the SEC will automatically update this prospectus. We incorporate by reference the documents listed below and any filings we make with the SEC under Sections 13(a), 13(c), 14, or 15(d) of the Exchange Act, after the initial filing of the registration statement that contains this prospectus and prior to the time that we sell all the securities offered by this prospectus: - Annual Report on Form 10-K for the year ended December 31, 1998. ii - Quarterly Reports on Form 10-Q for the quarters ended March 31, 1999, June 30, 1999 and September 30, 1999. - Current Report on Form 8-K filed with the SEC on October 1, 1999. You may request a copy of these filings (other than an exhibit to a filing unless that exhibit is specifically incorporated by reference into that filing) at no cost, by writing to or telephoning us at the following address: 288 Union Street, Rockland, Massachusetts 02370, Attention: Corporate Secretary, telephone (781) 878-6100. ------------------------ WE HAVE NOT, AND THE UNDERWRITER HAS NOT, AUTHORIZED ANY OTHER PERSON TO PROVIDE YOU WITH DIFFERENT INFORMATION. THIS PROSPECTUS IS NOT AN OFFER TO SELL, NOR IS IT SEEKING AN OFFER TO BUY, THESE TRUST PREFERRED SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED. THE INFORMATION IN THIS PROSPECTUS IS COMPLETE AND ACCURATE AS OF THE DATE ON THE FRONT COVER, BUT THE INFORMATION MAY HAVE CHANGED SINCE THAT DATE. iii SUMMARY THE ITEMS IN THE FOLLOWING SUMMARY ARE DESCRIBED IN MORE DETAIL LATER IN THIS PROSPECTUS. THIS SUMMARY PROVIDES AN OVERVIEW OF SELECTED INFORMATION AND DOES NOT CONTAIN ALL THE INFORMATION YOU SHOULD CONSIDER. THEREFORE, YOU SHOULD ALSO READ THE MORE DETAILED INFORMATION SET OUT IN THIS PROSPECTUS OR INCORPORATED HEREIN BY REFERENCE. IN THIS PROSPECTUS, REFERENCES TO "WE," "OUR," AND "INDEPENDENT" ARE TO INDEPENDENT BANK CORP. OUR COMPANY We are the holding company of Rockland Trust Company (the "Bank"), a Massachusetts trust company which was chartered in 1907. We are headquartered in Rockland, Massachusetts and at September 30, 1999, we had consolidated assets of $1.6 billion, deposits of $1.1 billion and stockholders' equity of $94 million. Through the Bank, we offer a full range of commercial and retail banking and trust services through our network of 34 banking offices, eight commercial lending centers, and two trust and financial services offices located in the Plymouth, Norfolk, and Bristol Counties of Southeastern Massachusetts. We are the only locally-based commercial bank in Plymouth County. As a community focused commercial bank, we seek to service the needs of local customers in our market by developing long-term deposit and lending relationships. As such, we have become a prominent financial institution in Plymouth County, which represents the majority of our market area. At June 30, 1998 (the most recent date for deposit market share information), the Bank had approximately 22.4% of the total deposits in Plymouth County. That amount represents approximately 178% of the market share of our closest competitor. In its lending activities, the Bank has emphasized the origination of residential and commercial loans within its primary market areas. At September 30, 1999, the Bank's gross loan portfolio consisted of 30% mortgage loans collateralized by commercial real estate, 20% of mortgage loans collateralized by residential real estate, 13% of commercial loans, 5% of real estate construction loans, and 32% of consumer loans. The Bank stresses asset quality through its emphasis on lending in its local markets where management is most qualified to make educated underwriting decisions and the application of generally conservative underwriting criteria. In May 1997, we issued $28.75 million of 9.28% cumulative trust preferred securities of Independent Capital Trust I ("Trust I"), which are scheduled to mature in 2027. Trust I invested the proceeds of the sale of these securities in $29.64 million of 9.28% junior subordinated debentures issued by us. Distributions on these securities are payable quarterly in arrears on the last day of March, June, September and December, such distributions can be deferred at our option for up to five years. The trust preferred securities can be prepaid in whole or in part on or after May 19, 2002 at a redemption price equal to $25 per security plus accumulated but unpaid distributions thereon to the date of the redemption. The trust preferred securities of Trust I are quoted on the Nasdaq National Market under the symbol "INDBP." PENDING BRANCH ACQUISITION. In September 1999, we entered into an agreement with Fleet Financial Group, Inc., Fleet National Bank and BankBoston, N.A. to acquire 12 branches, two of which are located in Brockton, Massachusetts, which is within our primary market area, and ten of which are located on Cape Cod, Massachusetts in Barnstable County, a market contiguous to where we presently operate. The 12 branches to be acquired presently have total deposits aggregating approximately $269 million. In connection with the acquisition, which is subject to, among other things, the receipt of regulatory approvals, we expect to acquire approximately $150 million of commercial and consumer loans. Following the acquisition, we will have approximately $1.8 billion in assets, $1.3 billion in deposits and 46 retail branches. We expect to pay a core deposit premium of approximately $32 million in connection with the acquisition. We filed our regulatory applications in October 1999 and presently expect that the transaction will close during the third quarter of 2000. Our principal office is located at 288 Union Street, Rockland, Massachusetts 02370 and our telephone number is (781) 878-6100. INDEPENDENT CAPITAL TRUST II Independent Capital Trust II (the "Trust"), the issuer of the Trust Preferred Securities, is a statutory business trust formed by us under the Delaware Business Trust Act. The Trust exists for the sole purpose of (i) issuing common securities of the Trust (the "Common Securities") to us and the Trust Preferred Securities (the Trust Preferred Securities and the Common Securities are referred to in this prospectus as the "Trust Securities") for cash and investing the proceeds in an equivalent amount of % Junior Subordinated Deferrable Interest Debentures due , 2029 (the "Junior Subordinated Debentures") issued by us and (ii) engaging in other activities that are necessary or incidental to the issuance of the Trust Securities and the investment in the Junior Subordinated Debentures. The Trust has no separate financial statements. We do not believe that the statements would be significant to you because the Trust is a direct wholly owned subsidiary of the Company, has no independent operations and exists solely for the reasons summarized above. The Trust's principal office is located at c/o The Bank of New York, 101 Barclay Street, New York, New York 10286 and its telephone number is (212) 815-5359. RISK FACTORS Prior to making an investment decision, you should carefully consider all of the information in this prospectus, and, in particular, you should evaluate the risk factors set forth under the caption "Risk Factors," which are described immediately following this Summary. 2 THE OFFERING Issuer of the Trust Preferred Securities..... Independent Capital Trust II, a Delaware statutory business trust. Securities offered........................... 2,000,000 % Trust Preferred Securities, liquidation amount $10 per security (2,300,000 Trust Preferred Securities if the underwriter's over-allotment option is exercised in full). The Trust Preferred Securities represent preferred undivided beneficial interests in the Trust's assets, which will consist solely of the Junior Subordinated Debentures and payments under the Junior Subordinated Debentures. The Trust will sell the Trust Preferred Securities to the public and the Common Securities to us. The Trust will use the proceeds from the sale of the Trust Securities to buy the Junior Subordinated Debentures from us. Distributions................................ If you purchase the Trust Preferred Securities, you will be entitled to receive cumulative cash distributions at a % annual rate. Distributions will accumulate from the date the Trust issues the Trust Preferred Securities, and will be paid quarterly in arrears on March 31, June 30, September 30 and December 31 of each year, beginning on , 1999. Distributions on the Trust Preferred Securities may be deferred, as described below. The initial cash distribution payable on , 1999 will equal $ for each Trust Preferred Security. Subsequent cash distributions will equal $ for each Trust Preferred Security. The record date for distributions on the Trust Preferred Securities will be one business day prior to the relevant distribution date for so long as the Trust Preferred Securities remain in book-entry form (if not book-entry form the record date will be the fifteenth day of the month in which the distributions are made). Maturity..................................... The Junior Subordinated Debentures will mature on , 2029. Redemption................................... We may redeem all or a part of the Junior Subordinated Debentures on or after , 2004 at a redemption price of $10 per Junior Subordinated Debenture, plus accrued and unpaid distributions.
3 In addition, we may redeem all of the Junior Subordinated Debentures at our option: - if certain tax events occur; - if there is a change in the Investment Company Act of 1940 that requires the Trust to register under that law; or - if there is a change in, among other things, the regulatory capital adequacy guidelines that apply to us. These circumstances are collectively referred to as "Special Events." We will not redeem the Junior Subordinated Debentures before they mature without approval by the regulatory agencies which supervise us if such approval is then required under applicable requirements. Upon any redemption of the Junior Subordinated Debentures, the Trust will use the cash proceeds of such redemption to pay you a liquidation amount for the Trust Preferred Securities. The liquidation amount you will receive will be equal to the redemption price described above. Deferral of distributions.................... The Trust relies solely on payments made by us on the Junior Subordinated Debentures to pay distributions on the Trust Preferred Securities. If no event of default under the Junior Subordinated Debentures has occurred or is continuing, we have the right, at one or more times, to defer interest payments on the Junior Subordinated Debentures for up to 20 consecutive calendar quarters, but not beyond the maturity date of the Junior Subordinated Debentures. If we defer interest payments on the Junior Subordinated Debentures: - the Trust will also defer distributions on the Trust Preferred Securities; - your distributions will continue to accrue at an annual rate of % of the liquidation amount of $10 per Trust Preferred Security; and - you will accumulate additional distributions at the same rate, compounded quarterly, on any unpaid distributions (to the extent permitted by law).
4 When a deferral period ends, we will be required to pay to the Trust all accumulated and unpaid interest due on the Junior Subordinated Debentures and, when the Trust receives this payment, it will be required to pay all accumulated and unpaid distributions on the Trust Securities. If we defer payments of interest on the Junior Subordinated Debentures, the Trust Preferred Securities will be treated as being issued with original issue discount for United States federal income tax purposes. This means that you will still be required to include income in your gross income for United States federal income tax purposes before you receive any corresponding cash distribution, even if you are a cash basis taxpayer. We have agreed to certain restrictions if we exercise our right to defer interest payments. During any period in which we defer interest payments on the Junior Subordinated Debentures, we will not be permitted to (with limited exceptions described under "Description of Junior Subordinated Debentures--Option to Extend Interest Payment Date"): - declare or pay dividends or make other distributions on, redeem, purchase or acquire, or make liquidation payments with respect to, our capital stock; - pay interest, principal or premium on, or repay, repurchase or redeem any of our debt securities that rank equal with or junior to the Junior Subordinated Debentures; or - make guarantee payments with respect to the foregoing. Guarantee.................................... We will fully and unconditionally guarantee the Trust Preferred Securities based on: - our obligations to make payments on the Junior Subordinated Debentures; - our obligations under a guarantee executed for your benefit (the "Guarantee"); and
5 - our obligations under the Trust Agreement, which sets forth the terms of the Trust Securities. If we do not make payments on the Junior Subordinated Debentures, the Trust will not have sufficient funds to make payments on the Trust Preferred Securities. The Guarantee does not cover payments when the Trust does not have sufficient funds. Instead, you (to the fullest extent of the law) or the property trustee may enforce the holder's rights under the Junior Subordinated Debentures directly against us. Distribution of the Junior Subordinated Debentures................................. We may dissolve the Trust at any time and distribute the Junior Subordinated Debentures to you, subject to any required approval by the regulatory agencies which supervise us. If the Junior Subordinated Debentures are distributed, we will use our best efforts to list them on a national securities exchange or comparable automated quotation system. Ranking...................................... Our obligations under the Junior Subordinated Debentures are unsecured and will rank junior in priority of payment to our current and any future senior and subordinated indebtedness and will be effectively subordinated to all existing and future liabilities and obligations of our subsidiaries, including the Bank. As of September 30, 1999, we had no senior or subordinated indebtedness outstanding and our subsidiaries had total liabilities (excluding liabilities owed to us) of $1.5 billion. Our obligations under the Junior Subordinated Debentures will rank equal to other junior subordinated debentures issued or to be issued by us to similar trusts, including the junior subordinated debentures sold to Trust I in May 1997. Our obligations under the Guarantee are unsecured and will rank in priority of payment: - junior to all of our indebtedness, except for those liabilities made equal or subordinate to the Junior Subordinated Debentures by their terms;
6 - equal to all other guarantees issued or to be issued by us with respect to other similar trust preferred securities, including the issuance of $28.75 million of trust preferred securities of Trust I in May 1997; and - senior to our capital stock. Limited voting rights........................ Except in limited circumstances, you as a holder of the Trust Preferred Securities will have no voting rights. Listing...................................... We intend to apply for listing of the Trust Preferred Securities on the Nasdaq National Market under the symbol "INDBO." Book-entry................................... The Trust Preferred Securities will be represented by a global security that will be deposited with and registered in the name of The Depository Trust Company, New York, New York or its nominee. This means that you will not receive a certificate for your Trust Preferred Securities. Use of proceeds.............................. The Trust plans to use the proceeds from the sale of the Trust Securities to purchase the Junior Subordinated Debentures from us. We intend to use the net proceeds from the sale of the Junior Subordinated Debentures for general corporate purposes, which shall include capital contributions to the Bank, and for working capital. - To the extent that the previously announced branch acquisition transaction with Fleet Financial Group, Inc. is completed, the offering will ensure that the Bank will continue to be "well capitalized" following consummation of the transaction. Initially, we may use the net proceeds to make short-term investments.
7 SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA) The selected consolidated financial and other data below should be read in connection with the financial information included in our Annual Report on Form 10-K for the year ended December 31, 1998 and our Quarterly Report on Form 10-Q for the nine months ended September 30, 1999. See "Where You Can Find More Information."
AT SEPTEMBER 30, AT DECEMBER 31, ----------------------- ---------------------------------------------------------- 1999 1998 1998 1997 1996 1995 1994 BALANCE SHEET DATA: ---------- ---------- ---------- ---------- ---------- -------- -------- (UNAUDITED) Total assets............................... $1,565,400 $1,514,730 $1,575,069 $1,370,007 $1,092,793 $987,589 $929,194 Loans, net of unearned discount............ 1,019,295 909,284 941,112 828,132 695,406 628,141 590,689 Securities held to maturity................ 233,565 308,743 284,944 308,112 290,894 226,896 256,785 Securities available for sale.............. 201,640 200,916 195,199 131,842 26,449 32,628 4,250 Total deposits............................. 1,066,656 986,332 1,043,317 988,148 918,572 871,085 796,612 FHLB borrowings............................ 265,224 301,224 313,724 206,724 78,000 20,000 25,000 Stockholders' equity....................... 94,086 96,291 95,848 92,493 81,110 72,572 64,202
NINE MONTHS ENDED SEPTEMBER 30, YEAR ENDED DECEMBER 31, ----------------------- ---------------------------------------------------------- 1999 1998 1998 1997 1996 1995 1994 OPERATIONS DATA: ---------- ---------- ---------- ---------- ---------- -------- -------- (UNAUDITED) Interest income............................ $ 83,386 $ 80,818 $ 108,712 $ 93,820 $ 77,424 $ 72,918 $ 63,540 Interest expense........................... 37,620 36,480 49,569 41,578 32,354 29,143 22,029 ---------- ---------- ---------- ---------- ---------- -------- -------- Net interest income........................ 45,766 44,338 59,143 52,242 45,070 43,775 41,511 Provision for possible loan losses......... 2,945 2,721 3,960 2,260 1,750 1,000 801 ---------- ---------- ---------- ---------- ---------- -------- -------- Net interest income after provision for loan losses.............................. 42,821 41,617 55,183 49,982 43,320 42,775 40,710 Non-interest income........................ 10,907 9,745 13,125 11,742 11,381 10,341 10,005 Non-interest expenses...................... 33,918 31,828 41,697 38,595 36,951 38,000 41,069 Minority interest expense.................. 2,001 2,001 2,668 1,645 -- -- -- ---------- ---------- ---------- ---------- ---------- -------- -------- Income before income taxes................. 17,809 17,533 23,943 21,484 17,750 15,116 9,646 Income taxes............................... 5,423 5,785 7,804 7,326 6,153 4,729 1,533 ---------- ---------- ---------- ---------- ---------- -------- -------- Net income................................. $ 12,386 $ 11,748 $ 16,139 $ 14,158 $ 11,597 $ 10,387 $ 8,113 ========== ========== ========== ========== ========== ======== ======== PER SHARE DATA: Net income: Basic.................................... $ 0.87 $ 0.79 $ 1.10 $ 0.97 $ 0.80 $ 0.72 $ 0.56 Diluted.................................. 0.86 0.78 1.08 0.95 0.79 0.71 0.56 Cash dividends............................. 0.30 0.30 0.40 0.34 0.25 0.18 0.08 Book value, end of period.................. 6.71 6.59 6.63 6.25 5.55 5.00 4.45
AT OR FOR THE NINE MONTHS ENDED SEPTEMBER 30, AT OR FOR THE YEAR ENDED DECEMBER 31, ----------------------- ---------------------------------------------------------- 1999 1998 1998 1997 1996 1995 1994 SELECTED FINANCIAL RATIOS(1): ---------- ---------- ---------- ---------- ---------- -------- -------- (UNAUDITED) Return on average assets................... 1.06% 1.11% 1.12% 1.15% 1.13% 1.10% 0.94% Return on average equity................... 17.28 16.20 16.71 16.45 15.20 15.28 13.36 Net interest margin........................ 4.25 4.44 4.36 4.52 4.72 4.97 5.19 Operating expenses as a percent of average assets................................... 2.90 3.01 2.88 3.14 3.60 4.02 4.75 Nonperforming loans as a percent of gross loans.................................... 0.38 0.60 0.56 0.69 0.63 0.83 1.31 Nonperforming assets as a percent of total assets at end of period.................. 0.26 0.37 0.34 0.43 0.43 0.60 1.26 Reserve for possible loan losses as a percent of loans, net of unearned discount................................. 1.44 1.50 1.46 1.53 1.76 1.92 2.32 Reserve for possible loan losses as a percent of nonperforming loans at end of period................................... 372.89 242.94 255.69 215.14 273.89 229.33 174.45 Dividend payout ratio...................... 34.88 37.97 37.03 35.78 31.64 25.35 14.28 Capital ratios at end of period: Tier 1 leverage capital ratio............ 7.93 8.13 7.91 8.64 7.35 7.24 6.76 Tier 1 risk-based capital ratio.......... 10.77 11.81 11.38 13.52 10.89 10.67 10.05 Total risk-based capital ratio........... 12.03 13.06 12.63 14.78 12.15 11.92 11.31 Ratio of earnings to fixed charges(2): Including interest on deposits............. 1.47x 1.47x 1.48x 1.51x 1.54x 1.51x 1.43x Excluding interest on deposits............. 2.18x 2.31x 2.27x 3.02x 4.26x 5.00x 5.66x
- ------------------------------ (1) With the exception of end-of-period ratios, all ratios are based on average daily balances during the indicated periods. (2) See "Ratios of Earnings to Fixed Charges." 8 RISK FACTORS YOU SHOULD CAREFULLY READ THE FOLLOWING RISK FACTORS BEFORE YOU DECIDE TO BUY ANY TRUST PREFERRED SECURITIES. YOU SHOULD ALSO CONSIDER THE OTHER INFORMATION IN THIS PROSPECTUS AND THE DOCUMENTS THAT ARE INCORPORATED BY REFERENCE. RISKS RELATED TO AN INVESTMENT IN THE TRUST PREFERRED SECURITIES PAYMENTS ON THE TRUST PREFERRED SECURITIES ARE ENTIRELY DEPENDENT ON OUR MAKING PAYMENTS ON THE JUNIOR SUBORDINATED DEBENTURES; THE GUARANTEE COVERS PAYMENTS ONLY IF THE TRUST HAS CASH AVAILABLE. The Trust's ability to timely pay distributions (including the $10 per Trust Preferred Security liquidation distribution) is entirely dependent on our making the related payments on the Junior Subordinated Debentures when due. If we do not make payments on the Junior Subordinated Debentures, the Trust will not have sufficient funds to pay distributions or the $10 per Trust Preferred Security liquidation amount. Because the Guarantee does not cover payments when the Trust does not have sufficient funds, you will not be able to rely upon the Guarantee for payment of these amounts. Instead, you may directly sue us or seek other remedies to collect your pro rata share of payments owed or rely on the property trustee to enforce the Trust's rights under the Junior Subordinated Debentures directly against us. THE TRUST'S ABILITY TO MAKE PAYMENTS ON THE TRUST PREFERRED SECURITIES DEPENDS ON OUR ABILITY TO MAKE PAYMENTS ON THE JUNIOR SUBORDINATED DEBENTURES. The Junior Subordinated Debentures and the Guarantee will be exclusively our obligations. We are a bank holding company regulated by the Board of Governors of the Federal Reserve System and substantially all of our assets are held by our subsidiaries. Our ability to make payments on the Junior Subordinated Debentures depends primarily on the results of operations of our subsidiaries and their ability to provide funds to us. Our subsidiaries are separate and distinct legal entities and have no obligations to pay any amounts due under the Junior Subordinated Debentures or to make funds available, whether by dividend, loan or otherwise, for such purpose. In addition, there are various legal limitations on the extent to which certain of our subsidiaries may extend credit, pay dividends or otherwise supply funds to, or engage in transactions with, us or some of our subsidiaries. The Trust will be unable to make payments to you if we do not receive funds from our subsidiaries which allow us to pay interest on or principal of the Junior Subordinated Debentures. Our right to participate in any distribution of the assets of any subsidiary, including the Bank, upon a subsidiary's liquidation or reorganization or otherwise, is subject to the prior claims of creditors of that subsidiary, except to the extent that we may be recognized as a creditor of that subsidiary. As a consequence, the Junior Subordinated Debentures and the Guarantee will be effectively subordinated to all existing and future liabilities of our subsidiaries. As of September 30, 1999, our subsidiaries had total liabilities (excluding liabilities owed to us) of $1.5 billion. Holders of the Junior Subordinated Debentures and beneficiaries of the Guarantee should look only to our assets for payments on the Junior Subordinated Debentures or under the Guarantee, as the case may be. There is no limit under the Trust Preferred Securities, the Junior Subordinated Debentures or the Guarantee as to our subsidiaries' ability to incur additional indebtedness. OUR OBLIGATIONS UNDER THE GUARANTEE AND THE JUNIOR SUBORDINATED DEBENTURES WILL BE SUBORDINATED IN RIGHT OF PAYMENT TO OUR CURRENT AND FUTURE SENIOR AND SUBORDINATED INDEBTEDNESS. Our obligations under the Guarantee are unsecured and will rank in priority of payment: - junior to all of our indebtedness, except for those liabilities made equal or subordinate to the Guarantee by their terms; 9 - equal to all other guarantees issued or to be issued by us with respect to other similar trust preferred securities, including the issuance of $28.75 million of trust preferred securities of Trust I in May 1997; and - senior to our capital stock. This means that we cannot make any payments on the Guarantee if we default on a payment of any of our other liabilities, except those liabilities made equal with or subordinate to the Guarantee by their terms. In the event of our bankruptcy, liquidation or dissolution, our assets would be available to pay obligations under the Guarantee only after all payments have been made on our other liabilities, except those liabilities made equal with or subordinate to the Guarantee by their terms. Our obligations under the Junior Subordinated Debentures are unsecured and will rank junior in priority of payment to our current and future senior and subordinated indebtedness, and will be effectively subordinated to all existing and future liabilities and obligations of our subsidiaries, including the Bank. This means that we cannot make any payments of principal (including redemption payments) or interest on the Junior Subordinated Debentures if we default on a payment on any of our senior indebtedness or subordinated indebtedness. In the event of our bankruptcy, liquidation or distribution, our assets would be available to pay obligations under the Junior Subordinated Debentures only after all payments have been made on our senior indebtedness and our subordinated indebtedness. As of September 30, 1999, we had no senior or subordinated indebtedness outstanding and our subsidiaries had total liabilities (excluding liabilities owed to us) of $1.5 billion. There is no limit under the Trust Preferred Securities, the Junior Subordinated Debentures or the Guarantee as to our ability to incur additional indebtedness, including indebtedness that ranks senior in priority of payment to the Junior Subordinated Debentures and the Guarantee. OUR ABILITY TO DEFER INTEREST PAYMENTS HAS ADVERSE TAX CONSEQUENCES FOR YOU AND MAY AFFECT THE TRADING PRICE FOR THE TRUST PREFERRED SECURITIES. So long as no event of default under the Junior Subordinated Debentures has occurred and is continuing, we may defer interest payments one or more times on the Junior Subordinated Debentures for up to 20 consecutive calendar quarters, but not beyond the maturity date of the Junior Subordinated Debentures. If we defer interest payments on the Junior Subordinated Debentures, the Trust will also defer distributions on the Trust Preferred Securities. During a deferral period, you will be required to accrue income (in the form of original issue discount) for United States federal income tax purposes equal to the interest that accrues on your pro-rata share of the Junior Subordinated Debentures held by the Trust. As a result, you must include the accrued but unpaid income in your gross income for United States federal income tax purposes before you receive cash, even if you are a cash basis taxpayer. You will also not receive the cash related to any accrued and unpaid interest from the Trust if you sell the Trust Preferred Securities before the end of any deferral period. The Trust Preferred Securities may trade at a price that does not fully reflect the value of accrued but unpaid interest on the Junior Subordinated Debentures. During a deferral period, your tax basis in the Trust Preferred Securities will increase by the amount of accrued but unpaid distributions. If you sell the Trust Preferred Securities during a deferral period, your increased tax basis will decrease the amount of any capital gain or increase the amount of any capital loss that you may have otherwise realized on the sale. A capital loss, except in certain limited circumstances, cannot be applied to offset ordinary income. As a result, deferral of distributions could result in ordinary income, and a related tax liability for the holder, and a capital loss that may only be used to offset a capital gain. We do not currently intend to exercise our right to defer interest payments on the Junior Subordinated Debentures. However, if we exercise our right in the future, we expect that the market 10 price of the Trust Preferred Securities would be adversely affected. If you sell the Trust Preferred Securities during a deferral period, you may not receive the same return on your investment as someone who continues to hold the Trust Preferred Securities. WE MAY REDEEM THE TRUST PREFERRED SECURITIES AT ANY TIME UPON THE OCCURRENCE OF A SPECIAL EVENT. At any time that a Special Event occurs and continues, we may redeem all of the Junior Subordinated Debentures. A Special Event means a Tax Event, an Investment Company Event or a Regulatory Capital Event and is more fully described under "Description of Trust Preferred Securities--Redemption" and defined under "Description of Trust Preferred Securities--Definitions." If there is a Special Event and we redeem the Junior Subordinated Debentures, the Trust must redeem the Trust Preferred Securities within 90 days at a redemption price equal to the liquidation amount of $10 per Trust Preferred Security, plus accrued and unpaid distributions. We may exercise this right only if we receive any required approval by the regulatory agencies which supervise us. WE MAY REDEEM SOME OR ALL OF THE JUNIOR SUBORDINATED DEBENTURES ON OR AFTER , 2004, WHICH WILL CAUSE THE TRUST TO REDEEM SOME OR ALL OF THE TRUST PREFERRED SECURITIES. We may redeem some or all of the Junior Subordinated Debentures on or after , 2004, which will cause the Trust Preferred Securities to be redeemed on that date. You should assume that we will exercise our redemption option if we are able to refinance our obligations at a lower interest rate or if it is otherwise in our interest to redeem the Junior Subordinated Debentures. If less than all of the Junior Subordinated Debentures are redeemed, the Trust must redeem an amount of Trust Preferred Securities having an aggregate liquidation value equal to the principal amount of the Junior Subordinated Debentures that have been redeemed. We can exercise this right only if we receive any required approval by the regulatory agencies which supervise us. DISTRIBUTION OF THE JUNIOR SUBORDINATED DEBENTURES COULD ADVERSELY AFFECT THE MARKET PRICE FOR THE TRUST PREFERRED SECURITIES AND HAVE TAX CONSEQUENCES FOR YOU. We may dissolve the Trust at any time before the maturity of the Junior Subordinated Debentures on , 2029. As a result, and subject to the terms of the Trust Agreement, the Trustees may distribute the Junior Subordinated Debentures to the holders of Trust Preferred Securities. Although we have agreed to use our best efforts to list the Junior Subordinated Debentures on a national securities exchange or comparable automated quotation system if this occurs, there can be no assurance that the Junior Subordinated Debentures will be approved for listing or that a trading market will exist for the Junior Subordinated Debentures. We cannot predict the market prices for the Junior Subordinated Debentures that may be distributed. Accordingly, the Junior Subordinated Debentures that you receive upon a distribution, or the Trust Preferred Securities you hold pending such a distribution, may trade at a price that is less than the price you paid to purchase the Trust Preferred Securities. Because you may receive Junior Subordinated Debentures, you must also make an investment decision with regard to the Junior Subordinated Debentures. You should carefully review all the information regarding the Junior Subordinated Debentures contained in this prospectus. Under current United States federal income tax laws, a distribution of the Junior Subordinated Debentures to you upon the dissolution of the Trust would not be a taxable event to you. Nevertheless, if the Trust is classified for United States federal income tax purposes as an association taxable as a corporation at the time it is dissolved, the distribution of the Junior Subordinated Debentures would be a taxable event to you. In addition, if there is a change in law, a distribution of the Junior Subordinated Debentures upon the dissolution of the Trust could be a taxable event to you. 11 THE HOLDERS OF THE TRUST PREFERRED SECURITIES AND THE JUNIOR SUBORDINATED DEBENTURES ARE NOT PROTECTED BY COVENANTS IN THE INDENTURE OR THE TRUST AGREEMENT. Neither the Indenture, which sets forth the terms of the Junior Subordinated Debentures, nor the Trust Agreement, which sets forth the terms of the Trust Securities, protects holders of Junior Subordinated Debentures, or Trust Preferred Securities, respectively, in the event we experience significant adverse changes in our financial condition or results of operations. In addition, neither the Indenture nor the Trust Agreement limits our ability or the ability of our subsidiaries to incur additional indebtedness, including indebtedness that ranks senior to the Junior Subordinated Debentures and the Guarantee. Therefore, the provisions of these governing instruments should not be considered a significant factor in evaluating whether we will be able to comply with our obligations under the Junior Subordinated Debentures or the Guarantee. YOU WILL HAVE LIMITED VOTING RIGHTS. As a holder of Trust Preferred Securities, you will have limited voting rights. Your voting rights will relate only to the modification of the Trust Preferred Securities and the exercise of the Trust's rights as holder of the Junior Subordinated Debentures. In general, only we can replace or remove any of the Trustees. The property trustee, the administrative trustees and we may amend the Trust Agreement without your consent for certain things, including to ensure that the Trust will be classified for United States federal income tax purposes as a grantor trust. You also will have no voting rights on matters submitted to a vote of our stockholders. However, if an event of default under the Trust Agreement occurs and is continuing, the holders of at least a majority in aggregate liquidation amount of the Trust Preferred Securities may replace the property trustee and the Delaware trustee. POTENTIAL TAX LAW CHANGES COULD REQUIRE US TO REDEEM THE TRUST PREFERRED SECURITIES. From time to time, certain tax law changes have been proposed that would deny interest deductions to corporate issuers of debt instruments with terms that include certain of the terms of the Junior Subordinated Debentures. In addition, the Internal Revenue Service ("IRS") has in the past challenged taxpayers' treatment as indebtedness of securities issued with characteristics similar to the Junior Subordinated Debentures. To date, such tax law change proposals have not been enacted and the only known challenge that has advanced as far as litigation was settled short of trial, with resolution favorable to the taxpayer's position. However, if any similar tax law change were enacted or any such challenge by the IRS were upheld, such event could give rise to a Tax Event (as defined under "Description of Trust Preferred Securities--Redemption") which could result in an early redemption of the Trust Preferred Securities. THERE MAY BE NO ACTIVE OR LIQUID MARKET FOR THE TRUST PREFERRED SECURITIES. Before this offering, there has been no market for the Trust Preferred Securities. We plan to have the Trust Preferred Securities quoted on the Nasdaq National Market. We cannot predict whether an active and liquid trading market for the Trust Preferred Securities will develop or whether a continued quotation of the Trust Preferred Securities will be available on the Nasdaq National Market. Although the underwriter has informed the Trust and us that it intends to make a market in the Trust Preferred Securities, the underwriter is not obligated to do so and any such market-making activity may be terminated at any time without notice. Future trading prices of the Trust Preferred Securities will depend on many factors including, among other things, prevailing interest rates, our operating results and financial condition, and the market for similar securities. Our 9.28% cumulative trust preferred securities issued by Trust I in May 1997 are quoted on the Nasdaq National Market under the symbol "INDBP." 12 RISKS RELATING TO OUR COMPANY CHANGES IN INTEREST RATES COULD REDUCE OUR PROFITABILITY. Our ability to make a profit, like that of most financial institutions, substantially depends upon our net interest income, which is the difference between the interest income we earn on our interest-earning assets (such as loans and investment securities) and the interest expense we pay on our interest-bearing liabilities (such as deposits and borrowings). Certain assets and liabilities, however, may react in different degrees to changes in market interest rates. Further, interest rates on some types of assets and liabilities may fluctuate prior to changes in broader market interest rates, while rates on other types may lag behind. Additionally, some of our assets, such as adjustable-rate mortgages, have features, including payment and rate caps, which restrict changes in their interest rates. Factors such as inflation, recession, unemployment, money supply, international disorders, instability in domestic and foreign financial markets, and other factors beyond our control may affect interest rates. Changes in market interest rates will also affect the level of voluntary prepayments on our loans and the receipt of payments on our mortgage-backed securities resulting in the receipt of proceeds that may be reinvested at a lower rate than the loan or mortgage-backed security being prepaid. Although we pursue an asset-liability management strategy designed to control our risk from changes in market interest rates, changes in interest rates can still have a material adverse effect on our profitability. OUR ALLOWANCE FOR LOAN LOSSES MAY BE INADEQUATE TO COVER LOSSES ACTUALLY INCURRED, WHICH COULD AFFECT OUR ABILITY TO MAKE PAYMENTS ON THE JUNIOR SUBORDINATED DEBENTURES. We maintain an allowance for loan losses in an amount we believe is sufficient to provide for known and inherent risks in our loan portfolio. If the Bank incurs actual losses on its loans in excess of its allowance for loan losses, it may have insufficient income to extend credit, pay dividends or otherwise supply funds to us. If this occurs, we may be unable to make payments of interest and principal on the Junior Subordinated Debentures, and the Trust may be unable to make payments of interest and principal to you. A SIGNIFICANT AMOUNT OF OUR LOANS ARE CONCENTRATED IN MASSACHUSETTS, AND ADVERSE CONDITIONS IN MASSACHUSETTS COULD NEGATIVELY IMPACT OUR OPERATIONS. Substantially all of the loans we originate are secured by properties located in or are made to businesses which operate in Massachusetts. Because of the current concentration of our loan origination activities in Massachusetts, in the event of adverse economic conditions in Massachusetts, we would likely experience higher rates of loss and delinquency on our loans than if our loans were more geographically diversified. Additionally, our loans may be subject to a greater risk of default than other comparable loans in the event of adverse economic, political or business developments or natural hazards that may affect Massachusetts and the ability of property owners in Massachusetts to make payments of principal and interest on the underlying loans, which could have an adverse effect on our results of operations or financial condition. COMPETITION WITH OTHER FINANCIAL INSTITUTIONS COULD ADVERSELY AFFECT OUR PROFITABILITY. We face substantial competition in originating loans and in attracting deposits. This competition in originating loans comes principally from other banks, other savings institutions, mortgage banking companies, consumer finance companies, insurance companies and other institutional lenders and purchasers of loans. In attracting deposits, we compete with insured depository institutions such as banks, savings institutions and credit unions, as well as institutions offering uninsured investment alternatives including money market funds. These competitors may offer higher interest rates than we do, which could result in either our attracting fewer deposits or in our being required to increase our rates in order to attract deposits. Increased deposit competition could increase our cost of funds and 13 adversely affect our ability to generate the funds necessary for our lending operations, thereby adversely affecting our results of operations. A number of institutions with which we compete have significantly greater assets, capital and other resources. In addition, many of our competitors are not subject to the same extensive federal regulation that governs our business. As a result, many of our competitors have advantages over us in conducting certain businesses and providing certain services. OUR FUTURE PROFITS WILL BE AFFECTED BY OUR ABILITY TO SUCCESSFULLY INTEGRATE THE NEW BRANCHES TO BE ACQUIRED FROM FLEET FINANCIAL GROUP, INC. We have agreed, subject to regulatory approval, to acquire 12 branches, two of which are located in Brockton, Massachusetts, which is within our primary market area, and ten of which are located on Cape Cod, Massachusetts in Barnstable County, a market contiguous to where we presently operate. In connection with the acquisition, we will acquire approximately $269 million of deposits and $150 million of commercial and consumer loans. Our future profits will be affected by our ability to retain the acquired deposits, to generate revenues from the new branch locations as well as the loans we are acquiring, to manage the costs associated with the acquired branch offices and to otherwise successfully integrate the new branches into our operations. IF OUR COMPUTER SYSTEMS DO NOT PROPERLY WORK ON JANUARY 1, 2000, OUR BUSINESS OPERATIONS COULD BE DISRUPTED. The Year 2000 issue is the result of computer programs being able to use only two digits rather than four to define the applicable year. Thus, date-sensitive software may recognize a date using "00" as the year 1900 rather than the year 2000. This could result in system failures or miscalculations, causing disruptions of operations, including, among others, a temporary inability to process deposit and loan transactions, effect financings or engage in normal business activities. We have established programs to prepare our computer systems and applications for the Year 2000 and we are utilizing both internal and external resources to identify, correct and test our systems for Year 2000 compliance. All financial institutions are heavily dependent on technology and the services of third party vendors in the delivery of products and services. An interruption in these services would severely hamper our ability to provide products and services to our customers. For example, without telephone, power, or mainframe computer access in 2000, we would have to resort to manual processing in order to serve customers. This type of scenario could not continue indefinitely without severe erosion in service levels and consequently earnings. In 1997, we converted our core operating system software to a leading provider of data processing services, Alltel. As a consequence, Alltel is leading the company's effort for ensuring Year 2000 compliance for all mainframe application software. Management has overall responsibility for ensuring compliant systems and is working closely with Alltel to ensure compliance by December 31, 1999. Costs related to this aspect of the Year 2000 effort are the responsibility of Alltel. An additional type of risk that banks face is customer risk. Specifically, large corporate borrowers face many of the Year 2000 issues that the Bank faces. To the extent that many of these issues are not resolved and the viability of the borrower organization is compromised, a credit risk issue could be created for the Bank. Management continues to monitor and manage the customer risk posed in this type of scenario. Bank regulatory agencies have issued guidance as to the standards they will use when assessing Year 2000 readiness. The failure of a financial institution, such as ourselves, to take appropriate steps to address deficiencies in its Year 2000 project management process may result in regulatory enforcement actions which could have material adverse effect on the institution, result in the imposition of civil money penalties, or result in the delay (or receipt of an unfavorable or critical evaluation of the management of a financial institution in connection with regulatory review) of applications seeking to acquire other entities or otherwise expand the institution's activities. 14 CHANGES IN STATUTES AND REGULATIONS COULD ADVERSELY AFFECT US. We are subject to extensive regulation and supervision by federal and state authorities. Such supervision and regulation establish a comprehensive framework of activities in which an institution may engage, and are intended primarily for the protection of the federal deposit insurance fund and the Bank's depositors. This regulatory structure also provides our regulators with significant discretion in the performance of their supervisory and enforcement duties. Any change in such regulation, whether by our regulators or as a result of legislation subsequently enacted by the Congress of the United States, could have a substantial impact on the Bank and its operations. Additional legislation and regulations may be enacted or adopted in the future that could significantly affect our powers, authority and operations, which could have a material adverse effect on our operations. RATIOS OF EARNINGS TO FIXED CHARGES The following table sets forth our consolidated ratios of earnings to fixed charges for the respective periods indicated.
NINE MONTHS ENDED YEARS ENDED DECEMBER 31, SEPTEMBER 30, -------------------------------------------------------- 1999 1998 1997 1996 1995 1994 ------------- -------- -------- -------- -------- -------- Ratios of earnings to fixed charges: Including interest on deposits................. 1.47x 1.48x 1.51x 1.54x 1.51x 1.43x Excluding interest on deposits................. 2.18x 2.27x 3.02x 4.26x 5.00x 5.66x
For purposes of computing the ratios of earnings to fixed charges, earnings represent income before extraordinary items and cumulative effect of changes in accounting principles plus applicable income taxes and fixed charges. Fixed charges includes gross interest expense (exclusive of interest on deposits in one case and inclusive of such interest in the other) and one-third of rent expenses which approximates the interest expense of such charges. USE OF PROCEEDS All of the proceeds from the sale of the Trust Preferred Securities together with proceeds of the Common Securities will be invested by the Trust in the Junior Subordinated Debentures to be issued by us. We intend to use the estimated net proceeds from the sale of the Junior Subordinated Debentures of approximately $ million ($ million if the underwriter's over-allotment option is exercised in full) for general corporate purposes, including capital contributions to the Bank, and for working capital. To the extent that the previously announced branch acquisition transaction with Fleet Financial Group, Inc. is completed, the offering will ensure that the Bank will continue to be "well capitalized" following consummation of the transaction. See "Summary--Our Company." Initially, the net proceeds may be used to make short-term investments. 15 CAPITALIZATION The following table sets forth our unaudited consolidated capitalization as of September 30, 1999 and such capitalization as adjusted, to reflect the sale of the Trust Preferred Securities, the issuance of the Junior Subordinated Debentures and the application of the estimated net proceeds as described in "Use of Proceeds." You should also read the more detailed information included or incorporated by reference in this prospectus, including the financial statements and related notes.
SEPTEMBER 30, 1999 ------------------------ ACTUAL AS ADJUSTED ---------- ----------- (DOLLARS IN THOUSANDS) Company-obligated mandatorily redeemable 9.28% trust preferred securities of Independent Capital Trust I due May 19, 2027.............................................. $ 28,750 $28,750 Company-obligated mandatorily redeemable % trust preferred securities of Independent Capital Trust II due , 2029(1)................................................... -- ---------- ------- Stockholders' equity: Preferred stock, $0.01 par share, 1,000,000 shares authorized; none issued................................. -- -- Common stock, par value $0.01, 30,000,000 shares authorized, 14,863,821 shares issued.................... 149 149 Surplus................................................... 45,024 45,024 Retained earnings......................................... 64,329 64,329 Treasury stock, 854,893 shares............................ (11,628) (11,628) Transitional unrealized loss on common stock shares held in rabbi trust.......................................... (1,312) (1,312) Accumulated other comprehensive income.................... (2,476) (2,476) ---------- ------- Total stockholders' equity.................................. $ 94,086 $94,086 ---------- ------- Total liabilities, minority interest in subsidiaries and stockholders' equity...................................... $1,565,400 $ ========== =======
- ------------------------ (1) The sole assets of the Trust, which is our subsidiary, will be the Junior Subordinated Debentures which will mature on , 2029. We will own all of the Common Securities issued by the Trust. 16 INDEPENDENT CAPITAL TRUST II The Trust is a statutory business trust formed under Delaware law upon the filing of a certificate of trust with the Delaware Secretary of State. The Trust will be governed by the terms of the Amended and Restated Declaration of Trust of the Trust (the "Trust Agreement") which will be qualified under the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"). The Trust exists for the exclusive purposes of (i) issuing and selling the Trust Securities, (ii) using the proceeds from the sale of Trust Securities to acquire the Junior Subordinated Debentures and (iii) engaging in other activities that are incidental or necessary to these purposes. The Junior Subordinated Debentures will be the sole assets of the Trust, and, accordingly, payments under the Junior Subordinated Debentures will be the sole revenues of the Trust. All of the Common Securities will be owned by us. We will acquire Common Securities with a $10 liquidation amount, equal to at least 3% of the total capital of the Trust. While the Common Securities will have terms equal in priority of payment with the Trust Preferred Securities, if we default on the Junior Subordinated Debentures, then cash distributions and liquidation, redemption and other amounts payable on the Common Securities will be subordinated to the Trust Preferred Securities in priority of payment. The Trust has a term of approximately 31 years, but may be dissolved earlier as provided in the Trust Agreement. The Trust's business and affairs are conducted by the Issuer Trustees, who are appointed by us as holder of the Common Securities. The trustees for the Trust will be The Bank of New York, as the Property Trustee (the "Property Trustee"), The Bank of New York (Delaware), as the Delaware Trustee (the "Delaware Trustee") and three Administrative Trustees who are our officers (each, an "Administrative Trustee" and collectively, the "Administrative Trustees"). The Property Trustee, the Delaware Trustee and the Administrative Trustees are collectively referred to as the "Issuer Trustees" in this prospectus. The Property Trustee will act as sole indenture trustee under the Trust Agreement. The Bank of New York will also act as trustee under the Guarantee and the Indenture. The duties and obligations of each Issuer Trustee are governed by the Trust Agreement. The holder of the Common Securities of the Trust or, if an event of default under the Trust Agreement has occurred and is continuing, the holders of not less than a majority in liquidation amount of the Trust Preferred Securities, will be entitled to appoint, remove or replace the Property Trustee and/or the Delaware Trustee. In no event will the holders of the Trust Preferred Securities have the right to vote to appoint, remove or replace the Administrative Trustees, whose voting rights will be vested exclusively in the holder of the Common Securities. We will pay all fees, expenses, debts and obligations related to the Trust and the offering of the Trust Preferred Securities and will pay, directly or indirectly, all ongoing costs and expenses of the Trust, except the Trust's obligations with respect to the Trust Preferred Securities and the Common Securities. For financial reporting purposes, the Trust will be treated as our subsidiary and, accordingly, the accounts of the Trust will be included in our Consolidated Financial Statements. We will present the Trust Preferred Securities as a separate line item in our consolidated Statement of Financial Condition entitled "Company-Obligated Mandatorily Redeemable Trust Preferred Securities of Subsidiary Trust Holding Solely Junior Subordinated Debentures of the Company" and we will include appropriate disclosures about the Trust Preferred Securities, the Guarantee and the Junior Subordinated Debentures in the notes to our Consolidated Financial Statements. For financial reporting purposes, we will record distributions payable on the Trust Preferred Securities as "minority interest income of subsidiaries" in our Consolidated Statements of Operations. We treat the 9.28% trust preferred securities issued by Trust I in May 1997 and the related junior subordinated debentures in the same manner. 17 DESCRIPTION OF TRUST PREFERRED SECURITIES This summary of certain provisions of the Trust Preferred Securities, the Common Securities and the Trust Agreement does not purport to be complete and is subject to, and is qualified in its entirety by reference to, all the provisions of the Trust Agreement, including the definitions therein of certain terms, and the Trust Indenture Act. The form of the Trust Agreement has been filed as an exhibit to the Registration Statement of which this prospectus forms a part. The Trust Agreement will be qualified under the Trust Indenture Act. The Property Trustee will act as the indenture trustee (the "Debenture Trustee") for purposes of complying with the Trust Indenture Act. GENERAL The Administrative Trustees will issue the Trust Preferred Securities on behalf of the Trust pursuant to the terms of the Trust Agreement. We will own all of the Common Securities. The Trust Preferred Securities will represent preferred undivided beneficial interests in the assets of the Trust and the holders of the Trust Preferred Securities will be entitled to a preference in certain circumstances with respect to Distributions (as defined below) and amounts payable on redemption or liquidation over the Common Securities, as well as other benefits as described in the Trust Agreement. The Trust Agreement prohibits the issuance by the Trust of any securities other than the Trust Securities or the incurrence of any indebtedness by the Trust. The Trust Preferred Securities will rank equal in priority of payment, and payments will be made thereon PRO RATA with the Common Securities except under certain circumstances. See "--Subordination of Common Securities." Legal title to the Junior Subordinated Debentures will be held by the Property Trustee in trust for the benefit of the holders of the Trust Securities. The Guarantee will not guarantee payment of Distributions or amounts payable on redemption of the Trust Preferred Securities or liquidation of the Trust when the Trust does not have funds on hand legally available for such payments. DISTRIBUTIONS PAYMENT OF DISTRIBUTIONS. Distributions on each Trust Preferred Security will be cumulative, will accrue from , 1999 and will be payable quarterly in arrears on March 31, June 30, September 30 and December 31 of each year, commencing , 1999, at the annual rate of % of the stated liquidation amount of $10 per Trust Preferred Security ("Distributions"). The initial Distribution will equal $ for each Trust Preferred Security. Subsequent Distributions will equal $ for each Trust Preferred Security. Distributions in arrears for more than one quarter will (to the extent permitted by law) accrue interest at the rate per annum of % thereof compounded quarterly. Distributions shall be made to the holders of the Trust Preferred Securities on the relevant record date, which for so long as the Trust Preferred Securities remain in book-entry form, will be one Business Day prior to the relevant Distribution Date (as defined below) and, in the event the Trust Preferred Securities are not in book-entry form, will be the fifteenth day of the month in which the relevant Distribution Date occurs. The amount of Distributions payable for any period will be computed on the basis of a 360-day year of twelve 30-day months and, for any period of less than a full calendar quarter, on the basis of the actual number of days elapsed in the quarter based on 30-day months. In the event that any date on which Distributions are payable on the Trust Preferred Securities is not a Business Day (as defined below), payment of the Distribution payable will be made on the next succeeding day that is a Business Day (and without any interest or other payment in respect to any such delay), except that if the next succeeding Business Day falls in the next succeeding calendar year, the payment shall be made on the immediately preceding Business Day, in each case with the same force and effect as if made on such date (each date on which Distributions are payable in accordance with the foregoing, a "Distribution Date"). A "Business Day" shall mean any day other 18 than a Saturday or a Sunday, or a day on which banking institutions in the City of New York, New York or Rockland, Massachusetts are authorized or required by law or executive order to close. DEFERRAL PERIOD. So long as no Debenture Event of Default shall have occurred and be continuing, we will have the right under the Indenture to defer the payment of interest on the Junior Subordinated Debentures at any time or from time to time for a period not exceeding 20 consecutive calendar quarters with respect to each deferral period (each, a "Deferral Period"), provided that no Deferral Period shall end on a date other than an Interest Payment Date (as defined herein) or extend beyond , 2029, which is the "Stated Maturity Date." Upon any such election, quarterly Distributions on the Trust Preferred Securities will be deferred by the Trust during such Deferral Period. Distributions to which holders of the Trust Preferred Securities are entitled during any such Deferral Period will accumulate additional Distributions thereon at the rate per annum of % thereof, compounded quarterly from the relevant Distribution Date. The term "Distributions," as used herein, includes any such additional Distributions. Prior to the termination of any Deferral Period, we may further extend the Deferral Period, provided that an extension will only be permitted under the Trust Agreement to the extent that the Deferral Period, together with all other extensions occurring both before and after such extension, does not exceed 20 consecutive calendar quarters, end on a date other than an Interest Payment Date or extend beyond the Stated Maturity Date. Upon the termination of any such Deferral Period and the payment of all amounts then due on any Interest Payment Date, we may elect to begin a new Deferral Period, subject to the above requirements. No interest shall be due and payable during a Deferral Period, except at the end of the period. If Distributions are deferred, the deferred Distributions and accrued interest will be paid to holders of the Trust Preferred Securities as they appear on the books and records of the Trust on the record date for Distributions due at the end of the Deferral Period. We must give the Property Trustee, the Administrative Trustees and the Debenture Trustee notice of our election of any such Deferral Period (or an extension thereof) at least five Business Days prior to the earlier of (i) the date the Distributions on the Trust Preferred Securities would have been payable except for the election to begin such Deferral Period and (ii) the date the Administrative Trustees are required to give notice to any securities exchange or automated quotation system or to holders of such Trust Preferred Securities of the record date or the date such Distributions are payable, but in any event not less than five Business Days prior to such record date. There is no limitation on the number of times that we may elect to begin a Deferral Period. During any such Deferral Period, we may not - declare or pay any dividends or distributions on, or redeem, purchase, acquire, or make a liquidation payment with respect to, any of our capital stock; - make any payment of principal, interest or premium, if any, on or repay, repurchase or redeem any of our debt securities (including any other debentures related to other trust preferred securities ("Other Debentures")) that rank equal with or junior in right of payment to the Junior Subordinated Debentures; or - make any guarantee payments with respect to any guarantee made by us of the debt securities of any of our subsidiaries (including other guarantees of trust preferred securities) if such guarantee ranks equal with or junior in right of payment to the Junior Subordinated Debentures. However, we will not violate the first bullet point above if we - declare or pay dividends or make distributions in shares of, or options, warrants or rights to subscribe for or purchase shares of, our common stock; 19 - declare a dividend in connection with the implementation of a stockholders' rights plan, or issue stock under any such plan in the future, or redeem or repurchase of any such rights pursuant to any such plan; - make payments under the Guarantee; - purchase any fractional shares as a result of a reclassification of our capital stock; - purchase any fractional interests in shares of our capital stock pursuant to the conversion or exchange provisions of such capital stock or the security being converted or exchanged therefor; or - purchase common stock as a result of the issuance of common stock or rights under any of our benefit plans for directors, officers or employees or any of our dividend reinvestment plans. We do not currently intend to exercise our option to defer payments of interest on the Junior Subordinated Debentures. SOURCE OF DISTRIBUTION. The Trust's funds available for distribution to holders of the Trust Preferred Securities will be limited to payments under the Junior Subordinated Debentures. If we do not make interest payments on the Junior Subordinated Debentures, the Property Trustee will not have funds available to pay Distributions on the Trust Preferred Securities. The payment of Distributions (if and to the extent the Trust has funds on hand legally available for the payment of such Distributions) will be guaranteed by us on a limited basis. REDEMPTION MANDATORY REDEMPTION OF THE TRUST PREFERRED SECURITIES. Upon the repayment or redemption at any time, in whole or in part, of any Junior Subordinated Debentures, the proceeds from such repayment or redemption will be applied by the Property Trustee to redeem a Like Amount (as defined below) of the Trust Securities, upon not less than 30 nor more than 60 days' notice of a date of redemption (the "Redemption Date"), at a redemption price equal to $10 per Trust Preferred Security plus any accrued and unpaid Distributions thereon to the Redemption Date. If less than all of the Junior Subordinated Debentures are to be prepaid on a Redemption Date, then the proceeds of such prepayment will be allocated PRO RATA to the Preferred and Common Trust Securities, as described below. OPTIONAL REDEMPTION OF THE JUNIOR SUBORDINATED DEBENTURES. On or after , 2004, we will have the right to redeem the Junior Subordinated Debentures in whole at any time or in part from time to time at a redemption price equal to 100% of the principal amount thereof plus accrued and unpaid interest on the Junior Subordinated Debentures so redeemed to the date fixed for redemption. We would redeem the Junior Subordinated Debentures upon not less than 30 nor more than 60 days written notice, in each case subject to receipt of prior approval if it is then required under applicable regulatory requirements. If we redeem the Junior Subordinated Debentures, the Trust Securities will be redeemed as described in the preceding paragraph. SPECIAL EVENT OR DISTRIBUTION OF JUNIOR SUBORDINATED DEBENTURES. If a Special Event (as defined below) occurs and is continuing, we will have the right upon not less than 30 nor more than 60 days written notice to redeem the Junior Subordinated Debentures in whole (but not in part) and thereby cause a mandatory redemption of the Trust Securities in whole (but not in part) at the redemption price within 90 days following the occurrence of such Special Event, in each case subject to receipt of prior approval if it is then required under applicable regulatory requirements. If a Special Event has occurred and is continuing and we do not elect to redeem the Junior Subordinated Debentures (and thereby cause a mandatory redemption of the Trust Securities) or to dissolve the Trust and, after satisfaction of creditors as required by applicable law, cause the Junior Subordinated Debentures to be 20 distributed to holders of the Trust Securities, the Trust Securities will remain outstanding and Additional Sums (as defined below) may be payable on the Junior Subordinated Debentures. DEFINITIONS. The terms described in the preceding paragraph have the following meanings: "Additional Sums" means the additional amounts as may be necessary to be paid by us with respect to the Junior Subordinated Debentures in order that the amount of Distributions then due and payable by the Trust on the outstanding Trust Securities will not be reduced as a result of any additional taxes, duties and other governmental charges to which the Trust has become subject. An "Investment Company Event" means the receipt by us of an opinion of counsel experienced in such matters to the effect that, as a result of any change in law or regulation or a change in interpretation or application of law or regulation by any legislative body, court, governmental agency or regulatory authority, there is more than an insubstantial risk that the Trust is or will be considered an "investment company" that is required to be registered under the Investment Company Act of 1940 (the "Investment Company Act"), which change becomes effective on or after the original issuance of the Trust Preferred Securities. "Like Amount" means (i) with respect to a redemption of Trust Securities, Trust Securities having a Liquidation Amount equal to that portion of the principal amount of Junior Subordinated Debentures to be contemporaneously redeemed in accordance with the Indenture, allocated to the Common Securities and to the Trust Preferred Securities based upon the relative Liquidation Amounts of such classes and the proceeds of which will be used to pay the redemption price of such Trust Securities, and (ii) with respect to a distribution of Junior Subordinated Debentures to holders of Trust Securities in connection with a dissolution or liquidation of the Trust, Junior Subordinated Debentures having a principal amount equal to the Liquidation Amount of the Trust Securities of the holders to whom such Junior Subordinated Debentures are distributed. "Liquidation Amount" means the stated amount of $10 per Trust Security. A "Regulatory Capital Event" means that we shall have received an opinion of independent bank regulatory counsel experienced in such matters to the effect that, as a result of (a) any amendment to, or change (including any announced prospective change) in, the laws or any regulations of the United States or any rules, guidelines or policies of applicable regulatory agencies or (b) any official administrative pronouncement or judicial decision interpreting or applying such laws or regulations, which amendment or change is effective or which pronouncement or decision is announced on or after the date of the Trust Agreement, there is more than an insubstantial risk that the Trust Preferred Securities do not constitute, or within 90 days of the date thereof, will not constitute, Tier 1 Capital (or its then equivalent) for purposes of the capital adequacy guidelines of the Board of Governors of the Federal Reserve (or any successor regulatory authority with jurisdiction over bank holding companies), or any capital adequacy guidelines as then in effect and applicable to us. The distribution of the Junior Subordinated Debentures in connection with the dissolution of the Trust by us will not in and of itself constitute a Regulatory Capital Event. A "Special Event" means a Tax Event, an Investment Company Event or a Regulatory Capital Event, as the case may be. A "Tax Event" means the receipt by us and the Trust of an opinion of counsel experienced in such matters to the effect that, as a result of any amendment to, or change (including any announced prospective change) in, the laws or any regulations of the United States or of any political subdivision or taxing authority, or as a result of any official administrative pronouncement or judicial decision interpreting or applying such laws or regulations, which amendment or change is effective or such pronouncement or decision is announced on or after the date of the Trust Agreement, there is more than an insubstantial risk that (i) the Trust is, or will be within 90 days of the date of such opinion, subject to United States federal income tax with respect to income received or accrued on the Junior 21 Subordinated Debentures, (ii) interest payable by us on the Junior Subordinated Debentures is not, or within 90 days of the date of such opinion will not be, deductible by us, in whole or in part, for United States federal income tax purposes or (iii) the Trust is, or will be within 90 days of the date of such opinion, subject to more than a minor amount of other taxes, duties or other governmental charges. DISTRIBUTION OF JUNIOR SUBORDINATED DEBENTURES We will have the right at any time to dissolve the Trust and, after satisfaction of liabilities to creditors of the Trust as required by applicable law, to cause the Junior Subordinated Debentures to be distributed to the holders of the Trust Securities in liquidation of the Trust. This right is subject to (i) our having received an opinion of counsel to the effect that such distribution will not be a taxable event to holders of Trust Preferred Securities and (ii) prior approval by the applicable regulatory authorities if it is then required under applicable regulatory requirements. After the date is fixed for any distribution of Junior Subordinated Debentures to holders of the Trust Securities, (i) the Trust Securities will no longer be deemed to be outstanding, (ii) The Depository Trust Company ("DTC" or "Depositary") or its nominee will receive, in respect of each registered global certificate, if any, representing Trust Securities held by it, a registered global certificate or certificates representing the Junior Subordinated Debentures to be delivered upon such distribution and (iii) any certificates representing Trust Securities not held by DTC or its nominee will be deemed to represent Junior Subordinated Debentures having a principal amount equal to the Liquidation Amount of such Trust Securities with an interest rate identical to the distribution rate of, and accrued and unpaid interest equal to the accumulated and unpaid Distributions on, such Trust Securities until such certificates are presented to the Administrative Trustees or their agent for cancellation, whereupon we will issue to such holder, and the Debenture Trustee will authenticate, a certificate representing such Junior Subordinated Debentures. We can give no assurance as to the market prices for the Trust Preferred Securities, or the Junior Subordinated Debentures that may be distributed in exchange for the Trust Securities, if a dissolution and liquidation of the Trust were to occur. Accordingly, the Trust Preferred Securities that you may purchase, or the Junior Subordinated Debentures that you may receive on dissolution and liquidation of the Trust, may trade at a discount to the price that you paid to purchase the Trust Preferred Securities. If the Junior Subordinated Debentures are distributed to the holders of Trust Preferred Securities, we will use our best efforts to list the Junior Subordinated Debentures on a national securities exchange or comparable automated quotation system. REDEMPTION PROCEDURES If applicable, Trust Securities will be redeemed at the redemption price with the proceeds from the contemporaneous repayment or redemption of the Junior Subordinated Debentures. Any redemption of Trust Securities will be made and the redemption price shall be payable on the Redemption Date only to the extent that the Trust has funds legally available for the payment of such redemption price. The Trust may not redeem fewer than all of the outstanding Trust Preferred Securities unless all accrued and unpaid Distributions have been paid on all Trust Preferred Securities for all quarterly Distribution periods terminating on or prior to the date of redemption. If a partial redemption of the Trust Preferred Securities would result in the delisting of the Trust Preferred Securities by a national securities exchange or other organization on which the Trust Preferred Securities are listed, then, pursuant to the Indenture, we may only redeem the Junior Subordinated Debentures in whole and, as a result, the Trust may only redeem the Trust Preferred Securities in whole. 22 If the Trust gives a notice of redemption in respect of the Trust Preferred Securities (which notice will be irrevocable), then, by 12:00 noon, New York City time, on the Redemption Date, to the extent that we have deposited with the Property Trustee by 10:00 a.m., New York City time, funds sufficient to pay the redemption price with respect to the Trust Preferred Securities held by DTC or its nominees, the Property Trustee will deposit or cause the Paying Agent (as defined herein) to deposit irrevocably with DTC funds sufficient to pay the redemption price and will give DTC or its nominees irrevocable instructions and authority to pay the redemption price to the holders of such Trust Preferred Securities. See "Book-Entry Issuance." If such Trust Preferred Securities are no longer in book-entry form, the Property Trustee, to the extent we have deposited with the Property Trustee funds sufficient to pay the redemption price, will irrevocably deposit with the Paying Agent for such Trust Preferred Securities funds sufficient to pay the aggregate redemption price and will give such Paying Agent irrevocable instructions and authority to pay the redemption price to the holders thereof upon surrender of their certificates evidencing such Trust Preferred Securities. Notwithstanding the foregoing, Distributions payable on or prior to the Redemption Date shall be payable to the holders of such Trust Preferred Securities on the relevant record dates for the related Distribution Dates. If notice of redemption shall have been given and funds deposited as required, then upon the date of such deposit, all rights of the holders of the Trust Preferred Securities called for redemption will cease, except the right of the holders of such Trust Preferred Securities to receive the redemption price, but without interest on such redemption price and such Trust Preferred Securities will cease to be outstanding. In the event that any Redemption Date of Trust Preferred Securities is not a Business Day, then the redemption price payable on such date will be paid on the next succeeding day that is a Business Day (and without any interest or other payment in respect of any such delay), except that, if such next succeeding Business Day falls in the next calendar year, such payment shall be made on the immediately preceding Business Day. In the event that we fail to repay the Junior Subordinated Debentures on maturity or payment of the redemption price is improperly withheld or refused and not paid either by the Trust or by us pursuant to the Guarantee as described under "Description of Guarantee," (i) Distributions on Trust Preferred Securities will continue to accrue at the then applicable rate from the Redemption Date originally established by the Trust to the date such redemption price is actually paid and (ii) the actual payment date will be the Redemption Date for purposes of calculating the redemption price. Subject to the Trust Agreement and applicable law (including, without limitation, United States federal securities law), we or our subsidiaries may at any time and from time to time purchase outstanding Trust Preferred Securities by tender, in the open market or by private agreement. Payment of the redemption price on the Trust Preferred Securities and any distribution of Junior Subordinated Debentures to holders of Trust Preferred Securities will be made on the Redemption Date. If less than all of the Trust Securities issued by the Trust are to be redeemed on a Redemption Date, then the aggregate redemption price for such Trust Securities to be redeemed will be allocated PRO RATA to the Trust Preferred Securities and Common Securities based upon the relative Liquidation Amounts of the Trust Securities or such other method as the Trustee shall deem appropriate, not more than 60 days prior to the date fixed for redemption. The particular Trust Preferred Securities to be redeemed will be selected by the Property Trustee from the outstanding Trust Preferred Securities not previously called for redemption, by such method as the Property Trustee deems fair and appropriate and which may provide for the selection for redemption of portions (equal to $10 or an integral multiple thereof) of the Liquidation Amount of Trust Preferred Securities. The Property Trustee will promptly notify the security registrar in writing of the Trust Preferred Securities selected for redemption and, in the case of any Trust Preferred Securities selected for partial redemption, the Liquidation Amount thereof to be redeemed. For all purposes of the Trust Agreement, unless the context otherwise requires, all provisions relating to the redemption of Trust Preferred Securities shall 23 relate to the portion of the aggregate Liquidation Amount of Trust Preferred Securities which has been or is to be redeemed. Notice of any redemption will be mailed at least 30 days but not more than 60 days prior to the Redemption Date to each holder of Trust Securities at its registered address. Unless we default in payment of the redemption price on, or in the repayment of, the Junior Subordinated Debentures, on and after the Redemption Date, Distributions will cease to accrue on the Trust Securities called for redemption. SUBORDINATION OF COMMON SECURITIES Payment of Distributions on, and the redemption price of, the Trust Securities, as applicable, shall be made PRO RATA based on the Liquidation Amount of the Trust Securities. However, if on any Distribution Date or Redemption Date a Debenture Event of Default (as described in "Description of Junior Subordinated Debentures--Debenture Events of Default") shall have occurred and be continuing, no payment of any Distribution on, or applicable redemption price of, any of the Common Securities, and no other payment on account of the redemption, liquidation or other acquisition of the Common Securities, will be made unless payment in full in cash of all accumulated and unpaid Distributions on all of the outstanding Trust Preferred Securities for all Distribution periods terminating on or prior to the Debenture Event of Default, or in the case of payment of the redemption price, the full amount of such redemption price shall have been made or provided for, and all funds available to the Property Trustee will first be applied to the payment in full in cash of all Distributions on, or redemption price of, the Trust Preferred Securities then due and payable. In the case of any Event of Default under the Trust Agreement relating to a Debenture Event of Default (as described in "--Events of Default; Notice"), as holder of the Common Securities, we will be deemed to have waived any right to act with respect to such Event of Default until the effect of such Event of Default has been cured, waived or otherwise eliminated. Until any such Event of Default has been so cured, waived or otherwise eliminated, the Property Trustee will act solely on behalf of the holders of the Trust Preferred Securities and not on behalf of us as holder of the Common Securities, and only the holders of the Trust Preferred Securities will have the right to direct the Property Trustee to act on their behalf. LIQUIDATION DISTRIBUTION UPON DISSOLUTION We will have the right at any time to dissolve the Trust and cause the Junior Subordinated Debentures to be distributed to the holders of the Trust Preferred Securities. Our right is subject to (i) our having received an opinion of an independent tax counsel experienced in such matters to the effect that such distribution will not be a taxable event to holders of Trust Preferred Securities for United States federal income tax purposes, and (ii) our having received prior approval if it is then required under applicable regulatory requirements. See "--Distribution of Junior Subordinated Debentures." In addition, the Trust will automatically dissolve upon the first to occur of: (i) certain events of our bankruptcy, dissolution or liquidation; (ii) the distribution of a Like Amount of the Junior Subordinated Debentures to the holders of the Trust Securities, if we have given written direction to the Property Trustee to dissolve the Trust (which direction is optional and, except as described above, wholly within our discretion); (iii) redemption of all of the Trust Securities; (iv) expiration of the term of the Trust; and (v) the entry of an order for the dissolution of the Trust by a court of competent jurisdiction. 24 If a dissolution occurs as described in clause (i), (ii), (iv), or (v) above, the Trust will be liquidated by the Administrative Trustees as expeditiously as the Administrative Trustees determine to be possible by distributing to the holders of the Trust Securities, after satisfaction of liabilities to creditors of the Trust, a Like Amount of the Junior Subordinated Debentures. However, if such a distribution is determined by the Property Trustee not to be practicable, the holders will be entitled to receive out of the assets of the Trust legally available for distribution, after satisfaction of liabilities to creditors of the Trust, an amount equal to the aggregate of the Liquidation Amount plus accumulated and unpaid Distributions thereon to the date of payment (such amount being the "Liquidation Distribution"). If such Liquidation Distribution can be paid only in part because the Trust has insufficient assets on hand legally available to pay in full the aggregate Liquidation Distribution, then the amounts payable directly by the Trust on the Trust Securities shall be paid on a PRO RATA basis. However, if a Debenture Event of Default has occurred and is continuing, the Trust Preferred Securities will have a priority over the Common Securities. See "--Subordination of Common Securities." If we elect not to redeem the Junior Subordinated Debentures prior to maturity in accordance with their terms and either elect not to or are unable to liquidate the Trust and distribute the Junior Subordinated Debentures to holders of the Trust Securities, the Trust Securities will remain outstanding until the repayment of the Junior Subordinated Debentures on the Stated Maturity Date. If we elect to dissolve the Trust and thereby cause the Junior Subordinated Debentures to be distributed to holders of the Trust Preferred Securities in liquidation of the Trust, we shall continue to have the right to redeem the Junior Subordinated Debentures, subject to certain conditions. EVENTS OF DEFAULT; NOTICE Any one of the following events that has occurred and is continuing constitutes an "Event of Default" under the Trust Agreement (an "Event of Default") with respect to the Trust Preferred Securities, regardless of the reason for such Event of Default and whether it occurs voluntary or involuntary or by operation of law or pursuant to any order, rule or regulation: - the occurrence of a Debenture Event of Default (see "Description of Junior Subordinated Debentures--Debenture Events of Default"); - default by the Trust in the payment of any Distribution when it becomes due and payable, and continuation of such default for a period of 30 days; - default by the Trust in the payment of the redemption price of any Trust Security when it becomes due and payable; - default in the performance, or breach, in any material respect, of any covenant or warranty of the Issuer Trustees in the Trust Agreement (other than a default or breach in the performance of a covenant or warranty which is addressed in the second or third clause above), and continuation of the default or breach, for a period of 60 days after there has been given, by registered or certified mail, to the defaulting Issuer Trustee or Trustees by the holders of at least 25% in aggregate Liquidation Amount of the outstanding Trust Preferred Securities, a written notice specifying the default or breach and requiring it to be remedied and stating that the notice is a "Notice of Default" under the Trust Agreement; or - the occurrence of certain events of bankruptcy or insolvency with respect to the Property Trustee and the failure by us to appoint a successor Property Trustee within 60 days of the event. Within 90 days after the occurrence of any Event of Default known to the Property Trustee, the Property Trustee will transmit notice of the Event of Default to the holders of the Trust Preferred Securities, the Administrative Trustees and us, unless the Event of Default has been cured or waived. We and the Administrative Trustees are required to file annually with the Property Trustee a certificate 25 as to whether or not we or they are in compliance with all the conditions and covenants applicable to them under the Trust Agreement. If a Debenture Event of Default has occurred and is continuing, the Trust Preferred Securities will have a preference over the Common Securities. See "--Subordination of Common Securities" and "--Liquidation Distribution Upon Default." Upon a Debenture Event of Default, unless the principal of all the Junior Subordinated Debentures has already become due and payable, either the Property Trustee or the holders of not less than 25% in aggregate principal amount of the Junior Subordinated Debentures then outstanding may declare all of the Junior Subordinated Debentures to be due and payable immediately by giving notice in writing to us (and to the Property Trustee, if notice is given by holders of the Junior Subordinated Debentures). If the Property Trustee or the holders of the Junior Subordinated Debentures fail to declare the principal of all of the Junior Subordinated Debentures due and payable upon a Debenture Event of Default, the holders of at least 25% in Liquidation Amount of the Trust Preferred Securities then outstanding will have the right to declare the Junior Subordinated Debentures immediately due and payable. In either event, payment of principal and interest on the Junior Subordinated Debentures will remain subordinated to the extent provided in the Indenture. In addition, holders of the Trust Preferred Securities have the right in certain circumstances to bring a direct action ("Direct Action"). See "Description of Junior Subordinated Debentures--Enforcement of Certain Rights by Holders of Trust Preferred Securities." REMOVAL OF ISSUER TRUSTEES Unless a Debenture Event of Default has occurred and is continuing, any Issuer Trustee may be removed at any time by the holder of the Common Securities. If a Debenture Event of Default has occurred and is continuing, the Property Trustee and the Delaware Trustee may be removed by the holders of a majority in Liquidation Amount of the outstanding Trust Preferred Securities. In no event will the holders of the Trust Preferred Securities have the right to vote to appoint, remove or replace the Administrative Trustees, which voting rights are vested exclusively in us, as the holder of the Common Securities. No resignation or removal of an Issuer Trustee (other than an Administrative Trustee) and no appointment of a successor trustee shall be effective until the acceptance of appointment by the successor trustee in accordance with the provisions of the Trust Agreement. CO-TRUSTEES AND SEPARATE PROPERTY TRUSTEE Unless an Event of Default has occurred and is continuing, at any time or times, for the purpose of meeting the legal requirements of the Trust Indenture Act or of any jurisdiction in which any property of the Trust may at the time be located, we, as the holder of the Common Securities, and the Administrative Trustees shall have the right to appoint one or more persons either to act as a co-trustee, jointly with the Property Trustee, of all or any part of such property, or to act as separate trustee of any such property, in either case, with such powers as may be provided in the instrument of appointment, and to vest in the person or persons in such capacity any property, title, right or power deemed necessary or desirable, subject to the provisions of the Trust Agreement. In case a Debenture Event of Default has occurred and is continuing, the Property Trustee alone will have power to make the appointment. MERGER OR CONSOLIDATION OF ISSUER TRUSTEES Any Person into which the Property Trustee or the Delaware Trustee that is not a natural person may be merged or converted or with which it may be consolidated, or any Person resulting from any merger, conversion or consolidation to which such Issuer Trustee is a party, or any Person succeeding to all or substantially all the corporate trust business of such Issuer Trustee, will be the successor of such Issuer Trustee under the Trust Agreement, provided the Person shall be otherwise qualified and eligible. 26 MERGERS, CONSOLIDATIONS, AMALGAMATIONS OR REPLACEMENTS OF THE TRUST The Trust may not merge with or into, consolidate, amalgamate, or be replaced by, or convey, transfer or lease its properties and assets as an entirety or substantially as an entirety to any corporation or other Person, except as described below or as otherwise described under "--Distribution of Junior Subordinated Debentures." The Trust may, at our request, with the consent of the Administrative Trustees but without the consent of the holders of the Trust Preferred Securities, the Property Trustee or the Delaware Trustee, merge with or into, consolidate, amalgamate, or be replaced by or convey, transfer or lease its properties and assets as an entirety or substantially as an entirety to a trust organized under the laws of any State; provided, that (i) the successor entity either (a) expressly assumes all of the obligations of the Trust with respect to the Trust Securities or (b) substitutes for the Trust Securities other securities having substantially the same terms as the Trust Securities (the "Successor Securities"), so long as the Successor Securities rank the same as the Trust Securities rank in priority with respect to Distributions and payments upon liquidation, redemption and otherwise, (ii) we expressly appoint a trustee of such successor entity possessing the same powers and duties as the Property Trustee with respect to the Junior Subordinated Debentures, (iii) the Trust Preferred Securities or the Successor Securities are listed, or any Successor Securities will be listed upon notification of issuance, on any national securities exchange or other organization on which the Trust Preferred Securities are then listed or quoted, if any, (iv) if the Trust Preferred Securities (including any Successor Securities) are rated by any nationally recognized statistical rating organization prior to the transaction, the merger, consolidation, amalgamation, replacement, conveyance, transfer or lease does not cause the Trust Securities (including any Successor Securities) or, if the Junior Subordinated Debentures are so rated, the Junior Subordinated Debentures, to be downgraded by any such nationally recognized statistical rating organization, (v) the merger, consolidation, amalgamation, replacement, conveyance, transfer or lease does not adversely affect the rights, preferences and privileges of the holders of the Trust Securities (including any Successor Securities), (vi) the successor entity has a purpose substantially identical to that of the Trust, (vii) prior to such merger, consolidation, amalgamation, replacement, conveyance, transfer or lease, we have received an opinion from independent counsel to the Trust experienced in such matters to the effect that (a) the merger, consolidation, amalgamation, replacement, conveyance, transfer or lease does not adversely affect the rights, preferences and privileges of the holders of the Trust Securities (including any Successor Securities) in any material respect (other than any dilution of such holders' interests in the new entity), (b) following the merger, consolidation, amalgamation, replacement, conveyance, transfer or lease, neither the Trust nor such successor entity will be required to register as an investment company under the Investment Company Act, and (c) the Trust will continue to be, or the successor entity will be, classified as a grantor trust for federal income tax purposes, (viii) we or any permitted successor or assignee owns all of the common securities of such successor entity and guarantees the obligations of such successor entity under the Successor Securities at least to the extent provided by the Guarantee and (ix) the Property Trustee is given an officer's certificate and an opinion of counsel each to the effect that all conditions precedent in the Trust Agreement to the transactions have been satisfied. Notwithstanding the foregoing, the Trust will not, except with the consent of holders of 100% in Liquidation Amount of the Trust Securities, consolidate, amalgamate, merge with or into, or be replaced by or convey, transfer or lease its properties and assets as an entirety or substantially as an entirety to, any other entity or permit any other entity to consolidate, amalgamate, merge with or into, or replace it if the consolidation, amalgamation, merger, replacement, conveyance, transfer or lease would cause the Trust or the successor entity not to be classified as a grantor trust for United States federal income tax purposes or each holder of the Trust Securities not to be treated as owning an undivided interest in the Junior Subordinated Debentures. 27 VOTING RIGHTS; AMENDMENT OF THE TRUST AGREEMENT Except as provided below and under "--Mergers, Consolidations, Amalgamations or Replacements of the Trust" and "Description of Guarantee--Amendments and Assignment" and as otherwise required by law and the Trust Agreement, the holders of the Trust Preferred Securities will have no voting rights. The Trust Agreement may be amended from time to time by us, the Property Trustee and the Administrative Trustees, without the consent of the holders of the Trust Securities (i) to cure any ambiguity, correct or supplement any provisions in the Trust Agreement that may be inconsistent with any other provision, or to make any other provisions with respect to matters or questions arising under the Trust Agreement, which shall not be inconsistent with the other provisions of the Trust Agreement, or (ii) to modify, eliminate or add to any provisions of the Trust Agreement to such extent as shall be necessary to ensure that the Trust will be classified for United States federal income tax purposes as a grantor trust at all times that any Trust Securities are outstanding or to ensure that the Trust will not be required to register as an investment company under the Investment Company Act. However, the amendment to the Trust Agreement under these circumstances may not adversely affect the interests of the holders of the Trust Securities. Any amendments of the Trust Agreement under these circumstances will become effective when notice is given to the holders of the Trust Securities. The Trust Agreement may be amended by the Administrative Trustees, the Property Trustee and us (i) with the consent of holders representing a majority (based upon Liquidation Amount) of the outstanding Trust Securities and (ii) upon receipt by the Issuer Trustees of an opinion of counsel experienced in such matters to the effect that such amendment or the exercise of any power granted to the Issuer Trustees in accordance with such amendment will not affect the Trust's status as a grantor trust for United States federal income tax purposes or the Trust's exemption from status as an investment company under the Investment Company Act. However, without the consent of each holder of Trust Securities, the Trust Agreement may not be amended to (i) change the amount or timing of any Distribution on the Trust Securities or reduce the amount payable on redemption thereof or otherwise adversely affect the amount of any Distribution required to be made in respect of the Trust Securities as of a specified date or (ii) restrict the right of a holder of Trust Securities to institute suit for the enforcement of any payment on or after the specified date. Notwithstanding the foregoing, no amendments or modification may be made to the Declaration if such amendment or modification would (i) cause the Trust to be classified as other than a grantor trust for United States federal income tax purposes, (ii) reduce or otherwise adversely affect the powers of the Property Trustee in contravention of the Trust Indenture Act or (iii) cause a Special Event. So long as any Junior Subordinated Debentures are held by the Property Trustee, subject to the requirement of the Property Trustee obtaining a tax opinion in certain circumstances set forth in the last sentence of this paragraph, the holders of a majority in Liquidation Amount of the Trust Preferred Securities have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Debenture Trustee, or direct the exercise of any trust or power conferred on the Property Trustee with respect to the Junior Subordinated Debentures, including the right to direct the Property Trustee, as holder of the Junior Subordinated Debentures, to (i) exercise the remedies available under the Indenture with respect to the Junior Subordinated Debentures, (ii) waive any past defaults under the Indenture that are available under the Indenture, (iii) exercise any right to rescind or annul a declaration of acceleration of the maturity of the principal of the Junior Subordinated Debentures or (iv) consent to any amendment, modification or termination of the Indenture or the Junior Subordinated Debentures, where the consent will be required. However, where a consent under the Indenture would require the consent of each affected holder of Junior Subordinated Debentures, no consent may be given by the Property Trustee without the prior approval of each holder of the Trust Preferred Securities. The Issuer Trustees will not revoke any action previously authorized or approved by a vote of the holders of the Trust Preferred Securities except by subsequent vote of those holders. 28 The Property Trustee will notify each holder of Trust Preferred Securities within 90 days of any notice of default with respect to the Junior Subordinated Debentures. In addition to obtaining the foregoing approvals of the holders of the Trust Preferred Securities prior to taking any of the foregoing actions, the Issuer Trustees will obtain an opinion of counsel experienced in such matters to the effect that the Trust will not be classified as an association taxable as a corporation for United States federal income tax purposes on account of such action. Any required approval of holders of Trust Preferred Securities may be given at a meeting of the holders convened for that purpose or pursuant to written consent without prior notice. The Administrative Trustees will cause a notice of any meeting at which holders of Trust Preferred Securities are entitled to vote to be given to each holder of record of Trust Preferred Securities in the manner set forth in the Trust Agreement. No vote or consent of the holders of Trust Preferred Securities will be required for the Trust to redeem and cancel the Trust Preferred Securities in accordance with the Trust Agreement. Notwithstanding that holders of the Trust Preferred Securities are entitled to vote or consent under any of the circumstances described above, any of the Trust Preferred Securities that are owned by us, the Trustees or any affiliate of us or any Trustees, will, for purposes of such vote or consent, be treated as if they were not outstanding. GLOBAL TRUST PREFERRED SECURITIES The Trust Preferred Securities will be represented by one or more global certificates registered in the name of DTC or its nominee (a "Global Trust Preferred Security"). Beneficial interests in the Trust Preferred Securities will be shown on, and transfer thereof will be effected only through, records maintained by persons that have accounts with such Depositary ("Participants"). Except as described below, Trust Preferred Securities in the certificated form will not be issued in exchange for the global certificates. See "Book-Entry Issuance." A global security will be exchangeable for Trust Preferred Securities registered in the names of persons other than the Depositary or its nominee only if (i) the Depositary notifies us that it is unwilling or unable to continue as a depositary for the global security and no successor depositary shall have been appointed within 90 days, or if at any time the Depositary ceases to be a clearing agency registered under the Exchange Act, at a time when the Depository is required to be so registered to act as such depository, (ii) the Trust in its sole discretion determines that the global security may be so exchangeable, or (iii) there shall have occurred and be continuing an Event of Default under the Indenture. Any global security that is exchangeable as described in the preceding sentence will be exchangeable for definitive certificates registered in the names as the Depositary shall direct. We expect that the instructions will be based upon directions received by the Depositary with respect to ownership of beneficial interests in the global security. In the event that Trust Preferred Securities are issued in definitive form, the Trust Preferred Securities will be in denominations of $10 and integral multiples thereof and may be transferred or exchanged at the offices described below. Unless and until it is exchanged in whole or in part for individual Trust Preferred Securities, a Global Trust Preferred Security may not be transferred except as a whole by the Depositary to a nominee of the Depositary or by a nominee of the Depositary to the Depositary or another nominee of the Depositary or by the Depositary or any nominee to a successor Depositary or any nominee of the successor. Payments on Trust Preferred Securities represented by a global security will be made to the Depositary, as the depositary for the Trust Preferred Securities. In the event the Trust Preferred Securities are issued in definitive form, Distributions will be payable, the transfer of the Trust Preferred Securities will be registrable, and Trust Preferred Securities will be exchangeable for Trust Preferred 29 Securities of other denominations of a like aggregate Liquidation Amount, at the corporate trust office of the Property Trustee, or at the offices of any paying agent or transfer agent appointed by the Administrative Trustees by check mailed to the address of the persons entitled thereto or by wire transfer. For a description of the terms of the depositary arrangements relating to payments, transfers, voting rights, redemptions and other notices and other manners, See "Book-Entry Issuance." Upon the issuance of a Global Trust Preferred Security, and the deposit of the Global Trust Preferred Security with or on behalf of the Depositary, the Depositary for the Global Trust Preferred Security or its nominee will credit, on its book-entry registration and transfer system, the respective aggregate Liquidation Amounts of the individual Trust Preferred Securities represented by the Global Trust Preferred Securities to the accounts of Participants. These accounts will be designated by the dealers, underwriters or agents with respect to the Trust Preferred Securities. Ownership of beneficial interests in a Global Trust Preferred Security will be limited to Participants or persons that may hold interests through Participants. Ownership of beneficial interests in the Global Trust Preferred Security will be shown on, and the transfer of that ownership will be effected only through, records maintained by the applicable Depositary or its nominee (with respect to interests of Participants) and the records of Participants (with respect to interests of persons who hold through Participants). The laws of some states require that certain purchasers of securities take physical delivery of the securities in definitive form. These limits and laws may impair the ability to transfer beneficial interest in a Global Trust Preferred Security. So long as the Depositary for a Global Trust Preferred Security, or its nominee, is the registered owner of the Global Trust Preferred Security, the Depositary or the nominee, as the case may be, will be considered the sole owner or holder of the Trust Preferred Securities represented by the Global Trust Preferred Security for all purposes under the Trust Agreement governing such Trust Preferred Securities. Except as provided below, owners of beneficial interest in a Global Trust Preferred Security will not be entitled to have any of the individual Trust Preferred Securities represented by such Global Trust Preferred Security registered in their names, will not receive or be entitled to receive physical delivery of any such Trust Preferred Securities in definitive form and will not be considered the owners or holders under the Trust Agreement. Neither the Property Trustee, any Paying Agent (as defined below), the Securities Registrar (as defined below) for the Trust Preferred Securities nor we will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests of the Global Trust Preferred Security representing the Trust Preferred Securities or for maintaining supervising or reviewing any records relating to the beneficial ownership interests. We expect that the Depositary for Trust Preferred Securities or its nominee, upon receipt of any payment of the Liquidation Amount or Distributions in respect of a permanent Global Trust Preferred Security, immediately will credit Participants' accounts with payments in amounts proportionate to their respective beneficial interest in the aggregate Liquidation Amount of such Global Trust Preferred Security as shown on the records of such Depositary or its nominee. We also expect that payments by Participants to owners of beneficial interests in such Global Trust Preferred Security held through such Participants will be governed by standing instructions and customary practices, as is now the case with securities held for the accounts of customers in bearer form or registered in "street name." These payments will be the responsibility of such Participants. If the Depositary for the Trust Preferred Securities is at any time unwilling, unable or ineligible to continue as depositary and a successor depositary is not appointed by us within 90 days, the Trust will issue individual Trust Preferred Securities in exchange for the Global Trust Preferred Security. In addition, the Trust may at any time and in its sole discretion, subject to any limitations described herein relating to the Trust Preferred Securities, determine not to have any Trust Preferred Securities represented by one or more Global Trust Preferred Securities and, in that event, will issue individual 30 Trust Preferred Securities in exchange for the Global Trust Preferred Security. In any such instance, an owner of a beneficial interest in a Global Trust Preferred Security will be entitled to physical delivery of individual Trust Preferred Securities represented by the Global Trust Preferred Security equal in Liquidation Amount to the beneficial interest and to have the Trust Preferred Securities registered in its name. Individual Trust Preferred Securities so issued will be issued in denominations, unless otherwise specified by us, of $10 and integral multiples thereof. PAYMENT AND PAYING AGENCY Payments on the Trust Preferred Securities held in global form will be made to the Depositary, which will credit the relevant accounts at the Depositary on the applicable Distribution Dates. Payments on the Trust Preferred Securities that are not held by the Depositary will be made by check mailed to the address of the holder entitled thereto as the address which appears on the register. The paying agent (the "Paying Agent") will initially be the Property Trustee and any co-paying agent chosen by the Property Trustee and acceptable to the Administrative Trustees and us. The Paying Agent will be permitted to resign as Paying Agent upon 30 days' written notice to the Administrative Trustees. In the event that the Property Trustee will no longer be the Paying Agent, the Administrative Trustees will appoint a successor (which will be a bank or trust company acceptable to the Administrative Trustees and us) to act as Paying Agent. REGISTRAR AND TRANSFER AGENT The Property Trustee will initially act as registrar and transfer agent for the Trust Preferred Securities (the "Securities Registrar"). Registration of transfers of the Trust Preferred Securities will be effected without charge by or on behalf of the Trust, but upon payment of any tax or other governmental charges that may be imposed in connection with any transfer or exchange. The Trust will not be required to register or cause to be registered the transfer of the Trust Preferred Securities after they have been called for redemption. INFORMATION CONCERNING THE PROPERTY TRUSTEE The Property Trustee, other than during the occurrence and continuance of an Event of Default, undertakes to perform only the duties as are specifically set forth in the Trust Agreement and, during the existence of an Event of Default, must exercise the same degree of care and skill as a prudent person would exercise or use in the conduct of his or her own affairs. Subject to this provision, the Property Trustee is under no obligation to exercise any of the powers vested in it by the Trust Agreement at the request of any holder of Trust Securities unless it is offered reasonable indemnity or security against the costs, expenses and liabilities that might be incurred. If no Event of Default has occurred and is continuing and the Property Trustee is required to decide between alternative causes of action, construe ambiguous provisions in the Trust Agreement or is unsure of the application of any provision of the Trust Agreement, and the matter is not one on which holders of the Trust Securities are entitled under the Trust Agreement to vote, then the Property Trustee may take the action as is directed by and, if not so directed, may take action as it deems advisable and in the best interests of the holders of the Trust Securities and will have no liability except for its own bad faith, negligence or willful misconduct. The Property Trustee also serves as the property trustee, guarantee trustee and the indenture trustee with respect to the 9.28% trust preferred securities issued by Trust I in May 1997 and the related junior subordinated debentures due May 19, 2027. MISCELLANEOUS The Administrative Trustees are authorized and directed to conduct the affairs of and to operate the Trust in such a way that the Trust will not be deemed to be an investment company required to be registered under the Investment Company Act or classified as other than a grantor trust for United 31 States federal income tax purposes and so that the Junior Subordinated Debentures will be treated by us as indebtedness for United States federal income tax purposes. In this connection, we and the Administrative Trustees are authorized to take any action, not inconsistent with applicable law, the certificate of trust of the Trust or the Trust Agreement, that we and the Administrative Trustees determine in our discretion to be necessary or desirable for these purposes, as long as the action does not adversely affect the interests of the holders of the Trust Securities or vary the terms thereof. The Administrative Trustees also serve as administrative trustees of Trust I. Holders of the Trust Securities have no preemptive or similar rights. The Trust may not borrow money, issue debt, execute mortgages or pledge any of its assets. 32 DESCRIPTION OF JUNIOR SUBORDINATED DEBENTURES The Junior Subordinated Debentures are to be issued under an Indenture, as supplemented from time to time (as so supplemented, the "Indenture"), between the Debenture Trustee and us. The Indenture will be qualified under the Trust Indenture Act. This summary of certain terms and provisions of the Junior Subordinated Debentures and the Indenture does not purport to be complete, and is qualified in its entirety by reference to all of the provisions of the Indenture and those terms made a part of the Indenture by the Trust Indenture Act. The form of the Indenture has been filed as an exhibit to the Registration Statement. Concurrently with the issuance of the Trust Preferred Securities, the Trust will invest the proceeds, together with the consideration paid by us for the Common Securities, in Junior Subordinated Debentures issued by us. The Junior Subordinated Debentures will be issued as unsecured debt under the Indenture. We may at any time dissolve the Trust and, after satisfaction of liabilities to creditors of the Trust, cause the Junior Subordinated Debentures to be distributed to the holders of the Trust Securities in liquidation of the Trust. If the Junior Subordinated Debentures are distributed to the holders of the Trust Preferred Securities, we will use our best efforts to list the Junior Subordinated Debentures on a national securities exchange or comparable automated quotation system. GENERAL The Junior Subordinated Debentures will bear interest at the annual rate of % of the principal amount thereof, payable quarterly in arrears on the last day of March, June, September and December of each year (each, an "Interest Payment Date"), commencing , 1999, to the person in whose name each Junior Subordinated Debenture is registered, subject to certain exceptions, on the fifteenth day of the month in which the relevant Interest Payment Date occurs. Notwithstanding the above, in the event that either (i) Junior Subordinated Debentures are held by the Property Trustee and the Trust Preferred Securities are no longer in book-entry only form or (ii) the Junior Subordinated Debentures are not represented by a Global Subordinated Debenture, the record date for such payment shall be the first day of the month in which such payment is made. The amount of each interest payment due with respect to the Junior Subordinated Debentures will include amounts accrued through the date the interest payment is due. We anticipate that, until the dissolution, if any, of the Trust, each Junior Subordinated Debenture will be held in the name of the Property Trustee in trust for the benefit of the holders of the Trust Preferred Securities. The amount of interest payable for any period will be computed on the basis of a 360-day year of twelve 30-day months and, for any period of less than a full calendar quarter, on the basis of the actual number of days elapsed in the quarter based upon 30-day months. In the event that any date on which interest is payable on the Junior Subordinated Debentures is not a Business Day, then payment of the interest payable will be made on the next succeeding day that is a Business Day (and without any interest or other payment in respect of any such delay), except that if the next succeeding Business Day falls in the next succeeding calendar year, then the payment will be made on the immediately preceding Business Day, in each case with the same force and effect as if made on such date. Accrued interest that is not paid on the applicable Interest Payment Date will bear additional interest on the amount thereof (to the extent permitted by law) at the rate per annum of % thereof, compounded quarterly. The term "interest," as used herein, includes quarterly interest payments, interest on quarterly interest payments not paid on the applicable Interest Payment Date and Additional Sums (as defined below), as applicable. The Junior Subordinated Debentures will mature on , 2029 (the "Stated Maturity Date"). On or after , 2004, we will have the right to redeem the Junior Subordinated Debentures in whole at any time or in part from time to time at a redemption price equal to 100% of the principal amount thereof plus accrued and unpaid interest on the Junior Subordinated Debentures so redeemed 33 to the date fixed for redemption, subject to our having received prior approval if it is then required under applicable regulatory requirements. In the event that we elect to redeem the Junior Subordinated Debentures, we will give notice to the Debenture Trustee, and the Debenture Trustee will give notice of the redemption to the holders of the Junior Subordinated Debentures no less than 30 days or more than 60 days prior to the effectiveness thereof. The Junior Subordinated Debentures will rank equal with all Other Debentures and will be unsecured and will rank subordinate and junior in right of payment to all Senior and Subordinated Indebtedness (as defined under "Description of Junior Subordinated Debentures--Subordination") to the extent and in the manner set forth in the Indenture. OPTION TO EXTEND INTEREST PAYMENT DATE So long as no Debenture Event of Default has occurred and is continuing, we will have the right under the Indenture to defer the payment of interest on the Junior Subordinated Debentures at any time and from time to time for a period not exceeding 20 consecutive calendar quarters, provided that no Deferral Period may end on a date other than an Interest Payment Date or extend beyond the Stated Maturity Date. At the end of such Deferral Period, we must pay all interest then accrued and unpaid (together with interest thereon) at the annual rate of %, compounded quarterly, to the extent permitted by applicable law. During a Deferral Period, interest will continue to accrue and, if the Junior Subordinated Debentures have been distributed to holders of the Trust Preferred Securities, holders of Junior Subordinated Debentures (or holders of the Trust Preferred Securities while Trust Preferred Securities are outstanding) will be required to accrue such deferred interest income for United States federal income tax purposes prior to the receipt of cash attributable to such income. See "Certain Federal Income Tax Consequences--Interest Income and Original Issue Discount." During a Deferral Period, we will not undertake any of the actions set forth below under "--Certain Covenants We Have Made." Prior to the termination of any such Deferral Period, we may further extend such Deferral Period, provided that such extension does not cause such Deferral Period together with all previous and further extensions within the Deferral Period to exceed 20 consecutive calendar quarters, end on a date other than an Interest Payment Date or extend beyond the Stated Maturity Date. Upon the termination of any such Deferral Period and the payment of all amounts then due on any Interest Payment Date, we may elect to begin a new Deferral Period, subject to the above requirements. No interest will be due and payable during a Deferral Period, except at the end of that period. We must give the Property Trustee, the Administrative Trustees and the Debenture Trustee notice of election of any Deferral Period (or an extension thereof) at least five Business Days prior to the earlier of (i) the next succeeding date on which Distributions on the Trust Preferred Securities are payable or (ii) the date the Trust is required to give notice to any securities exchange or to holders of Trust Preferred Securities of the record date or the date such Distributions are payable, but in any event not less than five Business Days prior to the record date. The Debenture Trustee will give notice of our election to begin or extend a new Deferral Period to the holders of the Trust Preferred Securities. ADDITIONAL SUMS If the Trust or the Property Trustee is required to pay any additional taxes, duties, assessments or other governmental charges, we will pay Additional Sums as required so that the Distributions payable by the Trust shall not be reduced as a result of any such additional taxes, duties, assessments or other governmental charges. 34 REDEMPTION Subject to our having received any prior approval required under applicable regulatory requirements, the Junior Subordinated Debentures are redeemable prior to maturity at our option on or after , 2004, in whole (at any time) or in part (from time to time), at a redemption price equal to 100% of the principal amount plus accrued and unpaid interest on the Junior Subordinated Debentures to the date of redemption. The Junior Subordinated Debentures are also redeemable prior to maturity at any time in whole (but not in part), within 90 days following the occurrence of a Special Event, in each case at a redemption price equal to 100% of the principal amount plus accrued and unpaid interest on the Junior Subordinated Debentures so redeemed to the date fixed for redemption. If a partial redemption of the Trust Preferred Securities resulting from a partial redemption of the Junior Subordinated Debentures would result in a delisting of the Trust Preferred Securities, then we may redeem the Junior Subordinated Debentures in whole only. Notice of any redemption will be mailed at least 30 days but not more than 60 days before the redemption date to each holder of Junior Subordinated Debentures to be redeemed at the holder's registered address. Unless we default in payments of the redemption price, on and after the redemption date, interest ceases to accrue on the Junior Subordinated Debentures or portions called for redemption. The Junior Subordinated Debentures will not be subject to any sinking fund. DISTRIBUTION UPON LIQUIDATION Under certain circumstances involving the dissolution of the Trust, the Junior Subordinated Debentures may be distributed to the holders of the Trust Preferred Securities in liquidation of the Trust after satisfaction of liabilities to creditors of the Trust. See "Description of Trust Preferred Securities--Liquidation Distribution Upon Dissolution." If distributed to holders of the Trust Preferred Securities in liquidation, the Junior Subordinated Debentures will initially be issued in the form of one or more global securities and the Depositary or any successor depositary for the Trust Preferred Securities will act as depositary for the Junior Subordinated Debentures. We anticipate that the depositary arrangements for the Junior Subordinated Debentures be substantially identical to those in effect for the Trust Preferred Securities. If the Junior Subordinated Debentures are distributed to the holders of Trust Preferred Securities upon the liquidation of the Trust, we will use our best efforts to list the Junior Subordinated Debentures on the Nasdaq National Market or such other stock exchanges or automated quotation system, if any, on which the Trust Preferred Securities are then listed or quoted. We can give no assurance as to the market price of any Junior Subordinated Debentures that may be distributed to the holders of Trust Preferred Securities. CERTAIN COVENANTS WE HAVE MADE If at any time (1) there shall have occurred any event of which we have actual knowledge that (a) is, or with the giving of notice or the lapse of time, or both, would be, a Debenture Event of Default and (b) in respect of which we shall not have taken reasonable steps to cure, (2) we are in default with respect to our payment of any obligations under the Guarantee, or (3) we shall have given notice of our election of a Deferral Period as provided in the Indenture and shall not have rescinded such notice, and such Deferral Period, or any extension thereof, shall have commenced and be continuing, then we will not, - declare or pay any dividends or distributions on, or redeem, purchase, acquire or make a liquidation payment with respect to, any of our capital stock; 35 - make any payment of principal, interest or premium, if any, on or repay or repurchase or redeem any of our debt securities (including Other Debentures) that rank equal with or junior in right of payment to the Junior Subordinated Debentures; or - make any guarantee payments with respect to any guarantee by us of the debt securities of any of our subsidiaries (including under Other Guarantees) if such guarantee ranks equal or junior in right of payment to the Junior Subordinated Debentures. However, we will not violate the first bullet point above if we - declare or pay dividends or make distributions in shares of, or options, warrants or rights to subscribe for or purchase shares of our common stock; - declare a dividend in connection with the implementation of a stockholders' rights plan, or issue stock under any plan in the future, or redeem or repurchase any rights under such a plan; - make payments under the Guarantee; - purchase fractional shares as a result of a reclassification of our capital stock; - purchase fractional interests in shares of our capital stock pursuant to the conversion or exchange provisions of our capital stock or the security being converted or exchanged; or - purchase common stock as a result of the issuance of common stock or rights under any of our benefit plans for directors, officers or employees or any of our dividend reinvestment plan. So long as the Trust Securities remain outstanding, we also have agreed (i) to maintain 100% direct or indirect ownership of the Common Securities; provided, however, that any permitted successor to us under the Indenture may succeed to our ownership of such Common Securities, (ii) to not voluntarily dissolve, wind-up or terminate the Trust, except in connection with the distribution of the Junior Subordinated Debentures or certain mergers, consolidations or amalgamations, each as permitted by the Trust Agreement, (iii) to timely perform our duties as sponsor of the Trust, (iv) to use our reasonable efforts to cause the Trust (a) to remain a business trust, except in connection with the distribution of Junior Subordinated Debentures to the holders of Trust Securities in liquidation of the Trust, the redemption of all of the Trust Securities of the Trust, or certain mergers, consolidations or amalgamations, each as permitted by the Trust Agreement, and (b) to otherwise continue to be classified as a grantor trust for United States federal income tax purposes and (v) to use our reasonable efforts to cause each holder of Trust Securities to be treated as owning an undivided beneficial interest in the Junior Subordinated Debentures. SUBORDINATION In the Indenture, we have covenanted and agreed that any Junior Subordinated Debentures issued thereunder will be subordinate and junior in right of payment to all Senior and Subordinated Indebtedness to the extent provided in the Indenture. Upon any payment or distribution of assets to creditors upon any liquidation, dissolution, winding up, reorganization, assignment for the benefit of creditors, marshaling of assets or any bankruptcy, insolvency, debt restructuring or similar proceedings in connection with any insolvency or bankruptcy proceeding which we are the subject of, the holders of Senior and Subordinated Indebtedness will first be entitled to receive payment in full of principal of all Allocable Amounts (as defined below) on such Senior and Subordinated Indebtedness before the holders of Junior Subordinated Debentures will be entitled to receive or retain any payment in respect thereof. As of September 30, 1999, we had no Senior and Subordinated Indebtedness outstanding. In the event of the acceleration of the maturity of Junior Subordinated Debentures, the holders of all Senior and Subordinated Indebtedness outstanding at the time of such acceleration will first be entitled to receive payment in full of such amounts due thereon (including any amounts due upon 36 acceleration) before the holders of Junior Subordinated Debentures will be entitled to receive or retain any payment in respect of the Junior Subordinated Debentures. No payments on account of principal, or interest, if any, in respect of the Junior Subordinated Debentures may be made if there shall have occurred and be continuing a default in any payment with respect to any Senior and Subordinated Indebtedness, or an event of default with respect to any Senior and Subordinated Indebtedness resulting in the acceleration of the maturity thereof, or if any judicial proceeding shall be pending with respect to any default. We are a holding company and almost all of our operating assets are owned by our subsidiaries. We are a legal entity separate and distinct from our subsidiaries. Holders of Junior Subordinated Debentures should look only to us for payments on the Junior Subordinated Debentures. The principal sources of our income are dividends, interest and fees from our subsidiaries. We rely primarily on dividends from the Bank to meet our obligations for payment of principal and interest on our corporate expenses. There are regulatory limitations on the payment of dividends directly or indirectly to us from the Bank. As of September 30, 1999, under applicable banking statutes, the total capital available for payment of dividends by the Bank to us was approximately $27 million. However, bank regulatory authorities have the power to prohibit any act, including the payment of dividends, if such act would reduce bank capital to a point that, in the opinion of such regulatory authorities, would render the Bank undercapitalized and thus constitute an unsafe or unsound banking practice. In addition, the Bank is subject to certain restrictions imposed by federal law on any extensions of credit to, and certain other transactions with, us and certain affiliates, and on investments in stock or other securities. These restrictions prevent us and our affiliates from borrowing from the Bank unless the loans are secured by various types of collateral. Further, secured loans, other transactions and investments by the Bank are generally limited in amount as to us and as to each of our affiliates to 10% of the Bank's capital and surplus and as to us and all of our other affiliates to an aggregate of 20% of the Bank's capital and surplus. Because we are a holding company, our right to participate in any distribution of assets of any subsidiary upon such subsidiary's liquidation or reorganization or otherwise (and thus the ability of holders of the Trust Preferred Securities to benefit indirectly from such distribution), is subject to the prior claims of creditors of that subsidiary (including depositors, in the case of the Bank), except to the extent we may be recognized as a creditor of that subsidiary. At September 30, 1999, our subsidiaries had total liabilities (excluding liabilities owed to us) of $1.5 billion. Accordingly, the Junior Subordinated Debentures will be effectively subordinated to all existing and future liabilities of our subsidiaries and all liabilities of any of our future subsidiaries. The Indenture does not limit our or our subsidiaries' ability to incur or issue other secured or unsecured debt, including Senior and Subordinated Indebtedness. DEFINITIONS. For purposes of the foregoing paragraphs, the following definitions apply: "Allocable Amounts," when used with respect to any Senior and Subordinated Indebtedness, means all amounts due or to become due on the Senior and Subordinated Indebtedness less, if applicable, any amount which would have been paid to, and retained by, the holders of the Senior and Subordinated Indebtedness (whether as a result of the receipt of payments by the holders of such Senior and Subordinated Indebtedness from us or any other obligated party or from any holders of, or trustee in respect of, other indebtedness that is subordinate and junior in right of payment to the Senior and Subordinated Indebtedness) but for the fact that such Senior and Subordinated Indebtedness is subordinated or junior in right of payment to (or subject to a requirement that amounts received on such Senior and Subordinated Indebtedness be paid over to obligees on) trade accounts payable or accrued liabilities arising in the ordinary course of business. "Indebtedness" means with respect to any person, whether recourse is to all or a portion of the assets of such person and whether or not contingent: (i) every obligation of any person for money 37 borrowed; (ii) every obligation of the person evidenced by bonds, debentures, notes or other similar instruments, including obligations incurred in connection with the acquisition of property, assets or businesses; (iii) every reimbursement obligation of the person with respect to letters of credit, banker's acceptances or similar facilities issued for the account of the person; (iv) every obligation of the person issued or assumed as the deferred purchase price of property or services (but excluding trade accounts payable or accrued liabilities arising in the ordinary course of business); (v) every capital lease obligation of the person; (vi) all indebtedness of the person whether incurred on or prior to the date of the Indenture or thereafter incurred, for claims in respect of derivative products, including interest rate, foreign exchange rate and commodity forward contracts, options and swaps and similar arrangements; and (vii) every obligation of the type referred to in clauses (i) through (vi) of another person and all dividends of another person the payment of which, in either case, the person has guaranteed or is responsible or liable, directly or indirectly, as obligor or otherwise. "Senior and Subordinated Indebtedness" means the principal of (and premium, if any) and interest, if any (including interest accruing on or after the filing of any petition in bankruptcy or for reorganization relating to us whether or not the claim for post-petition interest is allowed in such proceeding), on our Indebtedness whether incurred on or prior to the date of the Indenture or thereafter incurred, unless in the instrument creating or evidencing the same or pursuant to which the same is outstanding, it is provided that the obligations are not superior in right of payment to the Junior Subordinated Debentures or to other Indebtedness which is equal with, or subordinated to, the Junior Subordinated Debentures. However, Senior and Subordinated Indebtedness does not include (i) any of our Indebtedness which when incurred and without respect to any election under section 1111(b) of the United States Bankruptcy Reform Act of 1978, as amended, was without recourse to us, (ii) any Indebtedness we have to any of our subsidiaries, (iii) Indebtedness to any of our employees, and (iv) any other debt securities issued pursuant to the Indenture. DENOMINATIONS, REGISTRATION AND TRANSFER If the Junior Subordinated Debentures are distributed to the holders of the Trust Preferred Securities, the Junior Subordinated Debentures will be represented by global certificates registered in the name of the Depositary or its nominee (the "Global Subordinated Debenture"). Beneficial interests in the Junior Subordinated Debentures will be shown on, and transfers thereof will be effected only through, records maintained by the Depositary. Except as described below, Junior Subordinated Debentures in certificated form will not be issued in exchange for the global certificates. See "Book-Entry Issuance." Unless and until a Global Subordinated Debenture is exchanged in whole or in part for the individual Junior Subordinated Debentures, it may not be transferred except as a whole by the Depositary for the Global Subordinated Debenture to a nominee of the Depositary or by a nominee of the Depositary to the Depositary or another nominee of the Depositary or by the Depositary or any nominee to a successor Depositary or any nominee of the successor. A Global Subordinated Debenture will be exchangeable for Junior Subordinated Debentures registered in the names of persons other than the Depositary or its nominee only if (i) the Depositary notifies us that it is unwilling or unable to continue as a depositary for such Global Subordinated Debenture and no successor shall have been appointed, or if at any time the Depositary ceases to be a clearing agency registered under the Exchange Act, at a time when the Depositary is required to be so registered to act as such depositary, (ii) we in our sole discretion determine that the Global Subordinated Debenture will be so exchangeable or (iii) there shall have occurred and be continuing a Debenture Event of Default with respect to the Global Subordinated Debenture. Any Global Subordinated Debenture that is exchangeable pursuant to the preceding sentence will be exchangeable for definitive certificates registered in such names as the Depositary shall direct. It is expected that the instructions will be based upon directions received by the Depositary from its Participants with respect 38 to ownership of beneficial interests in the Global Subordinated Debenture. In the event that Junior Subordinated Debentures are issued in definitive form, the Junior Subordinated Debentures will be in denominations of $10 and integral multiples thereof and may be transferred or exchanged at the offices described below. Payments on Junior Subordinated Debentures represented by a Global Subordinated Debenture will be made to the Depositary, as the depositary for the Junior Subordinated Debentures. In the event Junior Subordinated Debentures will be registrable, Junior Subordinated Debentures will be exchangeable for Junior Subordinated Debentures of other denominations of a like aggregate principal amount, at the corporate office of the Debenture Trustee, or at the offices of any paying agent or transfer agent appointed by us, provided that payment of interest may be made at our option by check mailed to the address of the persons entitled thereto or by wire transfer. In addition, if the Junior Subordinated Debentures are issued in certificated form, the record dates for payment of interest will be the first day of the month in which such payment is to be made. For a description of the Depositary and the terms of the depositary arrangements relating to payments, transfers, voting rights, redemptions and other notices and other matters, see "Book-Entry Issuance." We will appoint the Debenture Trustee as securities registrar under the Indenture (the "Securities Registrar"). Junior Subordinated Debentures may be presented for exchange as provided above, and may be presented for registration of transfer (with the form of transfer endorsed thereon, or a satisfactory written instrument of transfer, duly executed), at the office of the Securities Registrar. We may at any time rescind the designation of any transfer agent or approve a change in the location through which any transfer agent acts, provided that we maintain a transfer agent in the place of payment. We may at any time designate additional transfer agents with respect to the Junior Subordinated Debentures. In the event of any redemption, neither we nor the Debenture Trustee shall be required to (i) issue, register the transfer of or exchange Junior Subordinated Debentures during a period beginning at the opening of business 15 days before the day of selection for redemption of Junior Subordinated Debentures and ending at the close of business on the day of mailing of the relevant notice of redemption or (ii) transfer or exchange any Junior Subordinated Debentures so selected for redemption, except, in the case of any Junior Subordinated Debentures being redeemed in part, any portion thereof not to be redeemed. GLOBAL SUBORDINATED DEBENTURES Upon the issuance of the Global Subordinated Debenture and the deposit of such Global Subordinated Debenture with or on behalf of the Depositary, the Depositary for the Global Subordinated Debenture or its nominee will credit, on its book-entry registration and transfer system, the respective principal amounts of the individual Junior Subordinated Debentures represented by the Global Subordinated Debenture to the accounts of persons that have accounts with such Depositary ("Participants"). Ownership of beneficial interests in a Global Subordinated Debenture will be limited to Participants or persons that may hold interests through Participants. Ownership of beneficial interests in such Global Subordinated Debenture will be shown on, and the transfer of that ownership will be effected only through, records maintained by the applicable Depositary or its nominee (with respect to interests of Participants). The laws of some states require that certain purchasers of securities take physical delivery of the securities in definitive form. These limits and laws may impair the ability to transfer beneficial interests in a Global Subordinated Debenture. 39 So long as the Depositary for a Global Subordinated Debenture, or its nominee, is the registered owner of the Global Subordinated Debenture, the Depositary or such nominee, as the case may be, will be considered the sole owner or holder of the Junior Subordinated Debentures represented by the Global Subordinated Debenture for all purposes under the Indenture governing the Junior Subordinated Debentures. Except as provided below, owners of beneficial interests in a Global Subordinated Debenture will not be entitled to have any of the individual Junior Subordinated Debentures represented by such Global Subordinated Debenture registered in their names, will not receive or be entitled to receive physical delivery of any such Junior Subordinated Debentures in definitive form and will not be considered the owners or holders under the Indenture. Payments of principal of and interest on individual Junior Subordinated Debentures represented by a Global Subordinated Debenture registered in the name of the Depositary or its nominee will be made to the Depositary or its nominee, as the case may be, as the registered owner of the Global Subordinated Debenture representing the Junior Subordinated Debentures. Neither we nor the Debenture Trustee, any Paying Agent, or the Securities Registrar for such Junior Subordinated Debentures will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests of the Global Subordinated Debenture representing the Junior Subordinated Debentures or for maintaining, supervising or reviewing any records relating to the beneficial ownership interests. If the Depositary is at any time unwilling, unable or ineligible to continue as depositary and a successor depositary is not appointed by us within 90 days after we receive notice or otherwise become aware of the situation, we will issue individual Junior Subordinated Debentures in exchange for the Global Subordinated Debenture. In addition, we may at any time and in our sole discretion, determine not to have the Junior Subordinated Debentures represented by one or more Global Subordinated Debenture and, in such event, we will issue individual Junior Subordinated Debentures in exchange for the Global Subordinated Debenture. Further, if we so specify with respect to the Junior Subordinated Debentures, an owner of a beneficial interest in a Global Subordinated Debenture representing Junior Subordinated Debentures may, on terms acceptable to us, the Debenture Trustee and the Depositary for such Global Subordinated Debenture, receive individual Junior Subordinated Debentures in exchange for such beneficial interests. In any such instance, an owner of a beneficial interest in a Global Subordinated Debenture will be entitled to physical delivery of individual Junior Subordinated Debentures registered in its name. Individual Junior Subordinated Debentures so issued will be issued in denominations, unless otherwise specified by us, of $10 and integral multiples thereof. PAYMENT AND PAYING AGENTS Payment of principal of and any interest on Junior Subordinated Debentures will be made at the office of the Debenture Trustee in the City of New York or at the office of such Paying Agent or Paying Agents as we may designate from time to time, except that at our option, payment of any interest may be made, except in the case of Junior Subordinated Debentures in global form, (i) by check mailed to the address of the Person entitled thereto as the address appears in the register for Junior Subordinated Debentures or (ii) by transfer to an account maintained by the Person as specified in the register, provided that proper transfer instructions have been received by the relevant Record Date. Payment of any interest on any Junior Subordinated Debenture will be made to the Person in whose name such Junior Subordinated Debenture is registered at the close of business on the Record Date. We may at any time designate additional Paying Agents or rescind the designation of any Paying Agent; however we will at all times be required to maintain a Paying Agent in each place of payment for the Junior Subordinated Debentures. We expect that the Depositary or its nominee, upon receipt of any payment of principal or interest in respect of a permanent Global Subordinated Debenture representing the Junior Subordinated Debentures, immediately will credit Participants' accounts with payments in amounts proportionate to 40 their respective beneficial interest in the principal amount of the Global Subordinated Debenture as shown on the records of such Depositary or its nominee. We also expect that payments by Participants to owners of beneficial interests in such Global Subordinated Debenture held through the Participants will be governed by standing instructions and customary practices, as is now the case with securities held for the accounts of customers in bearer form or registered in "street name." These payments will be the responsibility of such Participants. Any moneys deposited with the Debenture Trustee or any Paying Agent, or then held by us in trust, for the payment of the principal of or interest on any Junior Subordinated Debenture and remaining unclaimed for two years after such principal or interest has become due and payable will, at our request, be repaid to us and the holder of such Junior Subordinated Debenture will thereafter look, as a general unsecured creditor, only to us for payment thereof. MODIFICATION OF INDENTURE From time to time we and the Debenture Trustee may, without the consent of the holders of Junior Subordinated Debentures, amend, waive or supplement the Indenture for specified purposes, including, among other things, curing ambiguities, defects or inconsistencies (provided that any action does not adversely affect the interest of the holders of Junior Subordinated Debentures), and qualifying, or maintaining the qualification of, the Indenture under the Trust Indenture Act. The Indenture contains provisions permitting us and the Debenture Trustee, with the consent of the holders of a majority in principal amount of Junior Subordinated Debentures, to modify the Indenture in a manner affecting the rights of the holders of Junior Subordinated Debentures; provided that no such modification may, without the consent of the holders of each outstanding Junior Subordinated Debenture so affected, (i) change the Stated Maturity Date, or reduce the principal amount of the Junior Subordinated Debentures or reduce the rate or extend the time of payment of interest except pursuant to our right under the Indenture to defer the payment of interest or make the principal of, or interest on, the Junior Subordinated Debentures payable in any coin or currency other than U.S. dollars, or impair or affect the right of any holder of Junior Subordinated Debentures to institute suit for the payment thereof, or (ii) reduce the percentage of principal amount of Junior Subordinated Debentures, the holders of which are required to consent to any modification of the Indenture; provided that so long as any of the Trust Preferred Securities remain outstanding, no modification may be made that adversely affects the holders of such Trust Preferred Securities, and no termination of the Indenture may occur, and no waiver of any Debenture Event of Default or compliance with any covenant under the Indenture may be effective, without the prior consent of the holders of at least a majority of the aggregate Liquidation Amount of the Trust Preferred Securities unless and until the principal amount of the Junior Subordinated Debentures and all accrued and unpaid interest thereon have been paid in full and certain other conditions are satisfied. If the consent of the Property Trustee, as holder of the Junior Subordination Debentures, is required under the Indenture with respect to amendments, waivers or supplements of the Indenture or the Junior Subordinated Debentures, the Property Trustee shall request the direction of the holders of the Trust Securities with respect to such amendments, waivers or supplements and shall vote as directed by a majority in Liquidation Amount of the Trust Securities voting together as a single class. Where a consent under the Indenture would require the consent of each holder of Junior Subordinated Debentures, no such consent shall be given by the Property Trustee without the prior consent of each holder of Trust Preferred Securities. In addition, we and the Debenture Trustee may execute, without the consent of any holder of Junior Subordinated Debentures, any supplemental Indenture for the purpose of creating any new series of Junior Subordinated Debentures. 41 DEBENTURE EVENTS OF DEFAULT The Indenture provides that any one or more of the following described events with respect to the Junior Subordinated Debentures constitutes a "Debenture Event of Default," regardless of the reason and whether it is voluntary or involuntary or effected by operation of law or pursuant to any judgment, decree, order, rule or regulation: - failure for 30 days to pay any interest on the Junior Subordinated Debentures or any Other Debentures, when due (subject to the deferral of any due date in the case of an Deferral Period); - failure to pay any principal on the Junior Subordinated Debentures or any Other Debentures when due whether at maturity, upon redemption, by declaration of acceleration of maturity or otherwise; - failure to observe or perform certain other covenants contained in the Indenture for 60 days after written notice to us from the Debenture Trustee or the holders of at least 25% in aggregate outstanding principal amount of Junior Subordinated Debentures; - certain events of our bankruptcy, insolvency or reorganization. The holders of a majority in aggregate outstanding principal amount of the Junior Subordinated Debentures have, subject to certain exceptions, the right to direct the time, method and place of conducting any proceeding for any remedy available to the Debenture Trustee or exercising any trust or power conferred on the Debenture Trustee, with respect to the Junior Subordinated Debentures. The Debenture Trustee or the holders of not less than 25% in aggregate outstanding principal amount of the Junior Subordinated Debentures may declare the principal amount of, and any interest on, the Junior Subordinated Debentures to be due and payable immediately upon a Debenture Event of Default; provided that, in the case of certain events of bankruptcy, insolvency or reorganization, such amounts shall automatically become due and payable. If the Debenture Trustee or holders of the Junior Subordinated Debentures fail to make the declaration, the Property Trustee or the holders of at least 25% in the aggregate Liquidation Amount of the Trust Preferred Securities will have the right. The holders of a majority in aggregate outstanding principal amount of the Junior Subordinated Debentures may annul the declaration and waive the default if the default (other than the non-payment of the principal of the Junior Subordinated Debentures which has become due solely by such acceleration) has been cured and a sum sufficient to pay all matured installments of interest and principal due otherwise than by acceleration has been deposited with the Debenture Trustee. Should the holders of the Junior Subordinated Debentures fail to annul such declaration and waive the default, the holders of a majority in aggregate Liquidation Amount of the Trust Preferred Securities shall have the right. The holders of a majority in aggregate outstanding principal amount of the Junior Subordinated Debentures may, on behalf of the holders of all the Junior Subordinated Debentures, waive any past default, except a default in the payment of principal on or interest (unless such default has been cured and a sum sufficient to pay all matured installments of interest and principal due otherwise than by acceleration has been deposited with the Debenture Trustee) or a default in respect of a covenant or provision which under the Indenture cannot be modified or amended without the consent of the holder of each outstanding Junior Subordinated Debenture. In case a Debenture Event of Default occurs and is continuing as to Junior Subordinated Debentures, the Property Trustee will have the right to declare the principal of and the interest on such Junior Subordinated Debentures, and any other amounts payable under the Indenture, to be due and payable and to enforce its other rights as a creditor with respect to such Junior Subordinated Debentures. 42 The Indenture requires the annual filing by us with the Debenture Trustee of a certificate as to the absence of certain defaults under the Indenture. ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF TRUST PREFERRED SECURITIES If a Debenture Event of Default has occurred and is continuing and is attributable to our failure to pay the principal of or interest on the Junior Subordinated Debentures on the due date, a holder of Trust Preferred Securities may institute a Direct Action. We may not amend the Indenture to remove the right to bring a Direct Action without the prior written consent of the holders of all of the Trust Preferred Securities. If the right to bring a Direct Action is removed, the Trust may become subject to the reporting obligations under the Exchange Act and the rules and regulations thereunder. Notwithstanding any payments made to a holder of Trust Preferred Securities by us in connection with a Direct Action, we will remain obligated to pay the principal of or interest on the Junior Subordinated Debentures, and we will be subrogated to the rights of the holder of such Trust Preferred Securities with respect to payments on the Trust Preferred Securities to the extent of any payments made by us to such holder in any Direct Action. The holders of the Trust Preferred Securities will not be able to exercise directly any remedies available to the holders of the Junior Subordinated Debentures, other than those set forth in the preceding paragraph, unless there shall have been an Event of Default under the Trust Agreement. See "Description of Trust Preferred Securities--Events of Default; Notice." CONSOLIDATION, MERGER, SALE OF ASSETS AND OTHER TRANSACTIONS The Indenture provides that we will not consolidate with or merge into any other Person or convey, transfer or lease its properties as an entirety, or substantially as an entirety, to any Person, unless: (i) we are the surviving Person, or the Person formed by or surviving any consolidation or merger (if other than us) or to which the sale, conveyance, transfer or lease of property is made is a Person organized and existing under the laws of the United States or any state thereof or the District of Columbia; (ii) upon any consolidation, merger, sale, conveyance, transfer or lease, the due and punctual payment of the principal of and interest on the Junior Subordinated Debentures according to their tenor and the due and punctual performance and observance of all the covenants and conditions of the Indenture to be kept or performed by us will be expressly assumed, by supplemental indenture (which shall conform to the provisions of the Trust Indenture Act, as then in effect) satisfactory in form to the Debenture Trustee executed and delivered to the Debenture Trustee by the Person formed by the consolidation, or into which we will have been merged, or by the Person which will have acquired our property, as the case may be; (iii) after giving effect to the consolidation, merger, sale, conveyance, transfer or lease, no Default or Event of Default, or any event which, after notice or lapse of time or both, would become a Default or an Event of Default, will have occurred and be continuing; (iv) the consolidation, merger, sale, conveyance, transfer or lease does not cause the Junior Subordinated Debentures to be downgraded by a nationally recognized statistical rating organization; and (v) certain other conditions as prescribed in the Indenture are met. The general provisions of the Indenture do not afford holders of the Junior Subordinated Debentures protection in the event of a highly leveraged or other transaction involving us that may adversely affect holders of the Junior Subordinated Debentures. SATISFACTION AND DISCHARGE The Indenture provides that when, among other things, all Junior Subordinated Debentures not previously delivered to the Debenture Trustee for cancellation (i) have become due and payable or (ii) will become due and payable at maturity or called for redemption within one year, and we deposit or cause to be deposited with the Debenture Trustee funds, in trust, for the purpose and in an amount 43 sufficient to pay and discharge the entire indebtedness on the Junior Subordinated Debentures not previously delivered to the Debenture Trustee for cancellation, for the principal and interest to the Stated Maturity Date, then the Indenture will cease to be of further effect (except as to our obligations to pay all other sums due pursuant to the Indenture and to provide the officers' certificates and opinions of counsel described therein), and we will be deemed to have satisfied and discharged the Indenture. We will only be permitted to take such action if, among other things, we deliver to the Debenture Trustee an opinion of counsel (who may be counsel for us) to the effect that the holders of the Junior Subordinated Debentures will not recognize income, gain or loss for federal income tax purposes as a result of our actions and will be subject to federal income tax on the same amount and in the same manner and at the same times as would have been the case if such deposit and defeasance had not occurred. GOVERNING LAW The Indenture and the Junior Subordinated Debentures will be governed by and construed in accordance with the laws of the State of New York. INFORMATION CONCERNING THE DEBENTURE TRUSTEE The Debenture Trustee has and will be subject to all the duties and responsibilities specified with respect to an indenture trustee under the Trust Indenture Act. Subject to such provisions, the Debenture Trustee is under no obligation to exercise any of the powers vested in it by the Indenture at the request of any holder of Junior Subordinated Debentures, unless offered reasonable indemnity by such holder against the costs, expenses and liabilities which might be incurred thereby. The Debenture Trustee is not required to expend or risk its own funds or otherwise incur personal financial liability in the performance of its duties if the Debenture Trustee reasonably believes that repayment or adequate indemnity is not reasonably assured to it. 44 DESCRIPTION OF GUARANTEE The Guarantee will be executed and delivered by The Bank of New York (the "Guarantee Trustee") and us concurrently with the issuance by the Trust of the Trust Preferred Securities for the benefit of the holders from time to time of the Trust Preferred Securities. The Guarantee will be qualified as an Indenture under the Trust Indenture Act. This summary of certain provisions of the Guarantee does not purport to be complete and is subject to, and qualified in its entirety by reference to, all of the provisions of the Guarantee and the Trust Indenture Act. The form of the Guarantee has been filed as an exhibit to the Registration Statement of which this prospectus forms a part. GENERAL The Guarantee will be an irrevocable guarantee on a subordinated basis of the Trust's obligations under the Trust Preferred Securities, but will apply only to the extent that the Trust has funds sufficient to make such payments, and is not a guarantee of collection. We will irrevocably agree to pay in full on a subordinated basis, the Guarantee Payments (as defined below) to the holders of the Trust Preferred Securities, as and when due, regardless of any defense, right of set-off or counterclaim that the Trust may have or assert other than the defense of payment. The following payments with respect to the Trust Preferred Securities, to the extent not paid by or on behalf of the Trust (the "Guarantee Payments"), will be subject to the Guarantee: (i) any accrued and unpaid Distributions required to be paid on the Trust Preferred Securities, to the extent that the Trust has funds on hand legally available therefor at such time, (ii) the applicable redemption price with respect to the Trust Preferred Securities called for redemption, to the extent that the Trust has funds on hand legally available therefor at such time, and (iii) upon a voluntary or involuntary dissolution, winding-up or liquidation of the Trust (other than in connection with the distribution of the Junior Subordinated Debentures to holders of the Trust Preferred Securities or the redemption of all Trust Preferred Securities), the lesser of (a) the Liquidation Distribution, to the extent the Trust has funds legally available therefor at the time, and (b) the amount of assets of the Trust remaining available for distribution to holders of Trust Preferred Securities after satisfaction of liabilities to creditors of the Trust as required by applicable law. Our obligation to make a Guarantee Payment may be satisfied by direct payment of the required amounts by us to the holders of the Trust Preferred Securities or by causing the Trust to pay such amounts to such holders. We will, through the Guarantee, the Trust Agreement, the Junior Subordinated Debentures and the Indenture, taken together, fully, irrevocably and unconditionally guarantee all of the Trust's obligations under the Trust Preferred Securities. No single document standing alone or operating in conjunction with fewer than all of the other documents constitutes such guarantee. It is only the combined operation of these documents that has the effect of providing a full, irrevocable and unconditional guarantee of the Trust's obligations under the Trust Preferred Securities. See "Relationship Among the Trust Preferred Securities, the Junior Subordinated Debentures and the Guarantee." STATUS OF THE GUARANTEE If we do not make interest payments on the Junior Subordinated Debentures held by the Trust, the Trust will not be able to pay Distributions on the Trust Preferred Securities and will not have funds legally available therefor. The Guarantee will rank subordinate and junior in right of payment to all Senior and Subordinated Indebtedness. The Guarantee will rank equal to the Junior Subordinated Debentures, Other Debentures (including the junior subordinated debentures issued in connection with the issuance of the trust preferred securities of Trust I in May 1997), the guarantee on the Common Securities, any other guarantee on future issuances of trust preferred securities and any senior preferred stock which may be hereafter issued by the Company. Because we are a holding company, 45 our right to participate in any distribution of assets of any subsidiary upon such subsidiary's liquidation or reorganization or otherwise is subject to the prior claims of creditors of that subsidiary, except to the extent we may be recognized as a creditor of that subsidiary. Accordingly, our obligations under the Guarantee effectively will be subordinated to all existing and future liabilities of our subsidiaries and all liabilities of any of our future subsidiaries. Claimants should look only to our assets for payments under the Guarantee. For more information, please refer to "Description of Junior Subordinated Debentures--General." The Guarantee will constitute a guarantee of payment and not of collection, which means the guaranteed party may institute a legal proceeding directly against us to enforce its rights under the Guarantee without first instituting a legal proceeding against any other person or entity. The Guarantee will be held for the benefit of the holders of the Trust Preferred Securities. The Guarantee will not be discharged except by payment of the Guarantee Payments in full to the extent not paid by the Trust or upon distribution to the holders of the Trust Preferred Securities of the Junior Subordinated Debentures. The Guarantee does not limit our ability to incur or issue other secured or unsecured debt, including Senior and Subordinated Indebtedness, whether under the Indenture, any other indenture that we may enter into in the future or otherwise. EVENTS OF DEFAULT An event of default under the Guarantee will occur upon our failure to perform any of our payment or other obligations. The holders of a majority in aggregate Liquidation Amount of the Trust Preferred Securities will 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 the Guarantee or to direct the exercise of any trust or power conferred upon the Guarantee Trustee under the Guarantee. Any holder of the Trust Preferred Securities may institute a legal proceeding directly against us to enforce the Guarantee Trustee's rights under the Guarantee without first instituting a legal proceeding against the Trust, the Guarantee Trustee or any other person or entity. Notwithstanding the foregoing, if we fail to make a payment under the Guarantee, a holder of Trust Preferred Securities may directly institute a proceeding against us for enforcement of the Guarantee for payment to the holder of the Trust Preferred Securities of the holder's pro rata portion of the principal of or interest on the Junior Subordinated Debentures on or after the due dates specified in the Junior Subordinated Debentures. We, as guarantor, will be required to file annually with the Guarantee Trustee a certificate as to whether or not we are in compliance with all the conditions and covenants applicable to us under the Guarantee. AMENDMENTS AND ASSIGNMENT Except with respect to any changes that do not adversely affect the rights of holders of the Trust Preferred Securities (in which case no vote will be required), the Guarantee may not be amended without the prior approval of the holders of a majority of the aggregate Liquidation Amount of such outstanding Trust Preferred Securities. All guarantees and agreements contained in the Guarantee Agreement shall bind our successors, assigns, receivers, trustees and representatives and shall inure to the benefit of the holders of the Trust Preferred Securities then outstanding. TERMINATION OF THE GUARANTEE The Guarantee will terminate and be of no further force and effect upon full payment of the redemption price of the Trust Preferred Securities, upon full payment of the Liquidation Amount payable upon liquidation of the Trust or upon distribution of Junior Subordinated Debentures to the holders of the Trust Preferred Securities. The Guarantee will continue to be effective or will be 46 reinstated, as the case may be, if at any time any holder of the Trust Preferred Securities must restore payment of any sums paid under the Trust Preferred Securities or the Guarantee. INFORMATION CONCERNING THE GUARANTEE TRUSTEE The Guarantee Trustee, other than during the occurrence and continuance of a default by us in performance of the Guarantee, will undertake to perform only such duties as are specifically set forth in the Guarantee and, in case a default with respect to the Guarantee has occurred, must exercise the same degree of care and skill as a prudent person would exercise or use in the conduct of his or her own affairs. Subject to this provision, the Guarantee Trustee will be under no obligation to exercise any of the powers vested in it by the Guarantee at the request of any holder of the Trust Preferred Securities unless it is offered reasonable indemnity against the costs, expenses and liabilities that might be incurred thereby. GOVERNING LAW The Guarantee will be governed by and construed in accordance with the laws of the State of New York. BOOK-ENTRY ISSUANCE The Depositary will act as securities depositary for all of the Trust Preferred Securities and the Junior Subordinated Debentures. The Trust Preferred Securities and the Junior Subordinated Debentures will be issued only as fully-registered securities registered in the name of Cede & Co. (the Depositary's nominee). One or more fully-registered global certificates will be issued for the Trust Preferred Securities and the Junior Subordinated Debentures and will be deposited with the Depositary. The Depositary is a limited purpose trust company organized under the New York Banking Law, as a "banking organization" within the meaning of the New York Banking Law, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and a "clearing agency" registered pursuant to the provisions of Section 17A of the Exchange Act. The Depositary holds securities that its Participants deposit with the Depositary. The Depositary also facilitates the settlement among Participants of securities transactions, such as transfers and pledges, in deposited securities through electronic computerized book-entry changes in Participants' accounts, thereby eliminating the need for physical movement of securities certificates. "Direct Participants" include securities brokers and dealers, banks, trust companies, clearing corporations and certain other organizations. The Depositary is owned by a number of its Direct Participants and by the New York Stock Exchange, Inc., the American Stock Exchange, Inc. and the National Association of Securities Dealers, Inc. Access to the Depositary system is also available to others such as securities brokers and dealers, banks and trust companies that clear through or maintain custodial relationships with Direct Participants, either directly or indirectly ("Indirect Participants"). The rules applicable to the Depositary and its Participants are on file with the SEC. Purchases of Trust Preferred Securities or Junior Subordinated Debentures within the Depositary system must be made by or through Direct Participants, which will receive a credit for the Trust Preferred Securities or Junior Subordinated Debentures on the Depositary's records. The ownership interest of each actual purchaser of each Trust Preferred Securities and each Subordinated Debenture ("Beneficial Owner") is in turn to be recorded on the Direct and Indirect Participants' records. Beneficial Owners will not receive written confirmation from the Depositary of their purchases, but we expect that Beneficial Owners will receive written confirmations providing details of the transactions, as well as periodic statements of their holdings, from the Direct or Indirect Participants through which the Beneficial Owners purchased Trust Preferred Securities or Junior Subordinated Debentures. Transfers 47 of ownership interests in the Trust Preferred Securities or Junior Subordinated Debentures are to be accomplished by entries made on the books of Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in Trust Preferred Securities or Junior Subordinated Debentures, except in the event that use of the book-entry system for the Junior Subordinated Debentures is discontinued. The Depositary has no knowledge of the actual Beneficial Owners of the Trust Preferred Securities or Junior Subordinated Debentures; the Depositary's records reflect only the identity of the Direct Participants to whose accounts such Trust Preferred Securities or Junior Subordinated Debentures are credited, which may or may not be the Beneficial Owners. The Participants will remain responsible for keeping account of their holdings on behalf of their customers. Conveyance of notices and other communications by the Depositary to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners and the voting rights of Direct Participants, Indirect Participants and Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Redemption notices will be sent to Cede & Co. as the registered holder of the Trust Preferred Securities or Junior Subordinated Debentures. If less than all of the Trust Preferred Securities or the Junior Subordinated Debentures are being redeemed, the Property Trustee will determine by lot or PRO RATA the amount of the Trust Preferred Securities of each Direct Participant to be redeemed. Although voting with respect to the Trust Preferred Securities or the Junior Subordinated Debentures is limited to the holders of record of the Trust Preferred Securities or Junior Subordinated Debentures, as applicable, in those instances in which a vote is required, neither the Depositary nor Cede & Co. will itself consent or vote with respect to Trust Preferred Securities or Junior Subordinated Debentures. Under its usual procedures, the Depository would mail an omnibus proxy (the "Omnibus Proxy") to the relevant Issuer Trustee as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or voting rights to those Direct Participants to whose accounts such Trust Preferred Securities or Junior Subordinated Debentures are credited on the record date (identified in a listing attached to the Omnibus Proxy). Distribution payments on the Trust Preferred Securities or the Junior Subordinated Debentures will be made by the relevant Issuer Trustee to the Depositary. The Depositary's practice is to credit Direct Participants' accounts on the relevant payment date in accordance with their respective holdings shown on the Depositary's records unless the Depositary has reason to believe that it will not receive payments on such payment date. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices and will be the responsibility of such Participant and not of the Depositary, the relevant Issuer Trustee, the Trust or us, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of Distributions to the Depositary is the responsibility of the relevant Issuer Trustee, disbursement of such payments to Direct Participants is the responsibility of the Depositary, and disbursements of such payments to the Beneficial Owners is the responsibility of Direct and Indirect Participants. The Depositary may discontinue providing its services as securities depositary with respect to any of the Trust Preferred Securities or the Junior Subordinated Debentures at any time by giving reasonable notice to the relevant Issuer Trustee and us. In the event that a successor securities depositary is not obtained, definitive Trust Preferred Securities or Junior Subordinated Debentures certificates representing such Trust Preferred Securities or Junior Subordinated Debentures are required to be printed and delivered. We, at our option, may decide to discontinue use the system of book-entry transfers through the Depositary (or a successor depositary). After a Debenture Event of Default, the holders of a majority in liquidation preference of Trust Preferred Securities or aggregate principal amount of Junior Subordinated Debentures may determine to discontinue the system of 48 book-entry transfers through the Depositary. In any such event, definitive certificates for such Trust Preferred Securities or Junior Subordinated Debentures will be printed and delivered. The information in this section concerning the Depositary and the Depositary's book-entry system has been obtained from sources that the Trust and we believe to be accurate but neither the Trust nor we assume any responsibility for the accuracy thereof. Neither the Trust nor we have any responsibility for the performance by the Depositary or its Participants of their respective obligations as described herein or under the rules and procedures governing their respective operations. RELATIONSHIP AMONG THE TRUST PREFERRED SECURITIES, THE JUNIOR SUBORDINATED DEBENTURES AND THE GUARANTEE FULL AND UNCONDITIONAL GUARANTEE Payments of Distributions and other amounts due on the Trust Preferred Securities (to the extent the Trust has funds on hand legally available for the payment of such Distributions) will be irrevocably guaranteed by us as and to the extent set forth under "Description of Guarantee." Taken together, our obligations under the Junior Subordinated Debentures, the Indenture, the Trust Agreement and the Guarantee will provide, in the aggregate, a full, irrevocable and unconditional guarantee of payments of Distributions and other amounts due on the Trust Preferred Securities. No single document standing alone or operating in conjunction with fewer than all of the other documents constitutes such guarantee. It is only the combined operation of these documents that has the effect of providing a full, irrevocable and unconditional guarantee of the Trust's obligations under the Trust Preferred Securities. If and to the extent that we do not make the required payments on the Junior Subordinated Debentures, the Trust will not have sufficient funds to make the related payments, including Distributions, on the Trust Preferred Securities. The Guarantee will not cover any such payment when the Trust does not have sufficient funds on hand legally available therefor. In such event, the remedy of a holder of Trust Preferred Securities is to institute a Direct Action. Our obligations under the Guarantee will be (i) subordinate and junior in right of payment to all Senior and Subordinated Indebtedness, except for those liabilities made equal or subordinate to the Guarantee by their terms, (ii) PARI PASSU to all other guarantees issued or to be issued by us with respect to other similar trust preferred securities, including the issuance of $28.75 million of trust preferred securities of Trust I in May 1997; (iii) senior to our capital stock and (iv) effectively subordinated to the liabilities and obligations of our subsidiaries. SUFFICIENCY OF PAYMENTS As long as payments of interest and other payments are made when due on the Junior Subordinated Debentures, such payments will be sufficient to cover Distributions and other payments due on the Trust Preferred Securities, because: (i) the aggregate principal amount of the Junior Subordinated Debentures will be equal to the sum of the aggregate Liquidation Amount of the Trust Securities; (ii) the interest rate and interest and other payment dates on the Junior Subordinated Debentures will match the Distribution rate and Distribution and other payment dates for the Trust Securities; (iii) we shall pay for all and any costs, expenses and liabilities of the Trust except the Trust's obligations to holders of Trust Securities under the Trust Securities; and (iv) the Trust Agreement will provide that the Trust is not authorized to engage in any activity that is not consistent with the limited purposes thereof. ENFORCEMENT RIGHTS OF HOLDERS OF TRUST PREFERRED SECURITIES A holder of any Trust Preferred Security may institute a legal proceeding directly against us to enforce its rights under the Guarantee without first instituting a legal proceeding against the Guarantee Trustee, the Trust or any other person or entity. 49 A default or event of default under any Senior and Subordinated Indebtedness would not constitute a default or Event of Default under the Trust Agreement. However, in the event of payment defaults under, or acceleration of, Senior and Subordinated Indebtedness, the subordination provisions of the Indenture will provide that no payments may be made in respect of the Junior Subordinated Debentures until such Senior and Subordinated Indebtedness has been paid in full or any payment default thereunder has been cured or waived. Failure to make required payments on Junior Subordinated Debentures would constitute an Event of Default under the Trust Agreement. LIMITED PURPOSE OF THE TRUST The Trust Preferred Securities will represent preferred beneficial interests in the Trust, and the Trust exists for the sole purpose of issuing and selling the Trust Securities, using the proceeds from the sale of the Trust Securities to acquire the Junior Subordinated Debentures and engaging in other activities that are necessary or incidental thereto. A principal difference between the rights of a holder of a Trust Preferred Security and a holder of a Junior Subordinated Debenture is that a holder of a Junior Subordinated Debenture will be entitled to receive from us the principal amount of and interest on Junior Subordinated Debentures held, while a holder of Trust Preferred Securities is entitled to receive Distributions from the Trust (or, in certain circumstances, from us under the Guarantee) if and to the extent the Trust has funds on hand legally available for the payment of such Distributions. RIGHTS UPON TERMINATION Unless the Junior Subordinated Debentures are distributed to holders of the Trust Securities, upon any voluntary or involuntary dissolution, winding-up or liquidation of the Trust, after satisfaction of the liabilities of creditors of the Trust as required by applicable law, the holders of the Trust Preferred Securities will be entitled to receive, out of assets held by the Trust, the Liquidation Distribution in cash. See "Description of Trust Preferred Securities--Distribution of Junior Subordinated Debentures." Upon our voluntary or involuntary liquidation or bankruptcy, the Property Trustee, as holder of the Junior Subordinated Debentures, would be a subordinated creditor of ours, subordinated in right of payment to all Senior and Subordinated Indebtedness as set forth in the Indenture, but entitled to receive payment in full of principal and interest, before any of our stockholders receive payments or distributions. Since we will be the guarantor under the Guarantee and will agree to pay for all costs, expenses and liabilities of the Trust (other than the Trust's obligations to the holders of its Trust Securities), the positions of a holder of Trust Preferred Securities and a holder of Junior Subordinated Debentures relative to other creditors and to our stockholders in the event of our liquidation or bankruptcy will be substantially the same. 50 CERTAIN FEDERAL INCOME TAX CONSEQUENCES GENERAL In the opinion of Elias, Matz, Tiernan & Herrick L.L.P., special federal income tax counsel to the Trust and us ("Tax Counsel"), the following is a summary of certain of the material United States federal income tax consequences of the purchase, ownership and disposition of Trust Preferred Securities held as capital assets by a holder who purchases such Trust Preferred Securities upon initial issuance. It does not deal with special classes of holders such as banks, thrifts, real estate investment trusts, regulated investment companies, insurance companies, dealers in securities or currencies, tax-exempt investors, United States Alien Holders (as defined below) engaged in a U.S. trade or business or persons that will hold the Trust Preferred Securities as a position in a "straddle," as part of a "synthetic security" or "hedge," as part of a "conversion transaction" or other integrated investment, or as other than a capital asset. This summary also does not address the tax consequences to persons that have a functional currency other than the U.S. dollar or the tax consequences to shareholders, partners or beneficiaries of a holder of Trust Preferred Securities. Further, it does not include any description of any alternative minimum tax consequences or the tax laws of any state or local government or of any foreign government that may be applicable to the Trust Preferred Securities. This summary is based on the Internal Revenue Code of 1986, as amended (the "Code"), Treasury regulations thereunder and the administrative and judicial interpretations thereof, as of the date hereof, all of which are subject to change, possibly on a retroactive basis. An opinion of Tax Counsel is not binding on the Internal Revenue Service ("IRS") or the courts. No rulings have been or are expected to be sought from the IRS with respect to any of the transactions described herein and no assurance can be given that the IRS will not take contrary positions. Moreover, no assurance can be given that the opinions expressed herein will not be challenged by the IRS or, if challenged, that a challenge would not be successful. THE UNITED STATES FEDERAL INCOME TAX DISCUSSION SET FORTH BELOW IS INCLUDED FOR GENERAL INFORMATION ONLY AND MAY NOT BE APPLICABLE DEPENDING UPON A HOLDER'S PARTICULAR SITUATION. HOLDERS SHOULD CONSULT THEIR TAX ADVISORS WITH RESPECT TO THE TAX CONSEQUENCES TO THEM OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF THE TRUST PREFERRED SECURITIES, INCLUDING THE TAX CONSEQUENCES UNDER STATE, LOCAL, FOREIGN AND OTHER TAX LAWS AND THE POSSIBLE EFFECTS OF CHANGES IN UNITED STATES FEDERAL OR OTHER TAX LAWS. CLASSIFICATION OF THE JUNIOR SUBORDINATED DEBENTURES In connection with the issuance of the Junior Subordinated Debentures, Tax Counsel has rendered its opinion generally to the effect that, under then current law and assuming full compliance with the terms of the Indenture (and certain other documents), and based on certain facts and assumptions contained in such opinion, the Junior Subordinated Debentures will be classified for United States federal income tax purposes as our indebtedness. We, the Trust and the holders of the Trust Preferred Securities (by acceptance of a beneficial interest in a Trust Preferred Security) will agree to treat the Junior Subordinated Debentures as our indebtedness for all United States federal income tax purposes. CLASSIFICATION OF THE TRUST In connection with the issuance of the Trust Preferred Securities, Tax Counsel has rendered its opinion generally to the effect that, under then current law and assuming full compliance with the terms of the Trust Agreement and the Indenture (and certain other documents), and based on certain facts and assumptions contained in such opinion, the Trust will be classified for United States federal income tax purposes as a grantor trust and not as an association taxable as a corporation. Accordingly, for United States federal income tax purposes, each holder of Trust Preferred Securities generally will be considered the owner of an undivided interest in the Junior Subordinated Debentures, and each 51 holder will be required to include in its gross income a pro rata share of any interest (or original issue discount ("OID") accrued) with respect to its allocable share of those Junior Subordinated Debentures. INTEREST INCOME AND ORIGINAL ISSUE DISCOUNT Under applicable Treasury regulations (the "Regulations"), if the terms and conditions of a debt instrument make the likelihood that stated interest will not be timely paid a "remote" contingency, such contingency will be ignored in determining whether a debt instrument is issued with OID. We believe that the likelihood of our exercising our option to defer payments of interest is remote, because exercising the option would, among other things, prevent us from declaring dividends on any class of our equity securities. Based on this conclusion by us, Tax Counsel has rendered its opinion that the Junior Subordinated Debentures will not be considered to be issued with OID and, accordingly, stated interest on the Junior Subordinated Debentures generally will be taxable to a holder as ordinary income at the time it is paid or accrued in accordance with such holder's method of tax accounting. Under the Regulations, if we were to exercise our option to defer payments of stated interest, the Junior Subordinated Debentures would, at such time, be treated as redeemed and reissued with OID, and all stated interest on the Junior Subordinated Debentures would thereafter be treated as OID as long as the Junior Subordinated Debentures remain outstanding. In such event, all of a holder's taxable interest income with respect to the Junior Subordinated Debentures would thereafter be accounted for on an economic accrual basis regardless of such holder's method of tax accounting, and actual distributions of stated interest related thereto would not be reported as taxable income. Consequently, a holder of Trust Preferred Securities would be required to include in gross income OID even though we would not make actual cash payments during a Deferral Period. The Regulations have not yet been addressed in any rulings or other interpretations by the IRS, and it is possible that the IRS could take a position contrary to the interpretation described herein. If the option to defer the payment of interest was determined not to be "remote," the Junior Subordinated Debentures would be treated as having been originally issued with OID. In that event, all of a holder's taxable interest income with respect to the Junior Subordinated Debentures would be accounted for on an economic accrual basis regardless of the holder's method of tax accounting, and actual distributions of stated interest would not be reported as taxable income. CHARACTERIZATION OF INCOME Because income on the Trust Preferred Securities will constitute interest or OID, corporate holders of the Trust Preferred Securities will not be entitled to a dividends-received deduction with respect to any income recognized with respect to the Trust Preferred Securities. DISTRIBUTION OF JUNIOR SUBORDINATED DEBENTURES OR CASH UPON LIQUIDATION OF THE TRUST We will have the right at any time to liquidate the Trust and cause the Junior Subordinated Debentures to be distributed to the holders of the Trust Securities. The distribution, for United States federal income tax purposes, would be treated as a nontaxable event to each holder, and each holder would receive an aggregate tax basis in the Junior Subordinated Debentures equal to the holder's aggregate tax basis in its Trust Preferred Securities. For United States federal income tax purposes, a holder's holding period in the Junior Subordinated Debentures so received in liquidation of the Trust would include the period during which the Trust Preferred Securities were held by the holder. Under certain circumstances described herein, the Junior Subordinated Debentures may be redeemed for cash and the proceeds of such redemption distributed to holders in redemption of their Trust Preferred Securities. Such a redemption would, for United States federal income tax purposes, constitute a taxable disposition of the redeemed Trust Preferred Securities, and a holder could recognize gain or loss as if it sold such redeemed Trust Preferred Securities for cash. 52 SALES OF TRUST PREFERRED SECURITIES A holder that sells Trust Preferred Securities (including a redemption of the Trust Preferred Securities by us) will recognize gain or loss equal to the difference between its adjusted tax basis in the Trust Preferred Securities and the amount realized on the sale of such Trust Preferred Securities (other than with respect to accrued and unpaid interest which has not yet been included in income, which will be treated as ordinary income). A holder's adjusted tax basis in the Trust Preferred Securities generally will be its initial purchase price increased by OID (if any) previously includable in such holder's gross income to the date of disposition and decreased by payments (if any) received on the Trust Preferred Securities in respect of OID. The gain or loss generally will be a capital gain or loss and generally will be a long-term capital gain or loss if the Trust Preferred Securities have been held for more than one year. A holder who disposes of the Trust Preferred Securities between record dates for payments of distributions thereon will be required to include in income (to the extent not previously included in income) as ordinary income amounts attributable to accrued and unpaid interest on the Junior Subordinated Debentures through the date of disposition and the amount realized on disposition excludes the portion of the sales price treated as interest. To the extent the selling price is less than the holder's adjusted tax basis, a holder will recognize a capital loss. Subject to certain limited exceptions, capital losses cannot be applied to offset ordinary income for United States federal income tax purposes. The Trust Preferred Securities may trade at a price that does not accurately reflect the value of accrued but unpaid interest with respect to the underlying Junior Subordinated Debentures. A holder who uses the accrual method of accounting for tax purposes (and a cash method holder, if the Junior Subordinated Debenture are deemed to have been issued with OID) who disposes of his Trust Preferred Securities between record dates for payments of distributions thereon will be required to include accrued but unpaid interest on the Junior Subordinated Debentures through the date of disposition in income as ordinary income (i.e., interest or, if applicable, OID), and to add the amount to his adjusted tax basis in his pro rata share of the underlying Junior Subordinated Debentures deemed disposed of. To the extent the selling price is less than the holder's adjusted tax basis (which will include all accrued but unpaid interest) a holder will recognize a capital loss. Subject to certain limited exceptions, capital losses cannot be applied to offset ordinary income for United States federal income tax purposes. UNITED STATES ALIEN HOLDERS For purposes of this discussion, a "United States Alien Holder" is any corporation, individual, partnership, estate or trust that is not a U.S. Holder for United States federal income tax purposes. A "U.S. Holder" is a holder of Trust Preferred Securities who or which is (i) a citizen or individual resident (or is treated as a citizen or individual resident) of the United States for federal income tax purposes, (ii) a corporation or partnership created or organized in or under the laws of the United States or any political subdivision thereof, (iii) an estate the income of which is includable in its gross income for federal income tax purposes without regard to its source or (iv) a trust over which (A) a court within the United States is able to exercise primary supervision over the administration of the trust and (B) one or more United States persons have the authority to control all substantial decisions of the trust. Under present United States federal income tax laws: (i) payments by the Trust or any of its paying agents to any holder of a Trust Preferred Security who or which is a United States Alien Holder will not be subject to United States federal withholding tax; provided that, (a) the beneficial owner of the Trust Preferred Security does not actually or constructively own 10 percent or more of the total combined voting power of all of our classes of stock entitled to vote, (b) the beneficial owner of the 53 Trust Preferred Security is not a controlled foreign corporation that is related to us through stock ownership, (c) the beneficial owner is not a bank whose receipt of interest is described in Section 881(c)(3)(A) of the Code, and (d) either (A) the beneficial owner of the Trust Preferred Security certifies to the Trust or its agent, under penalties of perjury, that it is not a U.S. Holder and provides its name and address or (B) a securities clearing organization, bank or other financial institution that holds customers' securities in the ordinary course of its trade or business (a "Financial Institution"), and holds the Trust Preferred Security in such capacity, certifies to the Trust or its agent, under penalties of perjury, that such statement has been received from the beneficial owner by it or by a Financial Institution between it and the beneficial owner and furnishes the Trust or its agent with a copy thereof; and (ii) a United States Alien Holder of a Trust Preferred Security will not be subject to United States federal withholding tax on any gain realized upon the sale or other disposition of a Trust Preferred Security. Under Treasury regulations finalized in 1997, the certification requirement referred to in clause (i)(d) above may be satisfied with other documentary evidence for interest paid after December 31, 2000 with respect to offshore accounts or through certain foreign intermediaries. POTENTIAL TAX LAW CHANGES As discussed above, changes in legislation affecting the United States federal income tax treatment of the Junior Subordinated Debentures are possible, and could adversely affect our ability to deduct the interest payable on the Junior Subordinated Debentures. Moreover, any such legislation could adversely affect United States Alien Holders by characterizing income derived from the Junior Subordinated Debentures as dividends, generally subject to a 30% income tax (on a withholding basis) when paid to a United States Alien Holder, rather than as interest which, as discussed above, is generally exempt from income tax in the hands of a United States Alien Holder. INFORMATION REPORTING TO HOLDERS Generally, income on the Trust Preferred Securities will be reported to holders on Internal Revenue Form 1099, which forms should be mailed to holders of Trust Preferred Securities by January 31 following each calendar year. BACKUP WITHHOLDING Backup withholding of United States federal income tax at a rate of 31% may apply to payments made in respect of the Trust Preferred Securities to registered owners who are not "exempt recipients" and who fail to provide certain identifying information (such as the registered owner's taxpayer identification number) in the required manner. Generally, individuals are not exempt recipients, whereas corporations and certain other entities generally are exempt recipients. Payments made in respect of the Trust Preferred Securities to a U.S. Holder must be reported to the IRS, unless the U.S. Holder is an exempt recipient or establishes an exemption. Compliance with the identification procedures described in the "United States Alien Holders" section would establish an exemption from backup withholding for those United States Alien Holders who are not exempt recipients. In addition, upon the sale of the Trust Preferred Securities to (or through) a broker, the broker must withhold 31% of the entire purchase price, unless either (i) the broker determines that the seller is a corporation or other exempt recipient or (ii) the seller provides, in the required manner, certain identifying information and, in the case of a United States Alien Holder, certifies that such seller is a United States Alien Holder (and certain other conditions are met). Such a sale must also be reported by the broker to the IRS, unless either (i) the broker determines that the seller is an exempt recipient or (ii) the seller certifies its United States Alien Holder status (and certain other conditions are met). Certification of the registered owner's United States Alien Holder status would be made normally on an Internal Revenue Service Form W-8 under penalties of perjury, although in certain cases it may be possible to submit other documentary evidence. 54 ERISA CONSIDERATIONS We, as the obligor with respect to the Junior Subordinated Debentures held by the Trust, and our affiliates and the Property Trustee may be considered a "party in interest" (within the meaning of the Employment Retirement Income Security Act of 1974, as amended ("ERISA")) or a "disqualified person" (within the meaning of Section 4975 of the Code) with respect to many employee benefit plans that are subject to ERISA and/or certain employee benefit-related provisions of the Code ("Plans"). The purchase and/or holding of Trust Preferred Securities by a Plan that is subject to the fiduciary responsibility provisions of ERISA or the prohibited transaction provisions of Section 4975 of the Code (including individual retirement arrangements and other plans described in Section 4975(e)(1) of the Code) and with respect to which we, the Property Trustee or any affiliate is a service provider (or otherwise is a party in interest or a disqualified person) may constitute or result in a prohibited transaction under ERISA or Section 4975 of the Code, unless such Trust Preferred Securities are acquired pursuant to and in accordance with an applicable exemption, such as Prohibited Transaction Class Exemption ("PTCE") 84-14 (an exemption for certain transactions determined by an independent qualified professional asset manager), PTCE 91-38 (an exemption for certain transactions involving bank collective investment funds), PTCE 90-1 (an exemption for certain transactions involving insurance company pooled separate accounts), PTCE 95-60 (an exemption for transactions involving certain insurance company general accounts) or PTCE 96-23 (an exemption for certain transactions determined by an in-house asset manager). In order to avoid prohibited transactions that may result from the purchase and/or holding of the Trust Preferred Securities, each purchaser of a Trust Preferred Security shall be deemed to represent to us and the Property Trustee that either (a) no part of the funds being used to pay the purchase price of the Trust Preferred Security constitutes "plan assets," or (b) if the funds being used to pay the purchase price of the Trust Preferred Security include "plan assets," that its purchase and holding of the Trust Preferred Security will not result in a prohibited transaction under Section 406 of ERISA or Section 4975 of the Code (or, in the case of a governmental plan, any substantially similar Federal, State or local law) for which an exemption is not available. The U.S. Department of Labor has promulgated a regulation, 29 C.F.R. Section 2510.3-101 (the "Plan Asset Regulation"), describing what constitutes the assets of a Plan with respect to the Plan's investment in an entity for purposes of certain provisions of ERISA and the Code, including the fiduciary responsibility provisions of ERISA and the prohibited transaction provisions of ERISA and Section 4975 of the Code. Under the Plan Asset Regulation, if a Plan invests in an "equity interest" of an entity that is neither a "publicly offered security" nor a security issued by an investment company registered under the Investment Company Act, the Plan's assets include both the equity interest and an undivided interest in each of the entity's underlying assets, unless it is established that the entity is an "operating company" or that equity participation in the entity by "benefit plan investors" is not "significant." Because the Trust Preferred Securities will represent beneficial interests in the Trust, the Trust Preferred Securities are likely to be considered equity interests in the Trust for purposes of the Plan Asset Regulation, with the result that the assets of the Trust are likely to be treated as "plan assets" of the investing plans for purposes of ERISA and Section 4975 of the Code, unless the Trust Preferred Securities qualify as "publicly offered securities." A publicly-offered security is a security that is (a) freely transferable, (b) part of a class of securities that is owned, immediately subsequent to the initial offering, by 100 or more investors who were independent of the issuer and of one another ("Independent Investors") and (c) either is (i) part of a class of securities registered under section 12(b) or 12(g) of the Exchange Act, or (ii) sold to the plan as part of an offering of securities to the public pursuant to an effective registration statement under the Securities Act and the class of securities of which such security is a part is registered under 55 the Exchange Act within 120 days (or such later time as may be allowed by the Commission) after the end of the fiscal year of the issuer during which the offering of such securities to the public occurred. For purposes of the 100 Independent Investor criterion, the Trust Preferred Securities should be deemed to be a "class" of securities that would be tested separately from any other securities that may be issued by the Trust. It is anticipated that the Trust Preferred Securities will meet the foregoing criteria for treatment as "publicly-offered securities." No restrictions will be imposed on the transfer of the Trust Preferred Securities. It is expected that the Trust Preferred Securities will be held by at least 100 Independent Investors at the conclusion of the initial public offering although no assurance can be given, and no monitoring or other measures will be taken to ensure, that such condition is met. Also, the Trust Preferred Securities will be sold as part of an offering pursuant to an effective registration statement under the Act and then will be timely registered under the Exchange Act. As a result the Trust Preferred Securities should qualify as publicly-offered securities and therefore will be eligible for purchase by Plans. In light of the foregoing, fiduciaries or other persons contemplating purchasing the Trust Preferred Securities on behalf or with "plan assets" of any Plan should consult their own counsel regarding whether the Trust assets represented by the Trust Preferred Securities would be considered "plan assets," the consequences that would apply if the Trust's assets were considered "plan assets," and the possibility of exemptive relief from the prohibited transaction rules. In addition, based on the reasoning of the United States Supreme Court's decision in JOHN HANCOCK MUT. LIFE. INS. CO. V. HARRIS TRUST AND SAV. BANK, 510 U.S. 86 (1993), under certain circumstances assets in the general account of an insurance company may be deemed to be plan assets for certain purposes, and under such a reasoning a purchase of the Trust Preferred Securities with assets of an insurance company's general account may subject the insurance company to the prohibited transaction and other fiduciary responsibility rules of ERISA with respect to such assets. Insurance company general account investors should also consider the effect of the enactment of Section 401(c) of ERISA and any regulations issued under Section 401(c). Finally, Plan fiduciaries and other Plan investors should consider whether the investment (i) satisfies the diversification requirement of ERISA or other applicable law, (ii) is in accordance with the Plan's governing instruments, and (iii) is prudent in light of the "Risk Factors" and other factors discussed herein. THE SALE OF TRUST PREFERRED SECURITIES TO PLANS IS IN NO RESPECT A REPRESENTATION BY THE TRUST, US, THE PROPERTY TRUSTEE, THE UNDERWRITER OR ANY OTHER PERSON ASSOCIATED WITH THE SALE OF THE TRUST PREFERRED SECURITIES THAT SUCH SECURITIES MEET ALL RELEVANT LEGAL REQUIREMENTS WITH RESPECT TO INVESTMENTS BY PLANS GENERALLY OR ANY PARTICULAR PLAN, OR THAT SUCH SECURITIES ARE OTHERWISE APPROPRIATE FOR PLANS GENERALLY OR ANY PARTICULAR PLAN. ANY PURCHASER PROPOSING TO ACQUIRE TRUST PREFERRED SECURITIES WITH ASSETS OF ANY PLAN SHOULD CONSULT WITH ITS COUNSEL. 56 UNDERWRITING Legg Mason Wood Walker, Incorporated, as underwriter, has agreed, subject to the terms and conditions of its underwriting agreement with Independent and the Trust, to purchase from the Trust Trust Preferred Securities at the initial public offering price less the underwriting discounts and commissions set forth on the cover page of this prospectus. The underwriting agreement provides that the obligations of the underwriter are subject to certain conditions, and that if any of the foregoing Trust Preferred Securities are purchased by the underwriter pursuant to the underwriting agreement, all such securities must be so purchased. The underwriter may reject orders in whole or in part and withdraw, cancel, or modify the offer without notice. Each of Independent and the Trust has agreed to indemnify the underwriter and their controlling persons against certain liabilities, including liabilities under the Securities Act of 1933 or to contribute to payments the underwriter may be required to made in respect thereof. The underwriter may also impose a penalty bid on certain selling group members. This means that if the underwriter purchases Trust Preferred Securities in the open market to reduce the underwriter's short position or to stabilize the price of the Trust Preferred Securities, it may reclaim the amount of the selling concession from the selling group members who sold those Trust Preferred Securities as part of the offering. The underwriter may create a "short position" in the Trust Preferred Securities in connection with the offering, which means that they may over-allot or sell more shares than are set forth on the cover page of this prospectus. If the underwriter creates a short position by such over-allotment, then the underwriter may reduce that short position by purchasing Trust Preferred Securities in the open market. The underwriter also may elect to reduce any short position by exercising all or part of the over-allotment option. In general, purchases of a security for the purpose of stabilization or to reduce a short position could cause the price of security to be higher than it might otherwise be in the absence of such purchases. The imposition of a penalty bid might also have an effect on the price of a security to the extent that it were to discourage resales of the security. The underwriter has advised us and the Trust that it proposes to offer the Trust Preferred Securities directly to the public initially at the public offering price set forth on the cover page of this prospectus and to certain dealers at such price less a concession not in excess of $ per Trust Preferred Security. The underwriter may allow and such dealers may reallow a concession not in excess of $ per Trust Preferred Security to certain other brokers and dealers. After the public offering, the public offering price, concession and reallowance, and other selling terms may be changed by the underwriter. In view of the fact that the proceeds from the sale of the Trust Preferred Securities will be used to purchase the Junior Subordinated Debentures issued by us, the underwriting agreement provides that we will pay as compensation for the underwriter's arranging the investment therein of such proceeds an amount of $ per Trust Preferred Security. The Trust has granted to the underwriter an option, exercisable for 30 days from the date of this prospectus, to purchase up to an additional Trust Preferred Securities at the public offering price set forth on the cover page hereof less underwriting discounts. The underwriter may exercise such option to purchase additional Trust Preferred Securities solely for the purpose of covering over-allotments, if any, incurred in the sale of the Trust Preferred Securities. To the extent that the underwriter exercises its option to purchase additional Trust Preferred Securities, the Trust will issue and sell to us additional Common Securities and the we will issue and sell to the Trust Junior Subordinated Debentures in an aggregate principal amount equal to the total aggregate Liquidation Amount of the additional Trust Preferred Securities being purchased pursuant to the option and the additional Common Securities. 57 Both the Trust and us have agreed in the underwriting agreement that, subject to certain conditions, prior to days following the date of issuance of the Trust Preferred Securities, neither of us will, directly or indirectly, issue, sell, offer or agree to sell, grant any option for the sale of, or otherwise dispose of, Trust Preferred securities, any securities convertible into, exchangeable or exercisable for Trust Preferred Securities or the Junior Subordinated Debentures or any debt securities substantially similar to the Junior Subordinated Debentures or any equity security substantially similar to the Trust Preferred Securities, except with the prior written consent of the underwriter, and except for any disposal of Junior Subordinated Debentures following a liquidation of the Trust. Each of the Trust and us has agreed to indemnify the underwriter and their controlling persons against certain liabilities, including liabilities under the Securities Act or to contribute to payments the underwriter may be required to made in respect thereof. The underwriter has advised the Trust that it does not intend to confirm sales to any account over which they exercise discretionary authority in excess of 5% of the number of Trust Preferred Securities offered hereby. LEGAL MATTERS Certain legal matters will be passed upon for us by Elias, Matz, Tiernan & Herrick L.L.P., Washington, D.C., and for the underwriter by Thacher Proffitt & Wood. Certain matters of Delaware law relating to the validity of the Trust Preferred Securities will be passed upon on behalf of the Trust by Richards, Layton & Finger, P.A., special Delaware counsel to the Trust and us. EXPERTS The consolidated financial statements of Independent Bank Corp. and subsidiary incorporated by reference in our Annual Report on Form 10-K for the year ended December 31, 1998 and incorporated by reference in this prospectus have been audited by Arthur Andersen LLP, independent public accountants, as stated in their report appearing therein. 58 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 2,000,000 TRUST PREFERRED SECURITIES INDEPENDENT CAPITAL TRUST II % CUMULATIVE TRUST PREFERRED SECURITIES FULLY AND UNCONDITIONALLY GUARANTEED, AS DESCRIBED HEREIN, BY INDEPENDENT BANK CORP. ------------------ PROSPECTUS ------------------------ Legg Mason Wood Walker Incorporated , 1999 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- PART II INFORMATION NOT REQUIRED IN THE PROSPECTUS ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION. SEC registration fee........................................ $ 6,394 NASD fee.................................................... 3,400 Nasdaq fees................................................. 17,500 Trustees' fees and expenses................................. 6,000 Legal fees and expenses..................................... 110,000* Accounting fees and expenses................................ 45,000* Printing expenses........................................... 60,000* Miscellaneous expenses...................................... 26,706* -------- Total................................................... $275,000 ========
- ------------------------ * Estimated. ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS. Section 67 of the Massachusetts Business Corporation Law ("MBCL") sets forth certain circumstances under which directors, officers, employees and agents may be indemnified against liability which they may incur in their capacity as such. Section 67 of the MBCL provides as follows: INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES, ETC.--Indemnification of directors, officer, employees and other agents of a corporation and persons who serve at its request as directors, officers, employees or other agents of another organization or who serve at its request in any capacity with respect to any employee benefit plan, may be provided by it to whatever extent shall be specified in or authorized by (i) the articles of organization or (ii) a by-law adopted by the stockholders or (iii) a vote adopted by the holders of a majority of the shares of stock entitled to vote on the election of directors. Except as the articles of organization or by-laws otherwise require, indemnification of any persons referred to in the preceding sentence who are not directors of the corporation may be provided by it to the extent authorized by the directors. Such indemnification may include payment by the corporation of expenses incurred in defending a civil or criminal action or proceeding in advance of the final disposition of such action or proceeding, upon receipt of an undertaking by the person indemnified to repay such payment if he shall be adjudicated to be not entitled to indemnification under this section which undertaking may be accepted without reference to the financial ability of such person to make repayment. Any such indemnification may be provided although the person to be indemnified is no longer an officer, director, employee or agent of the corporation or of such other organization or no longer serves with respect to any such employee benefit plan. No indemnification shall be provided for any person with respect to any matter as to which he shall have been adjudicated in any proceeding not to have acted in good faith in the reasonable belief that his action was in the best interest of the corporation or to the extent that such matter relates to service with respect to an employee benefit plan, in the best interests of the participants or beneficiaries of such employee benefit plan. The absence of any express provision for indemnification shall not limit any right of indemnification existing independently of this section. A corporation shall have power to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or other agent of the corporation, or is or was serving II-1 at the request of the corporation as a director, officer, employee or other agent of another organization or with respect to any employee benefit plan against any liability incurred by him in any such capacity, or arising out of his status as such, whether or not the corporation would have the power to indemnify him against such liability. Article Twelve of the Company's By-laws, entitled "Indemnification of Directors, Officers and Others," provides as follows: The corporation shall, to the extent legally permissible, indemnify any person serving on who has served (i) as a Director or officer of the corporation, or (ii) at its request as a Director, trustee, officer, employee or other agent of another organization, or (iii) at its request in any capacity with respect to any employee benefit plan; against all liabilities and expenses including amounts paid in satisfaction of judgments, in compromise or as fines and penalties, and counsel fees reasonably incurred by him or her in connection with the defense or disposition of any action, suit or other proceeding, whether civil, criminal or administrative, in which he or she may be involved or with which he or she may be threatened, while serving or thereafter, by reason of his or her being or having been such a Director, officer, trustee, employee or agent, except with respect to any matter as to which he or she shall have been adjudicated in any proceeding not to have acted in good faith in the reasonable belief that his or her action was in the best interests of the corporation or to the extent that such matter relates to services with respect to an employee benefit plan, in the best interest of the participants or beneficiaries of such employee benefit plan; provided, however, that as to any matter disposed of by a compromise payment by such Director, officer, trustee, employee or agent, pursuant to a consent decree or otherwise, no indemnification either for said payment or for any other expenses shall be provided unless: (a) such compromise shall be approved as having been in the best interests of the corporation or employee benefit plan participants or beneficiaries, as the case may be, after notice that it involves such indemnification: (i) by a disinterested majority of the Directors then in office; or (ii) by the holders of a majority of the outstanding stock by the time entitled to vote for Directors, voting as a single class, exclusive of any stock owned by any interested Director or officer; or (b) in the absence of action by disinterested Directors or stockholders, there has been obtained at the request of a majority of the Directors then in office an opinion in writing of independent legal counsel to the effect that such Director or officer appears to have acted in good faith in the reasonable belief that his or her action was in the best interests of the corporation or employee benefit plan participants or beneficiaries, as the case may be. Expenses including counsel fees, reasonably incurred by any such Director, officer, trustee, employee or agent in connection with the defense or disposition of any such action, suit or other proceeding may be paid from time to time by the corporation in advance of the final disposition thereof upon receipt of an undertaking by such individual to repay the amounts so paid to the corporation if it is ultimately determined that indemnification for such expenses is not authorized under this section. The right of indemnification hereby provided shall not be exclusive of or affect any other rights to which any such Director, officer, trustee, employee or agent may be entitled. Nothing contained in this Article shall affect any rights to indemnification to which corporate personnel other than such Directors, officers, trustee, employees or agents may be entitled by contract or otherwise under law. As used in this Article the terms "Director," "officer," "trustee," "employee," and "agent" include their respective heirs, executors and administrators, and an "interested" Director, officer, trustee, employee or agent is one against whom in such capacity the proceedings in question or other proceeding on the same or similar grounds is then pending. II-2 ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
EXHIBIT NO. DESCRIPTION - ----------- ------------------------------------------------------------ 1 Form of Underwriting Agreement 4.1 Indenture of the Corporation relating to the Junior Subordinated Debentures 4.2 Form of Certificate of Junior Subordinated Debenture (included as Exhibit A to Exhibit 4.1) 4.3 Certificate of Trust of Independent Capital Trust II 4.4 Amended and Restated Declaration of Trust of Independent Capital Trust II 4.5 Form of Trust Preferred Security Certificate for Independent Capital Trust II (included as Exhibit A to Exhibit 4.4) 4.6 Form of Guarantee of the Corporation relating to the Trust Preferred Securities 5.1 Opinion and consent of Elias, Matz, Tiernan & Herrick L.L.P. as to legality of the Junior Subordinated Debentures and the Guarantee to be issued by the Corporation 5.2 Opinion of Richards, Layton & Finger P.A. as to legality of the Trust Preferred Securities to be issued by Independent Capital Trust II 8 Opinion of Elias, Matz, Tiernan & Herrick L.L.P. as to certain federal income tax matters 10 Purchase and Assumption Agreement by and among Independent Bank Corp., Rockland Trust Company, Fleet Financial Group, Inc., Fleet National Bank and BankBoston, N.A., dated September 27, 1999(1) 12.1 Computation of ratio of earnings to fixed charges (excluding interest on deposits) 12.2 Computation of ratio of earnings to fixed charges (including interest on deposits) 23.1 Consent of Arthur Andersen LLP 23.2 Consent of Elias, Matz, Tiernan & Herrick L.L.P. (included in Exhibit 5.1) 23.3 Consent of Richards, Layton & Finger P.A. (included in Exhibit 5.2) 24 Power of Attorney of certain officers and directors of the Corporation (located on the signature page hereto) 25.1 Form T-1 Statement of Eligibility of The Bank of New York to act as trustee under the Indenture 25.2 Form T-1 Statement of Eligibility of The Bank of New York to act as trustee under the Declaration of Trust of Independent Capital Trust II 25.3 Form T-1 Statement of Eligibility of The Bank of New York under the Guarantee for the benefit of the holders of the Trust Preferred Securities
- ------------------------ (1) Incorporated by reference from the current Report on Form 8-K filed by the Corporation with the Securities and Exchange Commission on October 1, 1999. II-3 ITEM 17. UNDERTAKINGS Each of the undersigned Registrants hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, as amended, each filing of a Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in this Registration Statement shall be deemed to be a new registration statement relating to the securities offered herein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of each undersigned Registrant pursuant to the provisions, or otherwise, each Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by each undersigned Registrant of expenses incurred or paid by a director, officer of controlling person of each Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, each Registrant will, unless in the opinion of its counsel the matter has been settled by the controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the Registrants pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act of 1933 shall be deemed to be part of this registration statement as of the time it was declared effective. For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. II-4 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, Independent Bank Corp. certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Rockland, Commonwealth of Massachusetts on the 28th day of October 1999. INDEPENDENT BANK CORP. By: /s/ DOUGLAS H. PHILIPSEN ----------------------------------------- Douglas H. Philipsen CHAIRMAN OF THE BOARD, CHIEF EXECUTIVE OFFICER AND PRESIDENT
Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated. Each of the directors and/or officers of Independent Bank Corp. whose signature appears below hereby appoints Douglas H. Philipsen and Richard J. Seaman, and each of them severally, as his or her attorney-in-fact to sign in his or her name and behalf, in any and all capacities stated below and to file with the Securities and Exchange Commission any and all amendments, including post-effective amendments, to this Registration Statement on Form S-3, making such changes in the Registration Statement as appropriate, and generally to do all such things in their behalf in their capacities as directors and/or officers to enable Independent Bank Corp. to comply with the provisions of the Securities Act of 1933, and all requirements of the Securities and Exchange Commission. /s/ RICHARD S. ANDERSON Date: October 28, 1999 - -------------------------------------------- Richard S. Anderson Director /s/ DONALD K. ATKINS Date: October 28, 1999 - -------------------------------------------- Donald K. Atkins Director /s/ W. PAUL CLARK Date: October 28, 1999 - -------------------------------------------- W. Paul Clark Director /s/ ROBERT L. CUSHING Date: October 28, 1999 - -------------------------------------------- Robert L. Cushing Director
II-5 /s/ BENJAMIN A. GILMORE, II Date: October 28, 1999 - -------------------------------------------- Benjamin A. Gilmore, II Director /s/ LAWRENCE M. LEVINSON Date: October 28, 1999 - -------------------------------------------- Lawrence M. Levinson Director /s/ DOUGLAS H. PHILIPSEN Date: October 28, 1999 - -------------------------------------------- Douglas H. Philipsen Chairman, Chief Executive Officer and President /s/ RICHARD H. SGARZI Date: October 28, 1999 - -------------------------------------------- Richard H. Sgarzi Director /s/ ROBERT J. SPENCE Date: October 28, 1999 - -------------------------------------------- Robert J. Spence Director /s/ WILLIAM J. SPENCE Date: October 28, 1999 - -------------------------------------------- William J. Spence Director /s/ BRIAN S. TEDESCHI Date: October 28, 1999 - -------------------------------------------- Brian S. Tedeschi Director /s/ THOMAS J. TEUTEN Date: October 28, 1999 - -------------------------------------------- Thomas J. Teuten Director /s/ RICHARD J. SEAMAN Date: October 28, 1999 - -------------------------------------------- Richard J. Seaman Chief Financial Officer and Treasurer (principal financial and accounting officer)
II-6 Pursuant to the requirements of the Securities Act of 1933, Independent Capital Trust II certifies that it has reasonable grounds to believe that it meets all the requirements for filing on Form S-3 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Rockland, Commonwealth of Massachusetts, on the 28th day of October 1999. INDEPENDENT CAPITAL TRUST II By: /s/ DOUGLAS H. PHILIPSEN ----------------------------------------- Douglas H. Philipsen ADMINISTRATIVE TRUSTEE By: /s/ RICHARD J. SEAMAN ----------------------------------------- Richard J. Seaman ADMINISTRATIVE TRUSTEE By: /s/ RUSSELL N. VIAU ----------------------------------------- Russell N. Viau ADMINISTRATIVE TRUSTEE
II-7 EX-1 2 EXHIBIT-1 Exhibit 1 ------------------------------------- INDEPENDENT BANK CORP. (a Massachusetts corporation); and INDEPENDENT CAPITAL TRUST II (a Delaware statutory business trust) 2,000,000 ____% Cumulative Trust Preferred Securities UNDERWRITING AGREEMENT Dated: __________, 1999 ------------------------------------- EXHIBIT 1 INDEPENDENT BANK CORP. (a Massachusetts corporation); and INDEPENDENT CAPITAL TRUST II (a Delaware statutory business trust) 2,000,000 ____% Cumulative Trust Preferred Securities (Liquidation Amount $10 Per Cumulative Preferred Security) UNDERWRITING AGREEMENT ______, 1999 LEGG MASON WOOD WALKER, INCORPORATED c/o Legg Mason Wood Walker, Incorporated 1747 Pennsylvania Avenue N.W. Washington, D.C. 20006 Attention: Mark C. Micklem, Managing Director Ladies and Gentlemen: Independent Capital Trust II (the "Trust"), a statutory business trust organized under the Delaware Business Trust Act, 12 Del. C. ss.ss. 3801 ET SEQ. (the "Delaware Act"), confirms its agreement with you and Legg Mason Wood Walker, Incorporated ("Legg Mason") with respect to the issuance and sale by the Trust, and the purchase by the Underwriter of the respective numbers of _____ % Cumulative Trust Preferred Securities (liquidation amount $10 per preferred security) set forth in Schedule A hereto and the grant by the Trust to the Underwriter, of the option described in Section 2(b) hereof to purchase all or any part of 300,000 additional Preferred Securities to cover overallotments, if any. The aforesaid 2,000,000 preferred securities (the "Initial Preferred Securities") to be purchased by the Underwriter and all or any part of the 300,000 preferred securities subject to the option described in Section 2(b) hereof (the "Optional Preferred Securities") are hereinafter called, collectively, the "Preferred Securities." The Preferred Securities are more fully described in the Prospectus (as defined below). The Preferred Securities will be guaranteed by Independent Bank Corp. (the "Company"), to the extent set forth in the Prospectus (as defined below), with respect to distributions and amounts payable upon liquidation or redemption (the "Preferred Securities Guarantee") pursuant to the Preferred Securities Guarantee Agreement (the "Preferred Securities Guarantee Agreement") to be dated as of Closing Time (as defined below) executed and delivered by the Company and The Bank of New York (the "Guarantee Trustee"), a New York banking corporation, not in its individual capacity but solely as trustee for the benefit of the holders from time to time of the Preferred Securities. The Company and the Trust each understand that the Underwriter proposes to make a public offering of the Preferred Securities as soon as it deems advisable after this Agreement has been executed and delivered, and the Declaration (as defined herein), the Indenture (as defined herein), and the Preferred Securities Guarantee Agreement have been qualified under the Trust Indenture Act of 1939, as amended (the "1939 Act"). The entire proceeds from the sale of the Preferred Securities will be combined with the entire proceeds from the sale by the Trust to the Company of its common securities (the "Common Securities") guaranteed by the Company, to the extent set forth in the Prospectus, with respect to distributions and amounts payable upon liquidation or redemption (the "Common Securities Guarantee" and, together with the Preferred Securities Guarantee, the "Guarantees") pursuant to the Common Securities Guarantee Agreement (the "Common Securities Guarantee Agreement" and, together with the Preferred Securities Guarantee Agreement, the "Guarantee Agreements"), to be dated as of Closing Time, executed and delivered by the Company for the benefit of the holders from time to time of the Common Securities, and will be used by the Trust to purchase the ____% Junior Subordinated Deferrable Interest Debentures due 2029 (the "Junior Subordinated Debentures") issued by the Company. The Preferred Securities and the Common Securities will be issued pursuant to the Amended and Restated Declaration of Trust of the Trust, to be dated as of Closing Time (the "Declaration"), among the Company, as Sponsor, The Bank of New York, as property trustee (the "Property Trustee"), The Bank of New York (Delaware), as Delaware trustee (the "Delaware Trustee"), and Douglas H. Philipsen, Richard J. Seaman and Russell N. Viau, as administrative trustees (the "Administrative Trustees" and together with the Property Trustee and the Delaware Trustee, the "Trustees"), and the holders from time to time of undivided beneficial interests in the assets of the Trust. The Junior Subordinated Debentures will be issued pursuant to an Indenture, to be dated as of Closing Time (the "Indenture"), between the Company and The Bank of New York, as debenture trustee (the "Debenture Trustee"). The Preferred Securities, the Preferred Securities Guarantee and the Junior Subordinated Debentures are collectively referred to herein as the "Securities." The Trust and the Company are collectively referred to herein as the "Offerors." The Indenture, the Declaration and this Agreement are collectively referred to herein as the "Operative Documents." Capitalized terms used herein without definition have the respective meanings specified in the Prospectus. The Company and the Trust have filed with the Securities and Exchange Commission (the "Commission") a registration statement on Form S-3 (Nos. 333-_____and 333-_____-01) covering the registration of the Securities under the Securities Act of 1933, as amended (the "1933 Act"), including the related preliminary prospectus. Promptly after execution and deliver of this Agreement, the Company will either (i) prepare and file a prospectus in accordance with the provisions of Rule 430A ("Rule 430A") and the rules and regulations of the Commission under the 1933 Act (the "1933 Act Regulations") and paragraph (b) of Rule 424 ("Rule 424(b)") of the 1933 Act Regulations or (ii) if the Company and the Trust have elected to rely upon Rule 434 ("Rule 434") of the 1933 Act Regulations, prepare and file a term sheet (a "Term Sheet") in accordance with the provisions of Rule 434 and Rule 424(b). The information included in such prospectus or in such Term Sheet, as the case may be, that was omitted from such registration statement at the time it became effective but that is deemed to be part of such registration statement at the time it became effective (a) pursuant to paragraph (b) of Rule 430A is referred to as "Rule 430A Information" or (b) pursuant to paragraph (d) of Rule 434 is referred to as "Rule 434 Information." Each prospectus used before such registration statement became effective, and any prospectus that omitted, as 2 applicable, the Rule 430A Information or the Rule 434 Information that was used after such effectiveness and prior to the execution and delivery of this Agreement, is herein called a "preliminary prospectus." Such registration statement, including the exhibits thereto and schedules thereto, if any, at the time it became effective and including the Rule 430A Information and the Rule 434 Information, as applicable, is herein called the "Registration Statement." Any registration statement filed pursuant to Rule 462(b) of the 1933 Act Regulations is herein referred to as the "Rule 462(b) Registration Statement" and after such filing the term "Registration Statement" shall include the Rule 462(b) Registration Statement". The final prospectus in the form first furnished to the Underwriters for use in connection with the offering of the Preferred Securities is herein call the "Prospectus." If Rule 434 is relied on, the term "Prospectus" shall refer to the preliminary prospectus dated __________, 1999 together with the Term Sheet and all references in this Agreement to the date of the Prospectus shall mean the date of the Term Sheet. For purposes of this Agreement, all references to the Registration Statement, any preliminary prospectus, the Prospectus or any Term Sheet or any amendment or supplement to any of the foregoing shall be deemed to include the copy filed with the Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval system ("EDGAR"). SECTION 1. REPRESENTATIONS AND WARRANTIES. (a) The Offerors jointly and severally represent and warrant to the Underwriter as of the date hereof, as of the Closing Time referred to in Section 2(c) hereof and as of each Date of Delivery (if any) referred to in Section 2(b) hereof, and agree with the Underwriter as follows: (i) COMPLIANCE WITH REGISTRATION REQUIREMENTS. Each of the Registration Statement and any Rule 462(b) Registration Statement has become effective under the 1933 Act and no stop order suspending the effectiveness of the Registration Statement or any Rule 462(b) Registration Statement has been issued under the 1933 Act and no proceedings for that purpose have been instituted or are pending or, to the knowledge of the Company, are contemplated by the Commission, and any request on the part of the Commission for additional information has been complied with. At the respective times the Registration Statement, any Rule 462(b) Registration Statement and any post-effective amendments thereto became effective and at the Closing Time (and, if any Optional Preferred Securities are purchased, at the Date of Delivery), the Registration Statement, the Rule 462(b) Registration Statement, if any, and any amendments and supplements thereto complied and will comply in all material respects with the requirements of the 1933 Act and the 1933 Act Regulations and did not and will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading. Neither the Prospectus nor any amendments or supplements thereto, at the time the Prospectus or any such amendment or supplement was issued and at the Closing Time (and, if any Optional Preferred Securities are purchased, at the Date of Delivery), included or will include an untrue statement of a material fact or omitted or will omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. If Rule 434 is used, the Company will comply with the requirements 3 of Rule 434 and the Prospectus shall not be "materially different," as such term is used in Rule 434, from the prospectus included in the Registration Statement at the time it became effective. The representations and warranties in this subsection shall not apply (A) to statements in or omissions from the Registration Statement or Prospectus made in reliance upon and in conformity with information furnished to the Trust or the Company in writing by the Underwriter expressly for use in the Registration Statement or Prospectus and (B) that part of the Registration Statement which shall constitute the Statements of Eligibility (Forms T-1) under the 1939 Act. Each preliminary prospectus and the prospectus filed as part of the Registration Statement as originally filed or as part of any amendment thereto, or filed pursuant to Rule 424 under the 1933 Act, complied when so filed in all material respects with the 1933 Act Regulations and, if applicable, each preliminary prospectus and the Prospectus delivered to the Underwriter for use in connection with this offering was substantively identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T. (ii) INDEPENDENT ACCOUNTANTS. The accountants who certified the financial statements incorporated by reference in the Prospectus are independent public accountants within the meaning of the 1933 Act and the 1933 Act Regulations. (iii) FINANCIAL STATEMENTS. The consolidated historical financial statements, together with the related schedules and notes, incorporated by reference in the Prospectus present fairly, in all material respects, the consolidated financial position of the Company and its consolidated subsidiaries at the dates indicated, and the statements of income, changes in stockholders' equity and cash flows of the Company and its consolidated subsidiaries for the periods specified, said financial statements have been prepared in conformity with generally accepted accounting principles ("GAAP") in the United States applied on a consistent basis throughout the periods involved, except as disclosed in the notes to such financial statements; the supporting schedules, if any, included in the Prospectus present fairly, in all material respects, the information required to be stated therein; and the summary financial data included in the Prospectus present fairly, in all material respects, the information shown therein and have been compiled on a basis consistent with that of the audited financial statements incorporated by reference in the Prospectus. (iv) NO MATERIAL ADVERSE CHANGE IN BUSINESS. Since the respective dates as of which information is given in the Prospectus, except as otherwise stated therein or contemplated thereby, there has not been (A) any material adverse change in the financial condition, or in the earnings, business affairs or business prospects of the Trust, or of the Company and its subsidiaries, considered as one enterprise, whether or not arising in the ordinary course of business (a "Material Adverse Effect"), (B) any transaction entered into by the Trust, the Company or any of its subsidiaries, other than in the ordinary course of business, that is material to the Trust, or to the Company and its subsidiaries, considered as one enterprise, or (C) any dividend or distribution of 4 any kind declared, paid or made by the Company on any class of its capital stock, other than regular quarterly dividends on the Company's common stock. (v) GOOD STANDING OF THE COMPANY. The Company has been duly organized and is validly existing as a corporation in good standing under the laws of the Commonwealth of Massachusetts and has corporate power and authority to own, lease and operate its properties and to conduct its business as described in the Prospectus and to enter into and perform its obligations under each of the Operative Documents to which it is a party; the Company is duly registered as a bank holding company under the Bank Holding Company Act of 1956, as amended. (vi) GOOD STANDING OF THE BANK. Rockland Trust Company (the "Bank") has been duly organized and is validly existing as a trust company in good standing under the laws of the Commonwealth of Massachusetts and has full power and authority under such laws to own, lease and operate its properties and to conduct its business as now being conducted and as described in the Prospectus. (vii) NO OTHER SIGNIFICANT SUBSIDIARIES. There are no significant subsidiaries" of the Company (as such term is defined in Rule 1-02 of Regulation S-X) other than the Bank. The subsidiaries of the Company other than the Bank, considered in the aggregate as a single subsidiary, do not constitute a "significant subsidiary" as defined in Rule 1-02 of Regulation S-X. (viii) FOREIGN QUALIFICATIONS. The Company and the Bank are each duly qualified as a foreign corporation to transact business and are each in good standing in each jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure to so qualify or be in good standing would not result in a Material Adverse Effect (as defined in Section 1(a)(iv) hereof). (ix) CAPITAL STOCK DULY AUTHORIZED AND VALIDLY ISSUED. All of the issued and outstanding capital stock of the Company has been duly authorized and validly issued and is fully paid and nonassessable and none of the capital stock of the Company was issued in violation of the preemptive rights or similar rights arising by operation of law, under the Articles of Organization or bylaws of the Company or under any agreement to which the Company is a party. All of the issued and outstanding capital stock of the Bank has been duly authorized and validly issued, is fully paid and nonassessable and is owned by the Company, directly or through subsidiaries, free and clear of any security interest, mortgage, pledge, lien, encumbrance, claim or equitable right; and none of such outstanding shares of capital stock of the Bank was issued in violation of any preemptive or similar rights arising by operation of law, or under the charter or by-laws of the Company or the Bank or under any agreement to which the Company or the Bank is a party. (x) CAPITALIZATION. The authorized, issued and outstanding capital stock of the Company as of September 30, 1999 is as set forth in the Prospectus under "Capitalization," and there have not been any subsequent issuances of capital stock of the Company except for 5 subsequent issuances, if any, pursuant to any dividend reinvestment plan, reservations, agreements, conversions, stock dividends or employee or director benefit plans. (xi) GOOD STANDING OF THE TRUST. The Trust has been duly created and is validly existing in good standing as a business trust under the Delaware Act with the power and authority to own property and to conduct its business as described in the Prospectus and to enter into and perform its obligations under the Operative Documents, as applicable, and the Preferred Securities; the Trust is not a party to or otherwise bound by any material agreement other than those described in the Prospectus; and the Trust is, and will be, under current law, classified for United States federal income tax purposes as a grantor trust and not as an association taxable as a corporation. (xii) AUTHORIZATION OF COMMON SECURITIES. The Common Securities have been duly authorized for issuance by the Trust pursuant to the Declaration and, when certificates therefor have been issued, executed and authenticated in accordance with the Declaration and delivered by the Trust to the Corporation against payment therefor in accordance with the Common Securities Subscription Agreement, will be validly issued and fully paid and nonassessable undivided beneficial ownership interests in the assets of the Trust. The issuance of the Common Securities is not subject to preemptive or other similar rights, and, at the Closing Time, all of the issued and outstanding Common Securities of the Trust will be directly owned by the Company free and clear of any security interest, mortgage, pledge, lien, encumbrance, claim or equitable right. (xiii) AUTHORIZATION OF PREFERRED SECURITIES. At the Closing Time, the Preferred Securities will have been duly authorized for issuance by the Trust pursuant to the Declaration, and the Preferred Securities, when certificates therefore have been issued, executed and authenticated in accordance with the Declaration and delivered against payment therefor as provided herein, will be validly issued and fully paid and nonassessable undivided beneficial ownership interests in the assets of the Trust and will conform to the description thereof in the Prospectus. The issuance of the Preferred Securities will not be subject to preemptive or other similar rights. (xiv) AUTHORIZATION OF AGREEMENT. This Agreement has been duly authorized, executed and delivered by the Offerors. (xv) AUTHORIZATION OF DECLARATION. The Declaration has been qualified under the 1939 Act and has been duly authorized by the Company and, at the Closing Time, will have been duly executed and delivered by the Company and the Trustees, and assuming due authorization, execution and delivery of the Declaration by the Trustees, the Declaration will, at the Closing Time, be a valid and binding agreement of the Company, enforceable against the Company in accordance with its terms, except to the extent that enforceability may be limited by (a) bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or other similar laws now or hereafter in effect relating to creditors' rights generally, (b) general principles of equity (regardless of whether enforceability is considered in a proceeding at law or in equity) and (c) any public policy underlying applicable federal or state laws (collectively, the "Enforceability Exceptions"). 6 (xvi) AUTHORIZATION OF GUARANTEES. The Preferred Securities Guarantee has been qualified under the 1939 Act and each of the Guarantees has been duly authorized by the Company; at the Closing Time, each of the Guarantees will have been duly executed and delivered by the Company and will constitute a valid and binding agreement of the Company, enforceable against the Company in accordance with its terms, except to the extent that enforceability may be limited by the Enforceability Exceptions; and the Preferred Securities Guarantee will conform in all material respects to the description thereof in the Prospectus. (xvii) AUTHORIZATION OF INDENTURE. The Indenture has been qualified under the 1939 Act and has been duly authorized by the Company and, at the Closing Time, will have been duly executed and delivered by the Company and will constitute a valid, legal and binding agreement of the Company, enforceable against the Company in accordance with its terms, except to the extent that enforceability may be limited by the Enforceability Exceptions. (xviii) AUTHORIZATION OF DEBENTURES. The Junior Subordinated Debentures have been duly authorized by the Company; at the Closing Time, the Junior Subordinated Debentures will have been duly executed by the Company and, when authenticated in the manner provided for in the Indenture and delivered by the Company to the Trust against payment therefor as described in the Prospectus, will constitute valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, except to the extent that enforceability may be limited by the Enforceability Exceptions; and the Junior Subordinated Debentures will be in the form contemplated by, and entitled to the benefits of, the Indenture and will conform in all material respects to the descriptions thereof in the Prospectus. (xix) AUTHORIZATION OF TRUSTEES. Each of the Administrative Trustees of the Trust is an officer of the Company and has been duly authorized by the Company to execute and deliver the Declaration. (xx) TRUST AND CORPORATION NOT INVESTMENT COMPANY. Neither the Trust nor the Company is, and immediately following consummation of the transactions contemplated hereby and the application of the net proceeds as described in the Prospectus neither the Trust nor the Company will be, an "investment company" or a company "controlled" by an "investment company" which is required to be registered under the Investment Company Act of 1940, as amended (the "1940 Act"). (xxi) ACCURACY OF DISCLOSURE. The Operative Documents conform in all material respects to the descriptions thereof contained in the Prospectus. (xxii) ABSENCE OF DEFAULTS AND CONFLICTS. The Trust is not in violation of the trust certificate of the Trust filed with the State of Delaware (the "Trust Certificate") or the Declaration, and neither the Company nor the Bank is in violation of its charter or by-laws; none of the Trust, the Company or the Bank is in default in the performance or observance of any obligation, agreement, covenant or condition contained in any contract, indenture, mortgage, deed of trust, 7 loan or credit agreement, note, lease or other agreement or instrument to which it is a party or by which it or any of them may be bound, or to which any of its property or assets is subject (collectively, "Agreements and Instruments"), except for such defaults under Agreements and Instruments that would not result in a Material Adverse Effect; and the execution, delivery and performance of the Operative Documents by the Trust or the Company, as the case may be, the issuance, sale and delivery of the Preferred Securities, the Junior Subordinated Debentures, the Preferred Securities Guarantee and the Common Securities Guarantee, the consummation of the transactions contemplated by the Operative Documents and compliance by the Offerors with the terms of the Operative Documents to which they are a party have been duly authorized by all necessary corporate action on the part of the Company and, at the Closing Time, will have been duly authorized by all necessary action on the part of the Trust and do not and will not, whether with or without the giving of notice or passage of time or both, violate, conflict with or constitute a breach of, or default or Repayment Event (as defined below) under, or result in the creation or imposition of any security interest, mortgage, pledge, lien, charge, encumbrance, claim or equitable right upon any property or assets of the Trust, the Company or any of its subsidiaries pursuant to any of the Agreements and Instruments (except for such conflicts, breaches or defaults or liens, charges or encumbrances that would not result in a Material Adverse Effect), nor will such action result in any violation of the provisions of the charter or by-laws of the Company or any of its subsidiaries or the Declaration or the Trust Certificate, or violation by the Company or any of its subsidiaries of any applicable law, statute, rule, regulation, judgment, order, writ or decree of any government, government authority, agency or instrumentality or court, domestic or foreign, including, without limitation, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation and the Commissioner of Banks of the Commonwealth of Massachusetts, having jurisdiction over the Trust, the Company, the Company's subsidiaries, or their respective properties (collectively, "Governmental Entities"). As used herein, a "Repayment Event" means any event or condition which gives the holder of any note, debenture or other evidence of indebtedness (or any person acting on such holder's behalf) the right to require the repurchase, redemption or repayment of all or a portion of such indebtedness by the Trust, the Company or any of its subsidiaries. (xxiii) ABSENCE OF LABOR DISPUTES. No labor dispute with the employees of the Company or any of its subsidiaries exists or, to the knowledge of the Company, is imminent, which may reasonably be expected to result in a Material Adverse Effect. (xxiv) ABSENCE OF PROCEEDINGS. There is no action, suit, proceeding, inquiry or investigation before or brought by any Governmental Entity now pending, or, to the knowledge of the Trust or the Company, threatened, against or affecting the Trust or the Company or any of its subsidiaries, which is not disclosed in the Prospectus and which in the reasonable judgment of the Trust or the Company might result in a Material Adverse Effect, or which, in the reasonable judgment of the Company might materially and adversely affect the properties or assets thereof or the consummation of the transactions contemplated by the Operative Documents or the performance by the Trust or the Company of its obligations hereunder or thereunder; the aggregate of all pending legal or governmental proceedings to which the Trust or the Company or any of its 8 subsidiaries is a party or of which any of their respective properties or assets is the subject which are not described in the Prospectus, including ordinary routine litigation incidental to the business, are not, in the reasonable judgement of the Company or the Trust, expected to result in a Material Adverse Effect. (xxv) ABSENCE OF FURTHER REQUIREMENTS. No filing with, or authorization, approval, consent, license, order, registration, qualification or decree of, any Governmental Entity, other than those that have been made or obtained, is necessary or required for the performance by the Trust or the Company of their obligations under the Operative Documents, as applicable, or the consummation by the Trust and the Company of the transactions contemplated by the Operative Documents. (xxvi) POSSESSION OF LICENSES AND PERMITS. The Trust, the Company and the Bank possess such permits, licenses, approvals, consents and other authorizations (collectively, "Governmental Licenses") issued by the appropriate Governmental Entities necessary to conduct the business now operated by them; the Trust, the Company and the Bank are in compliance with the terms and conditions of all such Governmental Licenses, except where the failure so to comply would not, singly or in the aggregate, have a Material Adverse Effect; all of the Governmental Licenses are valid and in full force and effect, except when the invalidity of such Governmental Licenses or the failure of such Governmental Licenses to be in full force and effect would not have a Material Adverse Effect; and neither the Trust, the Company nor the Bank has received any notice of proceedings relating to the revocation or modification of any such Governmental Licenses which, singly or in the aggregate, in the reasonable judgment of the Company, is likely to result in a Material Adverse Effect. (xxvii) NO OTHER AGREEMENTS. Other than such agreements, contracts and other documents as are described in the Prospectus or otherwise filed as exhibits to the Company's annual report on Form 10-K or quarterly reports on Form 10-Q or current reports on Form 8-K incorporated by reference in the Prospectus, there are no agreements, contracts or documents of a character described in Item 601 of Regulation S-K of the Commission to which the Company or the Bank is a party. (xxviii) TITLE TO PROPERTY. Each of the Trust, the Company and its subsidiaries has good and marketable title to all of their respective real and personal properties, in each case free and clear of all liens, encumbrances and defects, except as stated in the Prospectus, or such as do not materially affect the value of such properties in the aggregate to the Trust, or to the Company and its subsidiaries considered as one enterprise; and all of the leases and subleases material to the business of the Trust, and to the Company and its subsidiaries, considered as one enterprise, and under which either of the Offerors or any of such subsidiaries holds properties described in the Prospectus, are in full force and effect and neither the Offerors nor such subsidiaries have any notice of any material claim of any sort that has been asserted by anyone adverse to the rights of the Offerors or such subsidiaries under any of the leases or subleases mentioned above, or affecting or questioning the rights of such entity to the continued possession of the leased or subleased 9 premises under any such lease or sublease, which individually or in the aggregate might result in a Material Adverse Effect. (xxix) REGULATION M. The Company has not taken and will not take, directly or indirectly, any action designed to, or that might be reasonably expected to, cause or result in stabilization or manipulation of the price of the Preferred Securities. (xxx) INTELLECTUAL PROPERTY. Each of the Trust, the Company and the subsidiaries of the Company own or possess, or can acquire on reasonable terms, adequate patents, licenses, trademarks, service marks, or trade names (collectively, "Intellectual Property") presently employed by them in connection with the business now operated by them or reasonably necessary in order to conduct such business, and neither the Trust, the Company nor any of the Company's subsidiaries has received any notice or is otherwise aware of any infringement of or conflict with asserted rights of others with respect to any Intellectual Property or of any facts or circumstances which would render any Intellectual Property invalid or inadequate to protect the interest of the Trust, the Company or any of its subsidiaries therein, and which infringement or conflict (if the subject of any unfavorable decision, ruling or finding) or invalidity or inadequacy, singly or in the aggregate, in the reasonable judgment of the Company, is likely to result in a Material Adverse Effect. (xxxi) YEAR 2000. The computer software operated by the Company and any subsidiary which is material to the conduct of the business of the Company and any subsidiary is in compliance in all material respects with all relevant Federal Financial Institutions Examination Council guidance and requirements relating to the Year 2000 computer issues. (b) Any certificate signed by any Trustee of the Trust or any duly authorized officer of the Company or any of its subsidiaries and delivered to you or to counsel for the Underwriter shall be deemed a representation and warranty by the Trust or the Company, as the case may be, to the Underwriter as to the matters covered thereby. SECTION 2. SALE AND DELIVERY TO UNDERWRITER; CLOSING. (a) INITIAL PREFERRED SECURITIES. On the basis of the representations and warranties herein contained and subject to the terms and conditions herein set forth, the Trust agrees to sell to the Underwriter, and the Underwriter agrees to purchase from the Trust, at the purchase price of $10 per Initial Preferred Security, the number of Initial Preferred Securities set forth in Schedule A opposite the name of the Underwriter, plus any additional number of Initial Preferred Securities which the Underwriter may become obligated to purchase pursuant to the provisions of Section 10 hereof, subject, in each case, to such adjustments to the Underwriter as it in its sole discretion shall make to eliminate any sales or purchases of fractional securities. As compensation to the Underwriter for its commitments hereunder and in view of the fact that the proceeds of the sale of the Preferred Securities will be used to purchase the Junior Subordinated Debentures, the Company hereby agrees to pay at the Closing Time and at any Date of 10 Delivery to the Underwriter a commission of $____ per Preferred Security purchased by the Underwriter by wire transfer of immediately available funds. (b) OPTIONAL PREFERRED SECURITIES. In addition, on the basis of the representations and warranties herein contained and subject to the terms and conditions herein set forth, the Trust hereby grants an option to the Underwriter to purchase up to 300,000 Optional Preferred Securities at the price per share set forth in the immediately preceding paragraph. The option hereby granted will expire 30 days after the date hereof and may be exercised in whole or in part, but only once, solely for the purpose of covering over-allotments which may be made in connection with the offering and distribution of the Initial Preferred Securities, upon notice by the Underwriter to the Trust setting forth the number of Optional Preferred Securities as to which the Underwriter is exercising the option and the time and date of payment and delivery for such Optional Preferred Securities. Any such time and date of delivery (a "Date of Delivery") shall be determined by the Underwriter, but shall not be later than seven full business days after the exercise of said option, nor in any event prior to the Closing Time. If the option is exercised as to all or any portion of the Optional Preferred Securities, the Underwriter will purchase and the Trust agrees to sell to the Underwriter that proportion of the total number of Optional Preferred Securities to be sold by the Trust which the number of Initial Preferred Securities set forth in Schedule A opposite the name of the Underwriter bears to the total number of Initial Preferred Securities, subject in each case to such adjustments as the Underwriter in its discretion shall make to eliminate any sales or purchases of fractional shares. (c) PAYMENT. Payment of the purchase price for, and delivery of certificates for the Initial Preferred Securities shall be made at the offices of Elias, Matz, Tiernan & Herrick L.L.P. in Washington, D.C., or at such other place as shall be agreed upon by the Underwriter and the Offerors, at 9:00 a.m., Washington, D.C. time, on ________, 1999 (unless postponed in accordance with the provisions of Section 10 hereof), or such other time not later than ten (10) business days after such date as shall be agreed upon by the Underwriter and the Offerors (such time and date of payment and delivery being herein called the "Closing Time"). In addition, in the event that any or all of the Optional Preferred Securities are purchased by the Underwriter, payment of the purchase price for, and delivery of certificates for, such Optional Preferred Securities shall be made at the above-mentioned offices, or at such other place as shall be agreed upon by the Underwriter and the Offerors on the Date of Delivery as specified in the notice from the Underwriter to the Offerors. Payment shall be made to the Trust by wire transfer of immediately available funds, to the order of the Trust, to a bank designated by the Company, against delivery to the Underwriter through the facilities of the Depository Trust Company ("DTC") of certificates for the Preferred Securities to be purchased by them. (d) DENOMINATIONS, REGISTRATION. Certificates for the Initial Preferred Securities and the Optional Preferred Securities, if any, shall be in definitive form, and in such denominations and registered in such names as the Underwriter may request in writing at least one business day before the Closing Time 11 or the Date of Delivery, as the case may be. All such certificates shall be made available for examination and packaging by the Underwriter at the office of DTC or its designated custodian not later than 10:00 a.m. on the last business day prior to the Closing Time or the Date of Delivery, as the case may be. SECTION 3. COVENANTS OF THE OFFERORS. The Offerors jointly and severally covenant with the Underwriter as follows: (a) COMPLIANCE WITH SECURITIES REGULATIONS AND COMMISSION REQUESTS. The Company and the Trust, subject to Section 3(b) hereof, will comply with the requirements of Rule 430A or Rule 434, as applicable, and will notify the Underwriter immediately, and confirm the notice in writing, (i) when any post-effective amendment to the Registration Statement shall become effective, or any supplement to the Prospectus or any amended Prospectus shall have been filed, (ii) of the receipt of any comments from the Commission, (iii) of any request by the Commission for any amendment to the Registration Statement or any amendment or supplement to the Prospectus or for additional information, and (iv) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or of any order preventing or suspending the use of any preliminary prospectus, or of the suspension of the qualification of the Preferred Securities for offering or sale in any jurisdiction, or of the initiation or threatening of any proceedings for any of such purposes. The Company and the Trust will promptly effect the filings necessary pursuant to Rule 424(b) and will take such steps as it deems necessary to ascertain promptly whether the form of prospectus transmitted for filing under Rule 424(b) was received for filing by the Commission and, in the event that it was not, it will promptly file such prospectus. The Company and the Trust will make every reasonable effort to prevent the issuance of any stop order and, if any stop order is issued, to obtain the lifting thereof at the earliest possible moment. (b) FILING OF AMENDMENTS. The Company and the Trust will give the Underwriter notice of their intention to file or prepare any amendment to the Registration Statement (including any filing under Rule 462(b)), any Term Sheet or any amendment, supplement or revision to either the prospectus included in the Registration Statement at the time it became effective or to the Prospectus, whether pursuant to the 1933 Act or otherwise, will furnish the Underwriter with copies of any such documents a reasonable amount of time prior to such proposed filing or use, as the case may be, and will not file or use any such document to which the Underwriter or counsel for the Underwriter shall reasonably object. (c) DELIVERY OF REGISTRATION STATEMENTS. The Company has furnished or will deliver to the Underwriter and counsel for the Underwriter, without charge, two copies of the Registration Statement as originally filed and of each amendment thereto (including exhibits filed therewith or incorporated by reference therein) and copies of all consents and certificates of experts, and will also deliver to the Underwriter, without charge, a conformed copy of the Registration Statement as originally filed and of each amendment thereto (without exhibits) for the Underwriter. The copies of the Registration Statement and each amendment thereto furnished to the Underwriter will be substantively identical to the electronically transmitted copies thereof filed with the Commis sion pursuant to EDGAR, except to the extent permitted by Regulation S-T. 12 (d) DELIVERY OF PROSPECTUSES. The Offerors, as promptly as possible, will furnish to the Underwriter, without charge, such number of copies of the preliminary prospectus, the final Prospectus and any amendments and supplements thereto and documents incorporated by reference therein as the Underwriter may reasonably request, and the Company and the Trust hereby consent to the use of such copies for purposes permitted by the 1933 Act. The Company will furnish to the Underwriter, without charge, during the period when the Prospectus is required to be delivered under the 1933 Act or the Securities Exchange Act of 1934 (the "1934 Act"), such number of copies of the Prospectus (as amended or supplemented) as the Underwriter may reasonably request. The Prospectus and any amendments or supplements thereto furnished to the Underwriter will be substantively identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T. (e) CONTINUED COMPLIANCE WITH SECURITIES LAWS. The Company and the Trust will comply with the 1933 Act and the 1933 Act Regulations so as to permit the completion of the distribution of the Securities as contemplated in this Agreement and in the Prospectus. If at any time when a prospectus is required by the 1933 Act to be delivered in connection with sales of the Preferred Securities, any event shall occur or condition shall exist as a result of which it is necessary, in the opinion of counsel for the Underwriter or for the Company, to amend the Registration Statement or amend or supplement the Prospectus in order that the Prospectus will not include any untrue statements of a material fact or omit to state a material fact necessary in order to make the statements therein not misleading in the light of tile circumstances existing at the time it is delivered to a purchaser, or if it shall be necessary, in the opinion of such counsel, at any such time to amend the Registration Statement or amend or supplement the Prospectus in order to comply with the requirements of the 1933 Act or the 1933 Act Regulations, the Company and the Trust will promptly prepare and file with the Commission, subject to Section 3(b) hereof, such amendment or supplement as may be necessary to correct such statement or omission or to make the Registration Statement or the Prospectus comply with such requirements, and the Company will furnish to the Underwriter such number of copies of such amendment or supplement as the Underwriter may reasonably request. (f) BLUE SKY QUALIFICATIONS. The Company and the Trust will each use its best efforts, in cooperation with the Underwriter, to qualify the Preferred Securities for offering and sale under the applicable securities laws of such states and other jurisdictions as the Underwriter may reasonably designate and to maintain such qualifications in effect for a period of not less than one year from the later of the effective date of the Registration Statement and any Rule 462(b) Registration Statement, PROVIDED, HOWEVER, that neither the Company nor the Trust shall be obligated to file any general consent to service of process or to qualify as a foreign corporation or as a dealer in securities in any jurisdiction in which it is not so qualified or to subject itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject. In each jurisdiction in which the Preferred Securities have been so qualified, the Company and the Trust will file such statements and reports as may be required by the laws of such jurisdiction to continue such qualification in effect for a period of not less than one year from the later of the effective date of the Registration Statement and any Rule 462(b) Registration Statement. 13 (g) RULE 158. The Company will timely file such reports pursuant to the 1934 Act as are necessary in order to make generally available to its securityholders as soon as practicable an earnings statement for the purposes of, and to provide the benefits contemplated by, the last paragraph of Section 11(a) of the 1933 Act. (h) NOTICE AND EFFECT OF MATERIAL EVENTS. The Offerors will immediately notify the Underwriter, and confirm such notice in writing, of (x) any filing made by the Offerors of information relating to the offering of the Preferred Securities with any securities exchange or any other regulatory body in the United States, and (y) prior to the completion of the distribution of the Preferred Securities by the Underwriter as evidenced by a notice in writing from the Underwriter to the Offerors, any Material Adverse Effect, which (i) makes any statement in the Prospectus false or misleading or (ii) is not disclosed in the Prospectus. In such event or if during such time any event shall occur as a result of which it is necessary, in the reasonable opinion of the Company, its counsel or the Underwriter or counsel to the Underwriter, to amend or supplement the final Prospectus in order that the final Prospectus not include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein not misleading in the light of the circumstances then existing, the Company will forthwith amend or supplement the final Prospectus by preparing and furnishing to the Underwriter an amendment or amendments of, or a supplement or supplements to, the final Prospectus (in form and substance satisfactory in the reasonable opinion of counsel for the Underwriter) so that, as so amended or supplemented, the final Prospectus will not include an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at the time it is delivered to a subsequent purchaser, not misleading. (i) DTC. The Offerors will cooperate with the Underwriter and use their best efforts to permit the Preferred Securities to be eligible for clearance and settlement through the facilities of DTC. (j) USE OF PROCEEDS. The Trust will use the proceeds received by it from the sale of the Securities in the manner specified in the Prospectus under "Use of Proceeds." The Company will use the net proceeds received by it from the sale of the Junior Subordinated Debentures, in the manner specified in the Prospectus under "Use of Proceeds." (k) LISTING. The Company will use its best efforts to effect the listing of the Preferred Securities on the Nasdaq National Market ("NASDAQ"). If the Junior Subordinated Debentures are distributed on the occurrence of a Tax Event (as defined in the Prospectus), the Company will use its best efforts to effect the listing of the Junior Subordinated Debentures on NASDAQ or such other exchange where the Preferred Securities are listed. (l) RESTRICTION ON SALE OF SECURITIES. During a period of 90 days from the date of the Prospectus, neither the Company nor the Trust will, without the prior written consent of the Underwriter, (i) directly or indirectly, offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase or otherwise transfer or dispose of any Preferred Securities or Junior Subordinated Debentures (or any equity or debt securities substantially similar to the Preferred Securities or Junior Subordinated Debentures, respectively), or any 14 securities convertible into or exercisable or exchangeable for Preferred Securities or Junior Subordinated Debentures (or any equity or debt securities substantially similar to the Preferred Securities or Junior Subordinated Debenture, respectively) or file any registration statement under the 1933 Act with respect to any of the foregoing or (ii) enter into any swap or any other agreement or any transaction that transfers, in whole or in part, directly or indirectly, the economic consequence of ownership of Preferred Securities or Junior Subordinated Debentures (or any equity or debt securities substantially similar to the Preferred Securities or Junior Subordinated Debentures, respectively), whether any such swap or transaction described in clause (i) or (ii) above is to be settled by delivery of Preferred Securities or Junior Subordinated Debentures (or any equity or debt securities substantially similar to the Preferred Securities or Junior Subordinated Debentures, respectively) or such other securities, in cash or otherwise. The foregoing sentence shall not apply to the Preferred Securities or Junior Subordinated Debentures to be sold hereunder. (m) REPORTING REQUIREMENTS. The Company and the Trust, during the period when the Prospectus is required to be delivered under the 1933 Act or the 1934 Act, will file all documents required to be filed with the Commission pursuant to Section 13, 14 or 15 of the 1934 Act within the time periods required by the 1934 Act and the rules and regulations of the Commission under the 1934 Act. (n) FURNISH REPORTS. For and during the period ending three years after the effective date of the Registration Statement, the Company will furnish to the Underwriter copies of all reports and other communications (financial or otherwise) furnished by the Company to its securityholders generally and copies of any reports or financial statements furnished to or filed by the Company with the Commission or any national securities exchange on which any class of securities of the Company may be listed. SECTION 4. PAYMENT OF EXPENSES. (a) EXPENSES. The Company, as borrower under the Junior Subordinated Debentures, will pay all expenses incident to the performance of its, and the Trust's, obligations under this Agreement, including (i) the preparation, printing and any filing of the Registration Statement (including financial statements and any schedules or exhibits and any document incorporated therein by reference) and of each amendment or supplement thereto, (ii) the preparation, printing and delivery to the Underwriter of this Agreement, the Operative Documents and such other documents as may be required in connection with the offering, purchase, sale and delivery of the Preferred Securities and the Junior Subordinated Debentures, (iii) the preparation, issuance and delivery of the certificates for the Preferred Securities to the Underwriter, including any stock or other transfer taxes and any stamp or other duties payable upon the sale, issuance, or delivery of the Preferred Securities to the Underwriter, (iv) the fees and disbursements of the Company's counsel, accountants and other advisors, (v) the fees and expenses of any trustee appointed under any of the Operative Documents, including the fees and disbursements of counsel for such trustees in connection with the Operative Documents, (vi) the printing and delivery to the Underwriter of copies of each preliminary prospectus, any Term Sheets and of the Prospectus and any amendments or supplements thereto, if any, (vii) the fees and expenses of any transfer agent or registrar for the Preferred Securities, (viii) the filing fees incident to the review by the National Association of Securities Dealers, Inc. (the "NASD") of the terms of the sale of the Preferred Securities, (ix) the fees and expenses incurred in 15 connection with the listing of the Preferred Securities and, if applicable, the Junior Subordinated Debentures on NASDAQ, and (x) the cost and charges of qualifying the Preferred Securities with DTC. (b) TERMINATION OF AGREEMENT. If this Agreement is terminated by the Underwriter in accordance with the provisions of Section 5 or Section 9(a)(i) hereof, the Company shall reimburse the Underwriter for all of their reasonable, actual, accountable out-of-pocket expenses, including the reasonable fees and disbursements of Thacher Proffitt & Wood, counsel for the Underwriter, up to the limit specified in Section 4(a)(vi) hereof. SECTION 5. CONDITIONS OF UNDERWRITER' OBLIGATIONS. The obligations of the Underwriter hereunder are subject to the accuracy of the representations and warranties of the Offerors contained in Section 1 hereof or in certificates of any Trustee of the Trust, officer of the Corporation or any of its subsidiaries delivered pursuant to the provisions hereof, to the performance by the Offerors of their obligations hereunder, and to the following further conditions: (a) EFFECTIVENESS OF REGISTRATION STATEMENT. The Registration Statement, including any Rule 462(b) Registration Statement, has become effective and at Closing Time no stop order suspending the effectiveness of the Registration Statement shall have been issued under the 1933 Act or proceedings therefor initiated or threatened by the Commission, and any request on the part of the Commission for additional information shall have been complied with to the reasonable satisfaction of counsel to the Underwriter. A prospectus containing the Rule 430A Information shall have been filed with the Commission in accordance with Rule 424(b) (or a post-effective amendment providing such information shall have been filed and declared effective in accordance with the requirements of Rule 430(a) or, if the Company has elected to rely upon Rule 434, a Term Sheet shall have been filed with the Commission in accordance with Rule 424(b)). (b) OPINION OF OUTSIDE COUNSEL FOR OFFERORS. At the Closing Time, the Underwriter shall have received the favorable opinion, dated as of the Closing Time, of Elias, Matz, Tiernan & Herrick L.L.P., counsel for the Offerors, in form and substance reasonably satisfactory to the Underwriter. Such counsel may state that, insofar as such opinion involves factual matters, they have relied, to the extent they deem proper, upon certificates of Trustees of the Trust, officers of the Corporation or any designated subsidiary and certificates of public officials. Such counsel may also state that, insofar as such opinion involves matters of Massachusetts law, they have relied, to the extent they deem proper, on local Massachusetts counsel acceptable to the Underwriter. (c) OPINION OF SPECIAL DELAWARE COUNSEL FOR OFFERORS. At the Closing Time, the Underwriter shall have received the favorable opinion, dated as of the Closing Time, of Richards, Layton & Finger P.A., special Delaware counsel for the Offerors, in form and substance reasonably satisfactory to the Underwriter. (d) OPINION OF COUNSEL FOR THE BANK OF NEW YORK. At the Closing Time, the Underwriter shall have received the favorable opinion, dated as of the Closing Time, of Emmet, Marvin & Martin, LLP, counsel to The Bank of New York, as Property Trustee under the Declaration, Guarantee 16 Trustee under the Preferred Securities Guarantee Agreement and Debenture Trustee under the Indenture, in form and substance reasonably satisfactory to counsel for the Underwriter. (e) OPINION OF SPECIAL TAX COUNSEL FOR THE OFFERORS. At the Closing Time, the Underwriter shall have received an opinion, dated as of the Closing Time, of Elias, Matz, Tiernan & Herrick L.L.P., special tax counsel to the Offerors, substantially to the effect that (i) the Junior Subordinated Debentures will be classified as indebtedness for United States federal income tax purposes, (ii) the Trust will be classified as a grantor trust for United States federal income tax purposes, and (iii) the statements set forth in the Prospectus under the caption "Certain Federal Income Tax Consequences" constitute, in all material respects, a fair and accurate summary of the United States federal income tax consequences of the ownership and disposition of the Preferred Securities under current law. Such opinion may be conditioned on, among other things, the initial and continuing accuracy of the facts, financial and other information, covenants and representations set forth in certificates of officers of the Corporation and other documents deemed necessary for such opinion. (f) OPINION OF COUNSEL FOR THE UNDERWRITER. At the Closing Time, the Underwriter shall have received the favorable opinion, dated as of the Closing Time, of Thacher Proffitt & Wood, counsel for the Underwriter, with respect to the Preferred Securities, the Operative Documents, the Prospectus and other related matters as the Underwriter may require. Such counsel may also state that, insofar as such opinion involves factual matters, they have relied, to the extent they deem proper, upon certificates of Trustees of the Trust, officers of the Company or the Bank and certificates of public officials. (g) CERTIFICATES. At the Closing Time, there shall not have been, since the date hereof or since the respective dates as of which information is given in the Prospectus, any material adverse change in the financial condition or in the earnings, business affairs or business prospects of the Trust, or the Company and its subsidiaries, considered as one enterprise, whether or not arising in the ordinary course of business, and the Underwriter shall have received a certificate of the Chairman, the Chief Executive Officer, the President or any Vice President of the Corporation and of the Chief Financial Officer of the Corporation and a certificate of an Administrative Trustee of the Trust, dated as of the Closing Time, to the effect that, to his or her knowledge (i) there has been no such material adverse change, (ii) the representations and warranties in Section 1 hereof were true and correct when made and are true and correct with the same force and effect as though expressly made at and as of the Closing Time, and (iii) the Offerors have complied with all agreements and satisfied all conditions on their part to be performed or satisfied at or prior to the Closing Time. (h) ACCOUNTANT'S COMFORT LETTER. At the time of the execution of this Agreement, the Initial Purchaser shall have received from Arthur Andersen LLP (the "Accountants") a letter dated such date, in form and substance satisfactory to the Underwriter, containing statements and information of the type ordinarily included in accountants' "comfort letters" to Underwriter with respect to the financial statements and certain financial information included or incorporated by reference in the Prospectus. 17 (i) BRING-DOWN COMFORT LETTER. At the Closing Time, the Underwriter shall have received from the Accountants a letter dated as of the Closing Time, to the effect that they reaffirm the statements made in the letter furnished pursuant to subsection (h) of this Section, except that the specified date referred to shall be a date not more than three business days prior to the Closing Time. (j) APPROVAL OF LISTING. At the Closing Time, the Preferred Securities shall have been approved for listing on NASDAQ. (k) CONDITIONS TO PURCHASE OF OPTIONAL PREFERRED SECURITIES. In the event that the Underwriter exercises its option provided in Section 2(b) hereof to purchase all or any portion of the Optional Preferred Securities, the representations and warranties of the Company and the Trust contained herein and the statements in any certificates furnished by the Company and any Trustee hereunder shall be true and correct as of the Date of Delivery and, at the Date of Delivery, the Underwriter shall have received: (i) OPINION OF OUTSIDE COUNSEL FOR OFFERORS. The favorable opinion of Elias, Matz, Tiernan & Herrick L.L.P., counsel for the Offerors, in form and substance satisfactory to counsel for the Underwriter, dated such Date of Delivery, relating to the Optional Preferred Securities to be purchased on such Date of Delivery and otherwise to the same effect as the opinion required by Section 5(b) hereof. (ii) OPINION OF SPECIAL DELAWARE COUNSEL FOR OFFERORS. The favorable opinion, dated such Date of Delivery, of Richards, Layton & Finger P.A., special Delaware counsel for the Offerors, in form and substance satisfactory to counsel for the Underwriter, relating to the Optional Preferred Securities to be purchased on such Date of Delivery and otherwise to the same effects as the opinion required by Section 5(c) hereof. (iii) OPINION OF COUNSEL FOR THE BANK OF NEW YORK. The favorable opinion, dated such Date of Delivery, of Emmet, Marvin & Martin, LLP, counsel to The Bank of New York, as Property Trustee under the Declaration, Guarantee Trustee under the Preferred Securities Guarantee Agreement and Debenture Trustee under the Indenture, in form and substance satisfactory to counsel for the Underwriter, relating to the Optional Preferred Securities to be purchased on such Date of Delivery and otherwise to the same effect as the opinion required by Section 5(d) hereof. (iv) OPINION OF SPECIAL TAX COUNSEL FOR THE OFFERORS. The favorable opinion, dated such Date of Delivery, of Elias, Matz, Tiernan & Herrick L.L.P., special tax counsel to the Offerors, in form and substance satisfactory to counsel for the Underwriter, relating to the Optional Preferred Securities to be purchased on such Date of Delivery and otherwise to the same effect as the opinion required by Section 5(e) hereof. (v) OPINION OF COUNSEL FOR THE UNDERWRITER. The favorable opinion, dated such Date of Delivery, of Thacher Proffitt & Wood, counsel for the Underwriter, relating to the Optional 18 Preferred Securities to be purchased on such Date of Delivery and otherwise to the same effect as the opinion required by Section 5(f) hereof. (vi) CERTIFICATES. Certificates, dated such Date of Delivery, of the Chairman, the Chief Executive Officer, the President or any Vice President of the Company and of the Chief Financial Officer of the Company and a certificate of an Administrative Trustee of the Trust, confirming that the certificates delivered at the Closing Time pursuant to Section 5(g) hereof remain true and correct as of such Date of Delivery. (vii) BRING-DOWN COMFORT LETTER. A letter from the Accountants dated such Date of Delivery, in form and substance satisfactory to the Underwriter, substantially in the same form and substance as the letter furnished to the Underwriter pursuant to Section 5(i) hereof, except that the specified date referred to shall be a date not more than five days prior to such Date of Delivery. (l) ADDITIONAL DOCUMENTS. At the Closing Time, counsel for the Underwriter shall have been furnished such documents and opinions as they may reasonably require for the purpose of enabling them to pass upon the issuance and sale of the Preferred Securities as herein contemplated, or in order to evidence the accuracy of any of the representations or warranties of the Offerors, or the fulfillment of any of the conditions, herein contained; and all proceedings taken by the Offerors in connection with the issuance and sale of the Preferred Securities as herein contemplated shall be satisfactory in form and substance to the Underwriter and counsel for the Underwriter. (m) TERMINATION OF AGREEMENT. If any condition specified in this Section shall not have been fulfilled when and as required to be fulfilled, this Agreement may be terminated by the Underwriter by notice to the Offerors at any time at or prior to the Closing Time, and such termination shall be without liability of any party to any other party except as provided in Section 4 hereof and except that Sections 7 and 8 hereof shall survive any such termination and remain in full force and effect. SECTION 6. INDEMNIFICATION. (a) INDEMNIFICATION OF UNDERWRITER. The Offerors agree to jointly and severally indemnify and hold harmless (x) the Underwriter, (y) each person, if any, who controls the Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act (each such person, a "Control Person") and (z) the respective partners, directors, officers and employees of the Underwriter or any Control Person as follows: (i) against any and all loss, liability, claim, damage and expense whatsoever, as incurred, arising out of any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment or supplement thereto), including the Rule 430A Information and the Rule 434 Information, if applicable, or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading 19 or arising out of any untrue statement of a material fact contained in any preliminary prospectus or the Prospectus (or any amendment or supple ment thereto), or the omission or alleged omission therefrom of a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; (ii) against any and all loss, liability, claim, damage and expense whatsoever, as incurred, to the extent of the aggregate amount paid in settlement of any litigation or any investigation or proceeding by any governmental agency or body, commenced or threatened, or of any claim whatsoever based upon any such untrue statement or omission or any such alleged untrue statement or omission; provided that (subject to Section 6(d) below) any such settlement is effected with the written consent of the Offerors; and (iii) against any and all expense whatsoever, as incurred (including the fees and disbursements of counsel chosen by the Underwriter), reasonably incurred in investigating, preparing for or defending against any litigation or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue statement or omission or any such alleged untrue statement or omission to the extent that any such expense is not paid under (i) or (ii) above; provided, however, that this indemnity agreement shall not apply to any loss, liability, claim, damage or expense to the extent arising out of any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with written information furnished to the Offerors by the Underwriter expressly for use in the Registration Statement (or any amendment thereto), including the Rule 430A Information and the Rule 434 Information, if applicable, or any preliminary prospectus or the Prospectus (or any amendment or supplement thereto). The foregoing indemnity with respect to any untrue statement or alleged untrue statement contained in or omission or alleged omission from a preliminary prospectus shall not inure to the benefit of the Underwriter (or any person con trolling such Underwriter) from whom the person asserting any loss, liability, claim, damage or expense purchases any of the Preferred Securities which are the subject thereof if the Company shall sustain the burden of proving that such person was not sent or given a copy of the Prospectus (or the Prospectus as amended or supplemented) at or prior to the written confirmation of the sale of such Preferred Securities to such person and the untrue statement contained in or omission from such preliminary prospectus was corrected in the Prospectus (or the Prospectus as amended or supplemented) and the Company has previously furnished copies thereof to the Underwriter. (b) INDEMNIFICATION OF OFFERORS, DIRECTORS, OFFICERS AND EMPLOYEES. The Underwriter agrees to indemnify and hold harmless the Company, its directors, officers and employees, the Trust, each of the Trustees and each person, if any, who controls the Trust, any of the Trustees or the Company within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act against any and all loss, liability, claim, damage and expense described in the indemnity contained in Section 6(a) above, as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions, made in the Registration Statement (or any amendment thereto), including the Rule 430A Information and the Rule 434 Information, if applicable, or any preliminary prospectus or the Prospectus (or any amendment or 20 supplement thereto) in reliance upon and in conformity with written information furnished to the Offerors by the Underwriter expressly for use in the Registration Statement (or any amendment thereto) or such preliminary prospectus, or the Prospectus (or any amendment or supplement thereto). (c) ACTIONS AGAINST PARTIES; NOTIFICATION. Each indemnified party shall give notice as promptly as reasonably practicable to each indemnifying party of any action commenced against it in respect of which indemnity may be sought hereunder, but failure to so notify an indemnifying party shall not relieve such indemnifying party from any liability hereunder to the extent it is not materially prejudiced as a result thereof, and in any event shall not relieve it from any liability which it may have otherwise than on account of this indemnity agreement. An indemnifying party may participate at its own expense in the defense of any such action or, if it so elects within a reasonable time after receipt of such notice, to assume the defense of any suit brought to enforce any such claim, but if it so elects to assume the defense, such defense shall be conducted by counsel chosen by it and approved by the indemnified parties, which approval shall not be unreasonably withheld. In the event that an indemnifying party elects to assume the defense of any such suit and retain such counsel, the indemnified party or parties shall bear the fees and expenses of any additional counsel thereafter retained by such indemnified party or parties; PROVIDED, HOWEVER, that the indemnified party or parties shall have the right to employ counsel (in addition to local counsel) to represent the indemnified party or parties who may be subject to liability arising out of any action in respect of which indemnity may be sought against the indemnifying party if, in the reasonable judgement of counsel for the indemnified party or parties, there may be legal defenses available to such indemnified person which are different from or in addition to those available to such indemnifying person, in which event the reasonable fees and expenses of appropriate separate counsel shall be borne by the indemnifying party. In no event shall the indemnifying parties be liable for fees and expenses of more than one counsel (in addition to any local counsel) separate from their own counsel for all indemnified parties in connection with any one action or separate but similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances. No indemnifying party shall, without the prior written consent of the indemnified parties, settle or compromise or consent to the entry of any judgment with respect to any litigation, or any investi gation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever in respect of which indemnification or contribution could be sought under this Section 6 or Section 7 hereof (whether or not the indemnified parties are actual or potential parties thereto), unless such settlement, compromise or consent (i) includes an unconditional release of each indemnified party from all liability arising out of such litigation, investigation, proceeding or claim and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party. SECTION 7. CONTRIBUTION. In order to provide for just and equitable contribution in circumstances under which the indemnification provided for in Section 6 hereof is for any reason held to be unenforceable by an indemnified party in respect of any losses, liabilities, claims, damages or expenses referred to therein, then each indemnifying party shall contribute to the aggregate amount of such losses, liabilities, claims, damages and expenses incurred by such indemnified party, as incurred, (i) in such proportion as is appropriate to reflect the relative benefits received by the Offerors on the one hand and the Underwriter on the other hand from the offering of the Preferred Securities pursuant to this Agreement or (ii) if the allocation provided by clause (i) is not permitted by applicable law, in such proportion as is 21 appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Offerors, on the one hand, and of the Underwriter, on the other hand, in connection with the statements or omissions which resulted in such losses, liabilities, claims, damages or expenses, as well as any other relevant equitable considerations. The relative benefits received by the Offerors on the one hand and the Underwriter on the other hand in connection with the offering of the Preferred Securities pursuant to this Agreement shall be deemed to be in the same respective proportions as the total net proceeds from the offering of the Preferred Securities pursuant to this Agreement (before deducting expenses) received by the Offerors and the total commission received by the Underwriter, bear to the aggregate initial offering price of the Preferred Securities. The relative fault of the Offerors, on the one hand, and the Underwriter, on the other hand, shall be determined by reference to, among other things, whether any such untrue or alleged untrue statements of a material fact of omission or alleged omission to state a material fact relates to information supplied by the Offerors or by the Underwriter and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Offerors and the Underwriter agree that it would not be just and equitable if contribution pursuant to this Section 7 were determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to above in this Section 7. The aggregate amount of losses, liabilities, claims, damages and expenses incurred by an indemnified party and referred to above in this Section 7 shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue or alleged untrue statement or omission or alleged omission. Notwithstanding the provisions of this Section 7, the Underwriter shall not be required to contribute any amount in excess of the amount by which the total price at which the Preferred Securities purchased by it and distributed to the public were offered to the public exceeds the amount of any damages which the Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. For purposes of this Section 7, each person, if any, who controls the Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act and the respective partners, directors, officers and employees of the Underwriter shall have the same rights to contribution as the Underwriter, and each officer, director and employee of the Company, and each person, if any, who controls the Company within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act, shall have the same rights to contribution as the Company. 22 SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE DELIVERY. All representations, warranties and agreements contained in this Agreement or in certificates of officers of the Company or trustees of the Trust submitted pursuant hereto, shall remain operative and in full force and effect, regardless of any investigation made by or on behalf of any Underwriter or con trolling person, or by or on behalf of the Trust or the Company, and shall survive delivery of the Preferred Securities to the Underwriter. SECTION 9. TERMINATION OF AGREEMENT. (a) TERMINATION; GENERAL. The Underwriter may terminate this Agreement, by notice to the Offerors, at any time at or prior to the Closing Time (i) if there has occurred, since the time of execution of this Agreement or since the respective dates as of which information is given in the Prospectus, any material adverse change in the condition, financial or otherwise, or in the earnings, business affairs or business prospects of the Trust or the Company and its subsidiaries, considered as one enterprise, whether or not arising in the ordinary course of business or (ii) if there has occurred any material adverse change in the financial markets in the United States, any outbreak of hostilities or escalation thereof or other calamity or crisis, or any change or development involving a prospective change in national political, financial or economic conditions, in each case the effect of which is such as to make it, in the judgment of the Underwriter, impracticable to market the Preferred Securities or to enforce contracts for the sale of the Preferred Securities, or (iii) if trading in any securities of the Company has been suspended or limited by the Commission, or if trading generally on the American Stock Exchange, the New York Stock Exchange or NASDAQ has been suspended or limited, or minimum or maximum prices for trading have been fixed, or maximum ranges for prices have been required, by any of said exchanges or by such system or by order of the Commission, the NASD or any other governmental authority, or (iv) if a banking moratorium has been declared by either federal or Massachusetts authorities. (b) LIABILITIES. If this Agreement is terminated pursuant to this Section, such termination shall he without liability of any party to any other party except as provided in Section 4 hereof, and provided further that Sections 6 and 7 hereof shall survive such termination and remain in full force and effect. SECTION 10. NOTICES. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if mailed or transmitted by any standard form of telecommunication. Notices to the Underwriter shall be directed to Legg Mason Wood Walker, Incorporated, 1747 Pennsylvania Avenue N.W., Washington, D.C. 20006, Attention: Mark C. Micklem, Managing Director, with a copy to Thacher Proffitt & Wood, 1700 Pennsylvania Avenue, NW, Suite 800, Washington, DC 20006, Attention: Richard A. Schaberg, Esq.; notices to the Offerors shall be directed to Independent Bank Corp., 288 Union Street, Rockland, Massachusetts, 02370, Attention: Richard J. Seaman, with a copy to Elias, Matz, Tiernan & Herrick L.L.P., The Walker Building, 734 15th Street, NW, 12th Floor, Washington, DC 20005, Attention: Norman B. Antin, Esq. 23 SECTION 11. PARTIES. This Agreement shall inure to the benefit of and be binding upon each of the Underwriter and the Offerors and their respective successors. Nothing expressed or mentioned in this Agreement is intended or shall be construed to give any person, firm or corporation, other than the Underwriter and the Offerors and their respective successors and the controlling persons and officers and directors referred to in Sections 1, 6 and 7 hereof and their heirs and legal representatives, any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision herein contained. This Agreement and all conditions and provisions hereof are intended to be for the sole and exclusive benefit of the Underwriter and the Offerors and their respective successors, and said controlling persons and officers and directors and their heirs and legal representatives, and for the benefit of no other person, firm or corporation. No purchaser of Preferred Securities from the Underwriter shall be deemed to be a successor by reason merely of such purchase. The Company, on behalf of itself and its subsidiaries (including, without limitation, the Trust), hereby irrevocably submits to the exclusive jurisdiction of the federal and New York State courts located in the City of New York in connection with any suit, action or proceeding related to this Agreement or any of the matters contemplated hereby, irrevocably waives any defense of lack of personal jurisdiction and irrevocably agrees that all claims in respect of any suit, action or proceeding may be heard and determined in any such court. The Company, on behalf of itself and the subsidiaries (including, without limitation, the Trust), irrevocably waives, to the fullest extent it may effectively do so under applicable law, any objection which it may now or hereafter have to the laying of venue of any such suit, action or proceeding brought in any such court and any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. SECTION 12. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES. SECTION 13. EFFECT OF HEADINGS. The Article and Section headings herein are for convenience only and shall not affect the construction hereof. 24 If the foregoing is in accordance with your understanding of our agreement, please sign and return to the Company a counterpart hereof, whereupon this instrument, along with all counterparts, will become a binding agreement between the Underwriter and the Offerors in accordance with its terms. Very truly yours, INDEPENDENT BANK CORP. By: ----------------------------------- Name: Richard J. Seaman Title: Chief Financial Officer INDEPENDENT CAPITAL TRUST II By: ----------------------------------- Name: Richard J. Seaman Title: Administrative Trustee CONFIRMED AND ACCEPTED, as of the date first above written: LEGG MASON WOOD WALKER, INCORPORATED By: Legg Mason Wood Walker, Incorporated By: ------------------------------------ Authorized Signatory 25 SCHEDULE A Number of Initial Name of Underwriter Preferred-Securities - ---------------------------------------------------- -------------------- Legg Mason Wood Walker, Incorporated................ Total............................................... 26 EX-4.1 3 EXHIBIT 4.1 EXHIBIT 4.1 ================================================================================ ------------------------------ INDEPENDENT BANK CORP. ------------------------------ INDENTURE DATED AS OF _______ __, 1999 ------------------------------ THE BANK OF NEW YORK AS TRUSTEE ------------------------------ JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES ================================================================================ TIE-SHEET of provisions of Trust Indenture Act of 1939 with Indenture dated as of ______ __, 1999 between Independent Bank Corp. and The Bank of New York, Trustee: ACT SECTION INDENTURE SECTION 310(a)(1).................................................................6.09 310(a)(2) ................................................................6.09 310(a)(3)..................................................................N/A 310(a)(4)..................................................................N/A 310(a)(5)...........................................................6.10, 6.11 310(b).....................................................................N/A 310(c)....................................................................6.13 311(a) and (b).............................................................N/A 311(c)...........................................................4.01, 4.02(a) 312(a)....................................................................4.02 312(b) and (c)............................................................4.04 313(a)....................................................................4.04 313(b)(1).................................................................4.04 313(b)(2).................................................................4.04 313(c)....................................................................4.04 313(d)....................................................................4.04 314(a)....................................................................4.03 314(b).....................................................................N/A 314(c)(1) and (2).........................................................6.07 314(c)(3)..................................................................N/A 314(d) ....................................................................N/A 314(e)....................................................................6.07 314(f) ....................................................................N/A 315(a)(c) and (d).........................................................6.01 315(b) ...................................................................5.08 315(e) ...................................................................5.09 316(a)(1) ................................................................5.07 316(a)(2) .................................................................N/A 316(a) last sentence .....................................................2.09 316(b) ...................................................................9.02 317(a) ...................................................................5.05 317(b) ...................................................................6.05 318(a) ..................................................................13.08 - ---------- THIS TIE-SHEET IS NOT PART OF THE INDENTURE AS EXECUTED. TABLE OF CONTENTS* PAGE ---- ARTICLE I DEFINITIONS SECTION 1.01. Definitions..................................... 1 Additional Sums................................................... 1 Affiliate......................................................... 1 Allocable Amounts................................................. 1 Authenticating Agent.............................................. 2 Bankruptcy Law.................................................... 2 Board of Directors................................................ 2 Board Resolution.................................................. 2 Business Day...................................................... 2 Commission........................................................ 2 Common Securities................................................. 2 Common Securities Guarantee....................................... 2 Common Stock...................................................... 3 Company........................................................... 3 Company Request................................................... 3 Compounded Interest............................................... 3 Custodian......................................................... 3 Declaration....................................................... 3 Default........................................................... 3 Defaulted Interest................................................ 3 Deferred Interest................................................. 3 Definitive Securities............................................. 3 Depositary........................................................ 3 Dissolution Event................................................. 3 Event of Default.................................................. 3 Exchange Act...................................................... 3 Extended Interest Payment Period.................................. 4 Global Security................................................... 4 Indebtedness...................................................... 4 Indenture......................................................... 4 Independent Capital Trust II or the Trust......................... 4 Interest Payment Date............................................. 4 Investment Company Event.......................................... 4 - -------- *THIS TABLE OF CONTENTS SHALL NOT, FOR ANY PURPOSE, BE DEEMED TO BE A PART OF THE INDENTURE. i PAGE ---- Maturity Date..................................................... 4 Mortgage.......................................................... 5 Non Book-Entry Preferred Securities............................... 5 Officers.......................................................... 5 Officers' Certificate............................................. 5 Opinion of Counsel................................................ 5 Other Debentures.................................................. 5 Other Guarantees.................................................. 5 Outstanding....................................................... 5 Person............................................................ 6 Predecessor Security.............................................. 6 Preferred Securities.............................................. 6 Preferred Securities Guarantee.................................... 6 Principal Office of the Trustee................................... 7 Property Trustee.................................................. 7 Redemption Date................................................... 7 Redemption Price.................................................. 7 Regulatory Capital Event.......................................... 7 Responsible Officer............................................... 7 Securities or Security............................................ 7 Securities Act.................................................... 7 Securityholder or holder of Securities............................ 7 Security Register................................................. 7 Senior and Subordinated Indebtedness.............................. 7 Special Event..................................................... 8 Subsidiary........................................................ 8 Tax Event......................................................... 8 Trust Indenture Act of 1939....................................... 8 Trustee........................................................... 9 Trust Securities.................................................. 9 Underwriting Agreement............................................ 9 U.S. Government Obligations....................................... 9 ARTICLE II SECURITIES SECTION 2.01. Forms Generally................................. 9 SECTION 2.02. Execution and Authentication.................... 9 SECTION 2.03. Form and Payment................................ 10 SECTION 2.04. Global Security................................. 10 SECTION 2.05 Interest........................................ 12 SECTION 2.06. Transfer and Exchange........................... 13 SECTION 2.07. Replacement Securities.......................... 14 ii PAGE ---- SECTION 2.08. Temporary Securities............................ 14 SECTION 2.09. Cancellation.................................... 14 SECTION 2.10. Defaulted Interest.............................. 15 SECTION 2.11. CUSIP Numbers................................... 16 ARTICLE III PARTICULAR COVENANTS OF THE COMPANY SECTION 3.01. Payment of Principal and Interest............... 16 SECTION 3.02. Offices for Notices and Payments, etc........... 16 SECTION 3.03. Appointments to Fill Vacancies in Trustee's Office ......................................... 17 SECTION 3.04. Provision as to Paying Agent.................... 17 SECTION 3.05. Certificate to Trustee.......................... 18 SECTION 3.06. Compliance with Consolidation Provisions........ 18 SECTION 3.07. Limitation on Dividends......................... 19 SECTION 3.08. Covenants as to Independent Capital Trust II.... 19 SECTION 3.09. Payment of Expenses............................. 20 SECTION 3.10. Payment Upon Resignation or Removal............. 20 SECTION 3.11. Corporate Existence............................. 21 SECTION 3.12. Notice of Default............................... 21 SECTION 3.13. Listing on an Exchange.......................... 21 ARTICLE IV SECURITYHOLDERS' LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE SECTION 4.01. Securityholders' Lists.......................... 21 SECTION 4.02. Preservation and Disclosure of Lists............ 22 SECTION 4.03. Reports by Company.............................. 23 SECTION 4.04. Reports by the Trustee.......................... 24 ARTICLE V REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ON EVENT OF DEFAULT SECTION 5.01. Events of Default............................... 24 SECTION 5.02. Payment of Securities on Default; Suit Therefor. 26 SECTION 5.03. Application of Moneys Collected by Trustee...... 28 SECTION 5.04. Proceedings by Securityholders.................. 28 SECTION 5.05. Proceedings by Trustee.......................... 29 SECTION 5.06. Remedies Cumulative and Continuing.............. 29 SECTION 5.07. Direction of Proceedings and Waiver of Defaults by Majority of Securityholders.................. 30 SECTION 5.08. Notice of Defaults.............................. 30 SECTION 5.09. Undertaking to Pay Costs........................ 31 iii PAGE ---- SECTION 5.10. Waiver of Stay, Extension or Usury Laws......... 31 ARTICLE VI CONCERNING THE TRUSTEE SECTION 6.01. Duties and Responsibilities of Trustee.......... 32 SECTION 6.02. Reliance on Documents, Opinions, etc............ 33 SECTION 6.03. No Responsibility for Recitals, etc............. 35 SECTION 6.04. Trustee, Authenticating Agent, Paying Agents, Transfer Agents or Registrar May Own Securities. 35 SECTION 6.05. Moneys to be Held in Trust...................... 35 SECTION 6.06. Compensation and Expenses of Trustee............ 35 SECTION 6.07. Officers' Certificate as Evidence............... 36 SECTION 6.08. Conflicting Interest of Trustee................. 36 SECTION 6.09. Eligibility of Trustee.......................... 36 SECTION 6.10. Resignation or Removal of Trustee............... 37 SECTION 6.11. Acceptance by Successor Trustee................. 39 SECTION 6.12. Succession by Merger, etc....................... 39 SECTION 6.13. Limitation on Rights of Trustee as a Creditor... 40 SECTION 6.14. Authenticating Agents........................... 40 ARTICLE VII CONCERNING THE SECURITYHOLDERS SECTION 7.01. Action by Securityholders....................... 41 SECTION 7.02. Proof of Execution by Securityholders........... 42 SECTION 7.03. Who Are Deemed Absolute Owners.................. 42 SECTION 7.04. Securities Owned by Company Deemed Not Outstanding .................................... 42 SECTION 7.05. Revocation of Consents; Future Holders Bound.... 43 ARTICLE VIII SECURITYHOLDERS' MEETINGS SECTION 8.01. Purposes of Meetings............................ 43 SECTION 8.02. Call of Meetings by Trustee..................... 44 SECTION 8.03. Call of Meetings by Company or Securityholders.. 44 SECTION 8.04. Qualifications for Voting....................... 44 SECTION 8.05. Regulations..................................... 44 SECTION 8.06. Voting.......................................... 45 ARTICLE IX AMENDMENTS SECTION 9.01. Without Consent of Securityholders.............. 46 SECTION 9.02. With Consent of Securityholders................. 47 SECTION 9.03. Compliance with Trust Indenture Act; Effect of iv PAGE ---- Supplemental Indentures......................... 48 SECTION 9.04. Notation on Securities.......................... 48 SECTION 9.05. Evidence of Compliance of Supplemental Indenture to be Furnished Trustee......................... 49 ARTICLE X CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE SECTION 10.01. Company May Consolidate, etc., on Certain Terms. 49 SECTION 10.02. Successor Corporation to be Substituted for Company ........................................ 49 SECTION 10.03. Opinion of Counsel to be Given Trustee.......... 50 ARTICLE XI SATISFACTION AND DISCHARGE OF INDENTURE SECTION 11.01. Discharge of Indenture.......................... 50 SECTION 11.02. Deposited Moneys and U.S. Government Obligations to be Held in Trust by Trustee.................. 51 SECTION 11.03. Paying Agent to Repay Moneys Held............... 51 SECTION 11.04. Return of Unclaimed Moneys...................... 51 SECTION 11.05. Defeasance Upon Deposit of Moneys or U.S. Government Obligations.......................... 52 ARTICLE XII IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS SECTION 12.01. Indenture and Securities Solely Corporate Obligation...................................... 54 ARTICLE XIII MISCELLANEOUS PROVISIONS SECTION 13.01. Successors...................................... 54 SECTION 13.02. Official Acts by Successor Corporation.......... 54 SECTION 13.03. Surrender of Company Powers..................... 54 SECTION 13.04. Addresses for Notices, etc...................... 55 SECTION 13.05. Governing Law................................... 55 SECTION 13.06. Evidence of Compliance with Conditions Precedent 55 SECTION 13.07. Business Days .................................. 56 SECTION 13.08. Trust Indenture Act to Control.................. 56 SECTION 13.09. Table of Contents, Headings, etc................ 56 SECTION 13.10. Execution in Counterparts....................... 56 SECTION 13.11. Separability.................................... 56 SECTION 13.12. Assignment...................................... 56 SECTION 13.13. Acknowledgement of Rights....................... 57 v PAGE ---- ARTICLE XIV REDEMPTION OF SECURITIES SECTION 14.01. Special Event Redemption........................ 57 SECTION 14.02. Optional Redemption by Company.................. 57 SECTION 14.03. No Sinking Fund................................. 58 SECTION 14.04. Notice of Redemption; Selection of Securities... 58 SECTION 14.05. Payment of Securities Called for Redemption..... 59 ARTICLE XV SUBORDINATION OF SECURITIES SECTION 15.01. Agreement to Subordinate........................ 60 SECTION 15.02. Default on Senior and Subordinated Indebtedness. 60 SECTION 15.03. Liquidation; Dissolution; Bankruptcy............ 61 SECTION 15.04. Subrogation..................................... 62 SECTION 15.05. Trustee to Effectuate Subordination............. 63 SECTION 15.06. Notice by the Company........................... 63 SECTION 15.07. Rights of the Trustee; Holders of Senior and Subordinated Indebtedness................... 64 SECTION 15.08. Subordination May Not Be Impaired............... 65 ARTICLE XVI EXTENSION OF INTEREST PAYMENT PERIOD SECTION 16.01. Extension of Interest Payment Period............ 65 SECTION 16.02. Notice of Extension............................. 66 EXHIBIT A....................................................................A-1 Testimonium Signatures Acknowledgements vi THIS INDENTURE, dated as of _________ __, 1999, between Independent Bank Corp., a Massachusetts corporation (hereinafter sometimes called the "Company"), and The Bank of New York, a New York banking corporation, as trustee (hereinafter sometimes called the "Trustee"), W I T N E S S E T H : In consideration of the premises, and the purchase of the Securities by the holders thereof, the Company covenants and agrees with the Trustee for the equal and proportionate benefit of the respective holders from time to time of the Securities, as follows: ARTICLE I DEFINITIONS SECTION 1.01 Definitions. The terms defined in this Section 1.01 (except as herein otherwise expressly provided or unless the context otherwise requires) for all purposes of this Indenture shall have the respective meanings specified in this Section 1.01. All other terms used in this Indenture which are defined in the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"), or which are by reference therein defined in the Securities Act, shall (except as herein otherwise expressly provided or unless the context otherwise requires) have the meanings assigned to such terms in said Trust Indenture Act and in said Securities Act as in force at the date of this Indenture as originally executed. The following terms have the meanings given to them in the Declaration: (i) Clearing Agency; (ii) Delaware Trustee; (iii) Property Trustee; (iv) Administrative Trustees; (v) Direct Action; and (vi) Distributions. All accounting terms used herein and not expressly defined shall have the meanings assigned to such terms in accordance with generally accepted accounting principles and the term "generally accepted accounting principles" means such accounting principles as are generally accepted at the time of any computation. The words "herein", "hereof" and "hereunder" and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other subdivision. Headings are used for convenience of reference only and do not affect interpretation. The singular includes the plural and vice versa. "Additional Sums" shall have the meaning set forth in Section 2.05(c). "Affiliate" shall have the meaning given to that term in Rule 405 under the Securities Act or any successor rule thereunder. "Allocable Amounts" when used with respect to any Senior and Subordinated Indebtedness, means all amounts due or to become due on such Senior and Subordinated Indebtedness less, if applicable, any amount which would have been paid to, and retained by, the holders of such Senior and Subordinated Indebtedness (whether as a result of the receipt of payments by the holders of such Senior and Subordinated Indebtedness from the Company or any other obligor thereon or from any holders of, or trustee in respect of, other indebtedness that is subordinate and junior in right of payment to such Senior and Subordinated Indebtedness pursuant to any provision of such indebtedness for the payment over of amounts received on account of such indebtedness to the holders of such Senior and Subordinated Indebtedness or otherwise) but for the fact that such Senior and Subordinated Indebtedness is subordinated or junior in right of payment to (or subject to a requirement that amounts received on such Senior and Subordinated Indebtedness be paid over to obligees on) trade accounts payable or accrued liabilities arising in the ordinary course of business. "Authenticating Agent" shall mean any agent or agents of the Trustee which at the time shall be appointed and acting pursuant to Section 6.14. "Bankruptcy Law" shall mean Title 11, U.S. Code, or any similar federal or state law for the relief of debtors. "Board of Directors" shall mean either the Board of Directors of the Company or any duly authorized committee of that board. "Board Resolution" shall mean a copy of a resolution certified by the Secretary or an Assistant Secretary of the Company to have been duly adopted by the Board of Directors and to be in full force and effect on the date of such certification, and delivered to the Trustee. "Business Day" shall mean, with respect to any series of Securities, any day other than a Saturday or a Sunday or a day on which banking institutions in the cities of New York, New York or Rockland, Massachusetts are authorized or required by law or executive order to close. "Commission" shall mean the Securities and Exchange Commission, as from time to time constituted or created under the Exchange Act, or if at any time after the execution of this Indenture such Commission is not existing and performing the duties now assigned to it under the Trust Indenture Act, then the body performing such duties at such time. "Common Securities" shall mean undivided beneficial interests in the assets of Independent Capital Trust II which rank PARI PASSU with Preferred Securities issued by Independent Capital Trust II; PROVIDED, HOWEVER, that if an Event of Default has occurred and is continuing, no payments in respect of Distributions on, or payments upon liquidation, redemption or otherwise with respect to, the Common Securities shall be made until the holders of the Preferred Securities shall be paid in full the Distributions and the liquidation, redemption and other payments to which they are entitled. "Common Securities Guarantee" shall mean any guarantee that the Company may enter into with any Person or Persons that operates directly or indirectly for the benefit of holders of Common Securities of Independent Capital Trust II. 2 "Common Stock" shall mean the Common Stock, par value $.01 per share, of the Company or any other class of stock resulting from changes or reclassifications of such Common Stock consisting solely of changes in par value, or from par value to no par value, or from no par value to par value. "Company" shall mean Independent Bank Corp., a Massachusetts corporation, and, subject to the provisions of Article X, shall include its successors and assigns. "Company Request" or "Company Order" shall mean a written request or order signed in the name of the Company by an Officer of the Company, and delivered to the Trustee. "Compounded Interest" shall have the meaning set forth in Section 16.01. "Custodian" shall mean any receiver, trustee, assignee, liquidator, or similar official under any Bankruptcy Law. "Declaration" means the Amended and Restated Declaration of Trust of Independent Capital Trust II, dated as of _________ __, 1999, as amended from time to time. "Default" means any event, act or condition that with notice or lapse of time, or both, would constitute an Event of Default. "Defaulted Interest" shall have the same meaning set forth in Section 2.10. "Deferred Interest" shall have the meaning set forth in Section 16.01. "Definitive Securities" shall mean those securities issued in fully registered certificated form not otherwise in global form. "Depositary" shall mean, with respect to Securities, for which the Company shall determine that such Securities will be issued as a Global Security, The Depository Trust Company, New York, New York, another clearing agency, or any successor registered as a clearing agency under the Exchange Act or other applicable statute or regulation, which, in each case, shall be designated by the Company pursuant to Section 2.04(d). "Dissolution Event" means the liquidation of Independent Capital Trust II pursuant to the Declaration, and the distribution of the Securities held by the Property Trustee to the holders of the Trust Securities issued by Independent Capital Trust II PRO RATA in accordance with the Declaration. "Event of Default" shall mean any event specified in Section 5.01, continued for the period of time, if any, and after the giving of the notice, if any, therein designated. 3 "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended. "Extended Interest Payment Period" shall have the meaning set forth in Section 16.01. "Global Security" means, with respect to the Securities, a Security executed by the Company and delivered by the Trustee to the Depositary or pursuant to the Depositary's instruction, all in accordance with the Indenture, which shall be registered in the name of the Depositary or its nominee. "Indebtedness" shall mean with respect to any Person, whether recourse is to all or a portion of the assets of such Person and whether or not contingent, (i) every obligation of such Person for money borrowed; (ii) every obligation of such Person evidenced by bonds, debentures, notes or other similar instruments, including obligations incurred in connection with the acquisition of property, assets or businesses; (iii) every reimbursement obligation of such Person with respect to letters of credit, bankers' acceptances or similar facilities issued for the account of such Person; (iv) every obligation of such Person issued or assumed as the deferred purchase price of property or services (but excluding trade accounts payable or accrued liabilities arising in the ordinary course of business); (v) every capital lease obligation of such Person; (vi) all indebtedness of such Person whether incurred on or prior to the date of the Indenture or thereafter incurred, for claims in respect of derivative products, including interest rate, foreign exchange rate and commodity forward contracts, options and swaps and similar arrangements; and (vii) every obligation of the type referred to in clauses (i) through (vi) of another Person and all dividends of another Person the payment of which, in either case, such Person has guaranteed or is responsible or liable, directly or indirectly, as obligor or otherwise. "Indenture" shall mean this instrument as originally executed or, if amended as herein provided, as so amended. "Independent Capital Trust II" or the "Trust" shall mean Independent Capital Trust II, a Delaware business trust created for the purpose of issuing its undivided beneficial interests in connection with the issuance of Securities under this Indenture. "Interest Payment Date" shall have the meaning set forth in Section 2.05(a). "Investment Company Event" means the receipt by Independent Capital Trust II and the Company of an Opinion of Counsel, rendered by a law firm experienced in such matters, to the effect that, as a result of change in law or regulation or a change in interpretation or application of law or regulation by any legislative body, court, governmental agency or regulatory authority, Independent Capital Trust II is or will be considered an "investment company" that is required to be registered under the Investment Company Act of 1940, as amended, which change becomes effective on or after the date of original issuance of the Preferred Securities of Independent Capital Trust II. 4 "Maturity Date" shall mean __________ __, 2029, or such shorter period if the Company receives prior regulatory approval if then required under applicable capital guidelines or regulatory policies. "Mortgage" shall mean and include any mortgage, pledge, lien, security interest, conditional sale or other title retention agreement or other similar encumbrance. "Non Book-Entry Preferred Securities" shall have the meaning set forth in Section 2.04(a)(ii). "Officer" shall mean any of the Chairman, a Vice Chairman, the Chief Executive Officer, the President, the Chief Financial Officer, a Vice President, the Comptroller, the Secretary or an Assistant Secretary of the Company. "Officers' Certificate" shall mean a certificate signed by two Officers and delivered to the Trustee. "Opinion of Counsel" shall mean a written opinion of counsel, who may be an employee of the Company unless otherwise provided herein, and who shall be acceptable to the Trustee. "Other Debentures" means all junior subordinated debentures issued by the Company from time to time and sold to trusts established or to be established by the Company, in each case similar to the Trust, including but not limited to Independent Capital Trust I. "Other Guarantees" means all guarantees issued or to be issued by the Company with respect to preferred securities and issued to other trusts to be established by the Company, in each case similar to the Trust, including but not limited to Independent Capital Trust I. "Outstanding", when used with reference to Securities, shall, subject to the provisions of Section 7.04, mean, as of any particular time, all Securities authenticated and delivered by the Trustee or the Authenticating Agent under this Indenture, except (a) Securities theretofore cancelled by the Trustee or the Authenticating Agent or delivered to the Trustee for cancellation; (b) Securities, or portions thereof, for the payment or redemption of which moneys in the necessary amount shall have been deposited in trust with the Trustee or with any paying agent (other than the Company) or shall have been set aside and segregated in trust by the Company (if the Company shall act as its own paying agent); provided that, if such Securities, or portions thereof, are to be redeemed prior to maturity thereof, notice of such 5 redemption shall have been given as in Article XIV provided or provision satisfactory to the Trustee shall have been made for giving such notice; and (c) Securities in lieu of or in substitution for which other Securities shall have been authenticated and delivered pursuant to the terms of Section 2.08 unless proof satisfactory to the Company and the Trustee is presented that any such Securities are held by bona fide holders in due course; PROVIDED, HOWEVER, that in determining whether the Holders of the requisite principal amount of Outstanding Securities have given any request, demand, authorization, direction, notice, consent or waiver hereunder, Securities owned by the Company or any other obligor upon the Securities or any Affiliate of the Company or such other obligor shall be disregarded and deemed not to be Outstanding, except that, in determining whether the Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Securities which the Trustee actually knows to be so owned shall be so disregarded. Securities so owned which have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the Trustee the pledgee's right so to act with respect to such Securities and that the pledgee is not the Company or any other obligor upon the Securities or any Affiliate of the Company or such other obligor. Upon the written request of the Trustee, the Company shall furnish to the Trustee promptly an Officers' Certificate listing and identifying all Securities, if any, known by the Company to be owned or held by or for the account of the Company, or any other obligor on the Securities or any Affiliate of the Company or such obligor, and, subject to the provisions of Section 6.01, the Trustee shall be entitled to accept such Officers' Certificate as conclusive evidence of the facts therein set forth and of the fact that all Securities not listed therein are Outstanding for the purpose of any such determination. "Person" shall mean any individual, corporation, estate, partnership, joint venture, association, joint-stock company, limited liability company, trust, unincorporated organization or government or any agency or political subdivision thereof. "Predecessor Security" of any particular Security means every previous Security evidencing all or a portion of the same debt as that evidenced by such particular Security; and, for the purposes of this definition, any Security authenticated and delivered under Section 2.07 in lieu of a lost, destroyed or stolen Security shall be deemed to evidence the same debt as the lost, destroyed or stolen Security. "Preferred Securities" shall mean undivided beneficial interests in the assets of Independent Capital Trust II which rank PARI PASSU with the Common Securities issued by Independent Capital Trust II; PROVIDED, HOWEVER, that if an Event of Default has occurred and is continuing, no payments in respect of Distributions on, or payments upon liquidation, redemption or otherwise with respect to, the Common Securities shall be made until the holders of the Preferred Securities shall be paid in full the Distributions and the liquidation, redemption and other payments to which they are entitled. 6 "Preferred Securities Guarantee" shall mean any guarantee that the Company may enter into with The Bank of New York as trustee or other Persons that operates directly or indirectly for the benefit of holders of Preferred Securities. "Principal Office of the Trustee", or other similar term, shall mean the office of the Trustee, at which at any particular time its corporate trust business shall be principally administered. "Property Trustee" shall have the same meaning as set forth in the Declaration. "Redemption Date" when used with respect to any Security to be redeemed, means the date fixed for such redemption by or pursuant to this Indenture. "Redemption Price" when used with respect to any Security to be redeemed, means the price at which it is to be redeemed pursuant to this Indenture. "Regulatory Capital Event" means that the Company shall have received an opinion of independent bank regulatory counsel experienced in such matters to the effect that, as a result of (a) any amendment to, or change (including any announced prospective change) in, the laws (or any regulations thereunder) of the United States or any rules, guidelines or policies of applicable regulatory agencies or (b) any official administrative pronouncement or judicial decision interpreting or applying such laws or regulations, which amendment or change is effective or such pronounce ment or decision is announced on or after the date of this Indenture, the Preferred Securities do not constitute, or within 90 days of the date thereof, will not constitute, Tier I Capital (or its then equivalent) for purposes of the capital adequacy guidelines of the Board of Governors of the Federal Reserve (or any successor regulatory authority with jurisdiction over bank holding companies), or any capital adequacy guidelines as then in effect and applicable to the Company; PROVIDED, HOWEVER, that the distribution of the Junior Subordinated Debentures in connection with a termination of the Trust by the Company shall not in and of itself constitute a Regulatory Capital Event. "Responsible Officer" shall mean any officer in the corporate trust department of the Trustee with direct responsibility for the administration of the Indenture and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of his knowledge of and familiarity with the particular subject. "Securities" or "Security" mean, any debt securities or debt security, as the case may be, authenticated and delivered under this Indenture. "Securities Act" shall mean the Securities Act of 1933, as amended. "Securityholder", "holder of Securities", or other similar terms, shall mean any Person in whose name at the time a particular Security is registered on the register kept by the Company or the Trustee for that purpose in accordance with the terms hereof. 7 "Security Register" shall have the meaning specified in Section 2.06. "Senior and Subordinated Indebtedness" means the principal of (and premium, if any) and interest, if any (including interest accruing on or after the filing of any petition in bankruptcy or for reorganization relating to the Company whether or not such claim for post-petition interest is allowed in such proceeding), on Indebtedness of the Company, whether incurred on or prior to the date of this Indenture or thereafter incurred, unless, in the instrument creating or evidencing the same or pursuant to which the same is outstanding it is provided that such obligations are not superior in right of payment to the Securities or other Indebtedness which is PARI PASSU with, or subordinated to, the Securities, PROVIDED, HOWEVER, that Senior and Subordinated Indebtedness shall not be deemed to include (a) any Indebtedness of the Company which, when incurred and without respect to any election under Section 1111(b) of the Bankruptcy Reform Act of 1978, as amended, was without recourse to the Company, (b) any Indebtedness of the Company to any of its Subsidiaries, (c) Indebtedness to any employee of the Company, and (d) any Securities. "Special Event" means either an Investment Company Event, a Regulatory Capital Event or a Tax Event. "Subsidiary" shall mean with respect to any Person, (i) any corporation at least a majority of the outstanding voting stock of which is owned, directly or indirectly, by such Person or by one or more of its Subsidiaries, or by such Person and one or more of its Subsidiaries, (ii) any general partnership, joint venture or similar entity, at least a majority of whose outstanding partnership or similar interests shall at the time be owned by such Person, or by one or more of its Subsidiaries, or by such Person and one or more of its Subsidiaries and (iii) any limited partnership of which such Person or any of its Subsidiaries is a general partner. For the purposes of this definition, "voting stock" means shares, interests, participation or other equivalents in the equity interest (however designated) in such Person having ordinary voting power for the election of a majority of the directors (or the equivalent) of such Person, other than shares, interests, participation or other equivalents having such power only by reason of the occurrence of a contingency. "Tax Event" shall mean the receipt by Independent Capital Trust II and the Company of an opinion of counsel experienced in such matters to the effect that, as a result of any amendment to, or change (including any announced prospective change) in, the laws or any regulations thereunder of the United States or any political subdivision or taxing authority thereof or therein or as a result of any official administrative pronouncement or judicial decision interpreting or applying such laws or regulations, which amendment or change is effective or which pronouncement or decision is announced on or after the date of this Indenture, there is more than an insubstantial risk that (i) Independent Capital Trust II is, or will be within 90 days of the date of such opinion, subject to United States Federal income tax with respect to income received or accrued on the Securities, (ii) interest payable by the Company on the Securities is not, or within 90 days of the date of such opinion, will not be, deductible by the Company, in whole or in part, for United States Federal income tax purposes or (iii) Independent Capital Trust II is, or will be within 90 days of the date of 8 such opinion, subject to more than a DE MINIMIS amount of other taxes, duties or other governmental charges. "Trust Indenture Act of 1939" shall mean the Trust Indenture Act of 1939 as in force at the date of execution of this Indenture; PROVIDED, HOWEVER, that, in the event the Trust Indenture Act of 1939 is amended after such date, "Trust Indenture Act of 1939" shall mean, to the extent required by any such amendment, the Trust Indenture Act of 1939 as so amended. "Trustee" shall mean the Person identified as "Trustee" in the first paragraph hereof, and, subject to the provisions of Article VI hereof, shall also include its successors and assigns as Trustee hereunder. The term "Trustee" as used with respect to a particular series of the Securities shall mean the trustee with respect to that series. "Trust Securities" shall mean the Preferred Securities and the Common Securities, collectively. "Underwriting Agreement" shall mean the Underwriting Agreement dated ________ __, 1999 among the Company, Independent Capital Trust II and the underwriters named therein. "U.S. Government Obligations" shall mean securities that are (i) direct obligations of the United States of America for the payment of which its full faith and credit is pledged or (ii) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America, which, in either case under clauses (i) or (ii) are not callable or redeemable at the option of the issuer thereof, and shall also include a depository receipt issued by a bank or trust company as custodian with respect to any such U.S. Government Obligation or a specific payment of interest on or principal of any such U.S. Government Obligation held by such custodian for the account of the holder of a depository receipt, provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the U.S. Government Obligation or the specific payment of interest on or principal of the U.S. Government Obligation evidenced by such depository receipt. ARTICLE II SECURITIES SECTION 2.01 Forms Generally. The Securities and the Trustee's certificate of authentication shall be substantially in the form of EXHIBIT A, the terms of which are incorporated in and made a part of this Indenture. The Securities may have notations, legends or endorsements required by law, stock exchange rule, 9 agreements to which the Company is subject or usage. Each Security shall be dated the date of its authentication. The Securities shall be issued in denominations of $10 and integral multiples thereof. SECTION 2.02 Execution and Authentication. The Securities shall be executed on behalf of the Company by a duly authorized Officer and attested by a Secretary or an Assistant Secretary. The signature of any such person on the Securities may be manual or facsimile. If an Officer whose signature is on a Security no longer holds that office at the time the Security is authenticated, the Security shall nevertheless be valid. A Security shall not be valid until authenticated by the manual signature of the Trustee. The signature of the Trustee shall be conclusive evidence that the Security has been authenticated under this Indenture. The form of Trustee's certificate of authentication to be borne by the Securities shall be substantially as set forth in EXHIBIT A hereto. The Trustee shall, upon a Company Order, authenticate for original issue up to, and the aggregate principal amount of Securities outstanding at any time may not exceed $__________ aggregate principal amount of the Securities (or up to $_______ aggregate principal amount of Securities in the event that the underwriters exercise their over-allotment option granted pursuant to the Underwriting Agreement), except as provided in Sections 2.06, 2.07, 2.08 and 14.05. SECTION 2.03 Form and Payment. Except as provided in Section 2.04, the Securities shall be issued in fully registered certificated form without interest coupons. Principal of and interest on the Securities issued in certificated form will be payable, the transfer of such Securities will be registrable and such Securities will be exchangeable for Securities bearing identical terms and provisions at the office or agency of the Company maintained for such purpose under Section 3.02; PROVIDED, HOWEVER, that payment of interest with respect to Securities (other than a Global Security) may be made at the option of the Company (i) by check mailed to the holder at such address as shall appear in the Security Register or (ii) by transfer to an account maintained by the Person entitled thereto, provided that proper transfer instructions have been received in writing by the relevant record date. SECTION 2.04 Global Security. (a) In connection with a Dissolution Event, (i) if any Preferred Securities are held in book-entry form, the related Definitive Securities shall be presented to the Trustee (if an arrangement with the Depositary has been maintained) by the Property Trustee in exchange for one or more Global Securities (as may be required pursuant to Section 2.06) in an aggregate principal amount equal to the aggregate principal amount of all outstanding Securities, to be registered in the name of the Depositary, or its nominee, and delivered by the Trustee to the Depositary for crediting to 10 the accounts of its participants pursuant to the instructions of the Administrative Trustees; the Company upon any such presentation shall execute one or more Global Securities in such aggregate principal amount and deliver the same to the Trustee for authentication and delivery in accordance with this Indenture; and payments on the Securities issued as a Global Security will be made to the Depositary; and (ii) if any Preferred Securities are held in certificated form, the related Definitive Securities may be presented to the Trustee by the Property Trustee and any Preferred Security certificate which represents Preferred Securities other than Preferred Securities in book-entry form ("Non Book-Entry Preferred Securities") will be deemed to represent beneficial interests in Securities presented to the Trustee by the Property Trustee having an aggregate principal amount equal to the aggregate liquidation amount of the Non Book-Entry Preferred Securities until such Preferred Security certificates are presented to the Security Registrar for transfer or reissuance, at which time such Preferred Security certificates will be cancelled and a Security, registered in the name of the holder of the Preferred Security certificate or the transferee of the holder of such Preferred Security certificate, as the case may be, with an aggregate principal amount equal to the aggregate liquidation amount of the Preferred Security certificate cancelled, will be executed by the Company and delivered to the Trustee for authentication and delivery in accordance with this Indenture. Upon the issuance of such Securities, Securities with an equivalent aggregate principal amount that were presented by the Property Trustee to the Trustee will be cancelled. (b) The Global Securities shall represent the aggregate amount of outstanding Securities from time to time endorsed thereon; PROVIDED, that the aggregate amount of outstanding Securities represented thereby may from time to time be reduced or increased, as appropriate, to reflect exchanges and redemptions. Any endorsement of a Global Security to reflect the amount of any increase or decrease in the amount of outstanding Securities represented thereby shall be made by the Trustee, in accordance with instructions given by the Company as required by this Section 2.04. (c) The Global Securities may be transferred, in whole but not in part, only to the Depositary, another nominee of the Depositary, or to a successor Depositary selected or approved by the Company or to a nominee of such successor Depositary. (d) If at any time the Depositary notifies the Company that it is unwilling or unable to continue as Depositary or the Depositary has ceased to be a clearing agency registered under the Exchange Act, and a successor Depositary is not appointed by the Company within 90 days after the Company receives such notice or becomes aware of such condition, as the case may be, the Company will execute, and the Trustee, upon receipt of a Company Order, will authenticate and make available for delivery the Definitive Securities, in authorized denominations, and in an aggregate principal amount equal to the principal amount of the Global Security in exchange for such Global Security. If there is an Event of Default, the Depositary shall have the right to exchange the Global Securities for Definitive Securities. In addition, the Company may at any time determine that the Securities shall no longer be represented by a Global Security. In the event of such an Event of Default or such a determination, the Company shall execute, and subject to Section 2.06, the Trustee, upon receipt of an Officers' Certificate evidencing such determination by the Company and a Company Order, will authenticate and make available for delivery the Definitive Securities, in authorized denominations, and in an aggregate principal amount equal to the principal amount of the Global Security in exchange for such Global Security. Upon the exchange of the 11 Global Security for such Definitive Securities, in authorized denominations, the Global Security shall be cancelled by the Trustee. Such Definitive Securities issued in exchange for the Global Security shall be registered in such names and in such authorized denominations as the Depositary, pursuant to instructions from its direct or indirect participants or otherwise, shall instruct the Trustee. The Trustee shall deliver such Definitive Securities to the Depositary for delivery to the Persons in whose names such Definitive Securities are so registered. SECTION 2.05 Interest. (a) Each Security will bear interest at the rate of ____% per annum (the "Coupon Rate") from the most recent date to which interest has been paid or duly provided for or, if no interest has been paid or duly provided for, from _____ __, 1999, until the principal thereof becomes due and payable on the next succeeding Interest Payment Date (as defined below), and at the Coupon Rate on any overdue principal and (to the extent that payment of such interest is enforceable under applicable law) on any overdue installment of interest, compounded quarterly payable (subject to the provisions of Article XVI) quarterly in arrears on the last day of March, June, September and December of each year (each, an "Interest Payment Date") commencing on _____ _____, 1999, to the Person in whose name such Security or any predecessor Security is registered, at the close of business on the regular record date for such interest installment, which shall be the Business Day next preceding such Interest Payment Date; provided, however, that in the event that the Preferred Securities are no longer in book-entry only form or this Security (or one or more predecessor Securities) are not represented by a Global Security, the record date for such payment shall be the fifteenth day of the month in which such payment is due. (b) Interest will be computed on the basis of a 360-day year consisting of twelve 30-day months and, for any period of less than a full calendar month, the number of days lapsed in such month based upon a 30-day month. In the event that any Interest Payment Date falls on a day that is not a Business Day, then payment of interest payable on such date will be made on the next succeeding day which is a Business Day (and without any interest or other payment in respect of any such delay), except that if such next succeeding Business Day falls in the next succeeding calendar year, then such payment shall be made on the immediately preceding Business Day, in each case with the same force and effect as if made on such date. (c) During such time as the Property Trustee is the holder of any Securities, the Company shall pay any additional amounts on the Securities as may be necessary in order that the amount of Distributions then due and payable by Independent Capital Trust II on the outstanding 12 Trust Securities shall not be reduced as a result of any additional taxes, duties, assessments and other governmental charges to which Independent Capital Trust II or the Property Trustee has become subject as a result of a Tax Event ("Additional Sums"). Whenever in this Indenture or the Securities there is a reference in any context to the payment of principal of or interest on the Securities, such mention shall be deemed to include mention of the payments of the Additional Sums provided for in this paragraph to the extent that, in such context, Additional Sums are, were or would be payable in respect thereof pursuant to the provisions of this paragraph and express mention of the payment of Additional Sums (if applicable) in any provisions hereof shall not be construed as excluding Additional Sums in those provisions hereof where such express mention is not made; PROVIDED, HOWEVER, that the deferral of the payment of interest pursuant to Section 16.01 or the Securities shall not defer the payment of any Additional Sums that may be due and payable. SECTION 2.06 Transfer and Exchange. The Company shall cause to be kept at the Principal Office of the Trustee a register in which, subject to such reasonable regulations as it may prescribe, the Company shall provide for the registration of Securities and of transfers of Securities. Such register is herein sometimes referred to as the "Securities Register." To permit registrations of transfers, the Company shall execute and the Trustee shall authenticate Definitive Securities and Global Securities at the Security Registrar's request. All Definitive Securities and Global Securities issued upon any registration of transfer or exchange of Definitive Securities or Global Securities shall be the valid obligations of the Company, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Definitive Securities or Global Securities surrendered upon such registration of transfer or exchange. Upon surrender for registration of transfer of any Security at the office or agency of the Company designated for that purpose the Company shall execute, and the Trustee shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Securities of the same series of any authorized denominations, of a like aggregate principal amount, of the same original issue date and Stated Maturity Date and having the same terms. At the option of the holder, Securities may be exchanged for other Securities of the same series of any authorized denominations, of a like aggregate principal amount, of the same original issue date and Stated Maturity Date and having the same terms, upon surrender of the Securities to be exchanged at such office or agency. Whenever any securities are so surrendered for exchange, the Company shall execute, and the Trustee shall authenticate and deliver, the Securities which the holder making the exchange is entitled to receive. No service charge shall be made to a holder for any registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any transfer tax or similar governmental charge payable in connection therewith. 13 The Company shall not be required to (i) issue, register the transfer of or exchange Securities during a period beginning at the opening of business 15 days before the day of mailing of a notice of redemption or any notice of selection of Securities for redemption under Article XIV hereof and ending at the close of business on the day of such mailing; or (ii) register the transfer of or exchange any Security so selected for redemption in whole or in part, except the unredeemed portion of any Security being redeemed in part. Prior to due presentment for the registration of a transfer of any Security, the Trustee, the Company and any agent of the Trustee or the Company may deem and treat the Person in whose name any Security is registered as the absolute owner of such Security for the purpose of receiving payment of principal of and interest on such Securities, neither the Trustee, nor the Company nor any agent of the Trustee or the Company shall be affected by notice to the contrary. SECTION 2.07 Replacement Securities. If any mutilated Security is surrendered to the Trustee, or the Company and the Trustee receive evidence to their satisfaction of the destruction, loss or theft of any Security, the Company shall issue and the Trustee shall authenticate a replacement Security if the Trustee's requirements for replacements of Securities are met. An indemnity bond must be supplied by the holder that is sufficient in the judgment of the Trustee and the Company to protect the Company, the Trustee, any agent thereof or any authenticating agent from any loss that any of them may suffer if a Security is replaced. The Company or the Trustee may charge for its expenses in replacing a Security. Every replacement Security is an obligation of the Company and shall be entitled to all of the benefits of this Indenture equally and proportionately with all other Securities duly issued hereunder. SECTION 2.08 Temporary Securities. Pending the preparation of Definitive Securities, the Company may execute, and upon Company Order the Trustee shall authenticate and make available for delivery, temporary Securities that are printed, lithographed, typewritten, mimeographed or otherwise reproduced, in any authorized denomination, substantially of the tenor of the Definitive Securities in lieu of which they are issued and with such appropriate insertions, omissions, substitutions and other variations as the officers executing such Securities may determine, as conclusively evidenced by their execution of such Securities. If temporary Securities are issued, the Company shall cause Definitive Securities to be prepared without unreasonable delay. The Definitive Securities shall be printed, lithographed or engraved, or provided by any combination thereof, or in any other manner permitted by the rules and regulations of any applicable securities exchange, all as determined by the officers executing such Definitive Securities. After the preparation of Definitive Securities, the temporary Securities shall 14 be exchangeable for Definitive Securities upon surrender of the temporary Securities at the office or agency maintained by the Company for such purpose pursuant to Section 3.02 hereof, without charge to the Holder. Upon surrender for cancellation of any one or more temporary Securities, the Company shall execute, and the Trustee shall authenticate and make available for delivery, in exchange therefor the same aggregate principal amount of Definitive Securities of authorized denominations. Until so exchanged, the temporary Securities shall in all respects be entitled to the same benefits under this Indenture as Definitive Securities. SECTION 2.09 Cancellation. The Company at any time may deliver Securities to the Trustee for cancellation. The Trustee and no one else shall cancel all Securities surrendered for registration of transfer, exchange, payment, replacement or cancellation and shall retain or dispose of cancelled Securities in accordance with its normal practices (subject to the record retention requirement of the Exchange Act) unless the Company directs them to be returned to it. The Company may not issue new Securities to replace Securities that have been redeemed or paid or that have been delivered to the Trustee for cancellation. SECTION 2.10 Defaulted Interest. Any interest on any Security that is payable, but is not punctually paid or duly provided for, on any Interest Payment Date (herein called "Defaulted Interest") shall forthwith cease to be payable to the holder on the relevant regular record date by virtue of having been such holder; and such Defaulted Interest shall be paid by the Company, at its election, as provided in clause (a) or clause (b) below: (a) The Company may make payment of any Defaulted Interest on Securities to the Persons in whose names such Securities (or their respective Predecessor Securities) are registered at the close of business on a special record date for the payment of such Defaulted Interest, which shall be fixed in the following manner: the Company shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each such Security and the date of the proposed payment, and at the same time the Company shall deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as in this clause provided. Thereupon the Trustee shall fix a special record date for the payment of such Defaulted Interest which shall not be more than 15 nor less than 10 days prior to the date of the proposed payment and not less than 10 days after the receipt by the Trustee of the notice of the proposed payment. The Trustee shall promptly notify the Company of such special record date and, in the name and at the expense of the Company, shall cause notice of the proposed payment of such Defaulted Interest and the special record date therefor to be mailed, first class postage prepaid, to each Securityholder at his or her address as it appears 15 in the Security Register, not less than 10 days prior to such special record date. Notice of the proposed payment of such Defaulted Interest and the special record date therefor having been mailed as aforesaid, such Defaulted Interest shall be paid to the Persons in whose names such Securities (or their respective Predecessor Securities) are registered on such special record date and shall be no longer payable pursuant to the following clause (b). (b) The Company may make payment of any Defaulted Interest on any Securities in any other lawful manner not inconsistent with the requirements of any securities exchange on which such Securities may be listed, and upon such notice as may be required by such exchange, if, after notice given by the Company to the Trustee of the proposed payment pursuant to this clause, such manner of payment shall be deemed practicable by the Trustee. SECTION 2.11 CUSIP Numbers. The Company in issuing the Securities may use "CUSIP" numbers (if then generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices of redemption as a convenience to Securityholders; PROVIDED that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Securities or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Securities, and any such redemption shall not be affected by any defect in or omission of such numbers. The Company will promptly notify the Trustee of any change in the CUSIP numbers. ARTICLE III PARTICULAR COVENANTS OF THE COMPANY SECTION 3.01 Payment of Principal and Interest. The Company covenants and agrees for the benefit of the holders of the Securities that it will duly and punctually pay or cause to be paid the principal of and interest on the Securities at the place, at the respective times and in the manner provided herein. Except as provided in Section 2.03, each installment of interest on the Securities may be paid by mailing checks for such interest payable to the order of the holder of Security entitled thereto as they appear in the Security Register. The Company further covenants to pay any and all amounts, including, without limitation, Additional Sums, as may be required pursuant to Section 2.05(c), and Compounded Interest, as may be required pursuant to Section 16.01. By 10:00 a.m. New York time on the date specified herein for the payment of principal and interest, the Company will deposit with the Trustee or with one or more paying agents an amount of money sufficient to cover the required payment with respect to the Securities. 16 SECTION 3.02 Offices for Notices and Payments, etc. So long as any of the Securities remain outstanding, the Company will maintain in the Borough of Manhattan, The City of New York, an office or agency where the Securities may be presented for payment, an office or agency where the Securities may be presented for registration of transfer and for exchange as in this Indenture provided and an office or agency where notices and demands to or upon the Company in respect of the Securities or of this Indenture may be served. The Company will give to the Trustee written notice of the location of any such office or agency and of any change of location thereof. Until otherwise designated from time to time by the Company in a notice to the Trustee, any such office or agency for all of the above purposes shall be the Principal Office of the Trustee. In case the Company shall fail to maintain any such office or agency in the Borough of Manhattan, The City of New York, or shall fail to give such notice of the location or of any change in the location thereof, presentations and demands may be made and notices may be served at the Principal Office of the Trustee. In addition to any such office or agency, the Company may from time to time designate one or more offices or agencies outside the Borough of Manhattan, The City of New York, where the Securities may be presented for payment, registration of transfer and for exchange in the manner provided in this Indenture, and the Company may from time to time rescind such designation, as the Company may deem desirable or expedient; provided, however, that no such designation or rescission shall in any manner relieve the Company of its obligation to maintain any such office or agency in the Borough of Manhattan, The City of New York, for the purposes above mentioned. The Company will give to the Trustee prompt written notice of any such designation or rescission thereof. SECTION 3.03 Appointments to Fill Vacancies in Trustee's Office. The Company, whenever necessary to avoid or fill a vacancy in the office of Trustee, will appoint, in the manner provided in Section 6.10, a Trustee, so that there shall at all times be a Trustee hereunder. SECTION 3.04 Provision as to Paying Agent. (a) If the Company shall appoint a paying agent other than the Trustee with respect to the Securities, it will cause such paying agent to execute and deliver to the Trustee an instrument in which such agent shall agree with the Trustee, subject to the provision of this Section 3.04, (1) that it will hold all sums held by it as such agent for the payment of the principal of or interest (including Additional Sums and Com pounded Interest, if any) on the Securities (whether such sums have been paid to it by the Company or by any other obligor on the Securities) in trust for the benefit of the holders of the Securities; and 17 (2) that it will give the Trustee notice of any failure by the Company (or by any other obligor on the Securities) to make any payment of the principal of or interest (including Additional Sums and Compounded Interest, if any) on the Securities when the same shall be due and payable. (b) If the Company shall act as its own paying agent, it will, on or before each due date of the principal of or interest (including Additional Sums and Compounded Interest, if any) on the Securities, set aside, segregate and hold in trust for the benefit of the holders of the Securities a sum sufficient to pay such principal or interest (including Additional Sums and Compounded Interest, if any) so becoming due and will notify the Trustee of any failure to take such action and of any failure by the Company (or by any other obligor under the Securities) to make any payment of the principal of or interest (including Additional Sums and Compounded Interest, if any) on the Securities when the same shall become due and payable. Whenever the Company shall have one or more paying agents for the Securities, it will, on or prior to each due date of the principal of or interest (including Additional Sums and Compounded Interest, if any) on the Securities, deposit with the paying agent a sum sufficient to pay the principal or interest (including Additional Sums and Compounded Interest, if any) so becoming due, such sum to be held in trust for the benefit of the Persons entitled to such principal or interest (including Additional Sums and Compounded Interest, if any) and (unless such paying agent is the Trustee) the Company will promptly notify the Trustee of this action or failure so to act. (c) Anything in this Section 3.04 to the contrary notwithstanding, the Company may, at any time, for the purpose of obtaining a satisfaction and discharge with respect to the Securities hereunder, or for any other reason, pay or cause to be paid to the Trustee all sums held in trust for such Securities by the Trustee or any paying agent hereunder, as required by this Section 3.04, such sums to be held by the Trustee upon the trusts herein contained. (d) Anything in this Section 3.04 to the contrary notwithstanding, the agreement to hold sums in trust as provided in this Section 3.04 is subject to Sections 11.03 and 11.04. SECTION 3.05 Certificate to Trustee. The Company will deliver to the Trustee on or before 120 days after the end of each fiscal year in each year, commencing with the first fiscal year ending after the date hereof, so long as Securities are outstanding hereunder, an Officers' Certificate, one of the signers of which shall be the principal executive, principal financial or principal accounting officer of the Company, stating 18 that in the course of the performance by the signers of their duties as officers of the Company they would normally have knowledge of any default by the Company in the performance of any covenants and conditions contained herein, stating whether or not they have knowledge of any such default and, if so, specifying each such default of which the signers have knowledge and the nature thereof. For purposes of this section such default shall be determined without regard to any period of grace or requirement of notice. SECTION 3.06 Compliance with Consolidation Provisions. The Company will not, while any of the Securities remain outstanding, consolidate with, or merge into, or merge into itself, or sell or convey all or substantially all of its property to any other Person unless the provisions of Article X hereof are complied with. SECTION 3.07 Limitation on Dividends. The Company will not (i) declare or pay any dividends or distributions on, or redeem, purchase, acquire, or make a liquidation payment with respect to, any of the Company's capital stock (which includes common and preferred stock), (ii) make any payment of principal, premium, if any, or interest on or repay or repurchase or redeem any debt securities of the Company (including Other Debentures) that rank PARI PASSU with or junior in right of payment to the Securities or (iii) make any guarantee payments with respect to any guarantee by the Company of the debt securities of any Subsidiary of the Company (including Other Guarantees) if such guarantee ranks PARI PASSU or junior in right of payment to the Securities (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 Company, (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 Preferred Securities Guarantee, (d) the purchase of fractional shares resulting from a reclassification of the Company's capital stock, (e) the purchase of fractional interests in shares of the Company'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 Company's benefit plans for its directors, officers or employees or any of the Company's dividend reinvestment plans) if at such time (1) there shall have occurred any event that would constitute an Event of Default, (2) if such Securities are held by the Property Trustee, the Company shall be in default with respect to its payment obligations under the Preferred Securities Guarantee or (3) the Company shall have given notice of its election of the exercise of its right to extend the interest payment period pursuant to Section 16.01 and any such extension shall be continuing. SECTION 3.08 Covenants as to Independent Capital Trust II In the event Securities are issued to Independent Capital Trust II or a trustee of such trust in connection with the issuance of Trust Securities by Independent Capital Trust II, for so long as such Trust Securities remain outstanding, the Company (i) will maintain 100% direct or indirect 19 ownership of the Common Securities of Independent Capital Trust II; PROVIDED, HOWEVER, that any successor of the Company, permitted pursuant to Article X, may succeed to the Company's ownership of such Common Securities, (ii) will not voluntarily dissolve, wind-up or terminate the Trust, except in connection with the distribution of the Junior Subordinated Debentures or certain mergers, consolidations or amalgamation, each as permitted by the Declaration, (iii) will timely perform its duties as sponsor of the Trust, (iv) will use its reasonable efforts to cause Independent Capital Trust II (a) to remain a business trust, except in connection with a distribution of Securities to the holders of Trust Securities in liquidation of the Trust, the redemption of all of the Trust Securities of Independent Capital Trust II or certain mergers, consolidations or amalgamations, each as permitted by the Declaration of Independent Capital Trust II, and (b) to otherwise continue to be treated as a grantor trust and not an association taxable as a corporation for United States federal income tax purposes and (v) will use its reasonable efforts to cause each holder of Trust Securities to be treated as owning an undivided beneficial interest in the Securities. SECTION 3.09 Payment of Expenses. In connection with the offering, sale and issuance of the Securities to Independent Capital Trust II and in connection with the sale of the Trust Securities by Independent Capital Trust II, the Company, in its capacity as borrower with respect to the Securities, shall: (a) pay all costs and expenses relating to the offering, sale and issuance of the Securities, including commissions to the underwriters payable pursuant to the Underwriting Agreement and compensation of the Trustee in accordance with the provisions of Section 6.06; (b) pay all costs and expenses of the Trust (including, but not limited to, costs and expenses relating to the organization of Independent Capital Trust II, the offering, sale and issuance of the Trust Securities (including commissions to the underwriters in connection therewith), the fees and expenses of the Property Trustee and the Delaware Trustee, the costs and expenses relating to the operation of Independent Capital Trust II, including without limitation, costs and expenses of accountants, attorneys, statistical or bookkeeping services, expenses for printing and engraving and computing or accounting equipment, paying agent(s), registrar(s), transfer agent(s), duplicating, travel and telephone and other telecommunications expenses and costs and expenses incurred in connection with the acquisition, financing, and disposition of assets of Independent Capital Trust II; (c) be primarily and fully liable for any indemnification obligations arising with respect to the Declaration; (d) pay any and all taxes (other than United States withholding taxes attributable to Independent Capital Trust II or its assets) and all liabilities, costs and expenses with respect to such taxes of the Trust; and 20 (e) pay all other fees, expenses, debts and obligations (other than in respect of principal and interest on the Trust Securities) related to Independent Capital Trust II. SECTION 3.10 Payment Upon Resignation or Removal. Upon termination of this Indenture or the removal or resignation of the Trustee, unless otherwise stated, the Company shall pay to the Trustee all amounts accrued and owing to the date of such termination, removal or resignation. Upon termination of the Declaration or the removal or resignation of the Delaware Trustee or the Property Trustee, as the case may be, pursuant to Section 5.7 of the Declaration, the Company shall pay to the Delaware Trustee or the Property Trustee, as the case may be, all amounts accrued and owing to the date of such termination, removal or resignation. SECTION 3.11 Corporate Existence. The Company will, subject to the provisions of Article X, at all times maintain its corporate existence and right to carry on business and will duly procure all renewals and extensions thereof, and , to the extent necessary or desirable in the operation of its business, will use its best efforts to maintain, preserve and renew all of its rights, powers, privileges and franchises. SECTION 3.12 Notice of Default. The Company shall file with the Trustee written notice of any Event of Default within 30 days of its becoming aware of such Event of Default or an event which, with notice or the lapse of time or both, would constitute an Event of Default. SECTION 3.13 Listing on an Exchange. If the Securities are to be distributed to the holders of the Preferred Securities in connection with a Dissolution Event, the Company will, if the Securities are not already so listed, use its best efforts to list such Securities on the NASDAQ National Market or on such other exchange or other organizations as the Preferred Securities are then listed. 21 ARTICLE IV SECURITYHOLDERS' LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE SECTION 4.01 Securityholders' Lists. The Company covenants and agrees that it will furnish or cause to be furnished to the Trustee: (a) on a quarterly basis on each regular record date for the Securities, a list, in such form as the Trustee may reasonably require, of the names and addresses of the Securityholders as of such record date; and (b) at such other times as the Trustee may request in writing, within 30 days after the receipt by the Company, of any such request, a list of similar form and content as of a date not more than 15 days prior to the time such list is furnished, except that, no such lists need be furnished so long as the Trustee is in possession thereof by reason of its acting as Security registrar. SECTION 4.02 Preservation and Disclosure of Lists. (a) The Trustee shall preserve, in as current a form as is reasonably practicable, all information as to the names and addresses of the holders of the Securities (1) contained in the most recent list furnished to it as provided in Section 4.01 or (2) received by it in the capacity of Securities registrar (if so acting) hereunder. The Trustee may destroy any list furnished to it as provided in Section 4.01 upon receipt of a new list so furnished. (b) In case three or more holders of Securities (hereinafter referred to as "applicants") apply in writing to the Trustee and furnish to the Trustee reasonable proof that each such applicant has owned a Security for a period of at least six months preceding the date of such application, and such application states that the applicants desire to communicate with other holders of Securities or with holders of all Securities with respect to their rights under this Indenture and is accompanied by a copy of the form of proxy or other communication which such applicants propose to transmit, then the Trustee shall within five Business Days after the receipt of such application, at its election, either: 22 (1) afford such applicants access to the information preserved at the time by the Trustee in accordance with the provisions of subsection (a) of this Section 4.02, or (2) inform such applicants as to the approximate number of holders of all Securities, whose names and addresses appear in the information preserved at the time by the Trustee in accordance with the provisions of subsection (a) of this Section 4.02, and as to the approximate cost of mailing to such Securityholders the form of proxy or other communication, if any, specified in such application. If the Trustee shall elect not to afford such applicants access to such information, the Trustee shall, upon the written request of such applicants, mail to each Securityholder whose name and address appear in the informa tion preserved at the time by the Trustee in accordance with the provisions of subsection (a) of this Section 4.02 a copy of the form of proxy or other communication which is specified in such request with reasonable prompt ness after a tender to the Trustee of the material to be mailed and of payment, or provision for the payment, of the reasonable expenses of mailing, unless within five days after such tender, the Trustee shall mail to such applicants and file with the Commission, together with a copy of the material to be mailed, a written statement to the effect that, in the opinion of the Trustee, such mailing would be contrary to the best interests of the holders of Securities of such series or all Securities, as the case may be, or would be in violation of applicable law. Such written statement shall specify the basis of such opinion. If the Commission, after opportunity for a hearing upon the objections specified in the written statement so filed, shall enter an order refusing to sustain any of such objections or if, after the entry of an order sustaining one or more of such objections, the Commission shall find, after notice and opportunity for hearing, that all the objections so sustained have been met and shall enter an order so declaring, the Trustee shall mail copies of such material to all such Securityholders with reasonable promptness after the entry of such order and the renewal of such tender; otherwise the Trustee shall be relieved of any obligation or duty to such applicants respecting their application. (c) Each and every holder of Securities, by receiving and holding the same, agrees with the Company and the Trustee that neither the Company nor the Trustee nor any paying agent shall be held accountable by reason of the disclosure of any such information as to the names and addresses of the holders of Securities in accordance with the provisions of subsection (b) of this Section 4.02, regardless of the source from which such information was 23 derived, and that the Trustee shall not be held accountable by reason of mailing any material pursuant to a request made under said subsection (b). SECTION 4.03 Reports by Company. (a) The Company covenants and agrees to file with the Trustee, within 15 days after the date on which the Company is required to file the same with the Commission, copies of the annual reports and of the information, documents and other reports (or copies of such portions of any of the foregoing as said Commission may from time to time by rules and regulations prescribe) which the Company may be required to file with the Commission pursuant to Section 13 or Section 15(d) of the Exchange Act; or, if the Company is not required to file information, documents or reports pursuant to either of such sections, then to file with the Trustee and the Commission, in accordance with rules and regulations prescribed from time to time by the Commission, such of the supplementary and periodic information, documents and reports which may be required pursuant to Section 13 of the Exchange Act in respect of a security listed and registered on a national securities exchange as may be prescribed from time to time in such rules and regulations. (b) The Company covenants and agrees to file with the Trustee and the Commission, in accordance with the rules and regulations prescribed from time to time by said Commission, such additional information, documents and reports with respect to compliance by the Company with the conditions and covenants provided for in this Indenture as may be required from time to time by such rules and regulations. (c) The Company covenants and agrees to transmit by mail to all holders of Securities, as the names and addresses of such holders appear upon the Security Register, within 30 days after the filing thereof with the Trustee, such summaries of any information, documents and reports required to be filed by the Company pursuant to subsections (a) and (b) of this Section 4.03 as may be required by rules and regulations prescribed from time to time by the Commission. (d) Delivery of such reports, information and documents to the Trustee is for informational purposes only and the Trustee's receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Company's compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officers' Certificates). 24 SECTION 4.04 Reports by the Trustee. (a) The Trustee shall transmit to Securityholders such reports concerning the Trustee and its actions under this Indenture as may be required pursuant to the Trust Indenture Act at the times and in the manner provided pursuant thereto. If required by Section 313(a) of the Trust Indenture Act, the Trustee shall, within sixty days after each May 15 following the date of this Indenture, commencing May 15, 2000, deliver to Securityholders a brief report, dated as of such May 15, which complies with the provisions of such Section 313(a). (b) A copy of each such report shall, at the time of such transmission to Securityholders, be filed by the Trustee with each stock exchange, if any, upon which the Securities are listed, with the Commission and with the Company. The Company will promptly notify the Trustee when the Securities are listed on any stock exchange or any delisting thereof. ARTICLE V REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ON EVENT OF DEFAULT SECTION 5.01 Events of Default. One or more of the following events of default shall constitute an Event of Default hereunder: (a) default in the payment of any interest (including Compounded Interest or Additional Sums, if any) upon any Security or any Other Debentures when it becomes due and payable, and continuance of such default for a period of 30 days; PROVIDED, however, that a valid extension of an interest payment period by the Company in accordance with the terms hereof shall not constitute a default in the payment of interest for this purpose; or (b) default in the payment of all or any part of the principal of any Security or any Other Debentures as and when the same shall become due and payable either at maturity, upon redemption, by declaration of acceleration of maturity or otherwise; or (c) default in the performance, or breach, of any covenant or warranty of the Company in this Indenture (other than a covenant or warranty a default in whose performance or whose breach is elsewhere in this Section specifically dealt with), and continuance of such default or breach for a period of 60 days after there has been given, by registered or certified mail, to the Company by the Trustee or to the Company and the Trustee by the holders of at least 25% 25 in aggregate principal amount of the outstanding Securities a written notice specifying such default or breach and requiring it to be remedied and stating that such notice is a "Notice of Default" hereunder; or (d) a court having jurisdiction in the premises shall enter a decree or order for relief in respect of the Company in an involuntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, or appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator (or similar official) of the Company or for any substantial part of its property, or ordering the winding-up or liquidation of its affairs and such decree or order shall remain unstayed and in effect for a period of 60 consecutive days; or (e) the Company shall commence a voluntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, shall consent to the entry of an order for relief in an involuntary case under any such law, or shall consent to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator (or other similar official) of the Company or of any substantial part of its property, or shall make any general assignment for the benefit of creditors, or shall fail generally to pay its debts as they become due. If an Event of Default with respect to Securities at the time outstanding occurs and is continuing (other than an Event of Default specified in Section 5.01(d) or 5.01(e)), then in every such case the Trustee or the holders of not less than 25% in aggregate principal amount of the Securities then outstanding may declare the principal amount of all Securities to be due and payable immediately, by a notice in writing to the Company (and to the Trustee if given by the holders of the outstanding Securities), and upon any such declaration the same shall become immediately due and payable. If the Trustee or Securityholders fail to declare the principal of all of the Securities due and payable upon such an Event of Default, so long as the Property Trustee is holding the Debentures on behalf of Independent Capital Trust II, the holders of at least 25% in liquidation amount of the Preferred Securities then outstanding will have the right to declare the Securities immediately due and payable. If an Event of Default specified in Section 5.01(d) or 5.01(e) occurs and is continuing, the principal amount of all Securities shall become immediately due and payable without any declaration or other act on the part of the Trustee or the holders of Securities. The foregoing provisions, however, are subject to the condition that if, at any time after the principal of the Securities shall have been so declared due and payable, and before any judgment or decree for the payment of the moneys due shall have been obtained or entered as hereinafter provided, (i) the Company shall pay or shall deposit with the Trustee a sum sufficient to pay (A) all matured installments of interest (including Compounded Interest and Additional Sums, if any) upon all the Securities and the principal of any and all Securities which shall have become due otherwise than by acceleration (with interest upon such principal and, to the extent that payment of such interest is enforceable under applicable law, on overdue installments of interest, at the same 26 rate as the rate of interest specified in the Securities to the date of such payment or deposit) and (B) such amount as shall be sufficient to cover compensation due to the Trustee and each predecessor Trustee, their respective agents, attorneys and counsel, pursuant to Section 6.06, and (ii) any and all Events of Default under the Indenture, other than the non-payment of the principal of the Securities which shall have become due solely by such declaration of acceleration, shall have been cured, waived or otherwise remedied as provided herein, then, in every such case, the holders of a majority in aggregate principal amount of the Securities then outstanding, by written notice to the Company and to the Trustee, may rescind and annul such declaration and its consequences, but no such waiver or rescission and annulment shall extend to or shall affect any subsequent default or shall impair any right consequent thereon. In case the Trustee shall have proceeded to enforce any right under this Indenture and such proceedings shall have been discontinued or abandoned because of such rescission or annulment or for any other reason or shall have been determined adversely to the Trustee, then and in every such case the Company, the Trustee and the holders of the Securities shall be restored respectively to their several positions and rights hereunder, and all rights, remedies and powers of the Company, the Trustee and the holders of the Securities shall continue as though no such proceeding had been taken. SECTION 5.02 Payment of Securities on Default; Suit Therefor. The Company covenants that (a) in case default shall be made in the payment of any installment of interest (including Compounded Interest and Additional Sums, if any) upon any of the Securities as and when the same shall become due and payable, and such default shall have continued for a period of 30 days, or (b) in case default shall be made in the payment of the principal on any of the Securities as and when the same shall have become due and payable, whether at maturity of the Securities or upon redemption or by declaration or otherwise, then, upon demand of the Trustee, the Company will pay to the Trustee, for the benefit of the holders of the Securities, the whole amount that then shall have become due and payable on all such Securities for principal or interest (including Compounded Interest and Additional Sums, if any) or both, as the case may be, with interest upon the overdue principal and (to the extent that payment of such interest is enforceable under applicable law and, if the Securities are held by Independent Capital Trust II or a trustee of such trust, without duplication of any other amounts paid by Independent Capital Trust II or a trustee in respect thereof) upon the overdue installments of interest (including Compounded Interest and Additional Sums, if any) at the rate borne by the Securities; and, in addition thereto, such further amount as shall be sufficient to cover the costs and expenses of collection, including a reasonable compensation to the Trustee, its agents, attorneys and counsel, and any other amount due to the Trustee pursuant to Section 6.06. In case the Company shall fail forthwith to pay such amounts upon such demand, the Trustee, in its own name and as trustee of an express trust, shall be entitled and empowered to institute any actions or proceedings at law or in equity for the collection of the sums so due and unpaid, and may prosecute any such action or proceeding to judgment or final decreee, and may 27 enforce any such judgment or final decree against the Company or any other obligor on the Securities and collect in the manner provided by law out of the property of the Company or any other obligor on the Securities wherever situated the moneys adjudged or decreed to be payable. In case there shall be pending proceedings for the bankruptcy or for the reorganization of the Company or any other obligor on the Securities under Title 11, United States Code, or any other applicable law, or in case a receiver or trustee shall have been appointed for the property of the Company or such other obligor, or in the case of any other similar judicial proceedings relative to the Company or other obligor upon the Securities, or to the creditors or property of the Company or such other obligor, the Trustee, irrespective of whether the principal of the Securities shall then be due and payable as therein expressed or by declaration or otherwise and irrespective of whether the Trustee shall have made any demand pursuant to the provisions of this Section 5.02, shall be entitled and empowered, by intervention in such proceedings or otherwise, to file and prove a claim or claims for the whole amount of principal and interest owing and unpaid in respect of the Securities and, in case of any judicial proceedings, to file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for amounts due to the Trustee pursuant to 6.06) and of the Securityholders allowed in such judicial proceedings relative to the Company or any other obligor on the Securities, or to the creditors or property of the Company or such other obligor, unless prohibited by applicable law and regulations, to vote on behalf of the holders of the Securities in any election of a trustee or a standby trustee in arrangement, reorganization, liquidation or other bankruptcy or insolvency proceedings or person performing similar functions in comparable proceedings, and to collect and receive any moneys or other property payable or deliverable on any such claims, and to distribute the same after the deduction of its charges and expenses; and any receiver, assignee or trustee in bankruptcy or reorganization is hereby authorized by each of the Securityholders to make such payments to the Trustee, and, in the event that the Trustee shall consent to the making of such payments directly to the Securityholders, to pay to the Trustee such amounts as shall be sufficient to cover reasonable compensation to the Trustee, each predecessor Trustee and their respective agents, attorneys and counsel, and all other amounts due to the Trustee pursuant to Section 6.06. Nothing herein contained shall be construed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Securityholder any plan of reorganization, arrangement, adjustment or composition affecting the Securities or the rights of any holder thereof or to authorize the Trustee to vote in respect of the claim of any Securityholder in any such proceeding. All rights of action and of asserting claims under this Indenture, or under any of the Securities, may be enforced by the Trustee without the possession of any of the Securities, or the production thereof on any trial or other proceeding relative thereto, and any such suit or proceeding instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment shall be for the ratable benefit of the holders of the Securities. 28 In any proceedings brought by the Trustee (and also any proceedings involving the interpretation of any provision of this Indenture to which the Trustee shall be a party) the Trustee shall be held to represent all the holders of the Securities, and it shall not be necessary to make any holders of the Securities parties to any such proceedings. SECTION 5.03 Application of Moneys Collected by Trustee. Any moneys collected by the Trustee shall be applied in the order following, at the date or dates fixed by the Trustee for the distribution of such moneys, upon presentation of the Securities in respect of which moneys have been collected, and stamping thereon the payment, if only partially paid, and upon surrender thereof if fully paid: First: To the payment of costs and expenses of collection applicable to the Securities and all other amounts due to the Trustee under Section 6.06; Second: To the payment of all Senior and Subordinate Indebtedness of the Company if and to the extent required by Article XV; Third: To the payment of the amounts then due and unpaid upon Securities for principal of and interest (including Compounded Interest and Additional Sums, if any) on the Securities, in respect of which or for the benefit of which money has been collected, ratably, without preference of priority of any kind, according to the amounts due on such Securities for principal and interest, respectively; and Fourth: To the Company. SECTION 5.04 Proceedings by Securityholders. No holder of any Security shall have any right by virtue of or by availing of any provision of this Indenture to institute any suit, action or proceeding in equity or at law upon or under or with respect to this Indenture or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless such holder previously shall have given to the Trustee written notice of an Event of Default and of the continuance thereof with respect to the Securities specifying such Event of Default, as hereinbefore provided, and unless also the holders of not less than 25% in aggregate principal amount of the Securities then outstanding shall have made written request upon the Trustee to institute such action, suit or proceeding in its own name as Trustee hereunder and shall have offered to the Trustee such reasonable indemnity as it may require against the costs, expenses and liabilities to be incurred therein or thereby, and the Trustee for 60 days after its receipt of such notice, request and offer of indemnity shall have failed to institute any such action, suit or proceeding, it being understood and intended, and being expressly covenanted by the taker and holder of every Security with every other taker and holder and the Trustee, that no one or more holders of Securities shall have any right in any manner whatever by virtue of or by availing of any provision of this Indenture to affect, disturb or prejudice the rights of any other holder of Securities, 29 or to obtain or seek to obtain priority over or preference to any other such holder, or to enforce any right under this Indenture, except in the manner herein provided and for the equal, ratable and common benefit of all holders of Securities. Notwithstanding any other provisions in this Indenture, however, the right of any holder of any Security to receive payment of the principal of and interest (including Compounded Interest and Additional Sums, if any) on such Security, on or after the same shall have become due and payable, or to institute suit for the enforcement of any such payment, shall not be impaired or affected without the consent of such holder. For the protection and enforcement of the provisions of this Section, each and every Securityholder and the Trustee shall be entitled to such relief as can be given either at law or in equity. The Company and the Trustee acknowledge that pursuant to the Declaration, the holders of Preferred Securities are entitled, in the circumstances and subject to the limitations set forth therein, to commence a Direct Action with respect to any Event of Default under this Indenture and the Securities. SECTION 5.05 Proceedings by Trustee. In case an Event of Default occurs with respect to Securities and is continuing, the Trustee may in its discretion proceed to protect and enforce the rights vested in it by this Indenture by such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and enforce any of such rights, either by suit in equity or by action at law or by proceeding in bankruptcy or otherwise, whether for the specific enforcement of any covenant or agreement contained in this Indenture or in aid of the exercise of any power granted in this Indenture, or to enforce any other legal or equitable right vested in the Trustee by this Indenture or by law. SECTION 5.06 Remedies Cumulative and Continuing. All powers and remedies given by this Article V to the Trustee or to the Securityholders shall, to the extent permitted by law, be deemed cumulative and not exclusive of any other powers and remedies available to the Trustee or the holders of the Securities, by judicial proceedings or otherwise, to enforce the performance or observance of the covenants and agreements contained in this Indenture or otherwise established with respect to the Securities, and no delay or omission of the Trustee or of any holder of any of the Securities to exercise any right or power accruing upon any Event of Default occurring and continuing as aforesaid shall impair any such right or power, or shall be construed to be a waiver of any such default or an acquiescence therein; and, subject to the provisions of Section 5.04, every power and remedy given by this Article V or by law to the Trustee or to the Securityholders may be exercised from time to time, and as often as shall be deemed expedient, by the Trustee or by the Securityholders. 30 SECTION 5.07 Direction of Proceedings and Waiver of Defaults by Majority of Securityholders. The holders of a majority in aggregate principal amount of the Securities at the time outstanding shall have the right to direct the time, method, and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee; PROVIDED, HOWEVER, that (subject to the provisions of Section 6.01) the Trustee shall have the right to decline to follow any such direction if the Trustee shall determine that the action so directed would be unjustly prejudicial to the holders not taking part in such direction or if the Trustee being advised by counsel determines that the action or proceeding so directed may not lawfully be taken or if the Trustee in good faith by its board of directors or trustees, executive committee, or a trust committee of directors or trustees and/or Responsible Officers shall determine that the action or proceedings so directed would involve the Trustee in personal liability. Prior to any declaration accelerating the maturity of the Securities, the holders of a majority in aggregate principal amount of the Securities at the time outstanding may on behalf of the holders of all of the Securities waive any past default or Event of Default and its consequences except a default (a) in the payment of principal of or interest (including Compounded Interest and Additional Sums, if any) on any of the Securities or (b) in respect of covenants or provisions hereof which cannot be modified or amended without the consent of the holder of each Security affected; PROVIDED, HOWEVER, that if the Securities are held by the Property Trustee, such waiver or modification to such waiver shall not be effective until the holders of a majority in aggregate liquidation amount of Trust Securities shall have consented to such waiver or modification to such waiver; PROVIDED FURTHER, that if the consent of the holder of each outstanding Security is required, such waiver shall not be effective until each holder of the Trust Securities shall have consented to such waiver. Upon any such waiver, the default covered thereby shall be deemed to be cured for all purposes of this Indenture and the Company, the Trustee and the holders of the Securities shall be restored to their former positions and rights hereunder, respectively; but no such waiver shall extend to any subsequent or other default or impair any right consequent thereon. Whenever any default or Event of Default hereunder shall have been waived as permitted by this Section 5.07, said default or Event of Default shall for all purposes of the Securities and this Indenture be deemed to have been cured and to be not continuing. SECTION 5.08 Notice of Defaults. The Trustee shall, within 90 days after the occurrence of a Default with respect to the Securities known to a Responsible Officer of the Trustee, mail to all Securityholders, as the names and addresses of such holders appear upon the Security Register, notice of all Defaults known to the Trustee, unless such Defaults shall have been cured before the giving of such notice; and provided that, except in the case of default in the payment of the principal of or interest (including Compounded Interest or Additional Sums, if any) on any of the Securities, the Trustee shall be protected in withholding such notice if and so long as the board of directors, the executive committee, or a trust committee of directors and/or Responsible Officers of the Trustee in good faith determines that the withholding of such notice is in the interests of the Securityholders; and provided further, that in the case of any default of the character specified in Section 5.01(c) no such notice to 31 Securityholders shall be given until at least 60 days after the occurrence thereof but shall be given within 90 days after such occurrence. SECTION 5.09 Undertaking to Pay Costs. All parties to this Indenture agree, and each holder of any Security by his acceptance thereof shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or in any suit against the Trustee for any action taken or omitted by it as Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys' fees and expenses, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant; but the provisions of this Section 5.09 shall not apply to any suit instituted by the Trustee, to any suit instituted by any Securityholder, or group of Securityholders, holding in the aggregate more than 10% in aggregate principal amount of the Securities outstanding, or to any suit instituted by any Securityholder for the enforcement of the payment of the principal of or interest (including Compounded Interest and Additional Sums, if any) on any Security against the Company on or after the same shall have become due and payable. SECTION 5.10 Waiver of Stay, Extension or Usury Laws. The Company covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law or any usury or other law wherever enacted, now or at any time hereafter in force, which would prohibit or forgive the Company from paying all or any portion of the principal or any interest on (including Additional Sums and Compounded Interest, if any) any such amounts, as contemplated herein, or which may affect the covenants or the performance of this Indenture; and the Company (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such laws and covenants that will not hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted. ARTICLE VI CONCERNING THE TRUSTEE SECTION 6.01 Duties and Responsibilities of Trustee. With respect to the holders of the Securities issued hereunder, the Trustee, prior to the occurrence of an Event of Default and after the curing or waiving of all Events of Default which may have occurred, undertakes to perform such duties and only such duties as are specifically set forth in this Indenture. In case an Event of Default has occurred (which has not been cured or 32 waived) the Trustee shall exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as a prudent man would exercise or use under the circumstances in the conduct of his own affairs. No provision of this Indenture shall be construed to relieve the Trustee from liability for its own negligent action, its own negligent failure to act or its own willful misconduct, except that: (a) prior to the occurrence of an Event of Default and after the curing or waiving of all Events of Default which may have occurred, (1) the duties and obligations of the Trustee shall be determined solely by the express provisions of this Indenture, and the Trustee shall not be liable except for the performance of such duties and obligations as are specifically set forth in this Indenture, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and (2) in the absence of bad faith on the part of the Trustee, the 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 Trustee and conforming to the requirements of this Indenture; but, in the case of any such certificates or opinions which by any provision hereof are specifically required to be furnished to the Trustee, the Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein); (b) the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer or Officers, unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts; and (c) the 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 direction of the Securityholders pursuant to Section 5.07, relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee, under this Indenture. None of the provisions contained in this Indenture shall require the 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 there is reasonable ground for believing that 33 the repayment of such funds or liability is not reasonably assured to it under the terms of this Indenture or adequate indemnity against such risk is not reasonably assured to it. SECTION 6.02 Reliance on Documents, Opinions, etc. Except as otherwise provided in Section 6.01: (a) the Trustee may conclusively rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, bond, note, debenture or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties; (b) any request, direction, order or demand of the Company mentioned herein may be sufficiently evidenced by an Officers' Certificate (unless other evidence in respect thereof be herein specifically prescribed); and any Board Resolution may be evidenced to the Trustee by a copy thereof certified by the Secretary or an Assistant Secretary of the Company; (c) the Trustee may consult with counsel of its selection and any advice or Opinion of Counsel 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 of Counsel; (d) the Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request, order or direction of any of the Securityholders, pursuant to the provisions of this Indenture, unless such Securityholders shall have offered to the Trustee reasonable and sufficient security or indemnity against the costs, expenses and liabilities which may be incurred therein or thereby; nothing contained herein shall, however, relieve the Trustee of the obligation, upon the occurrence of an Event of Default with respect to the Securities (that has not been cured or waived) to exercise with respect to the Securities such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as a prudent man would exercise or use under the circumstances in the conduct of his own affairs. (e) the Trustee shall not be liable for any action taken or omitted by it in good faith and believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Indenture; nothing contained herein shall, however, relieve the Trustee of the obligation, upon the occurrence of an Event of Default (that has not been cured or waived), to exercise such of the rights and powers vested in it by this Indenture, and to use the same degree 34 of care and skill in their exercise, as a prudent man would exercise or use under the circumstances in the conduct of his own affairs; (f) the 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, consent, order, approval, bond, debenture, coupon or other paper or document, unless requested in writing to do so by the holders of a majority in aggregate principal amount of the outstanding Securities; provided, however, that if the payment within a reasonable time to the Trustee of the costs, expenses or liabilities likely to be incurred by it in the making of such investigation is, in the opinion of the Trustee, not reasonably assured to the Trustee by the security afforded to it by the terms of this Indenture, the Trustee may require reasonable indemnity against such expense or liability as a condition to so proceeding; (g) the Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents (including any Authenticating Agent) or attorneys, and the Trustee shall not be responsible for any misconduct or negligence on the part of any such agent or attorney appointed by it with due care; (h) the Trustee shall not be charged with knowledge of any Default or Event of Default with respect to the Securities unless (1) such default is a default under Sections 5.01(a) (other than a default with respect to the payment of Compounded Interest or Additional Sums) and 5.01(b) of the Indenture and the Trustee is the paying agent hereunder, (2) a Responsible Officer shall have actual knowledge of such Default or Event of Default or (3) written notice of such Default or Event of Default shall have been given to the Trustee at the Principal Office of the Trustee by the Company or any other obligor on the Securities or by any holder of the Securities and such notice references the Securities and this Indenture; (i) the Trustee shall not be liable for any action taken, suffered or omitted by it in good faith, without negligence or willful misconduct and believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Indenture; and (j) the rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder, and to each agent, custodian and other Person employed to act hereunder. 35 SECTION 6.03 No Responsibility for Recitals, etc. The recitals contained herein and in the Securities (except in the certificate of authentication of the Trustee or the Authenticating Agent) shall be taken as the statements of the Company and the Trustee and the Authenticating Agent assume no responsibility for the correctness of the same. The Trustee and the Authenticating Agent make no representations as to the validity or sufficiency of this Indenture or of the Securities. The Trustee and the Authenticating Agent shall not be accountable for the use or application by the Company of any Securities or the proceeds of any Securities authenticated and delivered by the Trustee or the Authenticating Agent in conformity with the provisions of this Indenture. SECTION 6.04 Trustee, Authenticating Agent, Paying Agents, Transfer Agents or Registrar May Own Securities. The Trustee or any Authenticating Agent or any paying agent or any transfer agent or any Security registrar, in its individual or any other capacity, may become the owner or pledgee of Securities with the same rights it would have if it were not Trustee, Authenticating Agent, paying agent, transfer agent or Security registrar. SECTION 6.05 Moneys to be Held in Trust. Subject to the provisions of Section 11.04, all moneys received by the Trustee or any paying agent shall, until used or applied as herein provided, be held in trust for the purpose for which they were received, but need not be segregated from other funds except to the extent required by law. The Trustee and any paying agent shall be under no liability for interest on any money received by it hereunder except as otherwise agreed in writing with the Company. So long as no Event of Default shall have occurred and be continuing, all interest allowed on any such moneys shall be paid from time to time upon the written order of the Company, signed by the Chairman of the Board of Directors, the President, a Vice President, the Treasurer or an Assistant Treasurer of the Company. SECTION 6.06 Compensation and Expenses of Trustee. The Company, as issuer of Securities under this Indenture, covenants and agrees to pay to the Trustee from time to time, and the Trustee shall be entitled to, such compensation as shall be agreed to in writing between the Company and the Trustee (which shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust), and the Company will pay or reimburse the Trustee upon its request for all reasonable expenses, disbursements and advances incurred or made by the Trustee in accordance with any of the provisions of this Indenture (including the reasonable compensation and the expenses and disbursements of its counsel and of all persons not regularly in its employ) except any such expense, disbursement or advance as may arise from its negligence or bad faith. The Company also covenants to indemnify each of the Trustee or any predecessor Trustee (and its officers, agents, directors and employees) for, and to hold it harmless against, any and all loss, damage, claim, liability or expense including taxes (other than 36 taxes based on the income of the Trustee) incurred without negligence or bad faith on the part of the Trustee and arising out of or in connection with the acceptance or administration of the trust or trusts hereunder, including the costs and expenses of defending itself against any claim of liability in the premises. The obligations of the Company under this Section 6.06 to compensate and indemnify the Trustee and to pay or reimburse the Trustee for expenses, disbursements and advances shall constitute additional indebtedness hereunder. Such additional indebtedness shall be secured by a lien prior to that of the Securities upon all property and funds held or collected by the Trustee as such, except funds held in trust for the benefit of the holders of particular Securities. When the Trustee incurs expenses or renders services in connection with an Event of Default specified in Section 5.01(d) or Section 5.01(e), the expenses (including the reasonable charges and expenses of its counsel) and the compensation for the services are intended to constitute expenses of administration under any applicable federal or state bankruptcy, insolvency or other similar law. The provisions of this Section shall survive the resignation or removal of the Trustee and the defeasance or other termination of this Indenture. SECTION 6.07 Officers' Certificate as Evidence. Except as otherwise provided in Sections 6.01 and 6.02, whenever in the administration of the provisions of this Indenture the Trustee shall deem it necessary or desirable that a matter be proved or established prior to taking or omitting any action hereunder, such matter (unless other evidence in respect thereof is herein specifically prescribed) may, in the absence of negligence or bad faith on the part of the Trustee, be deemed to be conclusively proved and established by an Officers' Certificate delivered to the Trustee, and such certificate, in the absence of negligence or bad faith on the part of the Trustee, shall be full warrant to the Trustee for any action taken or omitted by it under the provisions of this Indenture upon the faith thereof. SECTION 6.08 Conflicting Interest of Trustee. If the Trustee has or shall acquire any "conflicting interest" within the meaning of Section 310(b) of the Trust Indenture Act, the Trustee and the Company shall in all respects comply with the provisions of Section 310(b) of the Trust Indenture Act. SECTION 6.09 Eligibility of Trustee. The Trustee hereunder shall at all times 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 a corporation or other Person permitted to act as trustee by the Commission 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. 37 If such corporation publishes reports of condition at least annually, pursuant to law or to the requirements of the aforesaid supervising or examining authority, then for the purposes of this Section 6.09 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. The Company may not, nor may any Person directly or indirectly controlling, controlled by, or under common control with the Company, serve as Trustee. In case at any time the Trustee shall cease to be eligible in accordance with the provisions of this Section 6.09, the Trustee shall resign immediately in the manner and with the effect specified in Section 6.10. SECTION 6.10 Resignation or Removal of Trustee. (a) The Trustee, or any trustee or trustees hereafter appointed, may at any time resign by giving written notice of such resignation to the Company and by mailing notice thereof to the holders of the Securities at their addresses as they shall appear on the Security register. Upon receiving such notice of resignation, the Company shall promptly appoint a successor trustee or trustees by written instrument, in duplicate, one copy of which instrument shall be delivered to the resigning Trustee and one copy to the successor trustee. If no successor trustee shall have been so appointed and have accepted appointment within 60 days after the mailing of such notice of resignation to the affected Securityholders, the resigning Trustee, at the expense of the Company, may petition any court of competent jurisdiction for the appointment of a successor trustee, or any Securityholder who has been a bona fide holder of a Security for at least six months may, subject to the provisions of Section 5.09, on behalf of himself and all others similarly situated, petition any such court for the appointment of a successor trustee. Such court may thereupon, after such notice, if any, as it may deem proper and prescribe, appoint a successor trustee. (b) In case at any time any of the following shall occur: (1) the Trustee shall fail to comply with the provisions of Section 6.08 after written request therefor by the Company or by any Securityholder who has been a bona fide holder of a Security or Securities for at least six months, or (2) the Trustee shall cease to be eligible in accordance with the provi sions of Section 6.09 and shall fail to resign after written request therefor by the Company or by any such Securityholder, or 38 (3) the Trustee shall become incapable of acting, or shall be adjudged a bankrupt or insolvent, or a receiver of the Trustee or of its property shall be appointed, or any public officer shall take charge or control of the Trustee or of its property or affairs for the purpose of rehabili tation, conservation or liquidation, or (4) the Trustee shall commence a voluntary case under the Federal bankruptcy laws, as now or hereafter constituted, or any other applicable Federal or state bankruptcy, insolvency or similar law or shall consent to the appointment of or taking possession by a receiver, custodian, liquidator, assignee, trustee, sequestrator (or similar official) of the Trustee or its property or affairs, or shall make an assignment for the benefit of creditors, or shall admit in writing its inability to pay its debts generally as they become due, or shall take corporate action in furtherance of any such action. then, in any such case, the Company may remove the Trustee and appoint a successor trustee by written instrument, in duplicate, one copy of which instrument shall be delivered to the Trustee so removed and one copy to the successor trustee, or, subject to the provisions of Section 5.09, any Securityholder who has been a bona fide holder of a Security for at least six months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor trustee. Such court may thereupon, after such notice, if any, as it may deem proper and prescribe, remove the Trustee and appoint a successor trustee. (c) The holders of a majority in aggregate principal amount of the Securities at the time outstanding may at any time remove the Trustee and nominate a successor trustee, which shall be deemed appointed as successor trustee unless within 10 days after such nomination the Company objects thereto or if no successor trustee shall have been so appointed and shall have accepted appointment within 30 days after such removal, in which case the Trustee so removed or any Securityholder, upon the terms and conditions and otherwise as in subsection (a) of this Section 6.10 provided, may petition any court of competent jurisdiction for an appointment of a successor trustee. If a successor trustee shall not have accepted appointment within 30 days after the removal of the Trustee, the Trustee, at the expense of the Company, may petition any court of competent jurisdiction for the appointment of a successor trustee. (d) Any resignation or removal of the Trustee and appointment of a successor trustee pursuant to any of the provisions of this Section 6.10 shall become 39 effective upon acceptance of appointment by the successor trustee as provided in Section 6.11. (e) The Company shall give notice of each resignation and each removal of the Trustee with respect to the Securities and each appointment of a successor Trustee with respect to the Securities to all holders of Securities. Each notice shall include the name of the successor Trustee and the address of its Corporate Trust Office. SECTION 6.11 Acceptance by Successor Trustee. Any successor trustee appointed as provided in Section 6.10 shall execute, acknowledge and deliver to the Company and to its predecessor trustee an instrument accepting such appointment hereunder, and thereupon the resignation or removal of the retiring trustee shall become effective and such successor trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, duties and obligations of its predecessor hereunder, with like effect as if originally named as trustee herein; but, nevertheless, on the written request of the Company or of the successor trustee, the trustee ceasing to act shall, upon payment of any amounts then due it pursuant to the provisions of Section 6.06, execute and deliver an instrument transferring to such successor trustee all the rights and powers of the trustee so ceasing to act and shall duly assign, transfer and deliver to such successor trustee all property and money held by such retiring trustee thereunder. Upon request of any such successor trustee, the Company shall execute any and all instruments in writing for more fully and certainly vesting in and confirming to such successor trustee all such rights and powers. Any trustee ceasing to act shall, nevertheless, retain a lien upon all property or funds held or collected by such trustee to secure any amounts then due it pursuant to the provisions of Section 6.06. No successor trustee shall accept appointment as provided in this Section 6.11 unless at the time of such acceptance such successor trustee shall be qualified under the provisions of Section 6.08 and eligible under the provisions of Section 6.09. Upon acceptance of appointment by a successor trustee as provided in this Section 6.11, the Company shall mail notice of the succession of such trustee hereunder to the holders of Securities at their addresses as they shall appear on the Security register. If the Company fails to mail such notice within 10 days after the acceptance of appointment by the successor trustee, the successor trustee shall cause such notice to be mailed at the expense of the Company. SECTION 6.12 Succession by Merger, etc. Any corporation into which the Trustee may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Trustee shall be a party, or any corporation succeeding to all or substantially all of the 40 corporate trust business of the Trustee, shall be the successor of the Trustee hereunder without the execution or filing of any paper or any further act on the part of any of the parties hereto. In case at the time such successor to the Trustee shall succeed to the trusts created by this Indenture any Securities shall have been authenticated but not delivered, any such successor to the Trustee may adopt the certificate of authentication of any predecessor trustee, and deliver such Securities so authenticated; and in case at that time any of the Securities shall not have been authenticated, any successor to the Trustee may authenticate such Securities either in the name of any predecessor hereunder or in the name of the successor trustee; and in all such cases such certificates shall have the full force which the Securities or this Indenture elsewhere provides that the certificate of the Trustee shall have; provided, however, that the right to adopt the certificate of authentication of any predecessor Trustee or authenticate Securities in the name of any predecessor Trustee shall apply only to its successor or successors by merger, conversion or consolidation. SECTION 6.13 Limitation on Rights of Trustee as a Creditor. The Trustee shall comply with Section 311(a) of the Trust Indenture Act, excluding any creditor relationship described in Section 311(b) of the Trust Indenture Act. A Trustee who has resigned or been removed shall be subject to Section 311(a) of the Trust Indenture Act to the extent included therein. SECTION 6.14 Authenticating Agents. There may be one or more Authenticating Agents appointed by the Trustee upon the request of the Company with power to act on its behalf and subject to its direction in the authentication and delivery of Securities issued upon exchange or transfer thereof as fully to all intents and purposes as though any such Authenticating Agent had been expressly authorized to authenticate and deliver Securities; PROVIDED, that the Trustee shall have no liability to the Company for any acts or omissions of the Authenticating Agent with respect to the authentication and delivery of Securities. Any such Authenticating Agent shall at all times be a corporation organized and doing business under the laws of the United States or of any state or territory thereof or of the District of Columbia authorized under such laws to act as Authenticating Agent, having a combined capital and surplus of at least $50,000,000 and being 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 the requirements of such authority, then for the purposes of this Section 6.14 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 an Authenticating Agent shall cease to be eligible in accordance with the provisions of this Section, it shall resign immediately in the manner and with the effect herein specified in this Section. Any corporation into which any Authenticating Agent may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, consolidation or conversion to which any Authenticating Agent shall be a party, or any corporation succeeding to 41 the corporate trust business of any Authenticating Agent, shall be the successor of such Authenticat ing Agent hereunder, if such successor corporation is otherwise eligible under this Section 6.14 without the execution or filing of any paper or any further act on the part of the parties hereto or such Authenticating Agent. Any Authenticating Agent may at any time resign by giving written notice of resignation to the Trustee and to the Company. The Trustee may at any time terminate the agency of any Authenticating Agent by giving written notice of termination to such Authenticating Agent and to the Company. Upon receiving such a notice of resignation or upon such a termination, or in case at any time any Authenticating Agent shall cease to be eligible under this Section 6.14, the Trustee may, and upon the request of the Company shall, promptly appoint a successor Authenticat ing Agent eligible under this Section 6.14, shall give written notice of such appointment to the Company and shall mail notice of such appointment to all Securityholders as the names and addresses of such holders appear on the Security Register. Any successor Authenticating Agent upon acceptance of its appointment hereunder shall become vested with all rights, powers, duties and responsibilities of its predecessor hereunder, with like effect as if originally named as Authenticating Agent herein. The Company, as borrower, agrees to pay to any Authenticating Agent from time to time reasonable compensation for its services. Any Authenticating Agent shall have no responsibility or liability for any action taken by it as such in accordance with the directions of the Trustee. ARTICLE VII CONCERNING THE SECURITYHOLDERS SECTION 7.01 Action by Securityholders. Whenever in this Indenture it is provided that the holders of a specified percentage in aggregate principal amount of the Securities may take any action (including the making of any demand or request, the giving of any notice, consent or waiver or the taking of any other action) the fact that at the time of taking any such action the holders of such specified percentage have joined therein may be evidenced (a) by any instrument or any number of instruments of similar tenor executed by such Securityholders in person or by agent or proxy appointed in writing, or (b) by the record of such holders of Securities voting in favor thereof at any meeting of such Securityholders duly called and held in accordance with the provisions of Article VIII, or (c) by a combination of such instrument or instruments and any such record of such a meeting of such Securityholders. If the Company shall solicit from the Securityholders any request, demand, authorization, direction, notice, consent, waiver or other action, the Company may, at its option, as evidenced by an Officers' Certificate, fix in advance a record date for the determination of 42 Securityholders entitled to give such request, demand, authorization, direction, notice, consent, waiver or other action, but the Company shall have no obligation to do so. If such a record date is fixed, such request, demand, authorization, direction, notice, consent, waiver or other action may be given before or after the record date, but only the Securityholders of record at the close of business on the record date shall be deemed to be Securityholders for the purposes of determining whether Securityholders of the requisite proportion of outstanding Securities have authorized or agreed or consented to such request, demand, authorization, direction, notice, consent, waiver or other action, and for that purpose the outstanding Securities shall be computed as of the record date; PROVIDED, HOWEVER, that no such authorization, agreement or consent by such Securityholders on the record date shall be deemed effective unless it shall become effective pursuant to the provisions of this Indenture not later than six months after the record date. SECTION 7.02 Proof of Execution by Securityholders. Subject to the provisions of Section 6.01, 6.02 and 8.05, proof of the execution of any instrument by a Securityholder or his agent or proxy shall be sufficient if made in accordance with such reasonable rules and regulations as may be prescribed by the Trustee or in such manner as shall be satisfactory to the Trustee. The ownership of Securities shall be proved by the Security Register or by a certificate of the Security registrar. The Trustee may require such additional proof of any matter referred to in this Section as it shall deem necessary. The record of any Securityholders' meeting shall be proved in the manner provided in Section 8.06. SECTION 7.03 Who Are Deemed Absolute Owners. Prior to due presentment for registration of transfer of any Security, the Company, the Trustee, any Authenticating Agent, any paying agent, any transfer agent and any Security registrar may deem the person in whose name such Security shall be registered upon the Security Register to be, and may treat him as, the absolute owner of such Security (whether or not such Security shall be overdue) for the purpose of receiving payment of or on account of the principal of and (subject to Section 2.05) interest on such Security and for all other purposes; and neither the Company nor the Trustee nor any Authenticating Agent nor any paying agent nor any transfer agent nor any Security registrar shall be affected by any notice to the contrary. All such payments so made to any holder for the time being or upon his order shall be valid, and, to the extent of the sum or sums so paid, effectual to satisfy and discharge the liability for moneys payable upon any such Security. 43 SECTION 7.04 Securities Owned by Company Deemed Not Outstanding. In determining whether the holders of the requisite aggregate principal amount of Securities have concurred in any direction, consent or waiver under this Indenture, Securities which are owned by the Company or any other obligor on the Securities or by any Person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company or any other obligor on the Securities shall be disregarded and deemed not to be outstanding for the purpose of any such determination; provided that for the purposes of determining whether the Trustee shall be protected in relying on any such direction, consent or waiver, only Securities which a Responsible Officer of the Trustee actually knows are so owned shall be so disregarded. Securities so owned which have been pledged in good faith may be regarded as outstanding for the purposes of this Section 7.04 if the pledgee shall establish to the satisfaction of the Trustee the pledgee's right to vote such Securities and that the pledgee is not the Company or any such other obligor or Person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company or any such other obligor. In the case of a dispute as to such right, any decision by the Trustee taken upon the advice of counsel shall be full protection to the Trustee. SECTION 7.05 Revocation of Consents; Future Holders Bound. At any time prior to (but not after) the evidencing to the Trustee, as provided in Section 7.01, of the taking of any action by the holders of the percentage in aggregate principal amount of the Securities specified in this Indenture in connection with such action, any holder of a Security (or any Security issued in whole or in part in exchange or substitution therefor), subject to Section 7.01, the serial number of which is shown by the evidence to be included in the Securities the holders of which have consented to such action may, by filing written notice with the Trustee at its principal corporate trust office and upon proof of holding as provided in Section 7.02, revoke such action so far as concerns such Security (or so far as concerns the principal amount represented by any exchanged or substituted Security). Except as aforesaid any such action taken by the holder of any Security shall be conclusive and binding upon such holder and upon all future holders and owners of such Security, and of any Security issued in exchange or substitution therefor, irrespective of whether or not any notation in regard thereto is made upon such Security or any Security issued in exchange or substitution therefor. ARTICLE VIII SECURITYHOLDERS' MEETINGS SECTION 8.01 Purposes of Meetings. A meeting of Securityholders may be called at any time and from time to time pursuant to the provisions of this Article VIII for any of the following purposes: 44 (a) to give any notice to the Company or to the Trustee, or to give any directions to the Trustee, or to consent to the waiving of any default hereunder and its consequences, or to take any other action authorized to be taken by Securityholders pursuant to any of the provisions of Article V; (b) to remove the Trustee and nominate a successor trustee pursuant to the provisions of Article VI; (c) to consent to the execution of an indenture or indentures supplemental hereto pursuant to the provisions of Section 9.02; or (d) to take any other action authorized to be taken by or on behalf of the holders of any specified aggregate principal amount of such Securities under any other provision of this Indenture or under applicable law. SECTION 8.02 Call of Meetings by Trustee. The Trustee may at any time call a meeting of Securityholders to take any action specified in Section 8.01, to be held at such time and at such place in the Borough of Manhattan, The City of New York, as the Trustee shall determine. Notice of every meeting of the Securityholders, setting forth the time and the place of such meeting and in general terms the action proposed to be taken at such meeting, shall be mailed to holders of Securities at their addresses as they shall appear on the Securities Register. Such notice shall be mailed not less than 20 nor more than 180 days prior to the date fixed for the meeting. SECTION 8.03 Call of Meetings by Company or Securityholders. In case at any time the Company pursuant to a resolution of the Board of Directors, or the holders of at least 10% in aggregate principal amount of the Securities then outstanding, shall have requested the Trustee to call a meeting of Securityholders, by written request setting forth in reasonable detail the action proposed to be taken at the meeting, and the Trustee shall not have mailed the notice of such meeting within 20 days after receipt of such request, then the Company or such Securityholders may determine the time and the place in said Borough of Manhattan for such meeting and may call such meeting to take any action authorized in Section 8.01, by mailing notice thereof as provided in Section 8.02. SECTION 8.04 Qualifications for Voting. To be entitled to vote at any meeting of Securityholders a Person shall (a) be a holder of one or more Securities or (b) a Person appointed by an instrument in writing as proxy by a holder of one or more Securities. The only Persons who shall be entitled to be present or to speak at any meeting of Securityholders shall be the Persons entitled to vote at such meeting and their counsel 46 and any representatives of the Trustee and its counsel and any representatives of the Company and its counsel. SECTION 8.05 Regulations. Notwithstanding any other provisions of this Indenture, the Trustee may make such reasonable regulations as it may deem advisable for any meeting of Securityholders, in regard to proof of the holding of Securities and of the appointment of proxies, and in regard to the appointment and duties of inspectors of votes, the submission and examination of proxies, certificates and other evidence of the right to vote, and such other matters concerning the conduct of the meeting as it shall think fit. The Trustee shall, by an instrument in writing, appoint a temporary chairman of the meeting, unless the meeting shall have been called by the Company or by Securityholders as provided in Section 8.03, in which case the Company or the Securityholders calling the meeting, as the case may be, shall in like manner appoint a temporary chairman. A permanent chairman and a permanent secretary of the meeting shall be elected by majority vote of the meeting. Subject to the provisions of Section 8.04, at any meeting each holder of Securities or proxy therefor shall be entitled to one vote for each $10 principal amount of Securities held or represented by him; PROVIDED, HOWEVER, that no vote shall be cast or counted at any meeting in respect of any Security challenged as not outstanding and ruled by the chairman of the meeting to be not outstanding. The chairman of the meeting shall have no right to vote other than by virtue of Securities held by him or instruments in writing as aforesaid duly designating him as the person to vote on behalf of other Securityholders. Any meeting of Securityholders duly called pursuant to the provisions of Section 8.02 or 8.03 may be adjourned from time to time by a majority of those present, and the meeting may be held as so adjourned without further notice. SECTION 8.06 Voting. The vote upon any resolution submitted to any meeting of holders of Securities shall be by written ballots on which shall be subscribed the signatures of such holders or of their representatives by proxy and the serial number or numbers of the Securities held or represented by them. The permanent chairman of the meeting shall appoint two inspectors of votes who shall count all votes cast at the meeting for or against any resolution and who shall make and file with the secretary of the meeting their verified written reports in triplicate of all votes cast at the meeting. A record in duplicate of the proceedings of each meeting of Securityholders shall be prepared by the secretary of the meeting and there shall be attached to said record the original reports of the inspectors of votes on any vote by ballot taken thereat and affidavits by one or more persons having knowledge of the facts setting forth a copy of the notice of the meeting and showing that said notice was mailed as provided in Section 8.02. The record shall show the serial numbers of the Securities voting in favor of or against any resolution. The record shall be signed and verified by the affidavits of the permanent chairman and secretary of the meeting and one of the duplicates shall be delivered 46 to the Company and the other to the Trustee to be preserved by the Trustee, the latter to have attached thereto the ballots voted at the meeting. Any record so signed and verified shall be conclusive evidence of the matters therein stated. ARTICLE IX AMENDMENTS SECTION 9.01 Without Consent of Securityholders. The Company, when authorized by a Board Resolution, and the Trustee may from time to time and at any time amend the Indenture, without the consent of the Securityholders, for one or more of the following purposes: (a) to evidence the succession of another Person to the Company, or successive successions, and the assumption by the successor Person of the covenants, agreements and obligations of the Company pursuant to Article X hereof; (b) to add to the covenants of the Company such further covenants, restrictions or conditions for the protection of the Securityholders as the Board of Directors shall consider to be for the protection of the Securityholders, and to make the occurrence, or the occurrence and continuance, of a default in any of such additional covenants, restrictions or conditions a default or an Event of Default permitting the enforcement of all or any of the remedies provided in this Indenture as herein set forth; provided, however, that in respect of any such additional covenant, restriction or condition such amendment may provide for a particular period of grace after default (which period may be shorter or longer than that allowed in the case of other defaults) or may provide for an immediate enforcement upon such default or may limit the remedies available to the Trustee upon such default; (c) to cure any ambiguity or to correct or supplement any provision contained herein or in any supplemental indenture which may be defective or inconsis tent with any other provision contained herein or in any supplemental indenture, or to make such other provisions in regard to matters or questions arising under this Indenture; PROVIDED THAT any such action shall not adversely affect the interests of the holders of the Securities; (d) to evidence and provide for the acceptance of appointment hereunder by a successor trustee with respect to the Securities; 47 (e) to make provision for transfer procedures, certification, book-entry provisions and all other matters required pursuant to Section 2.06 or otherwise necessary, desirable or appropriate in connection with the issuance of Securities to holders of Preferred Securities in the event of a distribution of Securities by Independent Capital Trust II following a Dissolution Event; (f) to qualify or maintain qualification of this Indenture under the Trust Indenture Act; and (g) to make any change that does not adversely affect the rights of any Securityholder. The Trustee is hereby authorized to join with the Company in the execution of any supplemental indenture to effect such amendment, to make any further appropriate agreements and stipulations which may be therein contained and to accept the conveyance, transfer and assignment of any property thereunder, but the Trustee shall not be obligated to, but may in its discretion, enter into any such supplemental indenture which affects the Trustee's own rights, duties or immunities under this Indenture or otherwise. Any amendment to the Indenture authorized by the provisions of this Section 9.01 may be executed by the Company and the Trustee without the consent of the holders of any of the Securities at the time outstanding, notwithstanding any of the provisions of Section 9.02. SECTION 9.02 With Consent of Securityholders. With the consent (evidenced as provided in Section 7.01) of the holders of a majority in aggregate principal amount of the Securities at the time outstanding, the Company, when authorized by a Board Resolution, and the Trustee may from time to time and at any time amend the Indenture for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Indenture or of modifying in any manner the rights of the holders of the Securities; provided, however, that no such amendment shall without the consent of the holders of each Security then outstanding and affected thereby (i) change the Maturity Date of any Security, or reduce the rate or extend the time of payment of interest thereon (except as contemplated by Article XVI), or reduce the principal amount thereof, or reduce any amount payable on redemption thereof, or make the principal thereof or any interest thereon payable in any coin or currency other than that provided in the Securities, or impair or affect the right of any Securityholder to institute suit for payment thereof, or (ii) reduce the aforesaid percentage of Securities the holders of which are required to consent to any such amendment to the Indenture, PROVIDED, HOWEVER, that if the Securities are held by Independent Capital Trust II, such amendment shall not be effective until the holders of a majority in liquidation amount of Trust Securities shall have consented to such amendment; PROVIDED, FURTHER, that if the consent of the holder of each outstanding Security is required, such amendment shall not be effective until each holder of the Trust Securities shall have consented to such amendment. 48 Upon the request of the Company accompanied by a copy of a resolution of the Board of Directors certified by its Secretary or Assistant Secretary authorizing the execution of any supplemental indenture affecting such amendment, and upon the filing with the Trustee of evidence of the consent of Securityholders as aforesaid, the Trustee shall join with the Company in the execution of such supplemental indenture unless such supplemental indenture affects the Trustee's own rights, duties or immunities under this Indenture or otherwise, in which case the Trustee may in its discretion, but shall not be obligated to, enter into such supplemental indenture. Promptly after the execution by the Company and the Trustee of any supplemental indenture pursuant to the provisions of this Section, the Trustee shall transmit by mail, first class postage prepaid, a notice, prepared by the Company, setting forth in general terms the substance of such supplemental indenture, to the Securityholders as their names and addresses appear upon the Security Register. Any failure of the Trustee to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such supplemental indenture. It shall not be necessary for the consent of the Securityholders under this Section 9.02 to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such consent shall approve the substance thereof. SECTION 9.03 Compliance with Trust Indenture Act; Effect of Supplemental Indentures. Any supplemental indenture executed pursuant to the provisions of this Article IX shall comply with the Trust Indenture Act. Upon the execution of any supplemental indenture pursuant to the provisions of this Article IX, this Indenture shall be and be deemed to be modified and amended in accordance therewith and the respective rights, limitations of rights, obligations, duties and immunities under this Indenture of the Trustee, the Company and the holders of Securities shall thereafter be determined, exercised and enforced hereunder subject in all respects to such modifications and amendments and all the terms and conditions of any such supplemental indenture shall be and be deemed to be part of the terms and conditions of this Indenture for any and all purposes. SECTION 9.04 Notation on Securities. Securities authenticated and delivered after the execution of any supplemental indenture affecting such series pursuant to the provisions of this Article IX may bear a notation in form approved by the Trustee as to any matter provided for in such supplemental indenture. If the Company or the Trustee shall so determine, new Securities so modified as to conform, in the opinion of the Trustee and the Board of Directors, to any modification of this Indenture contained in any such supplemental indenture may be prepared and executed by the Company, authenticated by the Trustee or the Authenticating Agent and delivered in exchange for the Securities then outstanding. 49 SECTION 9.05 Evidence of Compliance of Supplemental Indenture to be Furnished Trustee. The Trustee, subject to the provisions of Sections 6.01 and 6.02, may receive and rely upon, in addition to the document required by Section 13.06, an Officers' Certificate and an Opinion of Counsel as conclusive evidence that any supplemental indenture executed pursuant hereto complies with the requirements of this Article IX. ARTICLE X CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE SECTION 10.01. Company May Consolidate, etc., on Certain Terms. Nothing contained in this Indenture or in any of the Securities shall prevent any consolidation or merger of the Company with or into any other Person (whether or not affiliated with the Company, as the case may be), or successive consolidations or mergers in which the Company or its successor or successors, as the case may be, shall be a party or parties, or shall prevent any sale, conveyance, transfer or lease of the property of the Company, or its successor or successors as the case may be, as an entirety, or substantially as an entirety, to any other Person (whether or not affiliated with the Company, or its successor or successors, as the case may be) authorized to acquire and operate the same; PROVIDED, that (a) the Company is the surviving Person, or the Person formed by or surviving any such consolidation or merger (if other than the Company) or to which such sale, conveyance, transfer or lease of property is made is a Person organized and existing under the laws of the United States or any State thereof or the District of Columbia, and (b) upon any such consolidation, merger, sale, conveyance, transfer or lease, the due and punctual payment of the principal of and interest on the Securities according to their tenor and the due and punctual performance and observance of all the covenants and conditions of this Indenture to be kept or performed by the Company shall be expressly assumed, by supplemental indenture (which shall conform to the provisions of the Trust Indenture Act, as then in effect) satisfactory in form to the Trustee executed and delivered to the Trustee by the Person formed by such consolidation, or into which the Company shall have been merged, or by the Person which shall have acquired such property, as the case may be, (c) after giving effect to such consolidation, merger, sale, conveyance, transfer or lease, no Default or Event of Default, or any event which, after notice or lapse of time or both, would become a Default or an Event of Default, shall have occurred and be continuing and (d) such consolidation, merger, sale, conveyance, transfer or lease does not cause the Securities to be downgraded by a nationally recognized statistical rating organization. SECTION 10.02. Successor Corporation to be Substituted for Company. In case of any such consolidation, merger, conveyance or transfer and upon the assumption by the successor corporation, by supplemental indenture, executed and delivered to the Trustee and satisfactory in form to the Trustee, of the due and punctual payment of the principal of and interest on all of the Securities and the due and punctual performance and observance of all of 50 the covenants and conditions of this Indenture to be performed or observed by the Company, such successor Person shall succeed to and be substituted for the Company, with the same effect as if it had been named herein as the party of the first part, and the Company thereupon shall be relieved of any further liability or obligation hereunder or upon the Securities. Such successor Person thereupon may cause to be signed, and may issue either in its own name or in the name of Independent Capital Trust II, any or all of the Securities issuable hereunder which theretofore shall not have been signed by the Company and delivered to the Trustee or the Authenticating Agent; and, upon the order of such successor Person instead of the Company and subject to all the terms, conditions and limitations in this Indenture prescribed, the Trustee or the Authenticating Agent shall authenticate and deliver any Securities which previously shall have been signed and delivered by the officers of the Company to the Trustee or the Authenticating Agent for authentication, and any Securities which such successor Person thereafter shall cause to be signed and delivered to the Trustee or the Authenticating Agent for that purpose. All the Securities so issued shall in all respects have the same legal rank and benefit under this Indenture as the Securities theretofore or thereafter issued in accordance with the terms of this Indenture as though all of such Indentures had been issued at the date of the execution hereof. SECTION 10.03. Opinion of Counsel to be Given Trustee. The Trustee, subject to the provisions of Sections 6.01 and 6.02, may receive an Opinion of Counsel as conclusive evidence that any consolidation, merger, sale, conveyance, transfer or lease, and any assumption, permitted or required by the terms of this Article X complies with the provisions of this Article X. ARTICLE XI SATISFACTION AND DISCHARGE OF INDENTURE SECTION 11.01. Discharge of Indenture. When (a) the Company shall deliver to the Trustee for cancellation all Securities theretofore authenticated (other than any Securities which shall have been destroyed, lost or stolen and which shall have been replaced as provided in Section 2.07) and not theretofore cancelled, or (b) all the Securities not theretofore cancelled or delivered to the Trustee for cancellation shall have become due and payable, or are by their terms to become due and payable within one year or are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption, and the Company shall deposit with the Trustee, in trust, funds sufficient to pay on the Maturity Date or upon redemption all of the Securities (other than any Securities which shall have been destroyed, lost or stolen and which shall have been replaced as provided in Section 2.07) not theretofore cancelled or delivered to the Trustee for cancellation, including principal and interest (including Compounded Interest and Additional Sums, if any) due or to become due to the Maturity Date or redemption date, as the case may be, but excluding, 51 however, the amount of any moneys for the payment of principal of or interest (including Compounded Interest and Additional Sums, if any) on the Securities (1) theretofore repaid to the Company in accordance with the provisions of Section 11.04, or (2) paid to any State or to the District of Columbia pursuant to its unclaimed property or similar laws, and if in either case the Company shall also pay or cause to be paid all other sums payable hereunder by the Company, then this Indenture shall cease to be of further effect except for the provisions of Sections 2.02, 2.06, 2.07, 3.01, 3.02, 3.04, 6.06, 6.10 and 11.04 hereof, which shall survive until such Securities shall mature and be paid. Thereafter, Sections 6.06, 6.10 and 11.04 shall survive, and the Trustee, on demand of the Company accompanied by any Officers' Certificate and an Opinion of Counsel and at the cost and expense of the Company, shall execute proper instruments acknowledging satisfaction of and discharging this Indenture, the Company, however, hereby agreeing to reimburse the Trustee for any costs or expenses thereafter reasonably and properly incurred by the Trustee in connection with this Indenture or the Securities. SECTION 11.02. Deposited Moneys and U.S. Government Obligations to be Held in Trust by Trustee. Subject to the provisions of Section 11.04, all moneys and U.S. Government Obligations deposited with the Trustee pursuant to Sections 11.01 or 11.05 shall be held in trust and applied by it to the payment, either directly or through any paying agent (including the Company if acting as its own paying agent), to the holders of the particular Securities for the payment of which such moneys or U.S. Government Obligations have been deposited with the Trustee, of all sums due and to become due thereon for principal and interest (including Additional Sums and Compounded Interest, if any). The Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the U.S. Government Obligations deposited pursuant to Section 11.05 or the principal and interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the holders of outstanding Securities. SECTION 11.03. Paying Agent to Repay Moneys Held. Upon the satisfaction and discharge of this Indenture all moneys then held by any paying agent of the Securities (other than the Trustee) shall, upon written demand of the Company, be repaid to it or paid to the Trustee, and thereupon such paying agent shall be released from all further liability with respect to such moneys. SECTION 11.04. Return of Unclaimed Moneys. Any moneys deposited with or paid to the Trustee or any paying agent for payment of the principal of or interest on Securities and not applied but remaining unclaimed by the holders of Securities for two years after the date upon which the principal of or interest (including Compounded Interest and Additional Sums, if any) on such Securities, as the case may be, shall have 52 become due and payable, shall be repaid to the Company by the Trustee or such paying agent on written demand; and the holder of any of the Securities shall thereafter look only to the Company for any payment which such holder may be entitled to collect and all liability of the Trustee or such paying agent with respect to such moneys shall thereupon cease. SECTION 11.05. Defeasance Upon Deposit of Moneys or U.S. Government Obligations. The Company shall be deemed to have been Discharged (as defined below) from its obligations with respect to the Securities on the 91st day after the applicable conditions set forth below have been satisfied: (1) the Company shall have deposited or caused to be deposited irrevocably with the Trustee or the Defeasance Agent (as defined below) as trust funds in trust, specifically pledged as security for, and dedicated solely to, the benefit of the holders of the Securities (i) money in an amount, or (ii) U.S. Government Obligations which through the payment of interest and principal in respect thereof in accordance with their terms will provide, not later than one day before the due date of any payment, money in an amount, or (iii) a combina tion of (i) and (ii), sufficient, in the opinion (with respect to (ii) and (iii)) of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee and the Defeasance Agent, if any, to pay and discharge each installment of principal of and interest on the outstanding Securities on the dates such installments of principal and interest are due; (2) if the Securities are then listed on any national securities exchange, the Company shall have delivered to the Trustee and the Defeasance Agent, if any, an Opinion of Counsel to the effect that the exercise of the option under this Section 11.05 would not cause such Securities to be delisted from such exchange; (3) no Default or Event of Default with respect to the Securities shall have occurred and be continuing on the date of such deposit; (4) the Company shall have delivered to the Trustee and the Defeasance Agent, if any, an Opinion of Counsel to the effect that holders of the Securities will not recognize income, gain or loss for United States federal income tax purposes as a result of the exercise of the option under this Section 11.05 and will be subject to United States federal income tax on the same amount and in the same manner and at the same times as would have been the case if such option had not been exercised, and such opinion shall be based on a statute so providing or be accompanied by a private letter ruling to that effect 53 received from the United States Internal Revenue Service or a revenue ruling pertaining to a comparable form of transaction to that effect published by the United States Internal Revenue Service; (5) the Trustee will not have a conflicting interest within the meaning of the Trust Indenture Act; (6) a breach or violation of, or default under, any other agreement or intrument to which the Company is a party or by which it is bound will not result; (7) a trust arising from such deposit will not result which constitutes an investment company within the meaning of the Investment Company Act of 1940, as amended, unless such trust shall be qualified or exempt from regulation thereunder; and (8) the Company shall have delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, each stating that all conditions precedent with respect to such Discharge have been complied with. "Discharged" means that the Company shall be deemed to have paid and discharged the entire indebtedness represented by, and obligations under, the Securities and to have satisfied all the obligations under this Indenture relating to the Securities (and the Trustee, at the expense of the Company, shall execute proper instruments acknowledging the same), except (A) the rights of holders of Securities to receive, from the trust fund described in clause (1) above, payment of the principal of and the interest on the Securities when such payments are due; (B) the Company's obligations with respect to the Securities under Sections 2.06, 2.07, 5.02 and 11.04; and (C) the rights, powers, trusts, duties and immunities of the Trustee hereunder. "Defeasance Agent" means another financial institution which is eligible to act as Trustee hereunder and which assumes all of the obligations of the Trustee necessary to enable the Trustee to act hereunder. In the event such a Defeasance Agent is appointed pursuant to this Section, the following conditions shall apply: (1) The Trustee shall have approval rights over the document appointing such Defeasance Agent and the document setting forth such Defeasance Agent's rights and responsibilities; (2) The Defeasance Agent shall provide verification to the Trustee acknowledg ing receipt of sufficient money and/or U. S. Government Obligations to meet the applicable conditions set forth in this Section 11.05. 54 ARTICLE XII IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS SECTION 12.01. Indenture and Securities Solely Corporate Obligations. No recourse for the payment of the principal of or interest on any Security, or for any claim based thereon or otherwise in respect thereof, and no recourse under or upon any obligation, covenant or agreement of the Company in this Indenture, or in any Security, or because of the creation of any indebtedness represented thereby, shall be had against any incorporator, stockholder, officer or director, as such, past, present or future, of the Company or of any successor Person to the Company, either directly or through the Company or any successor Person to the Company, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise; it being expressly understood that all such liability is hereby expressly waived and released as a condition of, and as a consideration for, the execution of this Indenture and the issue of the Securities. ARTICLE XIII MISCELLANEOUS PROVISIONS SECTION 13.01. Successors. All the covenants, stipulations, promises and agreements in this Indenture contained by the Company shall bind its successors and assigns whether so expressed or not. SECTION 13.02. Official Acts by Successor Corporation. Any act or proceeding by any provision of this Indenture authorized or required to be done or performed by any board, committee or officer of the Company shall and may be done and performed with like force and effect by the like board, committee or officer of any corporation that shall at the time be the lawful sole successor of the Company. SECTION 13.03. Surrender of Company Powers. The Company by instrument in writing executed by authority of 2/3 (two-thirds) of its Board of Directors and delivered to the Trustee may surrender any of the powers reserved to the Company, and thereupon such power so surrendered shall terminate both as to the Company, as the case may be, and as to any successor Person. 55 SECTION 13.04. Addresses for Notices, etc. Any notice or demand which by any provision of this Indenture is required or permitted to be given or served by the Trustee or by the holders of Securities on the Company may be given or served by being deposited postage prepaid by first class mail, registered or certified mail, overnight courier service or conformed telecopy addressed (until another address is filed by the Company with the Trustee for the purpose) to the Company at 288 Union Street, Rockland, Massachusetts 02370, Attention: Richard J. Seaman, Chief Financial Officer. Any notice, direction, request or demand by any Securityholder to or upon the Trustee shall be deemed to have been sufficiently given or made, for all purposes, if given or made in writing (which may be by facsimile) at the office of the Trustee, 101 Barclay Street, 21st Floor West, New York, New York 10286, Attention: Corporate Trust Trustee Administration, facsimile: (212) 815-5915 (unless another address is provided by the Trustee to the Company for such purpose). Any notice or communication to a Securityholder shall be mailed by first class mail to his or her address shown on the register kept by the Security Registrar. Failure to mail a notice or communication to a Securityholder or any defect in it shall not affect its sufficiency with respect to other Securityholders. SECTION 13.05. Governing Law. This Indenture and each Security shall be deemed to be a contract made under the laws of the State of New York, and for all purposes shall be governed by and construed in accordance with the laws of said State, without regard to conflicts of laws principles thereof. SECTION 13.06. Evidence of Compliance with Conditions Precedent. Upon any application or demand by the Company to the Trustee to take any action under any of the provisions of this Indenture, the Company shall furnish to the Trustee an Officers' Certificate stating that in the opinion of the signers all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with and an Opinion of Counsel stating that, in the opinion of such counsel, all such conditions precedent have been complied with. Each certificate or opinion provided for in this Indenture and delivered to the Trustee with respect to compliance with a condition or covenant provided for in this Indenture (except certificates delivered pursuant to Section 3.05) shall include (1) a statement that the Person making such certificate or opinion has read such covenant or condition; (2) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based; (3) a statement that, in the opinion of such Person, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and (4) a statement as to whether or not, in the opinion of such person, such condition or covenant has been complied with. 56 SECTION 13.07. Business Days. In any case where the date of payment of principal of or interest on the Securities will not be a Business Day, the payment of such principal of or interest on the Securities need not be made on such date but may be made on the next succeeding Business Day, with the same force and effect as if made on the date of payment and no interest shall accrue for the period from and after such date, except that if such next succeeding Business Day falls in the next succeeding calendar year, then such payment shall be made on the immediately preceding Business Day, in each case with the same force and effect as if made on such date. SECTION 13.08. Trust Indenture Act to Control. This Indenture is subject to and shall be governed by the provisions of the Trust Indenture Act that are required to be a part of this Indenture. If any provision hereof limits, qualifies or conflicts with a provision of the Trust Indenture Act that is required under such act to be a part of and govern this Indenture, the Trust Indenture Act provision shall control. If any provision of this Indenture modifies or excludes any provision of the Trust Indenture Act that may be so modified or excluded, the latter provision shall be deemed to apply to this Indenture as so modified or to be excluded, as the case may be. SECTION 13.09. Table of Contents, Headings, etc. The table of contents and the titles and headings of the articles and sections of this Indenture have been inserted for convenience of reference only, are not to be considered a part hereof, and shall in no way modify or restrict any of the terms or provisions hereof. SECTION 13.10. Execution in Counterparts. This Indenture may be executed in any number of counterparts, each of which shall be an original, but such counterparts shall together constitute but one and the same instrument. SECTION 13.11. Separability. In case any one or more of the provisions contained in this Indenture or in the Securities 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 Indenture or of the Securities, but this Indenture and the Securities shall be construed as if such invalid or illegal or unenforceable provision had never been contained herein or therein. SECTION 13.12. Assignment. The Company will have the right at all times to assign any of its respective rights or obligations under this Indenture to a direct or indirect wholly owned Subsidiary of the Company, 57 PROVIDED that, in the event of any such assignment, the Company will remain primarily liable for all such obligations. Subject to the foregoing, the Indenture is binding upon and inures to the benefit of the parties thereto and their respective successors and assigns. This Indenture may not otherwise be assigned by the parties thereto. SECTION 13.13. Acknowledgment of Rights. The Company acknowledges that, with respect to any Securities held by Independent Capital Trust II or a trustee of such trust, if the Property Trustee of such Trust fails to enforce its rights under this Indenture as the holder of the Securities held as the assets of Independent Capital Trust II, any holder of Preferred Securities may institute legal proceedings directly against the Company to enforce such Property Trustee's rights under this Indenture without first instituting any legal proceedings against such Property Trustee or any other person or entity. Notwithstanding the foregoing, if an Event of Default has occurred and is continuing and such event is attributable to the failure of the Company to pay principal of or interest on the Securities when due, the Company acknowledges that a holder of Preferred Securities may directly institute a proceeding for enforcement of payment to such holder of the principal of or interest on the Securities having a principal amount equal to the aggregate liquidation amount of the Preferred Securities of such holder on or after the respective due date specified in the Securities. ARTICLE XIV REDEMPTION OF SECURITIES SECTION 14.01. Special Event Redemption. If a Special Event has occurred and is continuing then, notwithstanding Section 14.02(a) but subject to Section 14.02(c), the Company shall have the right, at any time within 90 days following the occurrence of such Special Event, upon (i) not less than 45 days written notice to the Trustee and (ii) not less than 30 days nor more than 60 days written notice to the Securityholders, to redeem the Securities, in whole (but not in part), at the Redemption Price. The Redemption Price shall be paid prior to 12:00 noon, New York time, on the date of such redemption or such earlier time as the Company determines, PROVIDED that the Company shall deposit with the Trustee an amount sufficient to pay the Redemption Price by 10:00 a.m., New York time, on the date such Redemption Price is to be paid. SECTION 14.02. Optional Redemption by Company. (a) Subject to the provisions of this Article XIV, the Company shall have the right to redeem the Securities, in whole or in part, from time to time, on or after _______ __, 2004, at the Redemption Price. 58 If the Securities are only partially redeemed pursuant to this Section 14.02, the Securities to be redeemed shall be selected on a pro rata basis, by lot or by such other method that the Trustee shall deem appropriate not more than 60 days prior to the date fixed for redemption from the outstanding Securities not previously called for redemption, PROVIDED, HOWEVER, that any such method of selection may be made on the basis of the aggregate principal amount of Securities held by each Securityholder and may be made by making such adjustments as the Company deems fair and appropriate in order that only Securities in denominations of $10 or integral multiples thereof shall be redeemed. The Redemption Price shall be paid prior to 12:00 noon, New York time, on the date of such redemption or at such earlier time as the Company determines, PROVIDED that the Company shall deposit with the Trustee an amount sufficient to pay the Redemption Price by 10:00 a.m., New York time, on the date such Redemption Price is to be paid. (b) Notwithstanding the first sentence of Section 14.02, upon the entry of an order for dissolution of the Independent Capital Trust II by a court of competent jurisdiction, the Securities thereafter will be subject to optional redemption, in whole only, but not in part, on or after _________ __, 2004, at the Redemption Price, and otherwise in accordance with this Article XIV. (c) Any redemption of Securities pursuant to Section 14.01 or Section 14.02 shall be subject to the receipt by the Company of any required regulatory approval. (d) The Company shall not effect a partial redemption of the Securities if such partial redemption would result in a delisting of the Preferred Securities from the NASDAQ National Market or such other exchange or organization as the Preferred Securities are then listed. SECTION 14.03. No Sinking Fund. The Securities are not entitled to the benefit of any sinking fund. SECTION 14.04. Notice of Redemption; Selection of Securities. In case the Company shall desire to exercise the right to redeem all, or, as the case may be, any part of the Securities in accordance with their terms, it shall fix a date for redemption and shall mail a notice of such redemption at least 30 and not more than 60 days prior to the date fixed for redemption to the holders of Securities so to be redeemed as a whole or in part at their last addresses as the same appear on the Security Register. Such mailing shall be by first class mail. The notice if mailed in the manner herein provided shall be conclusively presumed to have been duly given, whether or not the holder receives such notice. In any case, failure to give such notice by mail or any defect in the notice to the holder of any Security designated for redemption as a whole or in part shall not affect the validity of the proceedings for the redemption of any other Security. Each such notice of redemption shall specify the CUSIP number of the Securities to be redeemed, the date fixed for redemption, the redemption price at which the Securities are to be redeemed (or the method by which such redemption price is to be calculated), the place or places of 59 payment that payment will be made upon presentation and surrender of the Securities, that interest accrued to the date fixed for redemption will be paid as specified in said notice, and that on and after said date interest thereon or on the portions thereof to be redeemed will cease to accrue. If less than all the Securities are to be redeemed the notice of redemption shall specify the numbers of the Securities to be redeemed. In case any Security is to be redeemed in part only, the notice of redemption shall state the portion of the principal amount thereof to be redeemed and shall state that on and after the date fixed for redemption, upon surrender of such Security, a new Security or Securities in principal amount equal to the unredeemed portion thereof will be issued. By 10:00 a.m. New York time on the redemption date specified in the notice of redemption given as provided in this Section, the Company will deposit with the Trustee or with one or more paying agents an amount of money sufficient to redeem on the redemption date all the Securities so called for redemption at the appropriate Redemption Price, together with accrued interest to the date fixed for redemption. The Company will give the Trustee notice not less than 45 days prior to the redemption date as to the aggregate principal amount of Securities to be redeemed and the Trustee shall select, in such manner as in its sole discretion it shall deem appropriate and fair, the Securities or portions thereof (in integral multiples of $10, except as otherwise set forth in the applicable form of Security) to be redeemed. SECTION 14.05. Payment of Securities Called for Redemption. If notice of redemption has been given as provided in Section 14.04, the Securities or portions of Securities with respect to which such notice has been given shall become due and payable on the date and at the place or places stated in such notice at the Redemption Price, together with interest accrued to the date fixed for redemption (subject to the rights of holders of Securities on the close of business on a regular record date in respect of an Interest Payment Date occurring on or prior to the redemption date), and on and after said date (unless the Company shall default in the payment of such Securities at the Redemption Price, together with interest accrued to said date) interest (including Compounded Interest and Additional Sums, if any) on the Securities or portions of Securities so called for redemption shall cease to accrue. On presentation and surrender of such Securities at a place of payment specified in said notice, the said Securities or the specified portions thereof shall be paid and redeemed by the Company at the Redemption Price, together with interest (including Compounded Interest and Additional Sums, if any) accrued thereon to the date fixed for redemption (subject to the rights of holders of Securities on the close of business on a regular record date in respect of an Interest Payment Date occurring on or prior to the redemption date). Upon presentation of any Security redeemed in part only, the Company shall execute and the Trustee shall authenticate and make available for delivery to the holder thereof, at the expense of the Company, a new Security or Securities of authorized denominations, in principal amount equal to the unredeemed portion of the Security so presented. 60 ARTICLE XV SUBORDINATION OF SECURITIES SECTION 15.01. Agreement to Subordinate. The Company covenants and agrees, and each holder of Securities issued hereunder likewise covenants and agrees, that the Securities shall be issued subject to the provisions of this Article XV; and each holder of a Security, whether upon original issue or upon transfer or assignment thereof, accepts and agrees to be bound by such provisions. The payment by the Company of the principal of and interest (including Compounded Interest and Additional Sums, if any) on all Securities issued hereunder shall, to the extent and in the manner hereinafter set forth, be subordinated and junior in right of payment in full of principal of all Allocable Amounts on such Senior and Subordinated Indebtedness, whether outstanding at the date of this Indenture or thereafter incurred. No provision of this Article XV shall prevent the occurrence of any Default or Event of Default hereunder. SECTION 15.02. Default on Senior and Subordinated Indebtedness. In the event and during the continuation of any default by the Company in the payment of principal, interest or any other payment due on any Senior and Subordinated Indebtedness (after any grace period with respect to such default has expired and such default has not been cured or waived or ceased to exist), or in the event that the maturity of any Senior and Subordinated Indebtedness has been accelerated because of a default, then, in either case, no payment shall be made by the Company with respect to the principal (including redemption payments) of or interest on the Securities. In the event of the acceleration of the maturity of the Securities, then no payment shall be made by the Company with respect to the principal (including redemption payments) of or interest on the Securities until the holders of all Senior and Subordinated Indebtedness outstanding at the time of such acceleration shall receive payment in full of such Senior and Subordinated Indebtedness (including any amounts due upon acceleration). In the event that, notwithstanding the foregoing, any payment shall be received by the Trustee when such payment is prohibited by the preceding paragraphs of this Section 15.02, such payment shall be held in trust for the benefit of, and shall be paid over or delivered to, the holders of Senior and Subordinated Indebtedness or their respective representatives, or to the trustee or trustees under any indenture pursuant to which any of such Senior and Subordinated Indebtedness may have been issued, as their respective interests may appear, but only to the extent that the holders of the Senior and Subordinated Indebtedness (or their representative or representatives or a trustee) 61 notify the Trustee in writing, within 90 days of such payment of the amounts then due and owing on such Senior and Subordinated Indebtedness and only the amounts specified in such notice to the Trustee shall be paid to the holders of such Senior and Subordinated Indebtedness. SECTION 15.03. Liquidation; Dissolution; Bankruptcy. Upon any payment by the Company or distribution of assets of the Company of any kind or character, whether in cash, property or securities, to creditors upon any dissolution or winding-up or liquidation or reorganization of the Company, whether voluntary or involuntary or in bankruptcy, insolvency, receivership or other proceedings, all Senior and Subordinated Indebtedness of the Company shall first be paid in full, or payment thereof provided for in money in accordance with its terms, before any payment is made by the Company on account of the principal or interest (including Compounded Interest and Additional Sums, if any) on the Securities; and upon any such dissolution or winding-up or liquidation or reorganization, any payment by the Company, or distribution of assets of the Company of any kind or character, whether in cash, property or securities, to which the Securityholders or the Trustee would be entitled to receive from the Company, except for the provisions of this Article XV, shall be paid by the Company or by any receiver, trustee in bankruptcy, liquidating trustee, agent or other Person making such payment or distribution, or by the Securityholders or by the Trustee under the Indenture if received by them or it, directly to the holders of Senior and Subordinated Indebtedness of the Company (PRO RATA to such holders on the basis of the respective amounts of Senior and Subordinated Indebtedness held by such holders, as calculated by the Company) or their representative or representatives, or to the trustee or trustees under any indenture pursuant to which any instruments evidencing such Senior and Subordinated Indebtedness may have been issued, as their respective interests may appear, to the extent necessary to pay all such Senior and Subordinated Indebtedness in full, in money or money's worth, after giving effect to any concurrent payment or distribution to or for the holders of such Senior and Subordinated Indebtedness, before any payment or distribution is made to the Securityholders or to the Trustee. In the event that, notwithstanding the foregoing, any payment or distribution of assets of the Company of any kind or character, whether in cash, property or securities, prohibited by the foregoing, shall be received by the Trustee before all Senior and Subordinated Indebtedness is paid in full, or provision is made for such payment in money in accordance with its terms, such payment or distribution shall be held in trust for the benefit of and shall be paid over or delivered to the holders of such Senior and Subordinated Indebtedness or their representative or representatives, or to the trustee or trustees under any indenture pursuant to which any instruments evidencing such Senior and Subordinated Indebtedness may have been issued, as their respective interests may appear, as calculated by the Company, for application to the payment of all Senior and Subordinated Indebtedness remaining unpaid to the extent necessary to pay all such Senior and Subordinated Indebtedness in full in money in accordance with its terms, after giving effect to any concurrent payment or distribution to or for the benefit of the holders of such Senior and Subordinated Indebtedness. 62 For purposes of this Article XV, the words "cash, property or securities" shall not be deemed to include shares of stock of the Company as reorganized or readjusted, or securities of the Company or any other corporation provided for by a plan of reorganization or readjustment, the payment of which is subordinated at least to the extent provided in this Article XV with respect to the Securities to the payment of Senior and Subordinated Indebtedness that may at the time be outstanding, provided that (i) such Senior and Subordinated Indebtedness is assumed by the new corporation, if any, resulting from any such reorganization or readjustment, and (ii) the rights of the holders of such Senior and Subordinated Indebtedness are not, without the consent of such holders, altered by such reorganization or readjustment. The consolidation of the Company with, or the merger of the Company into, another Person or the liquidation or dissolution of the Company following the sale, conveyance, transfer or lease of its property as an entirety, or substantially as an entirety, to another Person upon the terms and conditions provided for in Article X of this Indenture shall not be deemed a dissolution, winding-up, liquidation or reorganization for the purposes of this Section 15.03 if such other Person shall, as a part of such consolidation, merger, sale, conveyance, transfer or lease, comply with the conditions stated in Article X of this Indenture. Nothing in Section 15.02 or in this Section 15.03 shall apply to claims of, or payments to, the Trustee under or pursuant to Section 6.06 of this Indenture. SECTION 15.04. Subrogation. Subject to the payment in full of all Senior and Subordinated Indebtedness, the rights of the Securityholders shall be subrogated to the rights of the holders of such Senior and Subordinated Indebtedness to receive payments or distributions of cash, property or securities of the Company, as the case may be, applicable to such Senior and Subordinated Indebtedness until the principal of and interest on the Securities shall be paid in full; and, for the purposes of such subrogation, no payments or distributions to the holders of such Senior and Subordinated Indebtedness of any cash, property or securities to which the Securityholders or the Trustee would be entitled except for the provisions of this Article XV, and no payment pursuant to the provisions of this Article XV to or for the benefit of the holders of such Senior and Subordinated Indebtedness by Securityholders or the Trustee, shall, as between the Company, its creditors other than holders of Senior and Subordinated Indebtedness of the Company, and the holders of the Securities, be deemed to be a payment by the Company to or on account of such Senior and Subordinated Indebtedness. It is understood that the provisions of this Article XV are and are intended solely for the purposes of defining the relative rights of the holders of the Securities, on the one hand, and the holders of such Senior and Subordinated Indebtedness on the other hand. Nothing contained in this Article XV or elsewhere in this Indenture or in the Securities is intended to or shall impair, as between the Company, its creditors other than the holders of Senior and Subordinated Indebtedness of the Company, and the holders of the Securities, the obligation of the Company, which is absolute and unconditional, to pay to the holders of the Securities the principal of and interest (including Compounded Interest and Additional Sums, if any) on the Securities as and when the same shall become due and payable in accordance with their terms, or is intended to or shall affect the relative rights of the holders of the Securities and creditors of the 63 Company, as the case may be, other than the holders of Senior and Subordinated Indebtedness of the Company, as the case may be, nor shall anything herein or therein prevent the Trustee or the holder of any Security from exercising all remedies otherwise permitted by applicable law upon default under the Indenture, subject to the rights, if any, under this Article XV of the holders of such Senior and Subordinated Indebtedness in respect of cash, property or securities of the Company, as the case may be, received upon the exercise of any such remedy. Upon any payment or distribution of assets of the Company referred to in this Article XV, the Trustee, subject to the provisions of Article VI of this Indenture, and the Securityholders shall be entitled to conclusively rely upon any order or decree made by any court of competent jurisdiction in which such dissolution, winding-up, liquidation or reorganization proceedings are pending, or a certificate of the receiver, trustee in bankruptcy, liquidation trustee, agent or other Person making such payment or distribution, delivered to the Trustee or to the Securityholders, for the purposes of ascertaining the Persons entitled to participate in such distribution, the holders of Senior and Subordinated Indebtedness and other indebtedness of the Company, as the case may be, the amount thereof or payable thereon, the amount or amounts paid or distributed thereon and all other facts pertinent thereto or to this Article XV. SECTION 15.05. Trustee to Effectuate Subordination. Each Securityholder by such Securityholder's acceptance thereof authorizes and directs the Trustee on such Securityholder's behalf to take such action as may be necessary or appropriate to effectuate the subordination provided in this Article XV and appoints the Trustee such Securityholder's attorney-in-fact for any and all such purposes. SECTION 15.06. Notice by the Company. The Company shall give prompt written notice to a Responsible Officer of the Trustee of any fact known to the Company that would prohibit the making of any payment of monies to or by the Trustee in respect of the Securities pursuant to the provisions of this Article XV. Notwithstanding the provisions of this Article XV or any other provision of this Indenture, the Trustee shall not be charged with knowledge of the existence of any facts that would prohibit the making of any payment of monies to or by the Trustee in respect of the Securities pursuant to the provisions of this Article XV, unless and until a Responsible Officer of the Trustee shall have received written notice thereof from the Company or a holder or holders of Senior and Subordinated Indebtedness or from any trustee therefor; and before the receipt of any such written notice, the Trustee, subject to the provisions of Article VI of this Indenture, shall be entitled in all respects to assume that no such facts exist; PROVIDED, HOWEVER, that if the Trustee shall not have received the notice provided for in this Section 15.06 at least two Business Days prior to the date upon which by the terms hereof any money may become payable for any purpose (including, without limitation, the payment of the principal of or interest (including Compounded Interest and Additional Sums, if any) on any Security), then, anything herein contained to the contrary notwithstanding, the Trustee shall have full power and authority to receive such money and to apply the same to the purposes for which 64 they were received, and shall not be affected by any notice to the contrary that may be received by it within two Business Days prior to such date. The Trustee, subject to the provisions of Article VI of this Indenture, shall be entitled to conclusively rely on the delivery to it of a written notice by a Person representing himself to be a holder of Senior and Subordinated Indebtedness of the Company (or a trustee on behalf of such holder), as the case may be, to establish that such notice has been given by a holder of such Senior and Subordinated Indebtedness or a trustee on behalf of any such holder or holders. In the event that the Trustee determines in good faith that further evidence is required with respect to the right of any Person as a holder of such Senior and Subordinated Indebtedness to participate in any payment or distribution pursuant to this Article XV, the Trustee may request such Person to furnish evidence to the reasonable satisfaction of the Trustee as to the amount of such Senior and Subordinated Indebtedness held by such Person, the extent to which such Person is entitled to participate in such payment or distribution and any other facts pertinent to the rights of such Person under this Article XV, and, if such evidence is not furnished, the Trustee may defer any payment to such Person pending judicial determination as to the right of such Person to receive such payment. Upon any payment or distribution of assets of the Company referred to in this Article XV, the Trustee and the Securityholders shall be entitled to rely upon any order or decree entered by any court of competent jurisdiction in which such insolvency, bankruptcy, receivership, liquidation, reorganization, dissolution, winding up or similar case or proceeding is pending, or a certificate of the trustee in bankruptcy, liquidating trustee, custodian, receiver, assignee for the benefit of creditors, agent or other person making such payment or distribution, delivered to the Trustee or to the Securityholders, for the purpose of ascertaining the persons entitled to participate in such payment or distribution, the holders of Senior and Subordinated Indebtedness and other indebtedness of the Company, the amount thereof or payable thereon, the amount or amounts paid or distributed thereon and all other facts pertinent thereto or to this Article XV. SECTION 15.07. Rights of the Trustee; Holders of Senior and Subordinated Indebtedness. The Trustee in its individual capacity shall be entitled to all the rights set forth in this Article XV in respect of any Senior and Subordinated Indebtedness at any time held by it, to the same extent as any other holder of Senior and Subordinated Indebtedness, and nothing in this Indenture shall deprive the Trustee of any of its rights as such holder. With respect to the holders of Senior and Subordinated Indebtedness of the Company, the Trustee undertakes to perform or to observe only such of its covenants and obligations as are specifically set forth in this Article XV, and no implied covenants or obligations with respect to the holders of such Senior and Subordinated Indebtedness shall be read into this Indenture against the Trustee. The Trustee shall not be deemed to owe any fiduciary duty to the holders of such Senior and Subordinated Indebtedness and, subject to the provisions of Article VI of this Indenture, the Trustee shall not be liable to any holder of such Senior and Subordinated Indebtedness if it shall pay 65 over or deliver to Securityholders, the Company or any other Person money or assets to which any holder of such Senior and Subordinated Indebtedness shall be entitled by virtue of this Article XV or otherwise. Nothing in this Article XV shall apply to claims of, or payments to, the Trustee under or pursuant to Section 6.06. SECTION 15.08. Subordination May Not Be Impaired. No right of any present or future holder of any Senior and Subordinated Indebtedness of the Company to enforce subordination as herein provided shall at any time in any way be prejudiced or impaired by any act or failure to act on the part of the Company, as the case may be, or by any act or failure to act, in good faith, by any such holder, or by any noncompliance by the Company, as the case may be, with the terms, provisions and covenants of this Indenture, regardless of any knowledge thereof that any such holder may have or otherwise be charged with. Without in any way limiting the generality of the foregoing paragraph, the holders of Senior and Subordinated Indebtedness of the Company may, at any time and from time to time, without the consent of or notice to the Trustee or the Securityholders, without incurring responsibil ity to the Securityholders and without impairing or releasing the subordination provided in this Article XV or the obligations hereunder of the holders of the Securities to the holders of such Senior and Subordinated Indebtedness, do any one or more of the following: (i) change the manner, place or terms of payment or extend the time of payment of, or renew or alter, such Senior and Subordinated Indebtedness, or otherwise amend or supplement in any manner such Senior and Subordinated Indebtedness or any instrument evidencing the same or any agreement under which such Senior and Subordinated Indebtedness is outstanding; (ii) sell, exchange, release or otherwise deal with any property pledged, mortgaged or otherwise securing such Senior and Subordinated Indebtedness; (iii) release any Person liable in any manner for the collection of such Senior and Subordinated Indebtedness; and (iv) exercise or refrain from exercising any rights against the Company, as the case may be, and any other Person. ARTICLE XVI EXTENSION OF INTEREST PAYMENT PERIOD SECTION 16.01. Extension of Interest Payment Period. So long as no Event of Default has occurred and is continuing, the Company shall have the right, at any time and from time to time during the term of the Securities, to defer payments of interest by extending the interest payment period of such Securities for a period not exceeding 20 consecutive quarterly periods, including the first such quarterly period during such extension period (the "Extended Interest Payment Period"), during which Extended Interest Payment Period no interest shall be due and payable; PROVIDED THAT no Extended Interest Payment Period shall end on 66 a date other than an Interest Payment Date or extend beyond the Maturity Date. To the extent permitted by applicable law, interest, the payment of which has been deferred because of the extension of the interest payment period pursuant to this Section 16.01, will bear interest thereon at the Coupon Rate compounded quarterly for each quarterly period of the Extended Interest Payment Period ("Compounded Interest"). At the end of the Extended Interest Payment Period, the Company shall pay all interest accrued and unpaid on the Securities, including any Additional Sums and Compounded Interest (together, "Deferred Interest") that shall be payable to the holders of the Securities in whose names the Securities are registered in the Security Register on the first record date preceding the end of the Extended Interest Payment Period. Before the termination of any Extended Interest Payment Period, the Company may further defer payments of interest by further extending such period, PROVIDED that such period, together with all such previous and further extensions within such Extended Interest Payment Period, shall not exceed 20 consecutive quarterly periods, including the first such quarterly period during such Extended Interest Payment Period, end on a date other than an Interest Payment Date or extend beyond the Maturity Date of the Securities. Upon the termination of any Extended Interest Payment Period and the payment of all Deferred Interest then due, the Company may commence a new Extended Interest Payment Period, subject to the foregoing requirements. No interest shall be due and payable during an Extended Interest Payment Period, except at the end thereof, but the Company may prepay at any time all or any portion of the interest accrued during an Extended Interest Payment Period. SECTION 16.02. Notice of Extension. (a) If the Property Trustee is the only registered holder of the Securities at the time the Company selects an Extended Interest Payment Period, the Company shall give written notice to the Administrative Trustees, the Property Trustee and the Trustee of its selection of such Extended Interest Payment Period five Business Days before the earlier of (i) the next succeeding date on which Distributions on the Trust Securities issued by the Trust are payable, or (ii) the date the Trust is required to give notice of the record date, or the date such Distributions are payable, to any national securities exchange or to holders of the Preferred Securities issued by the Trust, but in any event at least five Business Days before such record date. (b) If the Property Trustee is not the only holder of the Securities at the time the Company selects an Extended Interest Payment Period, the Company shall give the holders of the Securities and the Trustee written notice of its selection of such Extended Interest Payment Period at least five Business Days before the earlier of (i) the next succeeding Interest Payment Date, or (ii) the date the Company is required to give notice of the record or payment date of such interest payment to any national securities exchange. (c) The quarterly period in which any notice is given pursuant to paragraphs (a) or (b) of this Section 16.02 shall be counted as one of the 20 quarterly periods permitted in the maximum Extended Interest Payment Period permitted under Section 16.01. 67 The Bank of New York hereby accepts the trusts in this Indenture declared and provided, upon the terms and conditions hereinabove set forth. 68 IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed by their respective officers thereunto duly authorized, as of the day and year first above written. INDEPENDENT BANK CORP. By ------------------------------- Name: Richard J. Seaman Title: Chief Financial Officer THE BANK OF NEW YORK, as Trustee By ------------------------------ Name: Title: 69 EXHIBIT A --------- (FORM OF FACE OF SECURITY) [THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE OF A DEPOSITARY. THIS SECURITY IS EX CHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUM STANCES DESCRIBED IN THE INDENTURE AND MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY. UNLESS THIS DEBENTURE IS PRESENTED BY AN AUTHORIZED REPRESEN TATIVE OF THE DEPOSITORY TO THE TRUST OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY PREFERRED SECURITY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF THE CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.] Principal Amount: $__________ No. 1 CUSIP No. ___________ Independent Capital Trust II ____% JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURE DUE ________ __, 2029 Independent Bank Corp., a Massachusetts corporation (the "Company", which term includes any successor Person under the Indenture hereinafter referred to), for value received, hereby promises to pay to The Bank of New York, as Property Trustee for Independent Capital Trust II or registered assigns, the principal sum of $__________, on ______ __, 2029 (the "Maturity Date"); provided that the Company may redeem this Security on a date not earlier than _________ __, 2004, and to pay interest on the outstanding principal amount hereof from ________ __, 1999, or from the most recent interest payment date (each such date, an "Interest Payment Date") to which interest has been paid or duly provided for, quarterly (subject to deferral as set forth herein) in arrears on the last day of March, June, September and December of each year, commencing ______ ____, 1999, at the rate of ____% per annum until the principal hereof shall have become due and payable, and on any A-1 overdue principal and (without duplication and to the extent that payment of such interest is enforceable under applicable law) on any overdue installment of interest at the same rate per annum compounded quarterly. The amount of interest payable on any Interest Payment Date shall be computed on the basis of a 360-day year of twelve 30-day months and, for any period less than a full calendar quarter, the number of days elapsed in such quarter based upon 30-day months. In the event that any date on which the principal of or interest on this Security is payable is not a Business Day, then the payment payable on such date will be made on the next succeeding Business Day (and without any interest or other payment in respect of any such delay), except that if such next succeeding Business Day falls in the next calendar year, then such payment shall be made on the immediately preceding Business Day, in each case with the same force and effect as if made on such date. Pursuant to the Indenture, in certain circumstances the Company will be required to pay Additional Sums and Compounded Interest (each as defined in the Indenture) with respect to this Security. The interest installment so payable, and punctually paid or duly provided for, on any Interest Payment Date will, as provided in the Indenture, be paid to the Person in whose name this Security (or one or more Predecessor Securities, as defined in said Indenture) is registered at the close of business on the regular record date for such interest installment, which shall be at the close of business on the Business Day next preceding such Interest Payment Date; PROVIDED, HOWEVER, that in the event that the Preferred Securities are no longer in book-entry only form or this Security (or one or more predecessor Securities) are not represented by a Global Security, the record date for such payment shall be the fifteenth day of the month in which such payment is due. Any such interest installment not punctually paid or duly provided for shall forthwith cease to be payable to the holders on such regular record date and may be paid to the Person in whose name this Security (or one or more Predecessor Securities) is registered at the close of business on a special record date to be fixed by the Trustee for the payment of such defaulted interest, notice whereof shall be given to the holders of Securities not less than 10 days prior to such special record date, or may be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Securities may be listed, and upon such notice as may be required by such exchange, all as more fully provided in the Indenture. The principal of and interest (including Compounded Interest and Additional Sums, if any) on this Security shall be payable at the office or agency of the Trustee maintained for that purpose in any coin or currency of the United States of America that at the time of payment is legal tender for payment of public and private debts; PROVIDED, HOWEVER, that, payment of interest may be made at the option of the Company by (i) check mailed to the holder at such address as shall appear in the Security Register or (ii) by transfer to an account maintained by the Person entitled thereto, provided that proper written transfer instructions have been received by the relevant record date. The indebtedness evidenced by this Security is, to the extent provided in the Indenture, subordinate and junior in right of payment to the prior payment in full of all Senior and Subordinated Indebtedness, and this Security is issued subject to the provisions of the Indenture with respect thereto. Each holder of this Security, by accepting the same, (a) agrees to and shall be bound A-2 by such provisions, (b) authorizes and directs the Trustee on his or her behalf to take such action as may be necessary or appropriate to acknowledge or effectuate the subordination so provided and (c) appoints the Trustee his or her attorney-in-fact for any and all such purposes. Each holder hereof, by his or her acceptance hereof, hereby waives all notice of the acceptance of the subordination provisions contained herein and in the Indenture by each holder of Senior and Subordinated Indebtedness, whether now outstanding or hereafter incurred, and waives reliance by each such holder upon said provisions. This Security shall not be entitled to any benefit under the Indenture hereinafter referred to, be valid or become obligatory for any purpose until the Certificate of Authentication hereon shall have been signed by or on behalf of the Trustee. The provisions of this Security are continued on the reverse side hereof and such provisions shall for all purposes have the same effect as though fully set forth at this place. IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed and sealed. Dated: _________ __, 1999 INDEPENDENT BANK CORP. By: -------------------------- Name: Richard J. Seaman Title:Chief Financial Officer Attest: By: _______________________ Name: Title: (FORM OF CERTIFICATE OF AUTHENTICATION) CERTIFICATE OF AUTHENTICATION This is one of the Securities referred to in the within-mentioned Indenture. THE BANK OF NEW YORK, as Trustee By____________________ Dated: _________ __, 1999 Authorized Signatory A-3 (FORM OF REVERSE OF SECURITY) This Security is one of the Securities of the Company (herein sometimes referred to as the "Securities"), specified in the Indenture, all issued or to be issued under and pursuant to an Indenture, dated as of ________ __, 1999 (the "Indenture"), duly executed and delivered between the Company and The Bank of New York, as Trustee (the "Trustee"), to which Indenture reference is hereby made for a description of the rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Company and the holders of the Securities. Upon the occurrence and continuation of a Special Event, as defined in the Indenture, the Company shall have the right, at any time within 90 days following the occurrence of such Special Event, to redeem this Security in whole (but not in part), a redemption price equal to the accrued and unpaid interest on the Security to be so redeemed to the date fixed for redemption, plus 100% of the principal amount thereof (the "Redemption Price"). In addition, subject to the Company having received the prior approval of the applicable regulatory agencies, if it is then required under applicable regulatory requirements, the Company shall have the right to redeem this Security, in whole or in part, at any time on or after _________ __, 2004 at the Redemption Price; PROVIDED, HOWEVER, that the Company shall not effect a partial redemption of this Security if such partial redemption would result in a delisting of the Preferred Securities from the NASDAQ National Market or such other exchange or organization as the Preferred Securities are then listed. The Redemption Price shall be paid prior to 12:00 noon, New York City time on the date of such redemption or at such earlier time as the Company determines, provided, that the Company shall deposit with the Trustee an amount sufficient to pay the applicable Redemption Price by 10:00 a.m., New York City time, on the date such Redemption Price is to be paid. Any redemption pursuant to this paragraph will be made upon not less than 30 days or more than 60 days notice. If the Securities are only partially redeemed by the Company, the particular Securities to be redeemed shall be selected on a pro rata basis, by lot or such other method that the Trustee shall deem appropriate not more than 60 days prior to the date fixed for redemption from the outstanding Securities not previously called for redemption, PROVIDED, HOWEVER, that any such selection may be made on the basis of the aggregate principal amount of Securities held by each Securityholder thereof and may be made by making such adjustments as the Company deems fair and appropriate in order that only Securities in denominations of $10 or integral multiples thereof shall be redeemed. In the event of redemption of this Security in part only, a new Security or Securities for the unredeemed portion hereof will be issued in the name of the holder hereof upon the cancellation hereof. In case an Event of Default, as defined in the Indenture, shall have occurred and be continuing, the principal of all of the Securities may be declared, and upon such declaration shall A-4 become, due and payable, in the manner, with the effect and subject to the conditions provided in the Indenture. The Indenture contains provisions permitting the Company and the Trustee, with the consent of the holders of a majority in aggregate principal amount of the Securities at the time outstanding, as defined in the Indenture, to execute supplemental indentures for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of the Indenture or of modifying in any manner the rights of the holders of the Securities; provided, however, that no such supplemental indenture shall, without the consent of each holder of Securities then outstanding and affected thereby, (i) change the Maturity Date of any Securities, or reduce the principal amount thereof, or reduce any amount payable on redemption thereof, or reduce the rate or extend the time of payment of interest thereon (subject to Article XVI of the Indenture), or make the principal of, or interest on, the Securities payable in any coin or currency other than U.S. dollars, or impair or affect the right of any holder of Securities to institute suit for the payment thereof, or (ii) reduce the aforesaid percentage of Securities, the holders of which are required to consent to any such supplemental indenture. The Indenture also contains provisions permitting the holders of a majority in aggregate principal amount of the Securities at the time outstanding affected thereby, on behalf of all of the holders of the Securities, to waive any past default in the performance of any of the covenants contained in the Indenture, or established pursuant to the Indenture, and its consequences, except a default in the payment of the principal of or interest on any of the Securities or a default in respect of any covenant or provision under which the Indenture cannot be modified or amended without the consent of each holder of Securities then outstanding. Any such consent or waiver by the holder of this Security (unless revoked as provided in the Indenture) shall be conclusive and binding upon such Holder and upon all future holders and owners of this Security and of any Security issued in exchange herefor or in place hereof, irrespective of whether or not any notation of such consent or waiver is made upon this Security. No reference herein to the Indenture and no provision of this Security or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of and interest (including Compounded Interest and Additional Sums, if any) on this Security at the time and place and at the rate and in the money herein prescribed. So long as no Event of Default shall have occurred and be continuing, the Company shall have the right, at any time and from time to time during the term of the Securities, to defer payments of interest by extending the interest payment period of such Securities for a period not exceeding 20 consecutive quarterly periods, including the first such quarterly period during such extension period, and not extending beyond the Maturity Date of the Securities (an "Extended Interest Payment Period") or ending on a date other than an Interest Payment Date, at the end of which period the Company shall pay all interest then accrued and unpaid (together with interest thereon at the rate specified for the Securities to the extent that payment of such interest is enforceable under applicable law). Before the termination of any such Extended Interest Payment Period, the Company may further defer payments of interest by further extending such Extended Interest Payment Period, PROVIDED that such Extended Interest Payment Period, together with all such A-5 previous and further extensions within such Extended Interest Payment Period, (i) shall not exceed 20 consecutive quarterly periods, including the first quarterly period during such Extended Interest Payment Period, (ii) shall not end on any date other than an Interest Payment Date, and (iii) shall not extend beyond the Maturity Date of the Securities. Upon the termination of any such Extended Interest Payment Period and the payment of all accrued and unpaid interest and any additional amounts then due, the Company may commence a new Extended Interest Payment Period, subject to the foregoing requirements. The Company has agreed that it will not (i) declare or pay any dividends or distributions on, or redeem, purchase, acquire, or make a liquidation payment with respect to, any of the Company's capital stock (which includes common and preferred stock), (ii) make any payment of principal, interest or premium, if any, on or repay or repurchase or redeem any debt securities of the Company that rank PARI PASSU with or junior in right of payment to the Securities or (iii) make any guarantee payments with respect to any guarantee by the Company of the debt securities of any Subsidiary of the Company if such guarantee ranks PARI PASSU or junior in right of payment to the Securities (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 Company, (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 Preferred Securities Guarantee, (d) the purchase of fractional shares resulting from a reclassification of the Company's capital stock, (e) the purchase of fractional interests in shares of the Company's capital stock pursuant to the exchange or conversion of such capital stock or the security being exchanged or converted and (f) purchases of Common Stock related to the issuance of Common Stock or rights under any of the Company's benefit plans for its directors, officers or employees or any of the Company's dividend reinvestment plans) if at such time (1) there shall have occurred any event would constitute an Event of Default, (2) if the Securities are held by the Property Trustee, the Company shall be in default with respect to its payment obligations under the Preferred Securities Guarantee or (3) the Company shall have given notice of its election of the exercise of its right to extend the interest payment period and any such extension shall be continuing. Subject to (i) the receipt of any required regulatory approval and (ii) the receipt by the Company of an opinion of counsel to the effect that such distribution will not be a taxable event to holders of Preferred Securities, the Company will have the right at any time to liquidate the Independent Capital Trust II and cause the Securities to be distributed to the holders of the Trust Securities in liquidation of the Trust. The Indenture contains provisions for satisfaction and discharge of the entire indebtedness of this Security upon compliance by the Company with certain conditions set forth in the Indenture. The Securities are issuable only in registered form without coupons in denominations of $10.00 and any integral multiple thereof. As provided in the Indenture and subject to the transfer A-6 restrictions limitations as may be contained herein and therein from time to time, this Security is transferable by the holder hereof on the Security Register of the Company, upon surrender of this Security for registration of transfer at the office or agency of the Company in the City and State of New York accompanied by a written instrument or instruments of transfer in form satisfactory to the Company or the Trustee duly executed by the holder hereof or his attorney duly authorized in writing, and thereupon one or more new Securities of authorized denominations and for the same aggregate principal amount and series will be issued to the designated transferee or transferees. No service charge will be made for any such registration of transfer, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in relation thereto. Prior to due presentment for registration of transfer of this Security, the Company, the Trustee, any authenticating agent, any paying agent, any transfer agent and the registrar may deem and treat the holder hereof as the absolute owner hereof (whether or not this Security shall be overdue and notwithstanding any notice of ownership or writing hereon made by anyone other than the Security Registrar) for the purpose of receiving payment of or on account of the principal hereof and (subject to the Indenture) interest due hereon and for all other purposes, and neither the Company nor the Trustee nor any authenticating agent nor any paying agent nor any transfer agent nor any registrar shall be affected by any notice to the contrary. No recourse shall be had for the payment of the principal of or interest on this Security, or for any claim based hereon, or otherwise in respect hereof, or based on or in respect of the Indenture, against any incorporator, stockholder, officer or director, past, present or future, as such, of the Company or of any predecessor or successor Person, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance hereof and as part of the consideration for the issuance hereof, expressly waived and released. All terms used in this Security that are defined in the Indenture shall have the meanings assigned to them in the Indenture. THE INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAW PROVISIONS THEREOF. A-7 EX-4.3 4 EXHIBIT 4.3 Exhibit 4.3 CERTIFICATE OF TRUST OF INDEPENDENT CAPITAL TRUST II This Certificate of Trust is being executed as of October 22, 1999 for the purposes of organizing a business trust pursuant to the Delaware Business Trust Act, 12 DEL. C. ss.ss. 3801 ET seq. (the "Act"). The undersigned hereby certifies as follows: 1. NAME. The name of the business trust is "Independent Capital Trust II" (the "Trust"). 2. DELAWARE TRUSTEE. The name and business address of the Delaware trustee of the Trust meeting the requirements of Section 3807 of the Act are as follows: The Bank of New York (Delaware) 23 White Clay Center Route 273 Newark, Delaware 19711 3. EFFECTIVE. This Certificate of Trust shall be effective immediately upon filing in the Office of the Secretary of State of the State of Delaware. IN WITNESS WHEREOF, the undersigned being all of the trustees of the Trust as of the date of the filing of this Certificate of Trust, have duly executed this Certificate of Trust in accordance with Section 3811(a) of the Act as of the day and year first above written. THE BANK OF NEW YORK (DELAWARE), as Delaware Trustee By: /s/Mary Jane Morrissey ------------------------------ Name: Mary Jane Morrissey Title: Authorized Signatory ADMINISTRATIVE TRUSTEE /s/Douglas H. Philipsen ----------------------------- Name: Douglas H. Philipsen ADMINISTRATIVE TRUSTEE /s/Richard J. Seaman ----------------------------- Name: Richard J. Seaman ADMINISTRATIVE TRUSTEE /s/Russell N. Viau ----------------------------- Name: Russell N. Viau EX-4.4 5 EXHIBIT 4.4 EXHIBIT 4.4 --------------------------------------------------- AMENDED AND RESTATED DECLARATION OF TRUST OF INDEPENDENT CAPITAL TRUST II DATED AS OF _________ __, 1999 --------------------------------------------------- TABLE OF CONTENTS PAGE ARTICLE I INTERPRETATION AND DEFINITIONS SECTION 1.1 Definitions............................................... 1 ARTICLE II TRUST INDENTURE ACT SECTION 2.1 Trust Indenture Act; Application.......................... 8 SECTION 2.2 Lists of Holders of Securities............................ 8 SECTION 2.3 Reports by the Property Trustee........................... 9 SECTION 2.4 Periodic Reports to Property Trustee...................... 9 SECTION 2.5 Evidence of Compliance with Conditions Precedent ......... 9 SECTION 2.6 Events of Default; Waiver................................. 10 SECTION 2.7 Event of Default; Notice.................................. 11 ARTICLE III ORGANIZATION SECTION 3.1 Name...................................................... 12 SECTION 3.2 Office.................................................... 12 SECTION 3.3 Purpose................................................... 12 SECTION 3.4 Authority................................................. 13 SECTION 3.5 Title to Property of the Trust............................ 13 SECTION 3.6 Powers and Duties of the Administrative Trustees ......... 13 SECTION 3.7 Prohibition of Actions by the Trust and the Trustees ..... 16 SECTION 3.8 Powers and Duties of the Property Trustee................. 17 SECTION 3.9 Certain Duties and Responsibilities of the Property Trustee .............................................. 19 SECTION 3.10 Certain Rights of Property Trustee........................ 21 SECTION 3.11 Delaware Trustee.......................................... 23 SECTION 3.12 Execution of Documents.................................... 23 SECTION 3.13 Not Responsible for Recitals or Issuance of Securities ... 24 SECTION 3.14 Duration of Trust......................................... 24 SECTION 3.15 Mergers................................................... 24 SECTION 3.16 Property Trustee May File Proofs of Claims................ 26 ARTICLE IV SPONSOR SECTION 4.1 Sponsor's Purchase of Common Securities................... 27 SECTION 4.2 Responsibilities of the Sponsor........................... 27 SECTION 4.3 Right to Proceed.......................................... 27 i Page ARTICLE V TRUSTEES SECTION 5.1 Number of Trustees: Appointment of Co-Trustee............. 28 SECTION 5.2 Delaware Trustee.......................................... 28 SECTION 5.3 Property Trustee; Eligibility............................. 29 SECTION 5.4 Certain Qualifications of Administrative Trustees and Delaware Trustee Generally............................. 30 SECTION 5.5 Administrative Trustees................................... 30 SECTION 5.6 Delaware Trustee.......................................... 30 SECTION 5.7 Appointment, Removal and Resignation of Trustees ......... 30 SECTION 5.8 Vacancies among Trustees.................................. 32 SECTION 5.9 Effect of Vacancies....................................... 32 SECTION 5.10 Meetings.................................................. 33 SECTION 5.11 Delegation of Power....................................... 33 SECTION 5.12 Merger, Conversion, Consolidation or Succession to Business ........................................... 33 ARTICLE VI DISTRIBUTIONS SECTION 6.1 Distributions............................................. 34 ARTICLE VII ISSUANCE OF SECURITIES SECTION 7.1 General Provisions Regarding Securities................... 34 SECTION 7.2 Execution and Authentication.............................. 35 SECTION 7.3 Form and Dating........................................... 35 SECTION 7.4 Registrar and Paying Agent................................ 37 SECTION 7.5 Paying Agent to Hold Money in Trust....................... 37 SECTION 7.6 Replacement Securities.................................... 37 SECTION 7.7 Outstanding Preferred Securities.......................... 38 SECTION 7.8 Preferred Securities in Treasury.......................... 38 SECTION 7.9 Definitive Securities..................................... 38 SECTION 7.10 Cancellation.............................................. 39 ii PAGE SECTION 7.11 CUSIP Numbers............................................. 39 ARTICLE VIII TERMINATION OF TRUST SECTION 8.1 Dissolution and Termination of Trust...................... 40 ARTICLE IX TRANSFER OF INTERESTS SECTION 9.1 Transfer of Securities.................................... 40 SECTION 9.2 Transfer Procedures and Restrictions...................... 42 SECTION 9.3 Deemed Security Holders................................... 44 SECTION 9.4 Book Entry Interests...................................... 44 SECTION 9.5 Notices to Clearing Agency................................ 45 SECTION 9.6 Appointment of Successor Clearing Agency.................. 45 ARTICLE X LIMITATION OF LIABILITY OF HOLDERS OF SECURITIES, TRUSTEES OR OTHERS SECTION 10.1 Liability................................................. 46 SECTION 10.2 Exculpation............................................... 46 SECTION 10.3 Fiduciary Duty............................................ 47 SECTION 10.4 Indemnification........................................... 47 SECTION 10.5 Outside Businesses........................................ 50 SECTION 10.6 Compensation; Fees........................................ 51 ARTICLE XI ACCOUNTING SECTION 11.1 Fiscal Year............................................... 51 SECTION 11.2 Certain Accounting Matters................................ 51 SECTION 11.3 Banking................................................... 52 SECTION 11.4 Withholding............................................... 52 ARTICLE XII AMENDMENTS AND MEETINGS SECTION 12.1 Amendments................................................ 52 SECTION 12.2 Meetings of the Holders; Action by Written Consent ....... 54 iii ARTICLE XIII REPRESENTATIONS OF PROPERTY TRUSTEE AND DELAWARE TRUSTEE SECTION 13.1 Representations and Warranties of Property Trustee ....... 56 SECTION 13.2 Representations and Warranties of Delaware Trustee ....... 56 ARTICLE XIV MISCELLANEOUS SECTION 14.1 Notices................................................... 57 SECTION 14.2 Governing Law............................................. 59 SECTION 14.3 Intention of the Parties.................................. 59 SECTION 14.4 Headings.................................................. 59 SECTION 14.5 Successors and Assigns.................................... 59 SECTION 14.6 Partial Enforceability.................................... 59 SECTION 14.7 Counterparts.............................................. 59 ANNEX I TERMS OF SECURITIES............................ I-1 EXHIBIT A-1 FORM OF PREFERRED SECURITY CERTIFICATE......... A1-1 EXHIBIT A-2 FORM OF COMMON SECURITY CERTIFICATE............ A2-1 EXHIBIT B SPECIMEN OF DEBENTURE.......................... B-1 EXHIBIT C UNDERWRITING AGREEMENT ........................ C-1 iv CROSS-REFERENCE TABLE* Section of Trust Indenture Act of 1939, as amended Section of Declaration 310(a).................................... 5.3 310(b).................................... 5.3(c), 5.3(d) 311(a).................................... 2.2(b) 311(b).................................... 2.2(b) 312(a).................................... 2.2(a) 312(b).................................... 2.2(b) 313....................................... 2.3 314(a).................................... 2.4; 3.6(j) 314(c).................................... 2.5 315(a).................................... 3.9 315(b).................................... 2.7(a) 315(c).................................... 3.9(a) 315(d).................................... 3.9(b) 316(a).................................... 2.6 316(c).................................... 3.6(e) 317(a).................................... 3.8(e); 3.8(h) 317(b).................................... 3.8(i); 7.5 --------------- * This Cross-Reference Table does not constitute part of the Declaration and shall not affect the interpretation of any of its terms or provisions. v AMENDED AND RESTATED DECLARATION OF TRUST OF INDEPENDENT CAPITAL TRUST II _________ __, 1999 AMENDED AND RESTATED DECLARATION OF TRUST, including Annex I and all exhibits attached hereto (this "Declaration"), dated and effective as of _________ __, 1999, by the Trustees (as defined herein), the Sponsor (as defined herein) and by the holders, from time to time, of undivided beneficial interests in the assets of the Trust to be issued pursuant to this Declaration; WHEREAS, the Trustees (other than the Property Trustee (as defined herein)) and the Sponsor established Independent Capital Trust II (the "Trust"), a trust formed under the Business Trust Act (as defined herein) pursuant to a Declaration of Trust dated as of ________ __, 1999 (the "Original Declaration"), and a Certificate of Trust filed with the Secretary of State of the State of Delaware on ________ __, 1999 (the "Certificate of Trust"), for the sole purpose of issuing and selling certain securities representing undivided beneficial interests in the assets of the Trust and investing the proceeds thereof in certain Debentures of the Debenture Issuer (each as hereinafter defined), and engaging in only those other activities that are necessary or incidental thereto; and WHEREAS, as of the date hereof, no interests in the Trust have been issued; and WHEREAS, all of the Trustees and the Sponsor, by this Declaration, amend and restate in its entirety each and every term and provision of the Original Declaration; NOW, THEREFORE, it being the intention of the parties hereto to continue the Trust as a statutory business trust under the Business Trust Act and that this Declaration constitute the governing instrument of such business trust, the Trustees declare that all assets contributed to the Trust will be held in trust for the benefit of the Holders (as defined herein), from time to time, of the securities representing undivided beneficial interests in the assets of the Trust issued hereunder, subject to the provisions of this Declaration. ARTICLE I INTERPRETATION AND DEFINITIONS SECTION 1.1 DEFINITIONS. Unless the context otherwise requires: (a) Capitalized terms used in this Declaration but not defined in the preamble above have the respective meanings assigned to them in this Section 1.1; 1 (b) a term defined anywhere in this Declaration has the same meaning throughout; (c) all references to "the Declaration" or "this Declaration" are to this Declaration as modified, supplemented or amended from time to time; (d) all references in this Declaration to Articles and Sections and Annexes and Exhibits are to Articles and Sections of and Annexes and Exhibits to this Declaration unless otherwise specified; (e) a term defined in the Trust Indenture Act has the same meaning when used in this Declaration unless otherwise defined in this Declaration or unless the context otherwise requires; and (f) a reference to the singular includes the plural and vice versa. "ADMINISTRATIVE TRUSTEE" has the meaning set forth in Section 5.1(b). "AFFILIATE" has the same meaning as given to that term in Rule 405 under the Securities Act or any successor rule thereunder. "AGENT" means any Paying Agent or Registrar. "AUTHORIZED OFFICER" of a Person means any other Person that is authorized to legally bind such former Person. "BOOK ENTRY INTEREST" means a beneficial interest in a Global Certificate registered in the name of a Clearing Agency or its nominee, ownership and transfers of which shall be maintained and made through book entries by a Clearing Agency as described in Section 9.4. "BUSINESS DAY" means any day other than a Saturday or a Sunday or a day on which banking institutions in the City of New York, New York, or the City of Rockland, Massachusetts are authorized or required by law or executive order to close. "BUSINESS TRUST ACT" means Chapter 38 of Title 12 of the Delaware Code, ss.3801 ET SEQ., as it may be amended from time to time, or any successor legislation. "CLEARING AGENCY" means an organization registered as a "Clearing Agency" pursuant to Section 17A of the Exchange Act that is acting as depositary for the Preferred Securities and in whose name or in the name of a nominee of that organization shall be registered a Global Certificate and which shall undertake to effect book entry transfers and pledges of the Preferred Securities. 2 "CLEARING AGENCY PARTICIPANT" means a broker, dealer, bank, other financial institution or other Person for whom from time to time the Clearing Agency effects book entry transfers and pledges of securities deposited with the Clearing Agency. "CLOSING TIME" means the "Closing Date" under the Underwriting Agreement, including pursuant to the exercise of any over-allotment option granted to the underwriter thereunder. "CODE" means the Internal Revenue Code of 1986, as amended from time to time, or any successor legislation. A reference to a specific section of the Code refers not only to such specific section but also to any corresponding provision of any federal tax statute enacted after the date of this Declaration, as such specific section or corresponding provision is in effect on the date of application of the provisions of this Declaration containing such reference. "COMMISSION" means the United States Securities and Exchange Commission as from time to time constituted, or if any time after the execution of this Declaration such Commission is not existing and performing the duties now assigned to it under applicable Federal securities laws, then the body performing such duties at such time. "COMMON SECURITIES" has the meaning specified in Section 7.1(a). "COMMON SECURITIES GUARANTEE" means the guarantee agreement dated as of _________ __, 1999 of the Sponsor in respect of the Common Securities. "COMPANY INDEMNIFIED PERSON" means (a) any Administrative Trustee; (b) any Affiliate of any Administrative Trustee; (c) any officers, directors, shareholders, members, partners, employees, representatives or agents of any Administrative Trustee; or (d) any officer, employee or agent of the Trust or its Affiliates. "CORPORATE TRUST OFFICE" means the office of the Property Trustee at which the corporate trust business of the Property Trustee shall, at any particular time, be principally administered, which office at the date of execution of this Agreement is located at 101 Barclay Street, 21st Floor West, New York, New York 10286. "COVERED PERSON" means: (a) any officer, director, shareholder, partner, member, representative, employee or agent of (i) the Trust or (ii) the Trust's Affiliates; and (b) any Holder of Securities. "DEBENTURES" means the ____% Junior Subordinated Deferrable Interest Debentures due _________ __, 2029 of the Debenture Issuer issued pursuant to the Indenture. "DEBENTURE ISSUER" means Independent Bank Corp., a Massachusetts corporation, or any successor entity resulting from any consolidation, amalgamation, merger or other business combination, in its capacity as issuer of the Debentures under the Indenture. 3 "DEBENTURE TRUSTEE" means The Bank of New York, a New York banking corporation, as trustee under the Indenture until a successor is appointed thereunder, and thereafter means such successor trustee. "DEFAULT" means an event, act or condition that with notice or lapse of time, or both, would constitute an Event of Default. "DEFINITIVE PREFERRED SECURITIES" shall have the meaning set forth in Section 7.3(c). "DELAWARE TRUSTEE" has the meaning set forth in Section 5.2. "DIRECT ACTION" shall have the meaning set forth in Section 3.8(e). "DISTRIBUTION" means a distribution payable to Holders in accordance with Section 6.1. "DTC" means The Depository Trust Company, the initial Clearing Agency. "EVENT OF DEFAULT" in respect of the Securities means: (i) an Event of Default (as defined in the Indenture) that has occurred and is continuing in respect of the Debentures; (ii) a default by the Trust in the payment of any Distribution when it becomes due and payable, and continuation of such default for a period of 30 days; (iii) a default by the Trust in the payment of the redemption price of any Trust Security when it becomes due and payable; (iv) a default in the performance, or breach, in any material respect, of any covenant or warranty of the Trustees in this Declaration (other than a default or breach in the performance of a covenant or warranty which is addressed in the second or third clause above), and continuation of the default or breach, for a period of 60 days after there has been given, by registered or certified mail, to the defaulting Trustee or Trustees by the holders of at least 25% in aggregate liquidation amount of the outstanding Trust Preferred Securities, a written notice specifying the default or breach and requiring it to be remedied and stating that the notice is a "Notice of Default" under this Declaration; or (v) the occurrence of certain events of bankruptcy or insolvency with respect to the Property Trustee and the failure by the Sponsor to appoint a successor Property Trustee within 60 days of the event. "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended from time to time, or any successor legislation. "FIDUCIARY INDEMNIFIED PERSON" has the meaning set forth in Section 10.4(b). "FISCAL YEAR" has the meaning set forth in Section 11.1. "GLOBAL PREFERRED SECURITY" has the meaning set forth in Section 7.3(a). 4 "HOLDER" means a Person in whose name a Security is registered, such Person being a beneficial owner within the meaning of the Business Trust Act; PROVIDED, HOWEVER, that in determining whether the Holders of the requisite liquidation amount of Preferred Securities have voted on any matter provided for in this Declaration, then for the purpose of such determination only (and not for any other purpose hereunder), if the Preferred Securities remain in the form of one or more Global Certificates, the term "Holders" shall mean the holder of the Global Certificate acting at the direction of the Preferred Security Beneficial Owners. "INDEMNIFIED PERSON" means a Company Indemnified Person or a Fiduciary Indemnified Person. "INDENTURE" means the Indenture dated, as of _________ __, 1999, between the Debenture Issuer and the Debenture Trustee, as amended or supplemented from time to time. "INVESTMENT COMPANY" means an investment company as defined in the Investment Company Act. "INVESTMENT COMPANY ACT" means the Investment Company Act of 1940, as amended from time to time, or any successor legislation. "INVESTMENT COMPANY EVENT" has the meaning set forth in Annex I. "LEGAL ACTION" has the meaning set forth in Section 3.6(g). "LIST OF HOLDERS" has the meaning set forth in Section 2.2(a). "MAJORITY IN LIQUIDATION AMOUNT" means, with respect to the Trust Securities, except as provided in the terms of the Preferred Securities or by the Trust Indenture Act, Holder(s) of outstanding Trust Securities voting together as a single class or, as the context may require, Holders of outstanding Preferred Securities or Holders of outstanding Common Securities voting separately as a class, who are the record owners of more than 50% of the aggregate liquidation amount of all outstanding Securities of the relevant class. "OFFICERS' CERTIFICATE" means, with respect to any Person, a certificate signed by any two of the following: the Chairman, a Vice Chairman, the Chief Executive Officer, the President, the Chief Financial Officer, a Vice President, the Comptroller, the Secretary or an Assistant Secretary of such Person. Any Officers' Certificate delivered by the Trust shall be signed by at least one Administrative Trustee. Any Officers' Certificate delivered with respect to compliance with a condition or covenant provided for in this Declaration shall include: (a) a statement that each officer signing the Officers' Certificate has read the covenant or condition and the definitions relating thereto; 5 (b) a brief statement of the nature and scope of the examination or investigation undertaken by each officer in rendering the Officers' Certificate; (c) a statement that each such 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 each such officer, such condition or covenant has been complied with. "OPINION OF COUNSEL" means a written opinion of counsel, who may be an employee of the Sponsor, and who shall be acceptable to the Property Trustee. "PAYING AGENT" has the meaning specified in Section 7.4. "PAYMENT AMOUNT" has the meaning specified in Section 6.1. "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. "PREFERRED SECURITY BENEFICIAL OWNER" means, with respect to a Book Entry Interest, a Person who is the beneficial owner of such Book Entry Interest, as reflected on the books of the Clearing Agency, or on the books of a Person maintaining an account with such Clearing Agency (directly as a Clearing Agency Participant or as an indirect participant, in each case in accordance with the rules of such Clearing Agency). "PREFERRED SECURITIES" means the ____% Cumulative Trust Preferred Securities. "PREFERRED SECURITIES GUARANTEE" means the guarantee agreement dated as of _________ __, 1999 of the sponsor in respect of the Preferred Securities. "PROPERTY TRUSTEE" has the meaning set forth in Section 5.3(a). "PROPERTY TRUSTEE ACCOUNT" has the meaning set forth in Section 3.8(c)(i). "PROSPECTUS" has the meaning set forth in Section 3.6(b)(i). "QUORUM" means a majority of the Administrative Trustees or, if there are only two Administrative Trustees, both of them. "REGISTRAR" has the meaning set forth in Section 7.4. 6 "REGISTRATION STATEMENT" has the meaning set forth in Section 3.6(b)(i). "REGULATORY CAPITAL EVENT" has the meaning set forth in Annex I. "RELATED PARTY" means, with respect to the Sponsor, any direct or indirect wholly owned subsidiary of the Sponsor or any other Person that owns, directly or indirectly, 100% of the outstanding voting securities of the Sponsor. "RESPONSIBLE OFFICER" means any officer within the Corporate Trust Office of the Property Trustee with direct responsibility for the administration of this Declaration and also means, 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. "RULE 3A-5" means Rule 3a-5 under the Investment Company Act, or any successor rule or regulation. "SECURITIES" or "TRUST SECURITIES" means the Common Securities and the Preferred Securities. "SECURITIES ACT" means the Securities Act of 1933, as amended from time to time, or any successor legislation. "SECURITIES GUARANTEES" means the Common Securities Guarantee and the Preferred Securities Guarantee. "SPECIAL EVENT" has the meaning set forth in Section 4(c) of Annex I hereto. "SPONSOR" means Independent Bank Corp., a Massachusetts corporation, or any successor entity resulting from any merger, consolidation, amalgamation or other business combination, in its capacity as sponsor of the Trust. "SUCCESSOR DELAWARE TRUSTEE" has the meaning set forth in Section 5.7(b)(ii). "SUCCESSOR ENTITY" has the meaning set forth in Section 3.15(b)(i). "SUCCESSOR PROPERTY TRUSTEE" has the meaning set forth in Section 3.8(f)(ii). "SUPER MAJORITY" has the meaning set forth in Section 2.6(a)(ii). "TAX EVENT" has the meaning set forth in Annex I. "10% IN LIQUIDATION AMOUNT" means, with respect to the Trust Securities, except as provided in the terms of the Preferred Securities or by the Trust Indenture Act, Holder(s) of outstanding Trust Securities voting together as a single class or, as the context may require, Holders 7 of outstanding Preferred Securities or Holders of outstanding Common Securities voting separately as a class, who are the record owners of 10% or more of the aggregate liquidation amount of all outstanding Securities of the relevant class. "TREASURY REGULATIONS" means the income tax regulations, including temporary and proposed regulations, promulgated under the Code by the United States Treasury, as such regulations may be amended from time to time (including corresponding provisions of succeeding regulations). "TRUST INDENTURE ACT" means the Trust Indenture Act of 1939, as amended from time to time, or any successor legislation. "TRUSTEE" or "TRUSTEES" means each Person who has signed this Declaration as a trustee, so long as such Person shall continue as a trustee in accordance with the terms hereof, and all other Persons who may from time to time be duly appointed, qualified and serving as trustees in accordance with the provisions hereof, and references herein to a Trustee or the Trustees shall refer to such Person or Persons solely in their capacity as trustees hereunder. "UNDERWRITING AGREEMENT" means the Underwriting Agreement for the initial offering and sale of Preferred Securities in the form of Exhibit C. ARTICLE II TRUST INDENTURE ACT SECTION 2.1 TRUST INDENTURE ACT; APPLICATION. (a) This Declaration is subject to the provisions of the Trust Indenture Act that are required to be part of this Declaration in order for this Declaration to be qualified under the Trust Indenture Act and shall, to the extent applicable, be governed by such provisions. (b) The Property Trustee shall be the only Trustee which is a "trustee" for the purposes of the Trust Indenture Act. (c) If and to the extent that any provision of this Declaration conflicts with the duties imposed by ss.ss. 310 to 317, inclusive, of the Trust Indenture Act, such imposed duties shall control. (d) The application of the Trust Indenture Act to this Declaration shall not affect the Trust's classification as a grantor trust for United States federal income tax purposes or the nature of the Securities as equity securities representing undivided beneficial interests in the assets of the Trust. 8 SECTION 2.2 LISTS OF HOLDERS OF SECURITIES. (a) Each of the Sponsor and the Administrative Trustees on behalf of the Trust shall provide the Property Trustee, unless the Property Trustee is Registrar for the Securities, (i) within 10 Business Days after each record date for payment of Distributions, a list, in such form as the Property Trustee may reasonably require, of the names and addresses of the Holders ("List of Holders") as of such record date, PROVIDED THAT neither the Sponsor nor the Administrative Trustees on behalf of the Trust shall be obligated to provide such List of Holders at any time that the List of Holders does not differ from the most recent List of Holders given to the Property Trustee by the Sponsor and the Administrative Trustees on behalf of the Trust, and (ii) at any other time, within 30 days of receipt by the Trust of a written request for a List of Holders as of a date no more than 14 days before such List of Holders is given to the Property Trustee. The Property Trustee shall preserve, in as current a form as is reasonably practicable, all information contained in Lists of Holders given to it or which it receives in the capacity as Paying Agent (if acting in such capacity), PROVIDED THAT the Property Trustee may destroy any List of Holders previously given to it on receipt of a new List of Holders. (b) The Property Trustee shall comply with its obligations under ss.ss. 311(a), 311(b) and 312(b) of the Trust Indenture Act. SECTION 2.3 REPORTS BY THE PROPERTY TRUSTEE. Within 60 days after May 15 of each year, commencing May 15, 2000, the Property Trustee shall provide to the Holders of the Preferred Securities such reports dated as of such May 15 as are required by ss. 313 of the Trust Indenture Act, if any, in the form and in the manner provided by ss. 313 of the Trust Indenture Act. The Property Trustee shall also comply with the requirements of ss. 313(d) of the Trust Indenture Act. SECTION 2.4 PERIODIC REPORTS TO PROPERTY TRUSTEE. Each of the Sponsor and the Administrative Trustees on behalf of the Trust shall provide to the Property Trustee such documents, reports and information as are required by ss. 314 of the Trust Indenture Act (if any) and the compliance certificate required by ss. 314 of the Trust Indenture Act in the form, in the manner and at the times required by ss. 314(a)(4) of the Trust Indenture Act, such compliance certificate to be delivered annually on or before 120 days after the end of each fiscal year of the Sponsor. Delivery of such documents, reports and information to the Property Trustee is for informational purposes only and the Property Trustee's receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Sponsor's compliance with any of its covenants hereunder (as to which the Property Trustee is entitled to rely exclusively on Officers' Certificates). 9 SECTION 2.5 EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT. Each of the Sponsor and the Administrative Trustees on behalf of the Trust shall provide to the Property Trustee such evidence of compliance with any conditions precedent provided for in this Declaration that relate to any of the matters set forth in ss. 314(c) of the Trust Indenture Act. Any certificate or opinion required to be given by an officer pursuant to ss. 314(c)(1) of the Trust Indenture Act may be given in the form of an Officers' Certificate. SECTION 2.6 EVENTS OF DEFAULT; WAIVER. (a) The Holders of a Majority in liquidation amount of Preferred Securities may, by vote, on behalf of the Holders of all of the Preferred Securities, waive any past Event of Default in respect of the Preferred Securities and its consequences, PROVIDED THAT, if the underlying Event of Default under the Indenture: (i) is not waivable under the Indenture, the Event of Default under the Declaration shall also not be waivable; or (ii) requires the consent or vote of greater than a majority in aggregate principal amount of the holders of the Debentures (a "Super Majority") to be waived under the Indenture, the Event of Default under the Declaration may only be waived by the vote of the Holders of at least the proportion in aggregate liquidation amount of the Preferred Securities that the relevant Super Majority represents of the aggregate principal amount of the Debentures outstanding. The foregoing provisions of this Section 2.6(a) shall be in lieu of ss. 316(a)(1)(B) of the Trust Indenture Act and such ss. 316(a)(1)(B) of the Trust Indenture Act is hereby expressly excluded from this Declaration and the Securities, as permitted by the Trust Indenture Act. Upon such waiver, any such default shall cease to exist, and any Event of Default with respect to the Preferred Securities arising therefrom shall be deemed to have been cured, for every purpose of this Declaration, but no such waiver shall extend to any subsequent or other default or an Event of Default with respect to the Preferred Securities or impair any right consequent thereon. Any waiver by the Holders of the Preferred Securities of an Event of Default with respect to the Preferred Securities shall also be deemed to constitute a waiver by the Holders of the Common Securities of any such Event of Default with respect to the Common Securities for all purposes of this Declaration without any further act, vote or consent of the Holders of the Common Securities. (b) The Holders of a Majority in liquidation amount of the Common Securities may, by vote, on behalf of the Holders of all of the Common Securities, waive any past Event of Default with respect to the Common Securities and its consequences, PROVIDED THAT, if the underlying Event of Default under the Indenture: (i) is not waivable under the Indenture, except where the Holders of the Common Securities are deemed to have waived such Event of Default under the 10 Declaration as provided below in this Section 2.6(b), the Event of Default under the Declaration shall also not be waivable; or (ii) requires the consent or vote of a Super Majority to be waived under the Indenture, except where the Holders of the Common Securities are deemed to have waived such Event of Default under the Declaration as provided below in this Section 2.6(b), the Event of Default under the Declaration may only be waived by the vote of the Holders of at least the proportion in aggregate liquidation amount of the Common Securities that the relevant Super Majority represents of the aggregate principal amount of the Debentures outstanding; PROVIDED FURTHER, each Holder of Common Securities will be deemed to have waived any such Event of Default and all Events of Default with respect to the Common Securities and their consequences until Events of Default with respect to the Preferred Securities have been cured, waived or otherwise eliminated, and until such Events of Default have been so cured, waived or otherwise eliminated, the Property Trustee will be deemed to be acting solely on behalf of the Holders of the Preferred Securities and only the Holders of the Preferred Securities will have the right to direct the Property Trustee in accordance with the terms of the Securities. The foregoing provisions of this Section 2.6(b) shall be in lieu of ss.ss. 316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act and such ss.ss. 316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act are hereby expressly excluded from this Declaration and the Securities, as permitted by the Trust Indenture Act. Subject to the foregoing provisions of this Section 2.6(b), upon such waiver, any such default shall cease to exist and any Event of Default with respect to the Common Securities arising therefrom shall be deemed to have been cured for every purpose of this Declaration, but no such waiver shall extend to any subsequent or other default or Event of Default with respect to the Common Securities or impair any right consequent thereon. (c) A waiver of an Event of Default under the Indenture by the Property Trustee, at the direction of the Holders of the Preferred Securities, constitutes a waiver of the corresponding Event of Default under this Declaration. The foregoing provisions of this Section 2.6(c) shall be in lieu of ss. 316(a)(1)(B) of the Trust Indenture Act and such ss. 316(a)(1)(B) of the Trust Indenture Act is hereby expressly excluded from this Declaration and the Securities, as permitted by the Trust Indenture Act. SECTION 2.7 EVENT OF DEFAULT; NOTICE. (a) The Property Trustee shall, within 90 days after the occurrence of a Default (as such term is defined in the Indenture) actually known to a Responsible Officer, transmit by mail, first class postage prepaid, to the Holders of the Preferred Securities, the Administrative Trustees and the Sponsor, notices of all Defaults with respect to the Securities actually known to a Responsible Officer, unless such Defaults have been cured before the giving of such notice; PROVIDED THAT, except for a default in the payment of principal of or interest (including Compounded Interest and Additional Sums (as such terms are defined in the Indenture) if any, on any of the Debentures, the Property Trustee shall be protected in withholding such notice if and so long as a Responsible 11 Officer in good faith determines that the withholding of such notice is in the interests of the Holders. The Sponsor and the Administrative Trustees shall file annually with the Property Trustee a certification as to whether or not they are in compliance with all the conditions and covenants applicable to them under this Declaration. (b) The Property Trustee shall not be deemed to have knowledge of any default except: (i) a default under Sections 5.01(a) (other than the payment of Compounded Interest and Additional Sums, each as defined in the Indenture) and 5.01(b) of the Indenture provided that the Property Trustee is the Paying Agent under the Indenture; or (ii) any default as to which the Property Trustee shall have received written notice at the corporate trust office of the Property Trustee and such notice references the Preferred Securities and this Declaration or of which a Responsible Officer charged with the administration of the Declaration shall have actual knowledge. ARTICLE III ORGANIZATION SECTION 3.1 NAME. The Trust is named "Independent Capital Trust II" as such name may be modified from time to time by the Administrative Trustees following written notice to the Delaware Trustee, the Property Trustee and the Holders. The Trust's activities may be conducted under the name of the Trust or any other name deemed advisable by the Administrative Trustees. SECTION 3.2 OFFICE. The address of the principal office of the Trust is c/o The Bank of New York, 101 Barclay Street, New York, New York 10286. On ten Business Days written notice to the Delaware Trustee, the Property Trustee and the Holders of Securities, the Administrative Trustees may designate another principal office. SECTION 3.3 PURPOSE. The exclusive purposes and functions of the Trust are (a) to issue and sell the Securities, (b) use the proceeds from the sale of the Securities to acquire the Debentures, and (c) except as otherwise limited herein, to engage in only those other activities that are necessary or incidental thereto. The Trust shall not borrow money, issue debt or reinvest proceeds derived from investments, mortgage or pledge any of its assets, or otherwise undertake (or permit to be 12 undertaken) any activity that would cause the Trust not to be classified for United States federal income tax purposes as a grantor trust. The Trust will be classified as a grantor trust for United States federal income tax purposes under Subpart E of Subchapter J of the Code, pursuant to which the owners of the Preferred Securities and the Common Securities will be the owners of the Trust for United States federal income tax purposes, and such owners will include directly in their gross income the income, gain, deduction or loss of the Trust as if the Trust did not exist. By the acceptance of this Trust, none of the Trustees, the Sponsor or the Holders of the Securities will take any position which is contrary to the classification of the Trust as a grantor trust for United States federal income tax purposes. SECTION 3.4 AUTHORITY. Subject to the limitations provided in this Declaration and to the specific duties of the Property Trustee, the Administrative Trustees shall have exclusive and complete authority to carry out the purposes of the Trust. An action taken by the Administrative Trustees in accordance with their powers shall constitute the act of and serve to bind the Trust and an action taken by the Property Trustee on behalf of the Trust in accordance with its powers shall constitute the act of and serve to bind the Trust. In dealing with the Trustees acting on behalf of the Trust, no Person shall be required to inquire into the authority of the Trustees to bind the Trust. Persons dealing with the Trust are entitled to rely conclusively on the power and authority of the Trustees as set forth in this Declaration. SECTION 3.5 TITLE TO PROPERTY OF THE TRUST. Except as may be otherwise provided in this Declaration, legal title to all assets of the Trust shall be vested in the Property Trustee for the benefit of the Trust and the Holders. The Holders shall not have legal title to any part of the assets of the Trust, but shall have an undivided beneficial interest in the assets of the Trust. SECTION 3.6 POWERS AND DUTIES OF THE ADMINISTRATIVE TRUSTEES. The Administrative Trustees shall have the exclusive power, duty and authority to cause the Trust to engage in the following activities: (a) to issue and sell the Securities in accordance with this Declaration and pursuant to the Underwriting Agreement; PROVIDED, HOWEVER, that except as contemplated in Section 7.1(a), (i) the Trust may issue no more than one series of Preferred Securities and no more than one series of Common Securities, (ii) there shall be no interests in the Trust other than the Securities, and (iii) the issuance of Securities shall be limited to a simultaneous issuance of both the Preferred Securities and Common Securities at the Closing Time; (b) in connection with the issuance and sale of the Preferred Securities, to: 13 (i) prepare and execute a Prospectus (the "Prospectus") in preliminary and final form prepared by the Sponsor, in relation to the offering and sale of the Preferred Securities and to execute and file with the Commission a registration statement on Form S-3(the "Registration Statement"), including any amendments thereto, for the offering and sale of the Preferred Securities; (ii) execute and file any documents prepared by the Sponsor, or take any acts as determined by the Sponsor to be necessary, in order to qualify or register all or part of the Preferred Securities in any State in which the Sponsor has determined to qualify or register such Preferred Securities for sale; (iii) execute and file an application, prepared by the Sponsor, to permit the Preferred Securities to trade or be quoted or listed in or on the Nasdaq National Market or any other securities exchange or quotation system. (iv) execute and deliver letters, documents or instruments with DTC and other Clearing Agencies relating to the Preferred Securities; (v) execute and file with the Commission a registration statement on Form 8-A, including any amendments thereto, prepared by the Sponsor, relating to the registration of the Preferred Securities under Section 12(b) or (g) of the Exchange Act; and (vi) execute and enter into the Underwriting Agreement providing for the sale of the Preferred Securities; (c) to acquire the Debentures with the proceeds of the sale of the Preferred Securities and the Common Securities; PROVIDED, HOWEVER, that the Administrative Trustees shall cause legal title to the Debentures to be held of record in the name of the Property Trustee for the benefit of the Holders; (d) to give the Sponsor and the Property Trustee prompt written notice of the occurrence of a Special Event; (e) to establish a record date with respect to all actions to be taken hereunder that require a record date be established, including and with respect to, for the purposes of ss. 316(c) of the Trust Indenture Act, Distributions, voting rights, redemptions and exchanges, and to issue relevant notices to the Holders of Preferred Securities and Holders of Common Securities as to such actions and applicable record dates; (f) to take all actions and perform such duties as may be required of the Administrative Trustees pursuant to the terms of this Declaration and the Securities; 14 (g) to bring or defend, pay, collect, compromise, arbitrate, resort to legal action, or otherwise adjust claims or demands of or against the Trust ("Legal Action"), unless pursuant to Section 3.8(e), the Property Trustee has the exclusive power to bring such Legal Action; (h) to employ or otherwise engage employees and agents (who may be designated as officers with titles) and managers, contractors, advisors and consultants to conduct the services that the Administrative Trustees have authority to conduct directly and pay reasonable compensation for such services; (i) to cause the Trust to comply with the Trust's obligations under the Trust Indenture Act; (j) to give the certificate required by ss. 314(a)(4) of the Trust Indenture Act to the Property Trustee, which certificate may be executed by any Administrative Trustee; (k) to incur expenses that are necessary or incidental to carry out any of the purposes of the Trust; (l) to act as, or appoint another Person to act as, Registrar for the Securities or to appoint a Paying Agent for the Securities as provided in Section 7.4 except for such time as such power to appoint a Paying Agent is vested in the Property Trustee; (m) to give prompt written notice to the Property Trustee and to Holders of any notice received from the Debenture Issuer of its election to defer payments of interest on the Debentures by extending the interest payment period under the Indenture; (n) to take all action that may be necessary or appropriate for the preservation and the continuation of the Trust's valid existence, rights, franchises and privileges as a statutory business trust under the laws of the State of Delaware and of each other jurisdiction in which such existence is necessary to protect the limited liability of the Holders or to enable the Trust to effect the purposes for which the Trust was created; (o) to take any action, not inconsistent with this Declaration or with applicable law, that the Administrative Trustees determine in their discretion to be necessary or desirable in carrying out the activities of the Trust as set out in this Section 3.6, including, but not limited to: (i) causing the Trust not to be deemed to be an Investment Company required to be registered under the Investment Company Act; (ii) causing the Trust to be classified for United States federal income tax purposes as a grantor trust or causing each Holder to be treated as owning an undivided beneficial interest in the Debentures; and 15 (iii) cooperating with the Debenture Issuer to ensure that the Debentures will be treated as indebtedness of the Debenture Issuer for United States federal income tax purposes; provided that such action does not adversely affect the interest of the Holders; (p) to take all action necessary to cause all applicable tax returns and tax information reports that are required to be filed with respect to the Trust to be duly prepared and filed by the Administrative Trustees, on behalf of the Trust; and (q) to execute all documents or instruments, perform all duties and powers, and do all things for and on behalf of the Trust in all matters necessary or incidental to the foregoing. The Administrative Trustees must exercise the powers set forth in this Section 3.6 in a manner that is consistent with the purposes and functions of the Trust set out in Section 3.3, and the Administrative Trustees shall not take any action that is inconsistent with the purposes and functions of the Trust set forth in Section 3.3. Subject to this Section 3.6, the Administrative Trustees shall have none of the powers or the authority of the Property Trustee set forth in Section 3.8. The Administrative Trustees may take all actions on behalf of the Trust that are not specifically required by this Declaration to be taken by any other Trustee. Any expenses incurred by the Administrative Trustees pursuant to this Section 3.6 shall be reimbursed by the Debenture Issuer. SECTION 3.7 PROHIBITION OF ACTIONS BY THE TRUST AND THE TRUSTEES. (a) The Trust shall not, and the Trustees (including the Property Trustee and the Delaware Trustee) shall not, engage in any activity other than as required or authorized by this Declaration. The Trust shall not: (i) invest any proceeds received by the Trust from holding the Debentures, but shall distribute all such proceeds to Holders pursuant to the terms of this Declaration and of the Securities; (ii) acquire any assets other than as expressly provided herein; (iii) possess Trust property for other than a Trust purpose; (iv) make any loans or incur any indebtedness other than loans represented by the Debentures; 16 (v) possess any power or otherwise act in such a way as to vary the Trust assets or the terms of the Securities in any way whatsoever, except as otherwise expressly provided herein; (vi) issue any securities or other evidences of beneficial ownership of, or beneficial interest in, the Trust other than the Securities; (vii) other than as provided in this Declaration or Annex I, (A) direct the time, method and place of conducting any proceeding with respect to any remedy available to the Debenture Trustee, or exercising any trust or power conferred upon the Debenture Trustee with respect to the Debentures, (B) waive any past default that is waivable under the Indenture or (C) exercise any right to rescind or annul any declaration that the principal of all the Debentures shall be due and payable; or (viii) consent to any amendment, modification or termination of the Indenture or the Debentures where such consent shall be required unless the Trust shall have received (A) an opinion of independent tax counsel experienced in such matters to the effect that such amendment, modification or termination will not cause more than an insubstantial risk that for United States federal income tax purposes the Trust will not be classified as a grantor trust, and (B) an Opinion of Counsel from a firm recognized to be experts in such matters, to the effect that the amendment, modification or termination will not cause more than an insubstantial risk that the Trust will be deemed to be an investment company required to be registered under the Investment Company Act of 1940, as amended. SECTION 3.8 POWERS AND DUTIES OF THE PROPERTY TRUSTEE. (a) The legal title to the Debentures shall be owned by and held of record in the name of the Property Trustee in trust for the benefit of the Holders. The right, title and interest of the Property Trustee to the Debentures shall vest automatically in each Person who may hereafter be appointed as Property Trustee in accordance with Section 5.7. Such vesting and cessation of title shall be effective whether or not conveyancing documents with regard to the Debentures have been executed and delivered. (b) The Property Trustee shall not transfer its right, title and interest in the Debentures to the Administrative Trustees or to the Delaware Trustee (if the Property Trustee does not also act as Delaware Trustee). (c) The Property Trustee shall: (i) establish and maintain a segregated non-interest bearing trust account (the "Property Trustee Account") in the name of and under the exclusive control of the Property Trustee on behalf of the Holders and, upon the receipt of payments of funds made in respect of the Debentures held by the Property Trustee, deposit such funds into the 17 Property Trustee Account and make payments or cause the Paying Agent to make payments to the Holders from the Property Trustee Account in accordance with Section 6.1. Funds in the Property Trustee Account shall be held uninvested until disbursed in accordance with this Declaration. The Property Trustee Account shall be an account that is maintained with a banking institution the rating on whose long-term unsecured indebtedness is rated in one of four highest rating categories by a "nationally recognized statistical rating organization", as that term is defined for purposes of Rule 436(g)(2) under the Securities Act; (ii) engage in such ministerial activities as shall be necessary or appropriate to effect the redemption of the Trust Securities to the extent the Debentures are redeemed or mature; and (iii) upon written notice of distribution issued by the Administrative Trustees in accordance with the terms of the Securities, engage in such ministerial activities as shall be necessary or appropriate to effect the distribution of the Debentures to Holders upon the occurrence of certain events set forth in Sections 2.7 and 8.1 hereof. (d) The Property Trustee shall take all actions and perform such duties as may be specifically required of the Property Trustee pursuant to the terms of this Declaration and the Securities. (e) Subject to Section 3.9(a), the Property Trustee shall take any Legal Action which arises out of or in connection with an Event of Default of which a Responsible Officer has actual knowledge or the Property Trustee's duties and obligations under this Declaration or the Trust Indenture Act. If an Event of Default has occurred and is continuing and such event is attributable to the failure of the Debenture Issuer to pay the principal of or interest (including Compounded Interest and Additional Sums (each as defined in Indenture), if any) on the Debentures on the date such principal or interest (including Compounded Interest and Additional Sums, if any) is otherwise payable (or in the case of redemption, on the redemption date), then a Holder of Preferred Securities may directly institute a proceeding for enforcement of payment to such Holder of the principal of or interest (including Compounded Interest and Additional Sums, if any), if any, on the Debentures having a principal amount equal to the aggregate liquidation amount of the Preferred Securities of such Holder (a "Direct Action") on or after the respective due date specified in the Debentures. In connection with such Direct Action, the Holders of the Common Securities will be subrogated to the rights of such Holder of Preferred Securities to the extent of any payment made by the Debenture Issuer to such Holder of Preferred Securities in such Direct Action. If the Property Trustee fails to declare the principal of all of the Debentures due and payable upon an Event of Default (as defined in the Indenture), so long as the Property Trustee is holding the Debentures on behalf of the Trust, the Holders of at least 25% in liquidation amount of the Preferred Securities then outstanding will have the right to declare the Debentures immediately due and payable. Except as provided in this Section 3.8(e), the Holders of Preferred Securities will not be able to exercise directly any other remedy available to the holders of the Debentures. 18 (f) The Property Trustee shall not resign as a Trustee unless either: (i) the Trust has been completely liquidated and the proceeds of the liquidation distributed to the Holders pursuant to the terms of the Securities; or (ii) a successor Property Trustee has been appointed and has accepted that appointment in accordance with Section 5.7 (a "Successor Property Trustee"). (g) The Property Trustee shall have the legal power to exercise all of the rights, powers and privileges of a holder of Debentures under the Indenture and, if an Event of Default actually known to a Responsible Officer occurs and is continuing, the Property Trustee shall, for the benefit of Holders, enforce its rights, including without limitation, its rights under the Indenture as holder of the Debentures, subject to the rights of the Holders pursuant to the terms of such Securities. (h) The Property Trustee shall be authorized to undertake any actions set forth in ss. 317(a) of the Trust Indenture Act. (i) For such time as the Property Trustee is the Paying Agent, the Property Trustee may authorize one or more Persons to act as additional Paying Agents and to pay Distributions, redemption payments or liquidation payments on behalf of the Trust with respect to all Securities and any such Paying Agent shall comply with ss. 317(b) of the Trust Indenture Act. Any such additional Paying Agent may be removed by the Property Trustee at any time the Property Trustee remains as Paying Agent and a successor Paying Agent or additional Paying Agents may be (but are not required to be) appointed at any time by the Property Trustee while the Property Trustee is so acting as Paying Agent. (j) Subject to this Section 3.8, the Property Trustee shall have none of the duties, liabilities, powers or the authority of the Administrative Trustees set forth in Section 3.6. Notwithstanding anything expressed or implied to the contrary in this Declaration or any Annex or Exhibit hereto, (i) the Property Trustee must exercise the powers set forth in this Section 3.8 in a manner that is consistent with the purposes and functions of the Trust set out in Section 3.3 and (ii) the Property Trustee shall not take any action that is inconsistent with the purposes and functions of the Trust set out in Section 3.3. SECTION 3.9 CERTAIN DUTIES AND RESPONSIBILITIES OF THE PROPERTY TRUSTEE. (a) The Property Trustee, before the occurrence of any Event of Default and after the curing of all Events of Default that may have occurred, shall undertake to perform only such duties as are specifically set forth in this Declaration and in the Securities and no implied covenants shall be read into this Declaration against the Property Trustee. In case an Event of Default has occurred (that has not been cured or waived pursuant to Section 2.6) of which a Responsible Officer has actual knowledge, the Property Trustee shall exercise such of the rights and powers vested in it 19 by this Declaration, and use the same degree of care and skill in their exercise, as a prudent person would exercise or use under the circumstances in the conduct of his or her own affairs. (b) No provision of this Declaration shall be construed to relieve the Property 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 an Event of Default and after the curing or waiving of all such Events of Default that may have occurred: (A) the duties and obligations of the Property Trustee shall be determined solely by the express provisions of this Declaration and in the Securities and the Property Trustee shall not be liable except for the performance of such duties and obligations as are specifically set forth in this Declaration and in the Securities, and no implied covenants or obligations shall be read into this Declaration or the Securities against the Property Trustee; and (B) in the absence of bad faith on the part of the Property Trustee, the Property 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 Property Trustee and conforming to the requirements of this Declaration; PROVIDED, HOWEVER, that in the case of any such certificates or opinions that by any provision hereof are specifically required to be furnished to the Property Trustee, the Property Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Declaration (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein); (ii) the Property Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it shall be proved that the Property Trustee was negligent in ascertaining the pertinent facts upon which such judgment was made; (iii) the Property 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 direction of the Holders of not less than a Majority in liquidation amount of the Securities relating to the time, method and place of conducting any proceeding for any remedy available to the Property Trustee, or exercising any trust or power conferred upon the Property Trustee under this Declaration; (iv) no provision of this Declaration shall require the Property 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 it shall have reasonable grounds for believing that the repayment of such funds or liability is not 20 reasonably assured to it under the terms of this Declaration or indemnity reasonably satisfactory to the Property Trustee against such risk or liability is not reasonably assured to it; (v) the Property Trustee's sole duty with respect to the custody, safe keeping and physical preservation of the Debentures and the Property Trustee Account shall be to deal with such property in a similar manner as the Property Trustee deals with similar property for its own account, subject to the protections and limitations on liability afforded to the Property Trustee under this Declaration and the Trust Indenture Act; (vi) the Property Trustee shall have no duty or liability for or with respect to the value, genuineness, existence or sufficiency of the Debentures or the payment of any taxes or assessments levied thereon or in connection therewith; (vii) the Property Trustee shall not be liable for any interest on any money received by it except as it may otherwise agree in writing with the Sponsor. Money held by the Property Trustee need not be segregated from other funds held by it except in relation to the Property Trustee Account maintained by the Property Trustee pursuant to Section 3.8(c)(i) and except to the extent otherwise required by law; (viii) the Property Trustee shall not be responsible for monitoring the compliance by the Administrative Trustees or the Sponsor with their respective duties under this Declaration, nor shall the Property Trustee be liable for any act, omission, default or misconduct of the Administrative Trustees or the Sponsor; and (ix) the Property Trustee shall not be deemed to have notice of any Event of Default unless a Responsible Officer of the Property Trustee has actual knowledge thereof or unless written notice of any event which is in fact such a default is received by the Property Trustee at the Corporate Trust Office of the Property Trustee. SECTION 3.10 CERTAIN RIGHTS OF PROPERTY TRUSTEE. (a) Subject to the provisions of Section 3.9: (i) the Property 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; (ii) any direction or act of the Sponsor or the Administrative Trustees contemplated by this Declaration may be sufficiently evidenced by an Officers' Certificate; 21 (iii) whenever in the administration of this Declaration, the Property Trustee shall deem it desirable that a matter be proved or established before taking, suffering or omitting any action hereunder, the Property Trustee (unless other evidence is herein specifically prescribed) may, in the absence of bad faith on its part, request and conclusively rely upon an Officers' Certificate which, upon receipt of such request, shall be promptly delivered by the Sponsor or the Administrative Trustees; (iv) the Property Trustee shall have no duty to see to any recording, filing or registration of any instrument (including any financing or continuation statement or any filing under tax or securities laws) or any rerecording, refiling or registration thereof; (v) the Property Trustee may consult with counsel or other experts of its selection and the advice or opinion of such counsel and experts with respect to legal matters or advice within the scope of such experts' area of expertise 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 Sponsor or any of its Affiliates, and may include any of its employees. The Property Trustee shall have the right at any time to seek instructions concerning the administration of this Declaration from any court of competent jurisdiction; (vi) the Property Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Declaration at the request or direction of any Holder, unless such Holder shall have provided to the Property Trustee security or indemnity, reasonably satisfactory to the Property Trustee, against the costs, expenses (including reasonable attorneys' fees and expenses and the expenses of the Property 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 Property Trustee; provided that, nothing contained in this Section 3.10(a)(vi) shall be taken to relieve the Property Trustee, upon the occurrence of an Event of Default, of its obligation to exercise the rights and powers vested in it by this Declaration; (vii) the Property 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 Property Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Property Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Trust, personally or by agent or attorney at the sole cost of the Sponsor and shall incur no liability or additional liability of any kind by reason of such inquiry or investigation; 22 (viii) the Property Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents, custodians, nominees or attorneys and the Property Trustee shall not be responsible for any misconduct or negligence on the part of any agent, custodian, nominee or attorney appointed with due care by it hereunder; (ix) any action taken by the Property Trustee or its agents hereunder shall bind the Trust and the Holders, and the signature of the Property Trustee or its agents alone shall be sufficient and effective to perform any such action and no third party shall be required to inquire as to the authority of the Property Trustee to so act or as to its compliance with any of the terms and provisions of this Declaration, both of which shall be conclusively evidenced by the Property Trustee's or its agent's taking such action; (x) whenever in the administration of this Declaration the Property Trustee shall deem it desirable to receive instructions with respect to enforcing any remedy or right or taking any other action hereunder, the Property Trustee (i) may request instructions from the Holders which instructions may only be given by the Holders of the same proportion in liquidation amount of the Securities as would be entitled to direct the Property Trustee under the terms of the Securities in respect of such remedy, right or action, (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 or accordance with such instructions; (xi) except as otherwise expressly provided by this Declaration, the Property Trustee shall not be under any obligation to take any action that is discretionary under the provisions of this Declaration; (xii) the Property 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 Declaration; (xiii) the rights, privileges, protections, immunities and benefits given to the Property Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Property Trustee in each of its capacities hereunder, and to each agent, custodian and other Person employed to act hereunder; and (xiv) If no Event of Default has occurred and is continuing and the Property Trustee is required to decide between alternative causes of action, construe ambiguous provisions in this Declaration or is unsure of the application of any provision of this Declaration, and the matter is not one on which the Holders are, under this Declaration, entitled to vote, then the Property Trustee may take the action as is directed by, and, if not so directed, may take action as it deems advisable and in the best interests 23 of, the Holders and will have no liability except for its own bad faith, negligence or willful misconduct. (b) No provision of this Declaration shall be deemed to impose any duty or obligation on the Property 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 Property 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 Property Trustee shall be construed to be a duty. SECTION 3.11 DELAWARE TRUSTEE. Notwithstanding any other provision of this Declaration other than Section 5.2, the Delaware Trustee shall not be entitled to exercise any powers, nor shall the Delaware Trustee have any of the duties and responsibilities of the Administrative Trustees or the Property Trustee described in this Declaration, or any other duties or responsibilities except as expressly stated in this Section 3.11. Except as set forth in Section 5.2, the Delaware Trustee shall be a Trustee for the sole and limited purpose of fulfilling the requirements of ss.3807 of the Business Trust Act; PROVIDeD THat, the Delaware Trustee shall have the power and authority and is hereby authorized to execute and file with the Secretary of State of the State of Delaware any certificate required to be filed under the Business Trust Act, except as provided in Section 8.1(b). In the event the Delaware Trustee shall at any time be required to take any action or perform any duty hereunder, the Delaware Trustee shall be entitled to the benefits of Section 3.9(b)(ii)-(viii) and Section 3.10. No implied covenants or obligations shall be read into this Declaration against the Delaware Trustee. SECTION 3.12 EXECUTION OF DOCUMENTS. Except as otherwise required by the Business Trust Act or this Declaration, any Administrative Trustee is authorized to execute on behalf of the Trust any documents that the Administrative Trustees have the power and authority to execute pursuant to Section 3.6; PROVIDED THAT the Registration Statement, including any amendments thereto, shall be signed by all of the Administrative Trustees. SECTION 3.13 NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES. The recitals contained in this Declaration and the Securities shall be taken as the statements of the Sponsor, and the Trustees do not assume any responsibility for their correctness. The Trustees make no representations as to the value or condition of the property of the Trust or any part thereof. The Trustees make no representations as to the validity or sufficiency of this Declaration, the Debentures or the Securities. 24 SECTION 3.14 DURATION OF TRUST. The Trust, unless dissolved pursuant to the provisions of Article VIII hereof, shall continue without dissolution until _________ __, 2030. SECTION 3.15 MERGERS. (a) The Trust may not merge with or into, consolidate, amalgamate or be replaced by, or convey, transfer or lease its properties and assets substantially as an entirety to any Person, except as described in Section 3.15(b) and (c) of this Declaration or Sections 3 and 4 of Annex I. (b) The Trust may, at the request of the Sponsor, with the consent of the Administrative Trustees or, if there are more than two, a majority of the Administrative Trustees and without the consent of the Holders, the Delaware Trustee or the Property Trustee, merge with or into, consolidate, amalgamate or be replaced by, or convey, transfer or lease its properties and assets as an entirety or substantially as an entirety to, a trust organized as such under the laws of any State; PROVIDED THAT: (i) such successor entity (the "Successor Entity") either: (A) expressly assumes all of the obligations of the Trust under the Securities; or (B) substitutes for the Securities other securities having substantially the same terms as the Securities (the "Successor Securities") so long as the Successor Securities rank the same as the Securities rank with respect to Distributions and payments upon liquidation, redemption and otherwise; (ii) the Sponsor expressly appoints a trustee of the Successor Entity that possesses the same powers and duties as the Property Trustee as the holder of the Debentures; (iii) the Preferred Securities or the Successor Securities are listed, or any Successor Securities will be listed upon notification of issuance, on any national securities exchange or with another organization on which the Preferred Securities are then listed or quoted, if any; (iv) if the Preferred Securities (including any Successor Securities) are rated by any nationally recognized statistical rating organization prior to such transaction, such merger, consolidation, amalgamation, replacement, conveyance, transfer or lease does not cause the Preferred Securities (including any Successor Securities), or if the Debentures are so rated, the Debentures, to be downgraded by any nationally recognized statistical rating organization; 25 (v) such merger, consolidation, amalgamation, replacement, conveyance, transfer or lease does not adversely affect the rights, preferences and privileges of the Holders (including the holders of any Successor Securities) in any material respect (other than with respect to any dilution of such Holders' interests in the new entity); (vi) such Successor Entity has a purpose substantially identical to that of the Trust; (vii) prior to such merger, consolidation, amalgamation, replacement, conveyance, transfer or lease, the Sponsor has received an opinion of an independent counsel to the Trust experienced in such matters to the effect that: (A) such merger, consolidation, amalgamation, replacement, conveyance, transfer or lease does not adversely affect the rights, preferences and privileges of the Holders (including the holders of any Successor Securities) in any material respect (other than with respect to any dilution of the Holders' interest in the new entity); (B) following such merger, consolidation, amalgamation, replacement, conveyance, transfer or lease, neither the Trust nor the Successor Entity will be required to register as an Investment Company; and (C) the Trust will continue to be, or the Successor Entity will be, classified as a grantor trust for United States federal income tax purposes; (viii) the Sponsor or any permitted successor or assignee owns all of the common securities of such Successor Entity and guarantees the obligations of such Successor Entity under the Successor Securities at least to the extent provided by the Preferred Securities Guarantee and the Common Securities Guarantee; and (ix) there shall have been furnished to the Property Trustee an Officer's Certificate and an Opinion of Counsel, each to the effect that all conditions precedent in this Declaration to such transaction have been satisfied. (c) Notwithstanding Section 3.15(b), the Trust shall not, except with the consent of Holders of 100% in liquidation amount of the Securities, consolidate, amalgamate, merge with or into, or be replaced by, or convey, transfer or lease its properties and assets as an entirety or substantially as an entirety to, any other Person or permit any other Person to consolidate, amalgamate, merge with or into, or replace it if such consolidation, amalgamation, merger, replacement, conveyance, transfer or lease would cause the Trust or the Successor Entity not to be classified as a grantor trust for United States federal income tax purposes. 26 SECTION 3.16 PROPERTY TRUSTEE MAY FILE PROOFS OF CLAIM In case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other similar judicial proceeding relative to the Trust or any other obligor upon the Securities or the property of the Trust or of such other obligor or their creditors, the Property Trustee (irrespective of whether any Distributions on the Securities shall then be due and payable as therein expressed or by declaration or otherwise and irrespective of whether the Property Trustee shall have made any demand on the Trust for the payment of any past due Distributions) shall be entitled and empowered, to the fullest extent permitted by law, by intervention in such proceeding or otherwise: (a) to file and prove a claim for the whole amount of any Distributions owing and unpaid in respect of the Securities (or, if the Securities are original issue discount Securities, such portion of the liquidation amount as may be specified in the terms of such Securities) and to file such other papers or documents as may be necessary or advisable in order to have the claims of the Property Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Property Trustee, its agents and counsel) and of the Holders allowed in such judicial proceeding; and (b) to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute the same; and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Property Trustee and, in the event the Property Trustee shall consent to the making of such payments directly to the Holders, to pay to the Property Trustee any amount due it for the reasonable compensation, expenses, disbursements and advances of the Property Trustee, its agents and counsel, and any other amounts due the Property Trustee. Nothing herein contained shall be deemed to authorize the Property Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement adjustment or compensation affecting the Securities or the rights of any Holder thereof or to authorize the Property Trustee to vote in respect of the claim of any Holder in any such proceeding. ARTICLE IV SPONSOR SECTION 4.1 SPONSOR'S PURCHASE OF COMMON SECURITIES. At the Closing Time, the Sponsor will purchase all of the Common Securities then issued by the Trust, in an amount equal to at least 3% of the total capital of the Trust, at the same time as the Preferred Securities are issued and sold. 27 SECTION 4.2 RESPONSIBILITIES OF THE SPONSOR. In connection with the issue and sale of the Preferred Securities, the Sponsor shall have the exclusive right and responsibility to engage in the following activities: (a) to prepare the Prospectus and to prepare and file the Registration Statement with the Commission, including any amendments thereto and to pay any registration fees in connection therewith; (b) to determine the States in which to take appropriate action to qualify or register for sale all or part of the Preferred Securities and to do any and all such acts, other than actions which must be taken by the Trust, and advise the Trust of actions it must take, and prepare for execution and filing any documents to be executed and filed by the Trust, as the Sponsor deems necessary or advisable in order to comply with the applicable laws of any such States; (c) if deemed necessary or advisable by the Sponsor, to prepare for filing by the Trust an application to permit the Preferred Securities to trade or be quoted or listed in or on the National Market System or any other securities exchange or quotation system; (d) to prepare for filing by the Trust with the Commission a registration statement on Form 8-A, including any amendments thereto, relating to the registration of the Preferred Securities under Section 12(b) or (g) of the Exchange Act; and (e) to negotiate the terms of the Underwriting Agreement providing for the sale of the Preferred Securities. SECTION 4.3 RIGHT TO PROCEED. The Sponsor acknowledges the rights of the Holders of Preferred Securities under Section 3.8(e) of the Declaration and Section 5(b) of Annex I, in the event that a failure of the Trust to pay Distributions on the Preferred Securities is attributable to the failure of the Debenture Issuer to pay interest or principal on the Debentures, to institute a proceeding directly against the Debenture Issuer for enforcement of its payment obligations on the Debentures and the Sponsor irrevocably waives any right or remedy to require that any such Holder take any action against the Trust or any other Person before proceeding against the Sponsor. 28 ARTICLE V TRUSTEES SECTION 5.1 NUMBER OF TRUSTEES: APPOINTMENT OF CO-TRUSTEE. The number of Trustees initially shall be five (5), and: (a) at any time before the issuance of any Securities, the Sponsor may, by written instrument, increase or decrease the number of Trustees; and (b) after the issuance of any Securities, the number of Trustees may be increased or decreased by vote of the Holders of a Majority in liquidation amount of the Common Securities voting as a class at a meeting of the Holders of the Common Securities; PROVIDED, HOWEVER, that, the number of Trustees shall in no event be less than two (2); PROVIDED FURTHER that (1) one Trustee shall satisfy the requirements of the Delaware Trustee pursuant to Section 5.2; (2) there shall be at least one Trustee who is an officer of the Sponsor (an "Administrative Trustee"); and (3) one Trustee shall be the Property Trustee for so long as this Declaration is required to qualify as an indenture under the Trust Indenture Act, and such Trustee may also serve as Delaware Trustee if it meets the applicable requirements. Notwithstanding the above, unless an Event of Default shall have occurred and be continuing, at any time or times, for the purpose of meeting the legal requirements of the Trust Indenture Act or of any jurisdiction in which any part of the Trust's property may at the time be located, the Holders of a Majority in liquidation amount of the Common Securities acting as a class at a meeting of the Holders of the Common Securities, and the Administrative Trustees shall have power to appoint one or more Persons either to act as a co-trustee, jointly with the Property Trustee, of all or any part of the Trust's property, or to act as separate trustee of any such property, in either case with such powers as may be provided in the instrument of appointment, and to vest in such Person or Persons in such capacity any property, title, right or power deemed necessary or desirable, subject to the provisions of this Declaration. In case an Event of Default has occurred and is continuing, the Property Trustee alone shall have power to make any such appointment of a co-trustee. SECTION 5.2 DELAWARE TRUSTEE. If required by the Business Trust Act, one Trustee (the "Delaware Trustee") shall be: (a) a natural person who is a resident of the State of Delaware; or (b) if not a natural person, an entity which has its principal place of business in the State of Delaware, and otherwise meets the requirements of Section 3807(a) of the Business Trust Act and any other applicable law, PROVIDED THAT, if the Property Trustee has its principal place of business in the State of Delaware and otherwise meets the requirements of applicable law, then the Property Trustee shall also be the Delaware Trustee, the Person theretofore serving as Delaware Trustee (if other than the Property Trustee) automatically shall cease to be a Trustee, the Property 29 Trustee promptly shall provide to the Person theretofore serving as Delaware Trustee written notice of the same (in relying on which the Person theretofore serving as Delaware Trustee shall be fully justified and protected), the number of Trustees automatically shall be reduced by one (1), the Property Trustee promptly shall cause the certificate of trust of the Trust to be amended as necessary, and Section 3.11 shall have no application. SECTION 5.3 PROPERTY TRUSTEE; ELIGIBILITY. (a) There shall at all times be one Trustee (the "Property Trustee") which shall act as Property Trustee which shall: (i) not be an Affiliate of the Sponsor; 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 a corporation or Person permitted by the Commission to act as an institutional trustee under the Trust Indenture Act, 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 5.3(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. (b) If at any time the Property Trustee shall cease to be eligible to so act under Section 5.3(a), the Property Trustee shall immediately resign in the manner and with the effect set forth in Section 5.7(c). (c) If the Property Trustee has or shall acquire any "conflicting interest" within the meaning of ss. 310(b) of the Trust Indenture Act, the Property Trustee and the Holder of the Common Securities (as if it were the obligor referred to in ss. 310(b) of the Trust Indenture Act) shall in all respects comply with the provisions of ss. 310(b) of the Trust Indenture Act. (d) The Preferred Securities Guarantee and the Indenture shall be deemed to be specifically described in this Declaration for purposes of clause (i) of the first proviso contained in Section 310(b) of the Trust Indenture Act. 30 (e) The initial Property Trustee shall be: The Bank of New York 101 Barclay Street 21st Floor West New York, New York 10286 Attention: Corporate Trust Department SECTION 5.4 CERTAIN QUALIFICATIONS OF ADMINISTRATIVE TRUSTEES AND DELAWARE TRUSTEE GENERALLY. Each Administrative Trustee and the Delaware Trustee (unless the Property Trustee also acts as Delaware Trustee) shall be either a natural person who is at least 21 years of age or a legal entity that shall act through one or more Authorized Officers. SECTION 5.5 ADMINISTRATIVE TRUSTEES. The initial Administrative Trustees shall be: Douglas H. Philipsen Richard J. Seaman Russell N. Viau (a) Except as expressly set forth in this Declaration and except if a meeting of the Administrative Trustees is called with respect to any matter over which the Administrative Trustees have power to act, any power of the Administrative Trustees may be exercised by, or with the consent of, any one such Administrative Trustee. (b) An Administrative Trustee shall have the authority set forth in Section 3.12 to execute on behalf of the Trust any documents which the Administrative Trustees have the power and authority to cause the Trust to execute pursuant to Section 3.6; PROVIDED THAT the Registration Statement, including any amendment thereto, shall be signed by all of the Administra tive Trustees. (c) An Administrative Trustee may, by power of attorney consistent with applicable law, delegate to any other natural person over the age of 21 his or her power for the purposes of signing any documents which the Administrative Trustees have power and authority to cause the Trust to execute pursuant to Section 3.6. 31 SECTION 5.6 DELAWARE TRUSTEE. The initial Delaware Trustee shall be: The Bank of New York (Delaware) 23 White Clay Center Route 273 Newark, Delaware 19711 Attention: Corporate Trust Department SECTION 5.7 APPOINTMENT, REMOVAL AND RESIGNATION OF TRUSTEES. (a) Subject to Section 5.7(b) of this Declaration and to Section 6(b) of Annex I hereto, Trustees may be appointed or removed without cause at any time: (i) until the issuance of any Securities, by written instrument executed by the Sponsor; (ii) unless an Event of Default shall have occurred and be continuing after the issuance of any Securities, by vote of the Holders of a Majority in liquidation amount of the Common Securities voting as a class at a meeting of the Holders of the Common Securities; and (iii) if an Event of Default shall have occurred and be continuing after the issuance of the Securities, with respect to the Property Trustee or the Delaware Trustee, by vote of Holders of a Majority in liquidation amount of the Preferred Securities voting as a class at a meeting of Holders of the Preferred Securities. (b) (i) The Trustee that acts as Property Trustee shall not be removed in accordance with Section 5.7(a) until a Successor Property Trustee has been appointed and has accepted such appointment by written instrument executed by such Successor Property Trustee and delivered to the Administrative Trustees and the Sponsor; and (ii) the Trustee that acts as Delaware Trustee shall not be removed in accordance with this Section 5.7(a) until a successor Trustee possessing the qualifications to act as Delaware Trustee under Sections 5.2 and 5.4 (a "Successor Delaware Trustee") has been appointed and has accepted such appointment by written instrument executed by such Successor Delaware Trustee and delivered to the Administrative Trustees and the Sponsor. (c) A Trustee appointed to office shall hold office until its or his successor shall have been appointed or until his death or its dissolution, or until his or its removal or resignation. Any Trustee may resign from office (without need for prior or subsequent accounting) by an instrument in writing signed by the Trustee and delivered to the Sponsor and the Trust, which 32 resignation shall take effect upon such delivery or upon such later date as is specified therein; PROVIDED, HOWEVER, that: (i) No such resignation of the Trustee that acts as the Property Trustee shall be effective: (A) until a Successor Property Trustee has been appointed and has accepted such appointment by instrument executed by such Successor Property Trustee and delivered to the Trust, the Sponsor and the resigning Property Trustee; or (B) until the assets of the Trust have been completely liquidated and the proceeds thereof distributed to the Holders; and (ii) no such resignation of the Trustee that acts as the Delaware Trustee shall be effective until a Successor Delaware Trustee has been appointed and has accepted such appointment by instrument executed by such Successor Delaware Trustee and delivered to the Trust, the Sponsor and the resigning Delaware Trustee. (d) The Holders of the Common Securities or, if an Event of Default shall have occurred and be continuing after the issuance of the Securities, the Holders of the Preferred Securities shall use their best efforts to promptly appoint a Successor Delaware Trustee or Successor Property Trustee, as the case may be, if the Property Trustee or the Delaware Trustee delivers an instrument of resignation in accordance with this Section 5.7. (e) If no Successor Property Trustee or Successor Delaware Trustee shall have been appointed and accepted appointment as provided in this Section 5.7 within 60 days after delivery of an instrument of resignation or removal, the Property Trustee or Delaware Trustee resigning or being removed, as applicable, may, at the expense of the Sponsor, petition any court of competent jurisdiction for appointment of a Successor Property Trustee or Successor Delaware Trustee, as applicable. Such court may thereupon, after prescribing such notice, if any, as it may deem proper, and appoint a Successor Property Trustee or Successor Delaware Trustee, as the case may be. (f) No Property Trustee or Delaware Trustee shall be liable for the acts or omissions to act of any Successor Property Trustee or Successor Delaware Trustee, as the case may be. (g) At the time of resignation or removal of the Property Trustee or the Delaware Trustee, the Debenture Issuer shall pay to such Trustee any amounts that may be owed to such Trustee pursuant to Section 10.4. (h) Any successor to an Administrative Trustee shall be an officer, director, employee or Affiliate of the Sponsor. 33 SECTION 5.8 VACANCIES AMONG TRUSTEES. If a Trustee ceases to hold office for any reason and the number of Trustees is not reduced pursuant to Section 5.1 or Section 5.2, or if the number of Trustees is increased pursuant to Section 5.1, a vacancy shall occur. A resolution certifying the existence of such vacancy by the Administrative Trustees or, if there are more than two, a majority of the Administrative Trustees shall be conclusive evidence of the existence of such vacancy. The vacancy shall be filled with a Trustee appointed in accordance with Section 5.7. SECTION 5.9 EFFECT OF VACANCIES. The death, resignation, retirement, removal, bankruptcy, dissolution, liquidation, incompetence or incapacity to perform the duties of a Trustee shall not operate to dissolve, terminate or annul the Trust. Whenever a vacancy in the number of Administrative Trustees shall occur, until such vacancy is filled by the appointment of an Administrative Trustee in accordance with Section 5.7, the Administrative Trustees in office, regardless of their number, shall have all the powers granted to the Administrative Trustees and shall discharge all the duties imposed upon the Administrative Trustees by this Declaration. SECTION 5.10 MEETINGS. If there is more than one Administrative Trustee, meetings of the Administrative Trustees shall be held from time to time upon the call of any Administrative Trustee. Regular meetings of the Administrative Trustees may be held at a time and place fixed by resolution of the Administrative Trustees, PROVIDED, HOWEVER, that meetings of the Administrative Trustees shall not be held in any jurisdiction which would subject the Trust to taxation under the laws of such jurisdiction. Notice of any in-person meetings of the Administrative Trustees shall be hand delivered or otherwise delivered in writing (including by facsimile, with a hard copy by overnight courier) not less than 24 hours before such meeting. Notice of any telephonic meetings of the Administrative Trustees or any committee thereof shall be hand delivered or otherwise delivered in writing (including by facsimile, with a hard copy by overnight courier) not less than 24 hours before a meeting. Notices shall contain a brief statement of the time, place and anticipated purposes of the meeting. The presence (whether in person or by telephone) of an Administrative Trustee at a meeting shall constitute a waiver of notice of such meeting except where an Administrative Trustee attends a meeting for the express purpose of objecting to the transaction of any activity on the ground that the meeting has not been lawfully called or convened. Unless provided otherwise in this Declaration, any action of the Administrative Trustees may be taken at a meeting by vote of a majority of the Administrative Trustees present (whether in person or by telephone) and eligible to vote with respect to such matter, provided that a Quorum is present, or without a meeting and without notice by the unanimous written consent of the Administrative Trustees. In the event there is only one Administrative Trustee, any and all action of such Administrative Trustee shall be evidenced by a written consent of such Administrative Trustee. 34 SECTION 5.11 DELEGATION OF POWER. (a) Any Administrative Trustee may, by power of attorney consistent with applicable law, delegate to any other natural person over the age of 21 his or her power for the purpose of executing any documents contemplated in Section 3.6, including any registration statement or amendment thereto filed with the Commission, or making any other governmental filing; and (b) the Administrative Trustees shall have power to delegate from time to time to such of their number or to officers of the Trust the doing of such things and the execution of such instruments either in the name of the Trust or the names of the Administrative Trustees or otherwise as the Administrative Trustees may deem expedient, to the extent such delegation is not prohibited by applicable law or contrary to the provisions of the Trust, as set forth herein. SECTION 5.12 MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS. Any Person into which the Property Trustee or the Delaware Trustee that is not a natural person, as the case may be, may be merged or converted or with which it may be consolidated, or any Person resulting from any merger, conversion or consolidation to which the Property Trustee or the Delaware Trustee, as the case may be, shall be a party, or any Person succeeding to all or substantially all the corporate trust business of the Property Trustee or the Delaware Trustee, as the case may be, shall be the successor of the Property Trustee or the Delaware Trustee, as the case may be, hereunder, provided such Person shall be otherwise qualified and eligible under this Article, without the execution or filing of any paper or any further act on the part of any of the parties hereto. ARTICLE VI DISTRIBUTIONS SECTION 6.1 DISTRIBUTIONS. Holders shall receive Distributions in accordance with the applicable terms of the relevant Holder's Securities. Distributions shall be made on the Preferred Securities and the Common Securities in accordance with the preferences set forth in their respective terms. If and to the extent that the Debenture Issuer makes a payment of interest (including Compounded Interest and Additional Sums, each as defined in the Indenture) or principal on the Debentures held by the Property Trustee or any other payments with respect to the Debentures held by the Property Trustee (the amount of any such payment being a "Payment Amount"), the Property Trustee shall and is directed, to the extent funds are available for that purpose, to make a distribution (a "Distribution") of the Payment Amount to Holders. 35 ARTICLE VII ISSUANCE OF SECURITIES SECTION 7.1 GENERAL PROVISIONS REGARDING SECURITIES. (a) The Administrative Trustees shall on behalf of the Trust issue one class of capital securities representing undivided beneficial interests in the assets of the Trust having such terms as are set forth in Annex I (the "Preferred Securities") and one class of common securities representing undivided beneficial interests in the assets of the Trust having such terms as are set forth in Annex I (the "Common Securities"). The Trust shall issue no securities or other interests in the assets of the Trust other than the Trust Securities. (b) The consideration received by the Trust for the issuance of the Securities shall constitute a contribution to the capital of the Trust and shall not constitute a loan to the Trust. (c) Upon issuance of the Securities as provided in this Declaration, the Securities so issued shall be deemed to be validly issued, fully paid and non-assessable undivided beneficial interests in the assets of the Trust. (d) Every Person, by virtue of having become a Holder or a Preferred Security Beneficial Owner in accordance with the terms of this Declaration, shall be deemed to have expressly assented and agreed to the terms of, and shall be bound by, this Declaration and the terms of the Securities, the Preferred Securities Guarantee, the Indenture and the Debentures. SECTION 7.2 EXECUTION AND AUTHENTICATION. (a) The Securities shall be signed on behalf of the Trust by an Administrative Trustee by manual or facsimile signature. In case any Administrative Trustee of the Trust who shall have signed any of the Securities shall cease to be such Administrative Trustee before the Securities so signed shall be delivered by the Trust, such Securities nevertheless may be delivered as though the person who signed such Securities had not ceased to be such Administrative Trustee; and any Securities may be signed on behalf of the Trust by such persons who, at the actual date of execution of such Security, shall be the Administrative Trustees of the Trust, although at the date of the execution and delivery of the Declaration any such person was not such an Administrative Trustee. (b) One Administrative Trustee shall sign the Preferred Securities for the Trust by manual or facsimile signature. Unless otherwise determined by the Administrative Trustees, such signature shall, in the case of Common Securities, be a manual signature. A Preferred Security shall not be valid until authenticated by the manual signature of an authorized signatory of the Property Trustee. The signature shall be conclusive evidence that the Preferred Security has been authenticated under this Declaration. 36 Upon a written order of the Trust signed by one Administrative Trustee, the Property Trustee shall authenticate the Preferred Securities for original issue. The aggregate number of Preferred Securities outstanding at any time shall not exceed the number set forth in the terms in Annex I hereto except as provided in Section 7.6. The Property Trustee may appoint an authenticating agent acceptable to the Trust to authenticate Preferred Securities. An authenticating agent may authenticate Preferred Securities whenever the Property Trustee may do so. Each reference in this Declaration to authentication by the Property Trustee includes authentication by such agent. An authenticating agent has the same rights as the Property Trustee to deal with the Sponsor or an Affiliate. SECTION 7.3 FORM AND DATING. The Preferred Securities and the Property Trustee's certificate of authentication shall be substantially in the form of Exhibit A-1 and the Common Securities shall be substantially in the form of Exhibit A-2, each of which is hereby incorporated in and expressly made a part of this Declaration. Certificates representing the Securities may be printed, lithographed or engraved or may be produced in any other manner as is reasonably acceptable to the Administrative Trustees, as evidenced by their execution thereof. The Securities may have letters, CUSIP or other numbers, notations or other marks of identification or designation and such legends or endorsements required by law, stock exchange rule, agreements to which the Trust is subject, if any, or usage (provided that any such notation, legend or endorsement is in a form acceptable to the Trust). The Trust at the direction of the Sponsor shall furnish any such legend to the Property Trustee in writing. Each Preferred Security shall be dated the date of its authentication. The terms and provisions of the Securities set forth in Annex I and the forms of Securities set forth in Exhibits A-1 and A-2 are part of the terms of this Declaration and to the extent applicable, the Property Trustee and the Sponsor, by their execution and delivery of this Declaration, expressly agree to such terms and provisions and to be bound thereby. (a) GLOBAL SECURITIES. The Preferred Securities shall be issued in the form of one or more permanent global Securities in definitive, fully registered form without distribution coupons as set forth in Exhibit A-1 hereto (a "Global Preferred Security"), which shall be deposited on behalf of the purchasers of the Preferred Securities represented thereby with the Property Trustee, as custodian for the Clearing Agency, and registered in the name of the Clearing Agency or a nominee of the Clearing Agency, duly executed by the Trust and authenticated by the Property Trustee as hereinafter provided. The number of Preferred Securities represented by a Global Preferred Security may from time to time be increased or decreased by adjustments made on the records of the Property Trustee and the Clearing Agency or its nominee as hereinafter provided. (b) BOOK-ENTRY PROVISIONS. This Section 7.3(b) shall apply only to the Global Preferred Securities and such other Preferred Securities in global form as may be authorized by the Trust to be deposited with or on behalf of the Clearing Agency. 37 The Trust shall execute and the Property Trustee shall, in accordance with this Section 7.3, authenticate and make available for delivery initially one or more Global Preferred Securities that (i) shall be registered in the name of Cede & Co. or other nominee of such Clearing Agency and (ii) shall be delivered by the Property Trustee to such Clearing Agency or pursuant to such Clearing Agency's written instructions or held by the Property Trustee as custodian for the Clearing Agency. Members of, or participants in, the Clearing Agency ("Participants") shall have no rights under this Declaration with respect to any Global Preferred Security held on their behalf by the Clearing Agency or by the Property Trustee as the custodian of the Clearing Agency or under such Global Preferred Security, and the Clearing Agency may be treated by the Trust, the Property Trustee and any agent of the Trust or the Property Trustee as the absolute owner of such Global Preferred Security for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Trust, the Property Trustee or any agent of the Trust or the Property Trustee from giving effect to any written certification, proxy or other authorization furnished by the Clearing Agency or impair, as between the Clearing Agency and its Participants, the operation of customary practices of such Clearing Agency governing the exercise of the rights of a holder of a beneficial interest in any Global Preferred Security. (c) DEFINITIVE PREFERRED SECURITIES. Except as provided in Section 7.9 or 9.2(d), owners of beneficial interests in a Global Preferred Security will not be entitled to receive physical delivery of certificated Preferred Securities ("Definitive Preferred Securities"). (d) AUTHORIZED DENOMINATIONS. The Preferred Securities are issuable only in denominations of $10 and any integral multiple thereof. SECTION 7.4 REGISTRAR AND PAYING AGENT. The Trust shall maintain in the Borough of Manhattan, The City of New York, (i) an office or agency where Preferred Securities may be presented for registration of transfer ("Registrar") and (ii) an office or agency where Preferred Securities may be presented for payment ("Paying Agent"). The Registrar shall keep a register of the Preferred Securities and of their transfer. The Administrative Trustees on behalf of the Trust may appoint the Registrar and the Paying Agent and may appoint one or more co-registrars and one or more additional paying agents in such other locations as it shall determine. The term "Registrar" includes any additional registrar and "Paying Agent" includes any additional paying agent. The Administrative Trustees on behalf of the Trust may change any Paying Agent, Registrar or co-registrar without prior notice to any Holder. The Paying Agent or Registrar shall be permitted to resign as Paying Agent or Registrar, as the case may be, upon 30 days' written notice to the Administrative Trustees. The Administrative Trustees on behalf of the Trust shall notify the Property Trustee of the name and address of any Agent not a party to this Declaration. If the Administrative Trustees on behalf of the Trust fails to appoint or maintain another entity as Registrar or Paying Agent, the Property Trustee shall act as such. The Trust or any of its Affiliates may act as Paying Agent or Registrar. The Trust shall act as Paying Agent and Registrar for the Common Securities. 38 The Trust initially appoints the Property Trustee as Registrar and Paying Agent for the Preferred Securities. SECTION 7.5 PAYING AGENT TO HOLD MONEY IN TRUST. The Trust shall require each Paying Agent other than the Property Trustee to agree in writing that the Paying Agent will hold in trust for the benefit of Holders or the Property Trustee all money held by the Paying Agent for the payment of liquidation amounts or Distributions, and will notify the Property Trustee if there are insufficient funds for such purpose. While any such insufficiency continues, the Property Trustee may require a Paying Agent to pay all money held by it to the Property Trustee. The Trust at any time may require a Paying Agent to pay all money held by it to the Property Trustee and to account for any money disbursed by it. Upon payment over to the Property Trustee, the Paying Agent (if other than the Trust or an Affiliate of the Trust) shall have no further liability for the monies previously held by it. If the Trust or the Sponsor or an Affiliate of the Trust or the Sponsor acts as Paying Agent, it shall segregate and hold in a separate trust fund for the benefit of the Holders all money held by it as Paying Agent. SECTION 7.6 REPLACEMENT SECURITIES. If a Holder claims that a Security owned by it has been lost, destroyed or wrongfully taken or if such Security is mutilated and is surrendered to the Trust or in the case of the Preferred Securities to the Property Trustee, the Trust shall issue and the Property Trustee shall, upon written order of the Trust, authenticate a replacement Security if the Property Trustee's and the Trust's requirements, as the case may be, are met. An indemnity bond must be provided by the Holder which, in the judgment of the Property Trustee, is sufficient to protect the Trustees, the Sponsor, the Trust or any authenticating agent from any loss which any of them may suffer if a Security is replaced. The Trust may charge such Holder for its expenses in replacing a Security. SECTION 7.7 OUTSTANDING PREFERRED SECURITIES. The Preferred Securities outstanding at any time are all the Preferred Securities authenticated by the Property Trustee except for those canceled by it, those delivered to it for cancellation and those described in this Section as not outstanding. If a Preferred Security is replaced, paid or purchased pursuant to Section 7.6 hereof, it ceases to be outstanding unless the Property Trustee receives proof satisfactory to it that the replaced, paid or purchased Preferred Security is held by a protected purchaser. If Preferred Securities are considered paid in full in accordance with the terms of this Declaration, they cease to be outstanding and Distributions on them shall cease to accumulate. Except as provided in Section 7.8, a Preferred Security does not cease to be outstanding because one of the Trust, the Sponsor or an Affiliate of the Sponsor holds the Security. 39 SECTION 7.8 PREFERRED SECURITIES IN TREASURY. In determining whether the Holders of the required amount of Securities have concurred in any direction, waiver or consent, Preferred Securities owned by the Trust, the Sponsor or an Affiliate of the Sponsor, as the case may be, shall be disregarded and deemed not to be outstanding, except that for the purposes of determining whether the Property Trustee shall be fully protected in relying on any such direction, waiver or consent, only Securities which a Responsible Officer of the Property Trustee actually knows are so owned shall be so disregarded. SECTION 7.9 DEFINITIVE SECURITIES. (a) A Global Preferred Security deposited with the Clearing Agency or with the Property Trustee as custodian for the Clearing Agency pursuant to Section 7.3 shall be transferred to the beneficial owners thereof in the form of Definitive Preferred Securities only if such transfer complies with Section 9.2 and (i) the Clearing Agency notifies the Sponsor that it is unwilling or unable to continue as Clearing Agency for such Global Preferred Security or if at any time such Clearing Agency ceases to be a "clearing agency" registered under the Exchange Act and a clearing agency is not appointed by the Sponsor within 90 days of such notice, (ii) a Default or an Event of Default has occurred and is continuing or (iii) the Trust at its sole discretion elects to cause the issuance of Definitive Preferred Securities. (b) Any Global Preferred Security that is transferable to the beneficial owners thereof in the form of Definitive Preferred Securities pursuant to this Section 7.9 shall be surrendered by the Clearing Agency to the Property Trustee located in the Borough of Manhattan, The City of New York, to be so transferred, in whole or from time to time in part, without charge, and the Property Trustee shall authenticate and make available for delivery, upon such transfer of each portion of such Global Preferred Security, an equal aggregate liquidation amount of Preferred Securities of authorized denominations in the form of certificated Preferred Securities. Any portion of a Global Preferred Security so transferred pursuant to this Section 7.9(b) shall be registered in such names as the Clearing Agency shall direct. (c) Subject to the provisions of Section 7.9(b), the Holder of a Global Preferred Security may grant proxies and otherwise authorize any Person, including Participants and Persons that may hold interests through Participants, to take any action which such Holder is entitled to take under this Declaration or the Securities. (d) In the event of the occurrence of any of the events specified in Section 7.9(a), the Trust will promptly make available to the Property Trustee a reasonable supply of certificated Preferred Securities in fully registered form without distribution coupons. (e) Payments on the Preferred Securities that are not held by the Depositary will be made by check mailed to the address of the holder certified thereto at the address which appears on the register. 40 SECTION 7.10 CANCELLATION. The Trust at any time may deliver Preferred Securities to the Property Trustee for cancellation. The Registrar and Paying Agent shall forward to the Property Trustee any Preferred Securities surrendered to them for registration of transfer, redemption, or payment. The Property Trustee shall promptly cancel all Preferred Securities, surrendered for registration of transfer, redemption, payment, replacement or cancellation and shall dispose of canceled Preferred Securities in accordance with its customary procedures unless the Trust otherwise directs. The Trust may not issue new Preferred Securities to replace Preferred Securities that it has paid or that have been delivered to the Property Trustee for cancellation. SECTION 7.11 CUSIP NUMBERS. The Trust in issuing the Preferred Securities may use "CUSIP" numbers (if then generally in use), and, if so, the Property Trustee shall use "CUSIP" numbers in notices of redemption as a convenience to Holders of Preferred Securities; PROVIDED that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Preferred Securities or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Preferred Securities, and any such redemption shall not be affected by any defect in or omission of such numbers. The Sponsor will promptly notify the Property Trustee of any change in the CUSIP numbers. ARTICLE VIII DISSOLUTION AND TERMINATION OF TRUST SECTION 8.1 DISSOLUTION AND TERMINATION OF TRUST. (a) The Trust shall automatically dissolve and be wound up in accordance with applicable law: (i) upon the occurrence of an Event of Default with respect to the Sponsor as described in Section 501(d) or (e) of the Indenture; (ii) upon the filing of a certificate of dissolution or liquidation or its equivalent with respect to the Sponsor; or the revocation of the Sponsor's charter and the expiration of 90 days after the date of revocation without a reinstatement thereof; (iii) based upon an election by the Sponsor to dissolve the Trust, following the distribution of the Debentures from the Trust to the Holders in exchange for all of the Securities;. (iv) upon the entry of a decree of judicial dissolution of the Sponsor or the Trust by a court of competent jurisdiction; 41 (v) when all of the Securities shall have been called for redemption and the amounts necessary for redemption thereof shall have been paid to the Holders in accordance with the terms of the Securities; or (vi) the expiration of the term of the Trust provided in Section 3.14. (b) As soon as is practicable after the occurrence of an event referred to in Section 8.1(a), but within 30 days of such event, notice of such dissolution shall be given to the Holders and upon completion of the winding up of Trust, the Administrative Trustees shall file a certificate of cancellation with the Secretary of State of the State of Delaware and the Trust shall terminate. (c) The provisions of Section 3.9 and Article X shall survive the termination of the Trust. ARTICLE IX TRANSFER OF INTERESTS SECTION 9.1 TRANSFER OF SECURITIES. (a) Securities may only be transferred, in whole or in part, in accordance with the terms and conditions set forth in this Declaration and in the terms of the Securities. To the fullest extent permitted by applicable law, any transfer or purported transfer of any Security not made in accordance with this Declaration shall be null and void. (b) The Administrative Trustees shall provide for the registration of Preferred Securities and of the transfer of Preferred Securities, which will be effected without charge but only upon payment (with such indemnity as the Administrative Trustees may require) in respect of any tax or other governmental charges that may be imposed in relation to it. Upon surrender for registration of transfer of any Preferred Securities, the Administrative Trustees shall cause one or more new Preferred Securities to be issued in the name of the designated transferee or transferees. Every Preferred Security surrendered for registration of transfer shall be accompanied by a written instrument of transfer in form satisfactory to the Administrative Trustees and the Registrar or co-registrar, duly executed by the Holder or such Holder's attorney duly authorized in writing. Each Preferred Security surrendered for registration of transfer shall be canceled by the Property Trustee. A transferee of a Preferred Security shall be entitled to the rights and subject to the obligations of a Holder hereunder upon the receipt by such transferee of a Preferred Security. By acceptance of a Preferred Security, each transferee shall be bound by this Declaration. (c) The Holder of the Common Securities may not transfer the Common Securities except (a) in connection with transactions permitted under Section 10.01 of the Indenture, or (b) to the Sponsor or an Affiliate thereof in compliance with applicable law (including the Securities Act and applicable state securities and blue sky laws); PROVIDED THAT, any such transfer is 42 subject to the condition precedent that the transferor obtain the written opinion of qualified independent counsel experienced in such matters that such transfer would not cause more than an insubstantial risk that: (i) the Trust would not be classified for United States federal income tax purposes as a grantor trust and each Holder of Securities would not be treated as owning an undivided beneficial interest in the Debentures; and (ii) the Trustee would be an Investment Company or the transferee would become an Investment Company. To the fullest extent permitted by law, any attempted transfer of the Common Securities other than as set forth in the immediately preceding sentence shall be void. For so long as the Trust Securities remain outstanding, the Sponsor will covenant (i) to directly or indirectly maintain 100% direct or indirect ownership of the Common Securities of the Trust; PROVIDED, HOWEVER, that any permitted successor of the Sponsor under the Indenture may succeed to the Sponsor's ownership of such Common Securities, (ii) to use its reasonable efforts to cause the Trust (a) to remain a business trust, except in connection with the distribution of Debentures to the Holders of Trust Securities in liquidation of the Trust, the redemption of all of the Trust Securities, or certain mergers, consolidations or amalgamations, each as permitted by this Declaration, and (b) to otherwise continue to be classified as a grantor trust for United States federal income tax purposes and (iii) to use its reasonable efforts to cause each holder of Trust Securities to be treated as owning an undivided beneficial interest in the Debentures. SECTION 9.2 TRANSFER PROCEDURES AND RESTRICTIONS. (a) TRANSFER AND EXCHANGE OF DEFINITIVE PREFERRED SECURITIES. When Definitive Preferred Securities are presented to the Registrar or co-registrar (x) to register the transfer of such Definitive Preferred Securities; or (y) to exchange such Definitive Preferred Securities which became mutilated, destroyed, defaced, stolen or lost, for an equal number of Definitive Preferred Securities, the Registrar or co-registrar shall register the transfer or make the exchange as requested if its reasonable requirements for such transaction are met; PROVIDED, HOWEVER, that the Definitive Preferred Securities surrendered for registration of transfer or exchange shall be duly endorsed or accompanied by a written instrument of transfer in form reasonably satisfactory to the Administrative Trustees and the Registrar or co-registrar, duly executed by the Holder thereof or his attorney duly authorized in writing; (b) TRANSFER AND EXCHANGE OF GLOBAL PREFERRED SECURITIES. The transfer and exchange of Global Preferred Securities or beneficial interests therein shall be effected through the 43 Clearing Agency, in accordance with this Declaration (including applicable restrictions on transfer set forth herein, if any) and the procedures of the Clearing Agency therefor. (c) RESTRICTIONS ON TRANSFER AND EXCHANGE OF GLOBAL PREFERRED SECURITIES. Notwithstanding any other provisions of this Declaration (other than the provisions set forth in this Section 9.2 and subsection (a) of Section 7.9), a Global Preferred Security may not be transferred as a whole except by the Clearing Agency to a nominee of the Clearing Agency or another nominee of the Clearing Agency or by the Clearing Agency or any such nominee to a successor Clearing Agency or a nominee of such successor Clearing Agency. (d) AUTHENTICATION OF DEFINITIVE PREFERRED SECURITIES. If at any time: (i) the Clearing Agency notifies the Sponsor that it is unwilling or unable to continue as Clearing Agency for such Global Preferred Security or if at any time such Clearing Agency ceases to be a "clearing agency" registered under the Exchange Act and a clearing agency is not appointed by the Sponsor within 90 days of such notice; (ii) there occurs a Default or an Event of Default which is continuing, or (iii) the Trust (by the Administrative Trustees), in its sole discretion, notifies the Property Trustee in writing that it elects to cause the issuance of Definitive Preferred Securities under this Declaration, then an Administrative Trustee on behalf of the Trust will execute, and the Property Trustee, upon receipt of a written order of the Trust signed by one Administrative Trustee requesting the authentication and delivery of Definitive Preferred Securities to the Persons designated by the Trust, will authenticate and make available for delivery Definitive Preferred Securities, equal in number to the number of Preferred Securities represented by the Global Preferred Securities, in exchange for such Global Preferred Securities. (e) CANCELLATION OR ADJUSTMENT OF GLOBAL PREFERRED SECURITY. At such time as all beneficial interests in a Global Preferred Security have either been exchanged for Definitive Preferred Securities to the extent permitted by this Declaration or redeemed, repurchased or canceled in accordance with the terms of this Declaration, such Global Preferred Security shall be canceled by the Property Trustee. At any time prior to such cancellation, if any beneficial interest in a Global Preferred Security is exchanged for Definitive Preferred Securities, Preferred Securities represented by such Global Preferred Security shall be reduced and an adjustment shall be made on the books and records of the Clearing Agency and the Registrar, to reflect such reduction. (f) OBLIGATIONS WITH RESPECT TO TRANSFERS OF PREFERRED SECURITIES. (i) To permit registrations of transfers, an Administrative Trustee on behalf of the Trust shall execute and the Property Trustee shall authenticate Definitive 44 Preferred Securities and Global Preferred Securities at the Registrar's or co-registrar's request in accordance with the terms of this Declaration. (ii) Registrations of transfers will be effected without charge, but only upon payment (with such indemnity as the Trust or the Sponsor may require) in respect of any tax or other governmental charge that may be imposed in relation to it. (iii) The Registrar or co-registrar shall not be required to register the transfer of (a) Preferred Securities during a period beginning at the opening of business 15 days before the day of mailing of a notice of redemption or any notice of selection of Preferred Securities for redemption and ending at the close of business on the day of such mailing; or (b) any Preferred Security so selected for redemption in whole or in part, except the unredeemed portion of any Preferred Security being redeemed in part. (iv) Prior to the due presentation for registration of transfer of any Preferred Security, the Trust, the Property Trustee, the Paying Agent, the Registrar or any co-registrar may deem and treat the Person in whose name a Preferred Security is registered as the absolute owner of such Preferred Security for the purpose of receiving Distributions on such Preferred Security (subject to Section 2(c) of Annex I) and for all other purposes whatsoever, and none of the Trust, the Property Trustee, the Paying Agent, the Registrar or any co-registrar shall be affected by notice to the contrary. (v) All Preferred Securities issued upon any registration of transfer pursuant to the terms of this Declaration shall evidence the same security and shall be entitled to the same benefits under this Declaration as the Preferred Securities surrendered upon such registration of transfer. (g) NO OBLIGATION OF THE PROPERTY TRUSTEE. (i) The Property Trustee shall have no responsibility or obligation to any beneficial owner of a Global Preferred Security, a Clearing Agency Participant in the Clearing Agency or other Person with respect to the accuracy of the records of the Clearing Agency or its nominee or of any Clearing Agency Participant thereof, with respect to any ownership interest in the Preferred Securities or with respect to the delivery to any Clearing Agency Participant, beneficial owner or other Person (other than the Clearing Agency) of any notice (including any notice of redemption) or the payment of any amount, under or with respect to such Preferred Securities. All notices and communications to be given to the Holders and all payments to be made to Holders under the Preferred Securities shall be given or made only to or upon the order of the registered Holders (which shall be the Clearing Agency or its nominee in the case of a Global Preferred Security). The rights of beneficial owners in any Global Preferred Security shall be exercised only through the Clearing Agency subject to the applicable rules and procedures of the Clearing Agency. The Property Trustee may conclusively rely and shall be fully protected in relying upon 45 information furnished by the Clearing Agency or any agent thereof with respect to its Clearing Agency Participants and any beneficial owners. (ii) The Property Trustee and the Registrar shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Declaration or under applicable law with respect to any transfer of any interest in any Preferred Security (including any transfers between or among Clearing Agency Participants or beneficial owners in any Global Preferred Security) other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by, the terms of this Declaration, and to examine the same to determine substantial compliance as to form with the express requirements hereof. SECTION 9.3 DEEMED SECURITY HOLDERS. The Trustees may treat the Person in whose name any Security shall be registered on the books and records of the Trust as the sole owner of such Security for purposes of receiving Distributions and for all other purposes whatsoever (subject to the definition of "Holder" contained herein) and, accordingly, shall not be bound to recognize any equitable or other claim to or interest in such Security on the part of any Person, whether or not the Trust shall have actual or other notice thereof. SECTION 9.4 BOOK ENTRY INTERESTS. Global Preferred Securities shall initially be registered on the books and records of the Trust in the name of Cede & Co., the nominee of the Clearing Agency, and no Preferred Security Beneficial Owner will receive a definitive Preferred Security Certificate representing such Preferred Security Beneficial Owner's interests in such Global Preferred Securities, except as provided in Section 7.9 and Section 9.2. Unless and until definitive, fully registered Preferred Securities certificates have been issued to the Preferred Security Beneficial Owners pursuant to Section 7.9 or Section 9.2: (a) the provisions of this Section 9.4 shall be in full force and effect; (b) the Trust and the Trustees shall be entitled to deal with the Clearing Agency for all purposes of this Declaration (including the payment of Distributions on the Global Preferred Securities and receiving approvals, votes or consents hereunder) as the Holder of the Preferred Securities and the sole holder of the Global Certificates and shall have no obligation to the Preferred Security Beneficial Owners; (c) to the extent that the provisions of this Section 9.4 conflict with any other provisions of this Declaration, the provisions of this Section 9.4 shall control; and 46 (d) the rights of the Preferred Security Beneficial Owners shall be exercised only through the Clearing Agency and shall be limited to those established by law and agreements between such Preferred Security Beneficial Owners and the Clearing Agency and/or the Clearing Agency Participants and the Clearing Agency shall receive and transmit payments of Distributions on the Global Certificates to such Clearing Agency Participants. DTC will make book entry transfers among the Clearing Agency Participants. SECTION 9.5 NOTICES TO CLEARING AGENCY. Whenever a notice or other communication to the Preferred Security Holders is required under this Declaration, unless and until definitive, fully registered Preferred Securities certificates have been issued to the Preferred Security Beneficial Owners pursuant to Section 7.9 or Section 9.2, the Trustees shall give all such notices and communications specified herein to be given to the Holders of Global Preferred Securities to the Clearing Agency, and shall have no notice obligations to the Preferred Security Beneficial Owners. SECTION 9.6 APPOINTMENT OF SUCCESSOR CLEARING AGENCY. If any Clearing Agency ceases to continue its services as securities depositary with respect to the Preferred Securities, the Administrative Trustees may, in their sole discretion, appoint a successor Clearing Agency with respect to such Preferred Securities. ARTICLE X LIMITATION OF LIABILITY OF HOLDERS OF SECURITIES, TRUSTEES OR OTHERS SECTION 10.1 LIABILITY. (a) Except as expressly set forth in this Declaration, the Securities Guarantees and the terms of the Securities, the Sponsor shall not be: (i) personally liable for the return of any portion of the capital contributions (or any return thereon) of the Holders which shall be made solely from assets of the Trust; and (ii) required to pay to the Trust or to any Holder any deficit upon dissolution or termination of the Trust or otherwise. (b) The Debenture Issuer shall be liable for all of the debts and obligations of the Trust (other than in respect of the payment of principal and interest on the Securities) to the extent not satisfied out of the Trust's assets. 47 (c) Pursuant to ss. 3803(a) of the Business Trust Act, the Holders shall be entitled to the same limitation of personal liability extended to stockholders of private corporations for profit organized under the General Corporation Law of the State of Delaware. SECTION 10.2 EXCULPATION. (a) No Indemnified Person shall be liable, responsible or accountable in damages or otherwise to the Trust 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 on behalf of the Trust and in a manner such Indemnified Person reasonably believed to be within the scope of the authority conferred on such Indemnified Person by this Declaration 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. (b) An Indemnified Person shall be fully protected in relying in good faith upon the records of the Trust and upon such information, opinions, reports or statements presented to the Trust by any Person as to matters the Indemnified Person reasonably believes are within such other Person's professional or expert competence and, if selected by such Indemnified Person, has been selected by such Indemnified Person with reasonable care on behalf of the Trust, 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 might properly be paid. SECTION 10.3 FIDUCIARY DUTY. (a) To the extent that, at law or in equity, an Indemnified Person has duties (including fiduciary duties) and liabilities relating thereto to the Trust or to any other Covered Person, an Indemnified Person acting under this Declaration shall not be liable to the Trust or to any other Covered Person for its good faith reliance on the provisions of this Declaration. The provisions of this Declaration, to the extent that they restrict the duties and liabilities of an Indemnified Person otherwise existing at law or in equity (other than the duties imposed on the Property Trustee under the Trust Indenture Act), are agreed by the parties hereto to replace such other duties and liabilities of such Indemnified Person. (b) Unless otherwise expressly provided herein: (i) whenever a conflict of interest exists or arises between any Covered Persons and Indemnified Persons; or (ii) whenever this Declaration or any other agreement contemplated herein or therein provides that an Indemnified Person shall act in a manner that is, or provides terms that are, fair and reasonable to the Trust or any Holder of Securities, 48 the Indemnified Person shall resolve such conflict of interest, take such action or provide such terms, considering in each case the relative interest of each party (including its own interest) to such conflict, agreement, transaction or situation and the benefits and burdens relating to such interests, any customary or accepted industry practices, and any applicable generally accepted accounting practices or principles. In the absence of bad faith by the Indemnified Person, the resolution, action or term so made, taken or provided by the Indemnified Person shall not constitute a breach of this Declaration or any other agreement contemplated herein or of any duty or obligation of the Indemnified Person at law or in equity or otherwise. (c) Whenever in this Declaration an Indemnified Person is permitted or required to make a decision: (i) in its "discretion" or under a grant of similar authority, the Indemnified Person shall be entitled to consider such interests and factors as it desires, including its own interests, and shall have no duty or obligation to give any consideration to any interest of or factors affecting the Trust or any other Person; or (ii) in its "good faith" or under another express standard, the Indemnified Person shall act under such express standard and shall not be subject to any other or different standard imposed by this Declaration. SECTION 10.4 INDEMNIFICATION. (a) (i) The Debenture Issuer shall indemnify, to the full extent permitted by law, any Company Indemnified Person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Trust) by reason of the fact that he is or was a Company Indemnified Person against expenses (including attorneys' fees and expenses), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Trust, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of NOLO CONTENDERE or its equivalent, shall not, of itself, create a presumption that the Company Indemnified Person did not act in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the Trust, and, with respect to any criminal action or proceeding, had reasonable cause to believe that his conduct was unlawful. (ii) The Debenture Issuer shall indemnify, to the full extent permitted by law, any Company Indemnified Person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the Trust to procure a judgment in its favor by reason of the fact that he is or was a Company 49 Indemnified Person against expenses (including attorneys' fees and expenses) actually and reasonably incurred by him in connection with the defense or settlement of such action or suit if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Trust and except that no such indemnification shall be made in respect of any claim, issue or matter as to which such Company Indemnified Person shall have been adjudged to be liable to the Trust unless and only to the extent that the Court of Chancery of Delaware or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such Person is fairly and reasonably entitled to indemnity for such expenses which such Court of Chancery or such other court shall deem proper. (iii) To the extent that a Company Indemnified Person shall be successful on the merits or otherwise (including dismissal of an action without prejudice or the settlement of an action without admission of liability) in defense of any action, suit or proceeding referred to in paragraphs (i) and (ii) of this Section 10.4(a), or in defense of any claim, issue or matter therein, he shall be indemnified, to the full extent permitted by law, against expenses (including attorneys' fees) actually and reasonably incurred by him in connection therewith. (iv) Any indemnification under paragraphs (i) and (ii) of this Section 10.4(a) (unless ordered by a court) shall be made by the Debenture Issuer only as authorized in the specific case upon a determination that indemnification of the Company Indemnified Person is proper in the circumstances because he has met the applicable standard of conduct set forth in paragraphs (i) and (ii). Such determination shall be made (1) by the Administrative Trustees by a majority vote of a Quorum consisting of such Administrative Trustees who were not parties to such action, suit or proceeding, (2) if such a Quorum is not obtainable, or, even if obtainable, if a Quorum of disinterested Administrative Trustees so directs, by independent legal counsel in a written opinion, or (3) by the Common Security Holder of the Trust. (v) Expenses (including attorneys' fees and expenses) incurred by a Company Indemnified Person in defending a civil, criminal, administrative or investigative action, suit or proceeding referred to in paragraphs (i) and (ii) of this Section 10.4(a) shall be paid by the Debenture Issuer in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such Company Indemnified Person to repay such amount if it shall ultimately be determined that he is not entitled to be indemnified by the Debenture Issuer as authorized in this Section 10.4(a). Notwith standing the foregoing, no advance shall be made by the Debenture Issuer if a determina tion is reasonably and promptly made (i) by the Administrative Trustees by a majority vote of a Quorum of disinterested Administrative Trustees, (ii) if such a Quorum is not obtainable, or, even if obtainable, if a Quorum of disinterested Administrative Trustees so directs, by independent legal counsel in a written opinion or (iii) the Common Security Holder of the Trust, that, based upon the facts known to the Administrative Trustees, counsel or the Common Security Holder at the time such determination is made, such 50 Company Indemnified Person acted in bad faith or in a manner that such person did not believe to be in or not opposed to the best interests of the Trust, or, with respect to any criminal proceeding, that such Company Indemnified Person believed or had reasonable cause to believe his conduct was unlawful. In no event shall any advance be made in instances where the Administrative Trustees, independent legal counsel or Common Security Holder reasonably determine that such person deliberately breached his duty to the Trust or its Common or Preferred Security Holders. (vi) The indemnification and advancement of expenses provided by, or granted pursuant to, the other paragraphs of this Section 10.4(a) shall not be deemed exclusive of any other rights to which those seeking indemnification and advancement of expenses may be entitled under any agreement, vote of stockholders or disinterested directors of the Debenture Issuer or Preferred Security Holders of the Trust or otherwise, both as to action in his official capacity and as to action in another capacity while holding such office. All rights to indemnification under this Section 10.4(a) shall be deemed to be provided by a contract between the Debenture Issuer and each Company Indemnified Person who serves in such capacity at any time while this Section 10.4(a) is in effect. Any repeal or modification of this Section 10.4(a) shall not affect any rights or obligations then existing. (vii) The Debenture Issuer or the Trust may purchase and maintain insurance on behalf of any person who is or was a Company Indemnified Person against any liability asserted against him and incurred by him in any such capacity, or arising out of his status as such, whether or not the Debenture Issuer would have the power to indemnify him against such liability under the provisions of this Section 10.4(a). (viii) For purposes of this Section 10.4(a), references to "the Trust" shall include, in addition to the resulting or surviving entity, any constituent entity (including any constituent of a constituent) absorbed in a consolidation or merger, so that any person who is or was a director, trustee, officer or employee of such constituent entity, or is or was serving at the request of such constituent entity as a director, trustee, officer, employee or agent of another entity, shall stand in the same position under the provisions of this Section 10.4(a) with respect to the resulting or surviving entity as he would have with respect to such constituent entity if its separate existence had continued. (ix) The indemnification and advancement of expenses provided by, or granted pursuant to, this Section 10.4(a) shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a Company Indemni fied Person and shall inure to the benefit of the heirs, executors and administrators of such a person. (b) To the fullest extent permitted by law, the Debenture Issuer agrees to indemnify the (i) Property Trustee, (ii) the Delaware Trustee, (iii) any Affiliate of the Property Trustee or the Delaware Trustee, and (iv) any officers, directors, shareholders, members, partners, 51 employees, representatives, custodians, nominees or agents of the Property Trustee or the Delaware Trustee (each of the Persons in (i) through (iv) being referred to as a "Fiduciary Indemnified Person") for, and to hold each Fiduciary Indemnified Person harmless against, any and all loss, liability, damage, claim or expense including taxes (other than taxes based on the income of such Fiduciary Indemnified Person) incurred without negligence or bad faith on its part, arising out of or in connection with the acceptance or administration of the trust or trusts hereunder, including the costs and expenses (including reasonable legal fees and expenses) of defending itself against or investigating any claim or liability in connection with the exercise or performance of any of its powers or duties hereunder. The obligation to indemnify as set forth in this Section 10.4(b) shall survive the resignation or removal of the Property Trustee or the Delaware Trustee, the dissolution of the Trust and the satisfaction and discharge of this Declaration. SECTION 10.5 OUTSIDE BUSINESSES. Any Covered Person, the Sponsor, the Delaware Trustee and the Property Trustee (subject to Section 5.3(c)) may engage in or possess an interest in other business ventures of any nature or description, independently or with others, similar or dissimilar to the business of the Trust, and the Trust and the Holders shall have no rights by virtue of this Declaration in and to such independent ventures or the income or profits derived therefrom, and the pursuit of any such venture, even if competitive with the business of the Trust, shall not be deemed wrongful or improper. No Covered Person, the Sponsor, the Delaware Trustee, or the Property Trustee shall be obligated to present any particular investment or other opportunity to the Trust even if such opportunity is of a character that, if presented to the Trust, could be taken by the Trust, and any Covered Person, the Sponsor, the Delaware Trustee and the Property Trustee shall have the right to take for its own account (individually or as a partner or fiduciary) or to recommend to others any such particular investment or other opportunity. Any Covered Person, the Delaware Trustee and the Property Trustee may engage or be interested in any financial or other transaction with the Sponsor or any Affiliate of the Sponsor, or may act as depositary for, trustee or agent for, or act on any committee or body of holders of, securities or other obligations of the Sponsor or its Affiliates. SECTION 10.6 COMPENSATION; FEES. The Debenture Issuer agrees: (a) to pay to the Trustees from time to time such compensation for all services rendered by them hereunder as the parties shall agree in writing 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 Trustees upon request for all reasonable expenses, disbursements and advances incurred or made by the Trustees in accordance with any provision of this Declaration (including the reasonable compensa tion and the expenses and disbursements of their respective agents and counsel), except any such expense, disbursement or advance as may be attributable to its negligence or bad faith. 52 The provisions of this Section 10.6 shall survive the dissolution of the Trust and the termination of this Declaration and the removal or resignation of any Trustee. No Trustee may claim any lien or charge on any property of the Trust as a result of any amount due pursuant to this Section 10.6. ARTICLE XI ACCOUNTING SECTION 11.1 FISCAL YEAR. The fiscal year ("Fiscal Year") of the Trust shall be the calendar year, or such other year as is required by the Code. SECTION 11.2 CERTAIN ACCOUNTING MATTERS. (a) At all times during the existence of the Trust, the Administrative Trustees shall keep, or cause to be kept, full books of account, records and supporting documents, which shall reflect in reasonable detail, each transaction of the Trust. The books of account shall be maintained on the accrual method of accounting, in accordance with generally accepted accounting principles, consistently applied. The books of account and the records of the Trust shall be examined by and reported upon as of the end of each Fiscal Year of the Trust by a firm of independent certified public accountants selected by the Administrative Trustees. (b) The Administrative Trustees shall cause to be duly prepared and delivered to each of the Holders, any annual United States federal income tax information statement, required by the Code, containing such information with regard to the Securities held by each Holder as is required by the Code and the Treasury Regulations. Notwithstanding any right under the Code to deliver any such statement at a later date, the Administrative Trustees shall endeavor to deliver all such information statements within 30 days after the end of each Fiscal Year of the Trust. (c) The Administrative Trustees shall cause to be duly prepared and filed with the appropriate taxing authority, an annual United States federal income tax return, on a Form 1041 or such other form required by United States federal income tax law, and any other annual income tax returns required to be filed by the Administrative Trustees on behalf of the Trust with any state or local taxing authority. SECTION 11.3 BANKING. The Trust may maintain one or more bank accounts in the name and for the sole benefit of the Trust; PROVIDED, HOWEVER, that all payments of funds in respect of the Debentures held by the Property Trustee shall be made directly to the Property Trustee Account and no other funds of the Trust shall be deposited in the Property Trustee Account. The sole signatories for such 53 accounts shall be designated by the Administrative Trustees; PROVIDED, HOWEVER, that the Property Trustee shall designate the signatories for the Property Trustee Account. SECTION 11.4 WITHHOLDING. The Trust and the Administrative Trustees shall comply with all withholding requirements under United States federal, state and local law. The Trust shall request, and the Holders shall provide to the Trust, such forms or certificates as are necessary to establish an exemption from withholding with respect to each Holder, and any representations and forms as shall reasonably be requested by the Trust to assist it in determining the extent of, and in fulfilling, its withholding obligations. The Administrative Trustees shall file required forms with applicable jurisdictions and, unless an exemption from withholding is properly established by a Holder, shall remit amounts withheld with respect to the Holder to applicable jurisdictions. To the extent that the Trust is required to withhold and pay over any amounts to any authority with respect to Distributions or allocations to any Holder, the amount withheld shall be deemed to be a Distribution in the amount of the withholding to the Holder. In the event of any claimed over withholding, Holders shall be limited to an action against the applicable jurisdiction. If the amount required to be withheld was not withheld from actual Distributions made, the Trust may reduce subsequent Distributions by the amount of such withholding. ARTICLE XII AMENDMENTS AND MEETINGS SECTION 12.1 AMENDMENTS. (a) Except as otherwise provided in this Declaration (including Section 7 of Annex I hereto) or by any applicable terms of the Securities, this Declaration may only be amended by a written instrument approved and executed by: (i) the Administrative Trustees (or if there are more than two Administrative Trustees a majority of the Administrative Trustees); (ii) if the amendment affects the rights, powers, duties, obligations or immunities of the Property Trustee, the Property Trustee; and (iii) if the amendment affects the rights, powers, duties, obligations or immunities of the Delaware Trustee, the Delaware Trustee. (b) No amendment shall be made, and any such purported amendment shall be void and ineffective: (i) unless the Property Trustee shall have first received: 54 (A) an Officers' Certificate from each of the Trust and the Sponsor that such amendment is permitted by, and conforms to, the terms of this Declaration (including the terms of the Securities) and that the interests of any Holder of Securities will not be materially affected by such amendment; and (B) an Opinion of Counsel (who may be counsel to the Sponsor or the Trust) that such amendment is permitted by, and conforms to, the terms of this Declaration (including the terms of the Securities) and that all conditions precedent, if any, in this Declaration to the execution and delivery of such amendment have been satisfied, PROVIDED, HOWEVER, that the Property Trustee shall not be required to sign any such amendment which affects the rights, powers, duties, obligations or immunities of the Property Trustee; and (ii) to the extent the result of such amendment would be to: (A) cause the Trust to fail to continue to be classified for purposes of United States federal income taxation as a grantor trust; (B) reduce or otherwise adversely affect the powers of the Property Trustee in contravention of the Trust Indenture Act; (C) cause the Trust to be deemed to be an Investment Company required to be registered under the Investment Company Act; or (D) cause a Tax Event. (c) At such time after the Trust has issued any Securities that remain outstanding, any amendment that would adversely affect the rights, privileges or preferences of any Holder may be effected only with such additional requirements as may be set forth in the terms of such Securities; (d) Section 9.1(c) and this Section 12.1 shall not be amended without the consent of all of the Holders; (e) Article Four shall not be amended without the consent of the Holders of a Majority in liquidation amount of the Common Securities; (f) The rights of the Holders of the Common Securities under Article Five to increase or decrease the number of, and appoint and remove Trustees shall not be amended without the consent of the Holders of a Majority in liquidation amount of the Common Securities; and 55 (g) Notwithstanding Section 12.1(c), this Declaration may be amended by the Sponsor, the Property Trustee and the Administrative Trustees without the consent of the Holders to: (i) cure any ambiguity, correct or supplement any provision in this Declaration that may be inconsistent with any other provision of this Declaration or to make any other provisions with respect to matters or questions arising under this Declaration which shall not be inconsistent with the other provisions of the Declaration; and (ii) to modify, eliminate or add to any provisions of the Declaration to such extent as shall be necessary to ensure that the Trust will be classified for United States federal income tax purposes as a grantor trust at all times that any Securities are outstanding or to ensure that the Trust will not be required to register as an Investment Company under the Investment Company Act; PROVIDED, HOWEVER, that in each case such action shall not adversely affect the interests of the Holders, and any such amendments of this Declaration shall become effective when notice thereof is given to the Holders. SECTION 12.2 MEETINGS OF THE HOLDERS; ACTION BY WRITTEN CONSENT. (a) Meetings of the Holders of any class of Securities may be called at any time by the Administrative Trustees (or as provided in the terms of the Securities) to consider and act on any matter on which Holders of such class of Securities are entitled to act under the terms of this Declaration, the terms of the Securities or the rules of any stock exchange on which the Preferred Securities are listed or admitted for trading. The Administrative Trustees shall call a meeting of the Holders of such class if directed to do so by the Holders of at least 10% in liquidation amount of such class of Securities. Such direction shall be given by delivering to the Administrative Trustees one or more notices in writing stating that the signing Holders wish to call a meeting and indicating the general or specific purpose for which the meeting is to be called. Any Holders calling a meeting shall specify in writing the Securities held by the Holders exercising the right to call a meeting and only those Securities specified shall be counted for purposes of determining whether the required percentage set forth in the second sentence of this paragraph has been met. (b) Except to the extent otherwise provided in the terms of the Securities, the following provisions shall apply to meetings of Holders: (i) notice of any such meeting shall be given to all the Holders having a right to vote there at least seven days and not more than 60 days before the date of such meeting. Whenever a vote, consent or approval of the Holders is permitted or required under this Declaration or the rules of any stock exchange on which the Preferred Securities are listed or admitted for trading, such vote, consent or approval may be given at a meeting of the Holders. Any action that may be taken at a meeting of the Holders may be taken 56 without a meeting and without prior notice if a consent in writing setting forth the action so taken is signed by the Holders owning not less than the minimum amount of Securities in liquidation amount that would be necessary to authorize or take such action at a meeting at which all Holders having a right to vote thereon were present and voting. Prompt notice of the taking of any action without a meeting shall be given to Holders entitled to vote who have not consented to such action in writing. The Administrative Trustees may specify that any written ballot submitted to the Holder of Securities for the purpose of taking any action without a meeting shall be returned to the Trust within the time specified by the Administrative Trustees; (ii) each Holder may authorize any Person to act for it by proxy on all matters in which a Holder is entitled to participate, including waiving notice of any meeting, or voting or participating at a meeting. No proxy shall be valid after the expiration of 11 months from the date thereof unless otherwise provided in the proxy. Every proxy shall be revocable at the pleasure of the Holder executing it. Except as otherwise provided herein, all matters relating to the giving, voting or validity of proxies shall be governed by the General Corporation Law of the State of Delaware relating to proxies, and judicial interpretations thereunder, as if the Trust were a Delaware corporation and the Holders were stockholders of a Delaware corporation; (iii) each meeting of the Holders shall be conducted by the Administra tive Trustees or by such other Person that the Administrative Trustees may designate; and (iv) unless the Business Trust Act, this Declaration, the terms of the Securities, the Trust Indenture Act or the listing rules of any stock exchange on which the Preferred Securities are then listed or trading, otherwise provides, the Administrative Trustees, in their sole discretion, shall establish all other provisions relating to meetings of Holders, including notice of the time, place or purpose of any meeting at which any matter is to be voted on by any Holders, waiver of any such notice, action by consent without a meeting and without prior notice, the establishment of a record date, quorum requirements, voting in person or by proxy or any other matter with respect to the exercise of any such right to vote, PROVIDED, HOWEVER, the meetings of Holders shall not be held in any jurisdiction which would subject the Trust to taxation under the laws of such jurisdiction. ARTICLE XIII REPRESENTATIONS OF PROPERTY TRUSTEE AND DELAWARE TRUSTEE SECTION 13.1 REPRESENTATIONS AND WARRANTIES OF PROPERTY TRUSTEE. The Trustee that acts as initial Property Trustee represents and warrants to the Trust, to the Holders of Securities and to the Sponsor at the date of this Declaration, and each 57 Successor Property Trustee represents and warrants to the Trust, to the Holders of Securities, and to the Sponsor at the time of the Successor Property Trustee's acceptance of its appointment as Property Trustee that: (a) The Property Trustee is a New York banking corporation, a national banking association or a bank or trust company organized under the laws of any State of the United States or the District of Columbia, in any case with trust powers and authority to execute and deliver, and to carry out and perform its obligations under the terms of, this Declaration; (b) the Property Trustee satisfies the requirements set forth in Section 5.3(a); (c) The execution, delivery and performance by the Property Trustee of this Declaration has been duly authorized by all necessary corporate action on the part of the Property Trustee. This Declaration has been duly executed and delivered by the Property Trustee and constitutes a legal, valid and binding obligation of the Property Trustee, enforceable against it in accordance with its terms, subject to applicable bankruptcy, reorganization, moratorium, insolvency, and other similar laws affecting creditors' rights generally and to general principles of equity and the discretion of the court (regardless of whether the enforcement of such remedies is considered in a proceeding in equity or at law); (d) The execution, delivery and performance of this Declaration by the Property Trustee does not conflict with or constitute a breach of the charter or by-laws of the Property Trustee; and (e) No consent, approval or authorization of, or registration with or notice to, any state or federal banking authority is required for the execution, delivery or performance by the Property Trustee of this Declaration. SECTION 13.2 REPRESENTATIONS AND WARRANTIES OF DELAWARE TRUSTEE. The Trustee that acts as initial Delaware Trustee represents and warrants to the Trust, to the Holders of Securities and to the Sponsor at the date of this Declaration, and each Successor Delaware Trustee represents and warrants to the Trust, to the Holders of Securities, and to the Sponsor at the time of the Successor Delaware Trustee's acceptance of its appointment as Delaware Trustee that: (a) The Delaware Trustee satisfies the requirements set forth in Section 5.2 and, if it is not a natural person, is duly organized, validly existing and in good standing under the laws of the State of Delaware or the United States, with trust power and authority to execute and deliver, and to carry out and perform its obligations under the terms of, this Declaration; (b) The execution, delivery and performance by the Delaware Trustee of this Declaration has been duly authorized by all necessary corporate action on the part of the Delaware Trustee. This Declaration has been duly executed and delivered by the Delaware Trustee and 58 constitutes a legal, valid and binding obligation of the Delaware Trustee, enforceable against it in accordance with its terms, subject to applicable bankruptcy, reorganization, moratorium, insolvency, and other similar laws affecting creditors' rights generally and to general principles of equity and the discretion of the court (regardless of whether the enforcement of such remedies is considered in a proceeding in equity or at law); (c) No consent, approval or authorization of, or registration with or notice to, any federal banking authority is required for the execution, delivery or performance by the Delaware Trustee of this Declaration; and (d) The Delaware Trustee is a natural person who is a resident of the State of Delaware or, if not a natural person, an entity which has its principal place of business in the State of Delaware. ARTICLE XIV MISCELLANEOUS SECTION 14.1 NOTICES. All notices provided for in this Declaration shall be in writing, duly signed by the party giving such notice, and shall be delivered, telecopied or mailed by first class mail, overnight courier service or confirmed telecopy, as follows: (a) if given to the Trust, in care of the Administrative Trustees at the mailing address set forth below (or such other address as the Trust may give notice of to the Property Trustee, the Delaware Trustee and the Holders): Independent Capital Trust II c/o Independent Bank Corp. 288 Union Street Rockland, Massachusetts 02370 Attention: Richard Seaman Administrative Trustee Telecopy: (781) 878-6100 59 (b) if given to the Delaware Trustee, at the mailing address set forth below (or such other address as Delaware Trustee may give notice of to the Administrative Trustees and the Property Trustee): The Bank of New York (Delaware) 23 White Clay Center Route 273 Newark, Delaware 19711 Attention: Corporate Trust Department Telecopy: (212) 815-5917 (c) if given to the Property Trustee, at the Property Trustee's mailing address set forth below (or such other address as the Property Trustee may give notice of to the Administra tive Trustees, the Delaware Trustee and the Holders): The Bank of New York 101 Barclay Street 21st Floor West New York, New York 10286 Attention: Corporate Trust Department Telecopy: (212) 815-5917 (d) if given to the Holder of the Common Securities, at the mailing address of the Sponsor set forth below (or such other address as the Holder of the Common Securities may give notice to the Property Trustee and the Trust): Independent Bank Corp. 288 Union Street Rockland, Massachusetts 02370 Attention: Richard J. Seaman Chief Financial Officer Telecopy: (781) 878-6100 (e) if given to any other Holder, at the address set forth on the books and records of the Trust. 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. 60 SECTION 14.2 GOVERNING LAW. This Declaration and the rights of the parties hereunder shall be governed by and interpreted in accordance with the laws of the State of Delaware and all rights and remedies shall be governed by such laws without regard to principles of conflict of laws. SECTION 14.3 INTENTION OF THE PARTIES. It is the intention of the parties hereto that the Trust be classified for United States federal income tax purposes as a grantor trust. The provisions of this Declaration shall be interpreted to further this intention of the parties. SECTION 14.4 HEADINGS. Headings contained in this Declaration are inserted for convenience of reference only and do not affect the interpretation of this Declaration or any provision hereof. SECTION 14.5 SUCCESSORS AND ASSIGNS Whenever in this Declaration any of the parties hereto is named or referred to, the successors and assigns of such party shall be deemed to be included, and all covenants and agreements in this Declaration by the Sponsor and the Trustees shall bind and inure to the benefit of their respective successors and assigns, whether so expressed. SECTION 14.6 PARTIAL ENFORCEABILITY. If any provision of this Declaration, or the application of such provision to any Person or circumstance, shall be held invalid, the remainder of this Declaration, or the application of such provision to persons or circumstances other than those to which it is held invalid, shall not be affected thereby. SECTION 14.7 COUNTERPARTS. This Declaration may contain more than one counterpart of the signature page and this Declaration may be executed by the affixing of the signature of each of the Trustees to one of such counterpart signature pages. All of such counterpart signature pages shall be read as though one, and they shall have the same force and effect as though all of the signers had signed a single signature page. 61 IN WITNESS WHEREOF, the undersigned has caused these presents to be executed as of the day and year first above written. INDEPENDENT CAPITAL TRUST II ------------------------------------------ Douglas H. Philipsen, as Administrative Trustee ------------------------------------------ Richard J. Seaman, as Administrative Trustee ------------------------------------------ Russell N. Viau, as Administrative Trustee THE BANK OF NEW YORK (DELAWARE), as Delaware Trustee By: --------------------------------------- Name: Title: THE BANK OF NEW YORK, as Property Trustee By: --------------------------------------- Name: Title: INDEPENDENT BANK CORP. as Sponsor and Debenture Issuer By: --------------------------------------- Richard J. Seaman Chief Financial Officer 62 ANNEX I TERMS OF ____% CUMULATIVE TRUST PREFERRED SECURITIES ____% COMMON SECURITIES Pursuant to Section 7.1 of the Amended and Restated Declaration of Trust, dated as of _______ __, 1999 (as amended from time to time, the "Declaration"), the designation, rights, privileges, restrictions, preferences and other terms and provisions of the Securities are set out below (each capitalized term used but not defined herein has the meaning set forth in the Declaration or, if not defined in such Declaration, as defined in the Prospectus referred to below in Section 2(c) of this Annex I): 1. DESIGNATION AND NUMBER. (a) PREFERRED SECURITIES. ________ __% Cumulative Trust Preferred Securities of the Trust with an aggregate liquidation amount with respect to the assets of the Trust of ____________ dollars ($_______) and each with a liquidation amount with respect to the assets of the Trust of $10 per security (if the underwriters exercise their Option and there is an Option Closing Date (as such terms are defined in the Underwriting Agreement), then up to an additional _____ Cumulative Trust Preferred Securities of the Trust with an aggregate liquidation amount with respect to the assets of the Trust of _____________ dollars ($______)), are hereby designated for the purposes of identification only as Preferred Securities. The certificates evidencing the Preferred Securities shall be substantially in the form of Exhibit A-1 to the Declaration, with such changes and additions thereto or deletions therefrom as may be required by ordinary usage, custom or practice or to conform to the rules of any exchange or quotation system on or in which the Preferred Securities are listed, traded or quoted. (b) COMMON SECURITIES. ______ Common Securities of the Trust with an aggregate liquidation amount with respect to the assets of the Trust of ______________ dollars ($_______), and a liquidation amount with respect to the assets of the Trust of $10 per security (if the underwriters exercise their Option and there is an Option Closing Date (as such terms are defined in the Underwriting Agreement), then up to an additional _____ Common Securities of the Trust with an aggregate liquidation amount with respect to the assets of the Trust of _____________ dollars ($______)), are hereby designated for the purposes of identification only as Common Securities. The certificates evidencing the Common Securities shall be substantially in the form of Exhibit A-2 to the Declaration, with such changes and additions thereto or deletions therefrom as may be required by ordinary usage, custom or practice. 2. DISTRIBUTIONS. (a) Distributions payable on each Security will be fixed at a rate per annum of ____% (the "Coupon Rate") of the liquidation amount of $10 per Security (the I-1 "Liquidation Amount"), such rate being the rate of interest payable on the Debentures to be held by the Property Trustee. Distributions in arrears for more than one quarterly period will bear additional distributions thereon compounded quarterly at the Coupon Rate (to the extent permitted by applicable law). A Distribution is payable only to the extent that payments are made in respect of the Debentures held by the Property Trustee and to the extent the Property Trustee has funds on hand legally available therefor. (b) Distributions on the Securities will be cumulative, will accumulate from the most recent date to which Distributions have been paid or duly provided for or, if no Distributions have been paid or duly provided for, from ______ __, 1999, and will be payable quarterly in arrears on the last day of March, June, September and December of each year, commencing on _______ __, 1999 (each, a "Distribution Date"), except as otherwise described below. Distributions will be computed on the basis of a 360-day year consisting of twelve 30-day months and for any period less than a full calendar quarter on the basis of the actual number of days elapsed in such 90-day quarter based on 30-day months. As long as no Event of Default has occurred and is continuing under the Indenture, the Debenture Issuer has the right under the Indenture to defer payments of interest on the Debentures by extending the interest payment period at any time and from time to time for a period not exceeding 20 consecutive quarterly periods, including the first such quarterly period during such period (each an "Extension Period"), during which Extension Period no interest shall be due and payable on the Debentures, PROVIDED THAT no Extension Period shall end on a date other than an Interest Payment Date for the Debentures or extend beyond the Maturity Date of the Debentures. As a consequence of such deferral, Distributions will also be deferred. Despite such deferral, Distributions will continue to accrue with interest thereon (to the extent permitted by applicable law) at the Coupon Rate compounded quarterly during any such Extension Period. Prior to the termination of any such Extension Period, the Debenture Issuer may further defer payments of interest by further extending such Extension Period; PROVIDED THAT such further deferment shall only be permitted to the extent that such Extension Period, together with all extensions occurring both before and after such deferment, does not exceed 20 consecutive quarterly periods, including the first quarterly period during such Extension Period, or extend beyond the Maturity Date of the Debentures. Payments of deferred Distributions will be payable to Holders of record as they appear on the books and records of the Trust on the record date for Distributions due at the end of such Extension Period. Upon the termination of any Extension Period and the payment of all amounts then due, the Debenture Issuer may commence a new Extension Period, subject to the above requirements. (c) Distributions on the Securities will be payable to the Holders thereof as they appear on the books and records of the Trust which for so long as the Securities remain in book entry form, will be one Business Day prior to the relevant Distribution Date and, in the event the Securities are not in book entry form, will be the close of business on the 15th day of the month in which the relevant Distribution Date occurs. Subject to any applicable laws and regulations and the provisions of the Declaration, each such payment in respect of the Global Preferred Securities will be made as described under the heading "Description of Trust Preferred Securities -- Global Trust Preferred Securities" and "Book-Entry Issuance" in the Prospectus dated _______ __, 1999, of the Debenture Issuer and the Trust relating to the Securities and the Debentures. Payments in I-2 respect of Preferred Securities held in certificated form will be made by check mailed or by wire to the Holder entitled thereto. The relevant record dates for the Common Securities shall be the same as the record dates for the Preferred Securities. Distributions payable on any Securities that are not punctually paid on any Distribution Date, as a result of the Debenture Issuer having failed to make a payment under the Debentures, will cease to be payable to the Holder on the relevant record date, and such defaulted Distribution will instead be payable to the Person in whose name such Securities are registered on the special record date or other specified date determined in accordance with the Indenture. If any date on which Distributions are payable on the Securities is not a Business Day, then payment of the Distribution payable on such date will be made on the next succeeding Business Day (and without any interest or other payment in respect of any such delay), except that, if such next succeeding Business Day is in the next succeeding calendar year, such payment shall be made on the immediately preceding Business Day with the same force and effect as if made on such date. (d) In the event that there is any money or other property held by or for the Trust that is not accounted for hereunder, such property shall be distributed Pro Rata (as defined herein) among the Holders. 3. LIQUIDATION DISTRIBUTION UPON DISSOLUTION. In the event of any voluntary or involuntary dissolution or termination of the Trust or the Sponsor otherwise gives notice of its election to dissolve the Trust pursuant to Section 8.1(a)(iii) of the Declaration, the Trust shall be liquidated by the Administrative Trustees as expeditiously as the Administrative Trustees determine to be possible by distributing, after satisfaction of liabilities to creditors of the Trust as provided by applicable law, to the Holders a Like Amount (as defined below) of the Debentures, unless such distribution is determined by the Property Trustee not to be practicable, in which event such Holders will be entitled to receive Pro Rata out of the assets of the Trust legally available for distribution to Holders, after satisfaction of liabilities to creditors of the Trust as provided by applicable law, an amount equal to the aggregate of the liquidation amount of $10 per Security plus accumulated and unpaid Distributions thereon to the date of payment (such amount being the "Liquidation Distribution"). "Like Amount" means (i) with respect to a redemption of the Securities, Securities having a Liquidation Amount equal to that portion of principal amount of Debentures to be contemporaneously redeemed in accordance with their terms allocated to the Common Securities and the Preferred Securities based upon the relative Liquidation Amounts of such classes and the proceeds of which will be used to pay the redemption price of such Securities and (ii) with respect to a distribution of Debentures upon the dissolution or liquidation of the Trust, Debentures having a principal amount equal to the Liquidation Amount of the Securities of the Holder to whom such Debentures are distributed. If, upon any such liquidation, the Liquidation Distribution can be paid only in part because the Trust has insufficient assets on hand legally available to pay in full the aggregate Liquidation Distribution, then the amounts payable directly by the Trust on the Securities shall be paid on a Pro Rata basis. I-3 4. REDEMPTION AND DISTRIBUTION. Upon the repayment of the Debentures in whole or in part, at maturity or upon early redemption (either at the option of the Debenture Issuer or pursuant to a Special Event, as de scribed below), the proceeds from such repayment shall be simultaneously applied by the Property Trustee (subject to the Property Trustee having received written notice no later than 45 days prior to such repayment) to redeem a Like Amount of the Securities at a redemption price equal to the accrued and unpaid interest on the Securities to be so redeemed to the date fixed for redemption, plus 100% of the principal amount thereof (the "Redemption Price"). In the case of an optional redemption, if fewer than all the outstanding Securi ties are to be so redeemed, the Securities to be redeemed will be determined as described in Section 4(f)(ii) below. The Debenture Issuer shall have the right (subject to the conditions in the Indenture) to elect to redeem the Debentures in whole or in part at any time on or after _________ __, 2004, upon not less than 30 days and not more than 60 days written notice, at the Redemption Price and, simultaneous with such redemption, to cause a Like Amount of the Securities to be redeemed by the Trust at the Redemption Price on a Pro Rata basis or such other method as the Property Trustee shall deem appropriate, subject to the receipt of prior approval of any applicable regulatory agency if it is then required under applicable regulatory requirements. (c) If at any time an Investment Company Event, a Tax Event or a Regulatory Capital Event (each as defined below, and each a "Special Event") occurs and shall be continuing, the Debenture Issuer shall have the right (subject to the conditions set forth in the Indenture) upon not less than 30 nor more than 60 days written notice, to redeem the Debentures in whole, but not in part, within the 90 days following the occurrence of such Special Event (the "90 Day Period"), and, simultaneous with such redemption, to cause a Like Amount of the Securities to be redeemed by the Trust at the Redemption Price on a Pro Rata basis or such other method as the Property Trustee shall deem appropriate, in each case subject to the receipt of prior approval of any applicable regulatory agency if it is then required under applicable regulatory requirements. "Investment Company Event" means the receipt by the Sponsor of an Opinion of Counsel, rendered by a law firm experienced in such matters, to the effect that, as a result of change in law or regulation or a change in interpretation or application of law or regulation by any legislative body, court, governmental agency or regulatory authority, the Trust is or will be considered an "investment company" that is required to be registered under the Investment Company Act of 1940, as amended, which change becomes effective on or after the date of original issuance of the Preferred Securities of Independent Capital Trust II. A "Regulatory Capital Event" shall occur at any time that the Sponsor shall have re ceived an opinion of independent bank regulatory counsel experienced in such matters to the effect that, as a result of (a) any amendment to, or change (including any announced prospective change) in, the laws (or any regulations thereunder) of the United States or any rules, guidelines or policies I - 4 of applicable regulatory agencies or (b) any official administrative pronouncement or judicial deci sion interpreting or applying such laws or regulations, which amendment or change is effective or such pronouncement or decision is announced on or after the date of Declaration, the Preferred Securities do not constitute, or within 90 days of the date thereof, will not constitute, Tier I Capital (or its then equivalent) applied as if the Sponsor (or its successor) were a bank holding company for purposes of the capital adequacy guidelines of the Board of Governors of the Federal Reserve (or any successor regulatory authority with jurisdiction over bank holding companies), or any capital adequacy guidelines as then in effect and applicable to the Sponsor; PROVIDED, HOWEVER, that the distribution of the Junior Subordinated Debentures in connection with a termination of the Trust by the Sponsor shall not in and of itself constitute a Regulatory Capital Event. "Tax Event" shall occur upon receipt by the Sponsor and the Trust of an Opinion of Counsel from counsel experienced in such matters to the effect that, as a result of any amendment to, or change (including any announced prospective change) in, the laws or any regulations thereunder of the United States or any political subdivision or taxing authority thereof or therein, or as a result of any official administrative pronouncement or judicial decision interpreting or applying such laws or regulations, which amendment or change is effective or which pronouncement or decision is announced on or after the date of the Declaration, there is more than an insubstantial risk that (i) the Trust is, or will be within 90 days of the date of such opinion, subject to United States federal income tax with respect to income received or accrued on the Debentures, (ii) interest payable by the Debenture Issuer on the Debentures is not, or within 90 days of the date of such opinion, will not be, deductible by the Debenture Issuer, in whole or in part, for United States federal income tax purposes, or (iii) the Trust is, or will be within 90 days of the date of such opinion, subject to more than a DE MINIMIS amount of other taxes, duties or other governmental charges. (d) On and from the date fixed by the Administrative Trustees for any distribution of Debentures and liquidation of the Trust: (i) the Securities will no longer be deemed to be out standing, (ii) the Clearing Agency or its nominee (or any successor Clearing Agency or its nominee), as the Holder of the Preferred Securities, will receive a registered global certificate or certificates representing the Debentures to be delivered upon such distribution and (iii) any certificates repre senting Securities not held by the Clearing Agency or its nominee (or any successor Clearing Agency or its nominee) will be deemed to represent beneficial interests in a Like Amount of Debentures until such certificates are presented to the Debenture Issuer or its agent for transfer or reissue. (e) The Trust may not redeem fewer than all the outstanding Securities unless all accumulated and unpaid Distributions have been paid on all Securities for all quarterly Distribution periods terminating on or before the date of redemption. (f) The procedure with respect to redemptions or distributions of Securities shall be as follows: (i) Notice of any redemption of, or notice of distribution of Debentures in exchange for, the Securities (a "Redemption/Distribution Notice") will be given by the Trust by mail to each Holder to be redeemed or exchanged not fewer than 30 nor more than 60 days before I - 5 the date fixed for redemption or exchange thereof which, in the case of a redemption, will be the date fixed for redemption of the Debentures. For purposes of the calculation of the date of redemption or exchange and the dates on which notices are given pursuant to this Section 4(f)(i), a Redemption/Distribution Notice shall be deemed to be given on the day such notice is first mailed by first-class mail, postage prepaid, to Holders. Each Redemp tion/Distribution Notice shall be addressed to the Holders at the address of each such Holder appearing in the books and records of the Trust. No defect in the Redemption/Distribution Notice or in the mailing of either thereof with respect to any Holder shall affect the validity of the redemption or exchange proceedings with respect to any other Holder. (ii) In the event that fewer than all the outstanding Securities are to be redeemed, the particular Securities to be redeemed shall be selected on a Pro Rata basis (based upon Liquidation Amounts), or such other method as the Property Trustee shall deem appropriate, not more than 60 days prior to the date fixed for redemption from the outstanding Preferred Securities not previously called for redemption, provided, however, that with respect to Holders that would be required to hold less than 100 but more than zero Securities as a result of such pro rata redemption, the Trust shall redeem Securities of each such Holder so that after such redemption such Holder shall hold either 100 Securities or such Holder no longer holds any Securities and shall use such method (including, without limitation, by lot) as the Property Trustee shall deem fair and appropriate, provided, further, that any such proration may be made on the basis of the aggregate Liquidation Amount of Securities held by each Holder thereof and may be made by making such adjustments as the Property Trustee deems fair and appropriate in order that only Securities in denominations of $10 or integral multiples thereof shall be redeemed. In respect of Preferred Securities registered in the name of and held of record by the Clearing Agency or its nominee (or any successor Clearing Agency or its nominee) or any nominee, the distribution of the proceeds of such redemption will be made to the Clearing Agency and disbursed by such Clearing Agency in accordance with the procedures applied by such agency or nominee. (iii) If Securities are to be redeemed and the Trust gives a Redemption/Distribution Notice (which notice will be irrevocable), then (A) with respect to Preferred Securities issued in book-entry form, by 12:00 noon, New York City time, on the redemption date, provided that the Debenture Issuer has paid the Property Trustee a sufficient amount of cash in con nection with the related redemption or maturity of the Debentures by 10:00 a.m., New York City time, on the maturity date or the date of redemption, as the case requires, the Property Trustee will deposit irrevocably with the Clearing Agency or its nominee (or successor Clearing Agency or its nominee) funds sufficient to pay the Redemption Price with respect to such Preferred Securities and will give the Clearing Agency irrevocable instructions and authority to pay the Redemption Price to the relevant Clearing Agency Participants, and (B) with respect to Preferred Securities issued in certificated form and Common Securities, pro vided that the Debenture Issuer has paid the Property Trustee a sufficient amount of cash in connection with the related redemption or maturity of the Debentures, the Property Trustee will pay the Redemption Price to the Holders by check mailed to the address of the relevant Holder appearing on the books and records of the Trust on the redemption date. If a Re I - 6 demption/Distribution Notice shall have been given and funds deposited as required, if applicable, then immediately prior to the close of business on the date of such deposit, or on the redemption date, as applicable, Distributions will cease to accumulate on the Securities so called for redemption and all rights of Holders so called for redemption will cease, except the right of the Holders of such Securities to receive the Redemption Price, but without inter est on such Redemption Price, and such Securities shall cease to be outstanding. (iv) Payment of accumulated and unpaid Distributions on the Redemption Date of the Securities will be subject to the rights of Holders on the close of business on a regular record date in respect of a Distribution Date occurring on or prior to such Redemption Date. Neither the Administrative Trustees nor the Trust shall be required to register or cause to be registered the transfer of (i) any Securities beginning on the opening of business 15 days before the day of mailing of a notice of redemption and ending at the close of business on the day of such mailing or (ii) any Securities selected for redemption except the unredeemed portion of any Security being redeemed. If any date fixed for redemption of Securities is not a Business Day, then payment of the Redemption Price payable on such date will be made on the next succeeding day that is a Business Day (and without any inter est or other payment in respect of any such delay) except that, if such next succeeding Business Day falls in the next calendar year, such payment shall be made on the immediately preceding Business Day, with the same force and effect as if made on such date fixed for re demption. If payment of the Redemption Price in respect of any Securities is improperly withheld or refused and not paid by the Sponsor as guarantor pursuant to the relevant Securi ties Guarantee, Distributions on such Securities will continue to accumulate from the original redemption date to the actual date of payment, in which case the actual payment date will be considered the date fixed for redemption for purposes of calculating the Redemption Price. (v) Redemption/Distribution Notices shall be sent by the Property Trustee on behalf of the Trust to (A) in respect of the Preferred Securities, the Clearing Agency or its nominee (or any successor Clearing Agency or its nominee) if the Global Certificates have been issued or, if Definitive Preferred Security Certificates have been issued, to the Holder there of, and (B) in respect of the Common Securities to the Holder thereof. (vi) Subject to the foregoing and applicable law (including, without limitation, United States federal securities laws and banking laws), provided the acquiror is not the Holder of the Common Securities or the obligor under the Indenture, the Sponsor or any of its subsidiaries may at any time and from time to time purchase outstanding Preferred Securities by tender, in the open market or by private agreement. 5. VOTING RIGHTS - PREFERRED SECURITIES. (g) Except as provided under Sections 5(b), 6(b) and 7 and as otherwise required by law and the Declaration, the Holders of the Preferred Securities will have no voting rights. I - 7 (h) So long as any Debentures are held by the Property Trustee, subject to the requirement of the Property Trustee obtaining a tax opinion in certain circumstances set forth in the last sentence of this paragraph, the Holders of a majority in Liquidation Amount of the Preferred Securities have the right to (i) direct the time, method and place of conducting any proceeding for any remedy available to the Debenture Trustee, or direct the exercise of any trust or power conferred on such Debenture Trustee with respect to the Debentures, (ii) waive any past default that is waivable under Section 5.07 of the Indenture, (iii) exercise any right to rescind or annul a declaration of acceleration of the maturity of the principal of the Debentures or (iv) consent to any amendment, modification or termination of the Indenture or the Debentures, where such consent shall be required, however, where a consent under the Indenture would require the consent of each holder of Debentures affected thereby, no such consent shall be given by the Property Trustee without the prior approval of each Holder of the Preferred Securities. The Trustees shall not revoke any action previously authorized or approved by a vote of the Holders of the Preferred Securities except by subsequent vote of such Holders. Subject to Section 2.7 of the Declaration, the Property Trustee shall notify each Holder of Preferred Securities of any notice of default with respect to the Debentures. In addition to obtaining the foregoing approvals of such Holders of the Preferred Securities, prior to taking any of the foregoing actions, except with respect to directing the time, method and place of conducting a proceeding for a remedy, the Trustees shall obtain an opinion of counsel experienced in such matters to the effect that the Trust will not be classified as an association taxable as a corporation for United States federal income tax purposes on account of such action. If an Event of Default under the Declaration has occurred and is continuing and such event is attributable to the failure of the Debenture Issuer to pay principal of or interest on the Debentures on the due date (or in the case of redemption, on the redemption date), then a Holder of Preferred Securities may directly institute a proceeding for enforcement of payment to such Holder of the principal of or interest on a Like Amount of Debentures (a "Direct Action") on or after the respective due date specified in the Debentures, and the amount of the payment will be based on the Holder's pro rata share of the amount due and owing on all Preferred Securities. In connection with such Direct Action, the Common Securities Holder will be subrogated to the rights of such Holder of Preferred Securities to the extent of any payment made by the Debenture Issuer to such Holder of Preferred Securities in such Direct Action. Except as provided in the second preceding sentence, the Holders of Preferred Securities will not be able to exercise directly any other remedy available to the holders of the Debentures. Any approval or direction of Holders of Preferred Securities may be given at a separate meeting of Holders of Preferred Securities convened for such purpose, at a meeting of all of the Holders of Securities in the Trust or pursuant to written consent and without prior notice. The Administrative Trustees will cause a notice of any meeting at which Holders of Preferred Securities are entitled to vote, to be mailed to each Holder of record of Preferred Securities. Each such notice will include a statement setting forth (i) the date of such meeting, (ii) a description of any resolution proposed for adoption at such meeting on which such Holders are entitled to vote and (iii) instructions for the delivery of proxies. I - 8 No vote or consent of the Holders of the Preferred Securities will be required for the Trust to redeem and cancel Preferred Securities or to distribute the Debentures in accordance with the Declaration and the terms of the Securities. Notwithstanding that Holders of Preferred Securities are entitled to vote or consent under any of the circumstances described above, any of the Preferred Securities that are owned by the Sponsor or any Affiliate of the Sponsor shall not be entitled to vote or consent and shall, for purposes of such vote or consent, be treated as if they were not outstanding. 6. VOTING RIGHTS - COMMON SECURITIES. (a) Except as provided under Sections 6(b), 6(c), and 7 and as otherwise required by law and the Declaration, the Holders of the Common Securities will have no voting rights. (b) Unless an Event of Default shall have occurred and be continuing, any Trustee may be removed at any time by the holder of the Common Securities. If an Event of Default has occurred and is continuing, the Property Trustee and the Delaware Trustee may be removed at such time by the holders of a Majority in liquidation amount of the outstanding Preferred Securities. In no event will the holders of the Preferred Securities have the right to vote to appoint, remove or replace, or increase or decrease the number of, the Administrative Trustees, which voting rights are vested exclusively in the Holder of the Common Securities. No resignation or removal of a Trustee and no appointment of a successor trustee shall be effective until the acceptance of appointment by the successor trustee in accordance with the provisions of the Declaration. (c) So long as any Debentures are held by the Property Trustee, subject to Section 2.6 of the Declaration and only after any Event of Default with respect to the Preferred Securities has been cured, waived or otherwise eliminated, the Trustees shall not (i) direct the time, method and place of conducting any proceeding for any remedy available to the Debenture Trustee, or executing any trust or power conferred on such Debenture Trustee with respect to the Debentures, (ii) waive any past default that is waivable under Section 5.07 of the Indenture, (iii) exercise any right to rescind or annul a declaration of acceleration of the maturity of the principal of the Debentures or (iv) consent to any amendment, modification or termination of the Indenture or the Debentures, where such consent shall be required, without, in each case, obtaining the prior approval of the Holders of a Majority in liquidation amount of all outstanding Common Securities; PROVIDED, HOWEVER, that where a consent under the Indenture would require the consent of each holder of Debentures affected thereby, no such consent shall be given by the Property Trustee without the prior approval of each Holder of the Common Securities. The Trustees shall not revoke any action previously authorized or approved by a vote of the Holders of the Common Securities except by subsequent vote of such Holders. Subject to Section 2.7 of the Declaration, the Property Trustee shall notify each Holder of Common Securities of any notice of default with respect to the Debentures. In addition to obtaining the foregoing approvals of such Holders of the Common Securities, prior to taking any of the foregoing actions, the Trustees shall obtain an opinion of I - 9 counsel experienced in such matters to the effect that the Trust will not be classified as an association taxable as a corporation for United States federal income tax purposes on account of such action. If an Event of Default under the Declaration has occurred and is continuing and such event is attributable to the failure of the Debenture Issuer to pay principal of or interest on the Debentures on the due date (or in the case of redemption, on the redemption date), then a Holder of Common Securities may institute a Direct Action for enforcement of payment to such Holder of the principal of or interest on a Like Amount of Debentures on or after the respective due date specified in the Debentures. In connection with Direct Action, the rights of the Common Securities Holder will be subordinated to the rights of such Holder of Preferred Securities to the extent of any payment made by the Debenture Issuer to such Holder of Common Securities in such Direct Action. Except as provided in the second preceding sentence, the Holders of Common Securities will not be able to exercise directly any other remedy available to the holders of the Debentures. Any approval or direction of Holders of Common Securities may be given at a separate meeting of Holders of Common Securities convened for such purpose, at a meeting of all of the Holders of Securities in the Trust or pursuant to written consent without prior notice . The Administrative Trustees will cause a notice of any meeting at which Holders of Common Securities are entitled to vote to be mailed to each Holder of record of Common Securities. Each such notice will include a statement setting forth (i) the date of such meeting, (ii) a description of any resolution proposed for adoption at such meeting on which such Holders are entitled to vote and (iii) instructions for the delivery of proxies. No vote or consent of the Holders of the Common Securities will be required for the Trust to redeem and cancel Common Securities or to distribute the Debentures in accordance with the Declaration and the terms of the Securities. 7. AMENDMENTS TO DECLARATION AND INDENTURE. In addition to the requirements set out in Section 12.1 of the Declaration, the Declaration may be amended from time to time by the Sponsor, the Property Trustee and the Administrative Trustees, without the consent of the Holders (i) to cure any ambiguity, correct or supplement any provisions in the Declaration that may be inconsistent with any other provisions, or to make any other provisions with respect to matters or questions arising under the Declaration which shall not be inconsistent with the other provisions of the Declaration or (ii) to modify, eliminate or add to any provisions of the Declaration to such extent as shall be necessary to ensure that the Trust will be classified for United States federal income tax purposes as a grantor trust at all times that any Securities are outstanding or to ensure that the Trust will not be required to register as an "Investment Company" under the Investment Company Act PROVIDED, HOWEVER, that in each case such action shall not adversely affect the interests of any Holder. Any amendments of the Declaration pursuant to the immediately preceding sentence shall become effective when notice thereof is given to the Holders. Under the circumstances referred to in Section 12.1(c) of the Declaration, the Declaration also may be amended by the Trustees and the Sponsor with (i) the consent of Holders representing a Majority in liquidation amount of all outstanding Securities, and I - 10 (ii) receipt by the Trustees of an Opinion of Counsel to the effect that such amendment or the exercise of any power granted to the Trustees in accordance with such amendment will not affect the Trust's status as a grantor trust for United States federal income tax purposes or the Trust's exemption from status as an Investment Company under the Investment Company Act, PROVIDED THAT, without the consent of each Holder of Trust Securities, the Declaration may not be amended to (i) change the amount or timing of any Distribution on the Trust Securities or otherwise adversely affect the amount of any Distribution required to be made in respect of the Trust Securities as of a specified date or (ii) restrict the right of a Holder of Trust Securities to institute suit for the enforcement of any such payment on or after such date. 8. PRO RATA. A reference in these terms of the Securities to any payment, distribution or treatment as being "Pro Rata" shall mean pro rata to each Holder according to the aggregate liquidation amount of the Securities held by the relevant Holder in relation to the aggregate liquidation amount of all Securities outstanding unless, in relation to a payment, an Event of Default under the Declaration has occurred and is continuing, in which case any funds available to make such payment shall be paid first to each Holder of the Preferred Securities pro rata according to the aggregate liquidation amount of Preferred Securities held by the relevant Holder relative to the aggregate liquidation amount of all Preferred Securities outstanding, and only after satisfaction of all amounts owed to the Holders of the Preferred Securities, to each Holder of Common Securities pro rata according to the aggregate liquidation amount of Common Securities held by the relevant Holder relative to the aggregate liquidation amount of all Common Securities outstanding. In any such proration, the Property Trustee on behalf of the Trust may make such adjustments as may be appropriate in order that only securities in authorized denominations shall be redeemed. 9. RANKING. The Preferred Securities rank PARI PASSU with the Common Securities and payment thereon shall be made Pro Rata with the Common Securities, except that, if an Event of Default under the Declaration occurs and is continuing, no payments in respect of Distributions on, or payments upon liquidation, redemption or otherwise with respect to, the Common Securities shall be made until the Holders of the Preferred Securities shall be paid in full the Distributions, Redemption Price, Liquidation Distribution and other payments to which they are entitled at such time. 10. ACCEPTANCE OF SECURITIES GUARANTEE AND INDENTURE. Each Holder of Preferred Securities and Common Securities, by the acceptance thereof, agrees to the provisions of the Preferred Securities Guarantee and the Common Securities Guarantee, respectively, including the subordination provisions therein and to the provisions of the Indenture. I - 11 11. NO PREEMPTIVE RIGHTS. The Holders shall have no preemptive or similar rights to subscribe for any additional securities in the Trust. The issuance of the Securities is not subject to any preemptive or similar rights. 12. MISCELLANEOUS. These terms constitute a part of the Declaration. The Sponsor will provide a copy of the Declaration, the Preferred Securities Guarantee, the Common Securities Guarantee (as may be appropriate) and the Indenture (including any supplemental indenture) to a Holder without charge upon written request to the Sponsor at its principal place of business. I - 12 EXHIBIT A-1 FORM OF ____% CUMULATIVE TRUST PREFERRED SECURITY CERTIFICATE [FACE OF SECURITY] [IF ISSUED AS A GLOBAL SECURITY INSERT: THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE DECLARATION HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE OF A DEPOSITARY. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE DECLARATION AND MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY. UNLESS THIS PREFERRED SECURITY CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY TO THE TRUST OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY PREFERRED SECURITY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHO RIZED REPRESENTATIVE OF THE DEPOSITORY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSONS IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.] A1-1 Number of Preferred Securities:________ CUSIP NO. ___________ Certificate Evidencing ____% Cumulative Trust Preferred Securities of Independent Capital Trust II ____% Cumulative Trust Preferred Securities (liquidation amount $10 per Preferred Security) Independent Capital Trust II, a statutory business trust created under the laws of the State of Delaware (the "Trust"), hereby certifies that Cede & Co. (the "Holder") is the registered owner of __________ Preferred Securities (as defined below) ($____________ in aggregate liquidation amount of Preferred Securities) of the Trust representing undivided beneficial interests in the assets of the Trust designated the ____% Cumulative Trust Preferred Securities (liquidation amount $10 per Preferred Security) (the "Preferred Securities"). Subject to the Declaration (as defined below), the Preferred Securities are transferable on the books and records of the Trust, in person or by a duly authorized attorney, upon surrender of this certificate duly endorsed and in proper form for transfer. The designation, rights, privileges, restrictions, preferences and other terms and provisions of the Preferred Securities represented hereby are issued and shall in all respects be subject to the provisions of the Amended and Restated Declaration of Trust of the Trust dated as of ________ __, 1999, as the same may be amended from time to time (the "Declaration"), including the designation of the terms of the Preferred Securities as set forth in Annex I to the Declaration. Capitalized terms used but not defined herein shall have the meaning given them in the Declaration. The Sponsor will provide a copy of the Declaration, the Preferred Securities Guarantee, the Common Securities Guarantee (as may be appropriate), and the Indenture (including any supplemental indenture) to a Holder without charge upon written request to the Sponsor at its principal place of business. Upon receipt of this certificate, the Holder is bound by the Declaration and is entitled to the benefits thereunder and to the benefits of the Preferred Securities Guarantee to the extent provided therein. By acceptance, the Holder agrees to treat, for United States federal income tax purposes, the Debentures as indebtedness and the Preferred Securities as evidence of indirect beneficial ownership in the Debentures. This Certificate shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to principles of conflict of laws. A1-2 IN WITNESS WHEREOF, the Trust has duly executed this certificate this _________ day of ___________ 1999. INDEPENDENT CAPITAL TRUST II By: ------------------------------------------ Richard J. Seaman Administrative Trustee PROPERTY TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is one of the Preferred Securities referred to in the within-mentioned Declaration. THE BANK OF NEW YORK as Property Trustee Dated: _____ __, 1999 By: ------------------------------------------ Authorized Signatory A1-3 [FORM OF REVERSE OF SECURITY] Distributions payable on each Preferred Security will be fixed at a rate per annum of ____% (the "Coupon Rate") of the liquidation amount of $10 per Preferred Security, such rate being the rate of interest payable on the Debentures to be held by the Property Trustee. Distributions in arrears for more than one quarterly period will bear interest thereon compounded quarterly at the Coupon Rate (to the extent permitted by applicable law). A Distribution is payable only to the extent that payments are made in respect of the Debentures held by the Property Trustee and to the extent the Property Trustee has funds on hand legally available therefor. Distributions on the Preferred Securities will be cumulative, will accumulate from the most recent date to which Distributions have been paid or duly provided for, if no Distributions have been paid or duly provided for, from _______ __, 1999 and will be payable quarterly in arrears, on the last day of March, June, September and December of each year, commencing on _____ __, 1999, except as otherwise described below. Distributions will be computed on the basis of a 360-day year consisting of twelve 30-day months and, for any period less than a full calendar quarter, the number of days elapsed in such 90-day quarter based on 30-day months. As long as no Event of Default has occurred and is continuing under the Indenture, the Debenture Issuer has the right under the Indenture to defer payments of interest by extending the interest payment period at any time and from time to time on the Debentures for a period not exceeding 20 consecutive calendar quarterly periods, including the first such quarterly period during such extension period (each an "Extension Period"), PROVIDED THAT no Extension Period shall end on a date other than an Interest Payment Date for the Debentures or extend beyond the Maturity Date of the Debentures. As a consequence of such deferral, Distributions also will be deferred. Despite such deferral, quarterly Distributions will continue to accumulate with interest thereon (to the extent permitted by applicable law) at the Coupon Rate compounded quarterly during any such Extension Period. Prior to the termination of any such Extension Period, the Debenture Issuer may further defer payments of interest by further extending such Extension Period; PROVIDED THAT such further deferment shall only be permitted to the extent that such Extension Period, together with all extensions occurring both before and after such deferment, does not exceed 20 consecutive quarterly periods, including the first quarterly period during such Extension Period, end on a date other than an Interest Payment Date for the Debentures or extend beyond the Maturity Date of the Debentures. Payments of accumulated Distributions will be payable to Holders as they appear on the books and records of the Trust on the first record date after the end of the Extension Period. Upon the termination of any Extension Period and the payment of all amounts then due, the Debenture Issuer may commence a new Extension Period, subject to the above requirements. Subject to the receipt of any required regulatory approval and to certain other conditions set forth in the Declaration and the Indenture, the Property Trustee may, at the direction of the Sponsor, at any time dissolve the Trust and cause the Debentures to be distributed to the holders of the Securities in liquidation of the Trust or, simultaneous with any redemption of the Debentures, cause a Like Amount of the Securities to be redeemed by the Trust. The Preferred Securities shall be redeemable as provided in the Declaration. A1-4 --------------------- ASSIGNMENT FOR VALUE RECEIVED, the undersigned assigns and transfers this Preferred Security Certificate to: - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- (Insert assignee's social security or tax identification number) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- (Insert address and zip code of assignee) and irrevocably appoints - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- ___________________________________________________________ agent to transfer this Preferred Security Certificate on the books of the Trust. The agent may substitute another to act for him or her. Date: _______________________ Signature: - ------------------------------------------------------------ (Sign exactly as your name appears on the other side of this Preferred Security Certificate) Signature Guarantee*: -------------------------------------- - ------------ * Signature must be guaranteed by an "eligible guarantor institution" that is a bank, stockbroker, savings and loan association or credit union meeting the requirements of the Registrar, which requirements include membership or participation in the Securities Transfer Agents Medallion Program ("STAMP") or such other "signature guarantee program" as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended. A1-5 Schedule A*** The initial number of Preferred Securities evidenced by the Certificate to which this Schedule is attached is _______ (having an aggregate liquidation amount of $______). The notations in the following table evidence decreases and increases in the number of Preferred Securities evidenced by such Certificate. Number of Preferred Decrease in Number Increase in Number Securities Remaining of Preferred of Preferred after such Decrease or Notation by Securities Securities Increase Registrar - -------------------------------------------------------------------------------- * Append to Global Preferred Securities only. A1-6 EXHIBIT A-2 [FORM OF COMMON SECURITY CERTIFICATE] THIS COMMON SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR ANY STATE SECURITIES LAWS OR ANY OTHER APPLICABLE SECURITIES LAW. NEITHER THIS COMMON SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION. THE HOLDER OF THIS COMMON SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER THIS COMMON SECURITY, PRIOR TO THE DATE (THE "RESALE RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUANCE DATE HEREOF AND THE LAST DATE ON WHICH INDEPENDENT BANK CORP. (THE "COMPANY") OR ANY "AFFILIATE" OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF THIS SECURITY) ONLY (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) SO LONG AS THIS COMMON SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A) THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH (A)(1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THIS COMMON SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITU TIONAL ACCREDITED INVESTOR, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR (E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS UNDER THE SECURITIES ACT, SUBJECT TO THE RIGHT OF THE TRUST AND THE COMPANY PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (i) PURSUANT TO CLAUSE (D) OR (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATIONS AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (ii) PURSUANT TO CLAUSE (D), TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE REVERSE OF THIS COMMON SECURITY IS COMPLETED AND DELIVERED BY THE TRANSFEREE TO THE TRUST. SUCH HOLDER FURTHER AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS COMMON SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. A2-1 THIS COMMON SECURITY IS NOT TRANSFERABLE EXCEPT AS SET FORTH IN SECTION 9.1(c) OF THE AMENDED AND RESTATED DECLARATION OF TRUST OF INDEPENDENT CAPITAL TRUST II, DATED AS OF _______ __, 1999, AS THE SAME MAY BE AMENDED FROM TIME TO TIME. A2-2 Certificate No. 1 Certificate Evidencing Common Securities of Independent Capital Trust II ____% Common Securities (liquidation amount $10 per Common Security) Independent Capital Trust II, a statutory business trust formed under the laws of the State of Delaware (the "Trust"), hereby certifies that Independent Bank Corp. (the "Holder") is the registered owner of ______ common securities of the Trust representing undivided beneficial interests in the assets of the Trust designated the ____% Common Securities (liquidation amount $10 per Common Security) (the "Common Securities"). Subject to the limitations in Section 9.1(c) of the Declaration (as defined below), the Common Securities are transferable on the books and records of the Trust, in person or by a duly authorized attorney, upon surrender of this certificate duly endorsed and in proper form for transfer. The designation, rights, privileges, restrictions, preferences and other terms and provisions of the Common Securities represented hereby are issued and shall in all respects be subject to the provisions of the Amended and Restated Declaration of Trust of the Trust dated as of ________ __, 1999, as the same may be amended from time to time (the "Declaration"), including the designation of the terms of the Common Securities as set forth in Annex I to the Declaration. Capitalized terms used but not defined herein shall have the meaning given them in the Declaration. The Sponsor will provide a copy of the Declaration, the Common Securities Guarantee, the Preferred Securities Guarantee (as may be appropriate) and the Indenture (including any supplemental indenture) to a Holder without charge upon written request to the Sponsor at its principal place of business. Upon receipt of this certificate, the Holder is bound by the Declaration and is entitled to the benefits thereunder and to the benefits of the Common Securities Guarantee to the extent provided therein. By acceptance, the Holder agrees to treat, for United States federal income tax purposes, the Debentures as indebtedness and the Common Securities as evidence of indirect beneficial ownership in the Debentures. This Certificate shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to principles of conflicts of laws. A2-3 IN WITNESS WHEREOF, the Trust has executed this certificate this ____ day of _________, 1999. INDEPENDENT CAPITAL TRUST II By: --------------------------------------- Richard J. Seaman Administrative Trustee A2-4 [FORM OF REVERSE OF SECURITY] Distributions payable on each Common Security will be fixed at a rate per annum of ______% (the "Coupon Rate") of the liquidation amount of $10 per Common Security, such rate being the rate of interest payable on the Debentures to be held by the Property Trustee. Distributions in arrears for more than one quarterly period will bear interest thereon compounded quarterly at the Coupon Rate (to the extent permitted by applicable law). A Distribution is payable only to the extent that payments are made in respect of the Debentures held by the Property Trustee and to the extent the Property Trustee has funds available therefor. Distributions on the Common Securities will be cumulative, will accrue from the most recent date to which Distributions have been paid or duly provided for or, if no Distributions have been paid or duly provided for, from ______ __, 1999 and will be payable quarterly in arrears, on the last day of March, June, September and December of each year, commencing on _____ __, 1999, except as otherwise described below. Distributions will be computed on the basis of a 360-day year consisting of twelve 30-day months and, for any period less than a full calendar quarter, the number of days elapsed in such 90-day quarter based on 30-day months. As long as no Event of Default has occurred and is continuing under the Indenture, the Debenture Issuer has the right under the Indenture to defer payments of interest by extending the interest payment period at any time and from time to time on the Debentures for a period not exceeding 20 consecutive calendar quarterly periods, including the first such quarterly period during such extension period (each an "Extension Period"), PROVIDED THAT no Extension Period shall end on a date other than an Interest Payment Date for the Debentures or extend beyond the Maturity Date of the Debentures. As a consequence of such deferral, Distributions also will be deferred. Despite such deferral, Distributions will continue to accumulate with interest thereon (to the extent permitted by applicable law) at the Coupon Rate compounded quarterly during any such Extension Period. Prior to the termination of any such Extension Period, the Debenture Issuer may further defer payments of interest by further extending such Extension Period; PROVIDED THAT such further deferment shall only be permitted to the extent that such Extension Period, together with all extensions occurring both before and after such deferment, does not exceed 20 consecutive quarterly periods, including the first quarterly period during such Extension Period, or end on a date other than an Interest Payment Date for the Debentures or extend beyond the Maturity Date of the Debentures. Payments of accrued Distributions will be payable to Holders as they appear on the books and records of the Trust on the first record date after the end of the Extension Period. Upon the termination of any Extension Period and the payment of all amounts then due, the Debenture Issuer may commence a new Extension Period, subject to the above requirements. Subject to the receipt of any required regulatory approval and to certain other conditions set forth in the Declaration and the Indenture, the Property Trustee may, at the direction of the Sponsor, at any time dissolve the Trust and cause the Debentures to be distributed to the holders to the Securities in liquidation of the Trust or, simultaneous with any redemption of the Debentures, cause a Like Amount of the Securities to be redeemed by the Trust. A2-5 Under certain circumstances, the right of the holders of the Common Securities shall be subordinate to the rights of the holders of the Preferred Securities (as defined in the Declaration), as provided in the Declaration. The Common Securities shall be redeemable as provided in the Declaration. --------------------- ASSIGNMENT FOR VALUE RECEIVED, the undersigned assigns and transfers this Common Security Certificate to: - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- (Insert assignee's social security or tax identification number) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- (Insert address and zip code of assignee) and irrevocably appoints - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- ___________________________________________________________ agent to transfer this Common Security Certificate on the books of the Trust. The agent may substitute another to act for him or her. Date: _______________________ Signature: ------------------------------------------------- (Sign exactly as your name appears on the other side of this Common Security Certificate) A2-6 EXHIBIT B SPECIMEN OF DEBENTURE EXHIBIT C UNDERWRITING AGREEMENT EX-4.6 6 EXHIBIT 4.6 EXHIBIT 4.6 --------------------------------------------------- TRUST PREFERRED SECURITIES GUARANTEE AGREEMENT INDEPENDENT BANK CORP. DATED AS OF ______ __, 1999 --------------------------------------------------- TABLE OF CONTENTS PAGE ARTICLE I DEFINITIONS AND INTERPRETATION SECTION 1.1 DEFINITIONS AND INTERPRETATION............................. 1 ARTICLE II TRUST INDENTURE ACT SECTION 2.1 TRUST INDENTURE ACT; APPLICATION........................... 5 SECTION 2.2 LISTS OF HOLDERS OF TRUST PREFERRED SECURITIES............. 6 SECTION 2.3 REPORTS BY THE TRUST PREFERRED SECURITIES GUARANTEE TRUSTEE 6 SECTION 2.4 PERIODIC REPORTS TO TRUST PREFERRED SECURITIES GUARANTEE TRUSTEE.............................................. 6 SECTION 2.5 EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT........... 7 SECTION 2.6 GUARANTEE EVENTS OF DEFAULT; WAIVER........................ 7 SECTION 2.7 GUARANTEE EVENT OF DEFAULT; NOTICE......................... 7 SECTION 2.8 CONFLICTING INTERESTS...................................... 7 ARTICLE III POWERS, DUTIES AND RIGHTS OF TRUST PREFERRED SECURITIES GUARANTEE TRUSTEE SECTION 3.1 POWERS AND DUTIES OF THE TRUST PREFERRED SECURITIES GUARANTEE TRUSTEE ................................... 8 SECTION 3.2 CERTAIN RIGHTS OF TRUST PREFERRED SECURITIES GUARANTEE TRUSTEE ............................................. 10 SECTION 3.3 NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF TRUST PREFERRED SECURITIES GUARANTEE....................... 12 ARTICLE IV TRUST PREFERRED SECURITIES GUARANTEE TRUSTEE SECTION 4.1 TRUST PREFERRED SECURITIES GUARANTEE TRUSTEE; ELIGIBILITY 12 SECTION 4.2 APPOINTMENT, REMOVAL AND RESIGNATION OF TRUST PREFERRED SECURITIES GUARANTEE TRUSTEE......................... 13 i PAGE ARTICLE V GUARANTEE SECTION 5.1 GUARANTEE.................................................. 14 SECTION 5.2 WAIVER OF NOTICE AND DEMAND................................ 14 SECTION 5.3 OBLIGATIONS NOT AFFECTED................................... 14 SECTION 5.4 RIGHTS OF HOLDERS.......................................... 15 SECTION 5.5 GUARANTEE OF PAYMENT....................................... 16 SECTION 5.6 SUBROGATION................................................ 16 SECTION 5.7 INDEPENDENT OBLIGATIONS.................................... 16 ARTICLE VI LIMITATION OF TRANSACTIONS; SUBORDINATION SECTION 6.1 LIMITATION OF TRANSACTIONS................................. 16 SECTION 6.2 RANKING.................................................... 17 ARTICLE VII TERMINATION SECTION 7.1 TERMINATION................................................ 17 ARTICLE VIII INDEMNIFICATION SECTION 8.1 EXCULPATION................................................ 18 SECTION 8.2 INDEMNIFICATION............................................ 18 ARTICLE IX MISCELLANEOUS SECTION 9.1 SUCCESSORS AND ASSIGNS..................................... 18 SECTION 9.2 AMENDMENTS................................................. 19 SECTION 9.3 NOTICES.................................................... 19 SECTION 9.4 BENEFIT.................................................... 20 SECTION 9.5 GOVERNING LAW.............................................. 20 ii TRUST PREFERRED SECURITIES GUARANTEE AGREEMENT This Trust Preferred Securities Guarantee Agreement (the "Trust Preferred Securities Guarantee"), dated as of _________ __, 1999, is executed and delivered by Independent Bank Corp., a Massachusetts corporation (the "Guarantor"), and The Bank of New York, a New York banking corporation, as trustee, for the benefit of the Holders (as defined herein) from time to time of the Trust Preferred Securities (as defined herein) of Independent Capital Trust II, a Delaware statutory business trust (the "Issuer"). WHEREAS, pursuant to an Amended and Restated Declaration of Trust (the "Declaration"), dated as of _______ __, 1999, 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, _______ trust preferred securities, having an aggregate liquidation amount of $__________, such trust preferred securities being designated the ___% Cumulative Trust Preferred Securities (collectively the "Trust Preferred Securities"); and WHEREAS, as incentive for the Holders to purchase the Trust Preferred Securities, the Guarantor desires irrevocably and unconditionally to agree, to the extent set forth in this Trust Preferred Securities Guarantee, to pay to the Holders 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 executing and delivering a guarantee agreement (the "Common Securities Guarantee"), with substantially identical terms to this Trust Preferred Securities Guarantee, for the benefit of the holders of the Common Securities (as defined herein), 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 the Common Securities Guarantee are subordinated, to the extent and in the manner set forth in the Common Securities Guarantee, to the rights of holders of Trust Preferred Securities to receive Guarantee Payments under this Trust Preferred Securities Guarantee; NOW, THEREFORE, in consideration of the purchase by each Holder, which purchase the Guarantor hereby acknowledges shall benefit the Guarantor, the Guarantor executes and delivers this Trust Preferred Securities Guarantee for the benefit of the Holders. ARTICLE I DEFINITIONS AND INTERPRETATION SECTION 1.1 DEFINITIONS AND INTERPRETATION In this Trust Preferred Securities Guarantee, unless the context otherwise requires: (a) capitalized terms used in this Trust Preferred Securities Guarantee but not defined in the preamble above have the respective meanings assigned to them in this Section 1.1; (b) a term defined in the Declaration as at the date of execution of this Trust Preferred Securities Guarantee have the same meaning when used in this Trust Preferred Securities Guarantee unless otherwise defined in this Trust Preferred Securities Guarantee; (c) a term defined anywhere in this Trust Preferred Securities Guarantee has the same meaning throughout; (d) all references to "the Trust Preferred Securities Guarantee" or "this Trust Preferred Securities Guarantee" are to this Trust Preferred Securities Guarantee as modified, supplemented or amended from time to time; (e) all references in this Trust Preferred Securities Guarantee to Articles and Sections are to Articles and Sections of this Trust Preferred Securities Guarantee, unless otherwise specified; (f) a term defined in the Trust Indenture Act has the same meaning when used in this Trust Preferred Securities Guarantee, unless otherwise defined in this Trust Preferred Securities Guarantee or unless the context otherwise requires; and (g) a reference to the singular includes the plural and vice versa. "AFFILIATE" has the same meaning as given to that term in Rule 405 under the Securities Act of 1933, as amended, or any successor rule thereunder. "BUSINESS DAY" means any day other than a Saturday or a Sunday, or a day on which banking institutions in The City of New York or Rockland, Massachusetts are authorized or required by law or executive order to close. "COMMON SECURITIES" means the securities representing common undivided beneficial interests in the assets of the Issuer. "CORPORATE TRUST OFFICE" means the office of the Trust Preferred Securities Guarantee Trustee at which the corporate trust business of the Trust Preferred Securities Guarantee Trustee shall, at any particular time, be principally administered, which office at the date of execution of this Trust Preferred Securities Guarantee is located at 101 Barclay Street, New York, New York 10286. 2 "COVERED PERSON" means any Holder or beneficial owner of Trust Preferred Securities. "DEBENTURES" means the series of subordinated deferrable interest debentures of the Guarantor designated the ____% Junior Subordinated Deferrable Interest Debentures due ______ __, 2029 held by the Property Trustee (as defined in the Declaration) of the Issuer. "GUARANTEE EVENT OF DEFAULT" means a default by the Guarantor on any of its payment or other obligations under this Trust Preferred Securities Guarantee; provided, however, that except with respect to a default in payment of any Guarantee Payment, the Guarantor shall have received notice of default and shall not have cured such default within 60 days after receipt of such notice. "GUARANTEE PAYMENTS" means the following payments or distributions, without duplication, with respect to the Trust Preferred Securities, to the extent not paid or made by the Issuer: (i) any accumulated and unpaid Distributions (as defined in the Declaration) that are required to be paid on such Trust Preferred Securities to the extent the Issuer has funds on hand legally available therefor at such time; (ii) the redemption price, including all accumulated 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 Trust Preferred Securities called for redemption by the Issuer; and (iii) upon a voluntary or involuntary dissolution or winding up of the Issuer (other than in connection with the distribution of Debentures to the Holders in exchange for Trust Preferred Securities as provided in the Declaration), the lesser of (a) the aggregate of the liquidation amount and all accumulated and unpaid Distributions on the Trust Preferred 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 under the Common Securities Guarantee with respect to the Common Securities or any guarantee payment under any Other Common Securities Guarantees shall be made until the Holders shall be paid in full the Guarantee Payments to which they are entitled under this Trust Preferred Securities Guarantee. "HOLDER" shall mean any holder, as registered on the books and records of the Issuer, of any Trust Preferred Securities; provided, however, that, in determining whether the holders of the requisite percentage of Trust Preferred Securities have given any request, notice, consent or waiver hereunder, "Holder" shall not include the Guarantor or any Affiliate of the Guarantor. "INDEMNIFIED PERSON" means the Trust Preferred Securities Guarantee Trustee, any Affiliate of the Trust Preferred Securities Guarantee Trustee, or any officers, directors, shareholders, members, partners, employees, representatives, nominees, custodians or agents of the Trust Preferred Securities Guarantee Trustee. 3 "INDENTURE" means the Indenture dated as of _____ __, 1999, among the Guarantor (the "Debenture Issuer") and The Bank of New York, as trustee (the "Indenture Trustee"), pursuant to which the Debentures are to be issued to the Property Trustee of the Issuer. "INDENTURE EVENT OF DEFAULT" shall mean any event specified in Section 5.01 of the Indenture. "MAJORITY IN LIQUIDATION AMOUNT OF THE TRUST PREFERRED SECURITIES" means, except as provided by the Declaration, the terms of the Preferred Securities or by the Trust Indenture Act, a vote by Holder(s) of more than 50% of the aggregate liquidation amount of all Trust Preferred Securities. In determining whether the Holders of the requisite amount of Trust Preferred Securities have voted, Trust Preferred Securities which are owned by the Guarantor or any Affiliate of the Guarantor or any other obligor on the Trust Preferred Securities shall be disregarded for the purpose of any such determination. "OFFICERS' CERTIFICATE" means, with respect to the Guarantor, a certificate signed by any two of the following: the Chairman, a Vice Chairman, the Chief Executive Officer, the President, a Vice President, the Comptroller, the Secretary or an Assistant Secretary of the Guarantor. Any Officers' Certificate delivered with respect to compliance with a condition or covenant provided for in this Trust Preferred Securities Guarantee (other than pursuant to Section 314(d)(4) of the Trust Indenture Act) shall include: (a) a statement that each officer signing the Officers' Certificate has read the covenant or condition and the definitions relating thereto; (b) a statement that each such 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 (c) a statement as to whether, in the opinion of each such officer, such condition or covenant has been complied with. "OTHER COMMON SECURITIES GUARANTEES" shall have the same meaning as "Other Guarantees" as defined in the Common Securities Guarantee. "OTHER DEBENTURES" means all junior subordinated debentures issued by the Guarantor from time to time and sold to trusts to be established by the Guarantor, in each case similar to the Issuer, including but not limited to Independent Capital Trust I. "OTHER GUARANTEES" means all guarantees issued or to be issued by the Guarantor with respect to trust preferred securities similar to the Trust Preferred Securities issued by other 4 trusts established or to be established by the Guarantor, in each case similar to the Issuer, including but not limited to Independent Capital Trust I. "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. "RESPONSIBLE OFFICER" means, with respect to the Trust Preferred Securities Guarantee Trustee, any officer within the Corporate Trust Office of the Trust Preferred Securities Guarantee Trustee with direct responsibility for the administration of this Trust Preferred Securities Guarantee and also means, 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. "SUCCESSOR TRUST PREFERRED SECURITIES GUARANTEE TRUSTEE" means a successor Trust Preferred Securities Guarantee Trustee possessing the qualifications to act as Trust Preferred Securities Guarantee Trustee under Section 4.1. "TRUST PREFERRED SECURITIES GUARANTEE TRUSTEE" means The Bank of New York, a New York banking corporation, until a Successor Trust Preferred Securities Guarantee Trustee has been appointed and has accepted such appointment pursuant to the terms of this Trust Preferred Securities Guarantee and thereafter means each such Successor Trust Preferred Securities Guarantee Trustee. "TRUST INDENTURE ACT" means the Trust Indenture Act of 1939, as amended from time to time, or any successor legislation. "TRUST SECURITIES" means the Common Securities and the Trust Preferred Securities, collectively. ARTICLE II TRUST INDENTURE ACT SECTION 2.1 TRUST INDENTURE ACT; APPLICATION (a) This Trust Preferred Securities Guarantee is subject to the provisions of the Trust Indenture Act that are required to be part of this Trust Preferred Securities Guarantee and shall, to the extent applicable, be governed by such provisions; and 5 (b) if and to the extent that any provision of this Trust Preferred Securities Guarantee limits, qualifies or conflicts with the duties imposed by Section 310 to 317, inclusive, of the Trust Indenture Act, such imposed duties shall control. SECTION 2.2 LISTS OF HOLDERS OF TRUST PREFERRED SECURITIES (a) The Guarantor shall provide the Trust Preferred Securities Guarantee Trustee (unless the Trust Preferred Securities Guarantee Trustee is otherwise the registrar of the Trust Preferred Securities) with a list, in such form as the Trust Preferred Securities Guarantee Trustee may reasonably require, of the names and addresses of the Holders of the Trust Preferred Securities ("List of Holders") as of such date, (i) within 14 days after each record date for payment of Distributions, as defined in the Declaration, and (ii) at any other time within 30 days of receipt by the Guarantor of a written request for a List of Holders as of a date no more than 14 days before such List of Holders is given to the Trust Preferred Securities Guarantee Trustee, PROVIDED, that the Guarantor shall not be obligated to provide such List of Holders at any time the List of Holders does not differ from the most recent List of Holders given to the Trust Preferred Securities Guarantee Trustee by the Guarantor. The Trust Preferred Securities Guarantee Trustee shall preserve, in as current a form as is reasonably practicable, all information contained in a List of Holders given to it, provided that it may destroy any List of Holders previously given to it on receipt of a new List of Holders. (b) The Trust Preferred Securities Guarantee Trustee shall comply with its obligations under Sections 311(a), 311(b) and Section 312(b) of the Trust Indenture Act. SECTION 2.3 REPORTS BY THE TRUST PREFERRED SECURITIES GUARANTEE TRUSTEE Within 60 days after May 15 of each year, commencing May 15, 2000, the Trust Preferred Securities Guarantee Trustee shall provide to the Holders such reports as are required by Section 313 of the Trust Indenture Act, if any, in the form and in the manner provided by Section 313 of the Trust Indenture Act. The Trust Preferred Securities Guarantee Trustee shall also comply with the other requirements of Section 313 of the Trust Indenture Act. SECTION 2.4 PERIODIC REPORTS TO TRUST PREFERRED SECURITIES GUARANTEE TRUSTEE The Guarantor shall provide to the Trust Preferred Securities Guarantee Trustee such documents, reports and information as required by Section 314 of the Trust Indenture Act (if any) and the compliance certificate required by Section 314 of the Trust Indenture Act in the form, in the manner and at the times required by Section 314 of the Trust Indenture Act, provided that such compliance certificate shall be delivered on or before 120 days after the end of each fiscal year of the Guarantor. 6 SECTION 2.5 EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT The Guarantor shall provide to the Trust Preferred Securities Guarantee Trustee such evidence of compliance with any conditions precedent, if any, provided for in this Trust Preferred Securities Guarantee that relate to any of the matters set forth in Section 314(c) of the Trust Indenture Act. Any certificate or opinion required to be given by an officer pursuant to Section 314(c)(1) may be given in the form of an Officers' Certificate. SECTION 2.6 GUARANTEE EVENTS OF DEFAULT; WAIVER The Holders of a Majority in liquidation amount of Trust Preferred Securities may, by vote or by written consent, on behalf of all Holders, waive any past Guarantee Event of Default and its consequences. Upon such waiver, any such Guarantee Event of Default shall cease to exist, and any Guarantee Event of Default arising therefrom shall be deemed to have been cured, for every purpose of this Trust Preferred Securities Guarantee, but no such waiver shall extend to any subsequent or other default or Guarantee Event of Default or impair any right consequent thereon. SECTION 2.7 GUARANTEE EVENT OF DEFAULT; NOTICE (a) The Trust Preferred Securities Guarantee Trustee shall, within 90 days after the occurrence of a Guarantee Event of Default, mail by first class postage prepaid, to all Holders, notices of all Guarantee Events of Default actually known to a Responsible Officer, unless such defaults have been cured before the giving of such notice; provided, that, except in the case of a Guarantee Event of Default in the timing or payment of any Guarantee Payment, the Trust Preferred Securities Guarantee Trustee shall be protected in withholding such notice if and so long as the board of directors, the executive committee, or a trust committee of directors and/or a Responsible Officer of the Trust Preferred Securities Guarantee Trustee in good faith determines that the withholding of such notice is in the interests of the Holders. (b) The Trust Preferred Securities Guarantee Trustee shall not be deemed to have knowledge of any Guarantee Event of Default unless the Trust Preferred Securities Guarantee Trustee shall have received written notice from the Guarantor, or a Responsible Officer charged with the administration of this Trust Preferred Securities Guarantee shall have obtained actual knowledge, of such Guarantee Event of Default. SECTION 2.8 CONFLICTING INTERESTS The Declaration shall be deemed to be specifically described in this Trust Preferred Securities Guarantee for the purposes of clause (i) of the first proviso contained in Section 310(b) of the Trust Indenture Act. 7 ARTICLE III POWERS, DUTIES AND RIGHTS OF TRUST PREFERRED SECURITIES GUARANTEE TRUSTEE SECTION 3.1 POWERS AND DUTIES OF THE TRUST PREFERRED SECURITIES GUARANTEE TRUSTEE (a) This Trust Preferred Securities Guarantee shall be held by the Trust Preferred Securities Guarantee Trustee for the benefit of the Holders, and the Trust Preferred Securities Guarantee Trustee shall not transfer this Trust Preferred Securities Guarantee to any Person except a Holder exercising his, her or its rights pursuant to Section 5.4(b) or to a Successor Trust Preferred Securities Guarantee Trustee on acceptance by such Successor Trust Preferred Securities Guarantee Trustee of its appointment to act as Successor Trust Preferred Securities Guarantee Trustee. The right, title and interest of the Trust Preferred Securities Guarantee Trustee shall automatically vest in any Successor Trust Preferred Securities Guarantee Trustee, and such vesting and succession of title shall be effective whether or not conveyancing documents have been executed and delivered pursuant to the appointment of such Successor Trust Preferred Securities Guarantee Trustee. (b) If a Guarantee Event of Default actually known to a Responsible Officer has occurred and is continuing, the Trust Preferred Securities Guarantee Trustee shall enforce this Trust Preferred Securities Guarantee for the benefit of the Holders. (c) The Trust Preferred Securities Guarantee Trustee, before the occurrence of any Guarantee Event of Default and after the curing of all Guarantee Events of Default that may have occurred, shall undertake to perform only such duties as are specifically set forth in this Trust Preferred Securities Guarantee, and no implied covenants shall be read into this Trust Preferred Securities Guarantee against the Trust Preferred Securities Guarantee Trustee. In case a Guarantee Event of Default has occurred (that has not been cured or waived pursuant to Section 2.6) and is actually known to a Responsible Officer, the Trust Preferred Securities Guarantee Trustee shall exercise such of the rights and powers vested in it by this Trust Preferred Securities 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 Trust Preferred Securities Guarantee shall be construed to relieve the Trust Preferred Securities 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 Guarantee Event of Default and after the curing or waiving of all such Guarantee Events of Default that may have occurred: (A) the duties and obligations of the Trust Preferred Securities Guarantee Trustee shall be determined solely by the express provisions of this Trust Preferred Securities Guarantee, and the Trust Preferred Securities 8 Guarantee Trustee shall not be liable except for the performance of such duties and obligations as are specifically set forth in this Trust Preferred Securities Guarantee, and no implied covenants or obligations shall be read into this Trust Preferred Securities Guarantee against the Trust Preferred Securities Guarantee Trustee; and (B) in the absence of bad faith on the part of the Trust Preferred Securities Guarantee Trustee, the Trust Preferred Securities 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 Trust Preferred Securities Guarantee Trustee and conforming to the requirements of this Trust Preferred Securities Guarantee; but in the case of any such certificates or opinions that by any provision hereof are specifically required to be furnished to the Trust Preferred Securities Guarantee Trustee, the Trust Preferred Securities Guarantee Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Trust Preferred Securities Guarantee (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein); (ii) the Trust Preferred Securities Guarantee Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it shall be proved that the Trust Preferred Securities Guarantee Trustee was negligent in ascertaining the pertinent facts upon which such judgment was made; (iii) the Trust Preferred Securities 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 direction of the Holders of a Majority in liquidation amount of the Trust Preferred Securities relating to the time, method and place of conducting any proceeding for any remedy available to the Trust Preferred Securities Guarantee Trustee, or exercising any trust or power conferred upon the Trust Preferred Securities Guarantee Trustee under this Trust Preferred Securities Guarantee; and (iv) no provision of this Trust Preferred Securities Guarantee shall require the Trust Preferred Securities 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 Trust Preferred Securities Guarantee Trustee shall have reasonable grounds for believing that the repayment of such funds or liability is not reasonably assured to it under the terms of this Trust Preferred Securities Guarantee or indemnity, reasonably satisfactory to the Trust Preferred Securities Guarantee Trustee, against such risk or liability is not reasonably assured to it. 9 SECTION 3.2 CERTAIN RIGHTS OF TRUST PREFERRED SECURITIES GUARANTEE TRUSTEE (a) Subject to the provisions of Section 3.1: (i) The Trust Preferred Securities 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. (ii) Any direction or act of the Guarantor contemplated by this Trust Preferred Securities Guarantee may be sufficiently evidenced by an Officers' Certificate. (iii) Whenever, in the administration of this Trust Preferred Securities Guarantee, the Trust Preferred Securities Guarantee Trustee shall deem it desirable that a matter be proved or established before taking, suffering or omitting any action hereunder, the Trust Preferred Securities 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 Officers' Certificate which, upon receipt of such request, shall be promptly delivered by the Guarantor. (iv) The Trust Preferred Securities Guarantee Trustee shall have no duty to see to any recording, filing or registration of any instrument (or any rerecording, refiling or registration thereof). (v) The Trust Preferred Securities 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 Trust Preferred Securities Guarantee Trustee shall have the right at any time to seek instructions concerning the administration of this Trust Preferred Securities Guarantee from any court of competent jurisdiction. (vi) The Trust Preferred Securities Guarantee Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Trust Preferred Securities Guarantee at the request or direction of any Holder, unless such Holder shall have provided to the Trust Preferred Securities Guarantee Trustee such security and indemnity, reasonably satisfactory to the Trust Preferred Securities Guarantee Trustee, against the costs, expenses (including attorneys' fees and expenses and the expenses of the Trust Preferred Securities 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 Trust Preferred Securities Guarantee Trustee; provided 10 that, nothing contained in this Section 3.2(a)(vi) shall be taken to relieve the Trust Preferred Securities Guarantee Trustee, upon the occurrence of a Guarantee Event of Default, of its obligation to exercise the rights and powers vested in it by this Trust Preferred Securities Guarantee. (vii) The Trust Preferred Securities 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 Trust Preferred Securities Guarantee Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit. (viii) The Trust Preferred Securities 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 Trust Preferred Securities Guarantee Trustee shall not be responsible for any misconduct or negligence on the part of any agent, custodian, nominee or attorney appointed with due care by it hereunder. (ix) Any action taken by the Trust Preferred Securities Guarantee Trustee or its agents hereunder shall bind the Holders, and the signature of the Trust Preferred Securities 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 Trust Preferred Securities Guarantee Trustee to so act or as to its compliance with any of the terms and provisions of this Trust Preferred Securities Guarantee, both of which shall be conclusively evidenced by the Trust Preferred Securities Guarantee Trustee's or its agent's taking such action. (x) Whenever in the administration of this Trust Preferred Securities Guarantee the Trust Preferred Securities Guarantee Trustee shall deem it desirable to receive instructions with respect to enforcing any remedy or right or taking any other action hereunder, the Trust Preferred Securities Guarantee Trustee (i) may request instructions from the Holders of a Majority in liquidation amount of the Trust Preferred 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 Trust Preferred Securities 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 Trust Preferred Securities Guarantee. (b) No provision of this Trust Preferred Securities Guarantee shall be deemed to impose any duty or obligation on the Trust Preferred Securities Guarantee Trustee to perform any 11 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 Trust Preferred Securities 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 Trust Preferred Securities Guarantee Trustee shall be construed to be a duty. SECTION 3.3. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF TRUST PREFERRED SECURITIES GUARANTEE The recitals contained in this Trust Preferred Securities Guarantee shall be taken as the statements of the Guarantor, and the Trust Preferred Securities Guarantee Trustee does not assume any responsibility for their correctness. The Trust Preferred Securities Guarantee Trustee makes no representation as to the validity or sufficiency of this Trust Preferred Securities Guarantee. ARTICLE IV TRUST PREFERRED SECURITIES GUARANTEE TRUSTEE SECTION 4.1 TRUST PREFERRED SECURITIES GUARANTEE TRUSTEE; ELIGIBILITY (a) There shall at all times be a Trust Preferred Securities 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 a corporation or Person permitted by the Securities and Exchange Commission to act as an institutional trustee under the Trust Indenture Act, 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 4.1(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. (b) If at any time the Trust Preferred Securities Guarantee Trustee shall cease to be eligible to so act under Section 4.1(a), the Trust Preferred Securities Guarantee Trustee shall immediately resign in the manner and with the effect set out in Section 4.2(c). (c) If the Trust Preferred Securities Guarantee Trustee has or shall acquire any "conflicting interest" within the meaning of Section 310(b) of the Trust Indenture Act, the Trust 12 Preferred Securities Guarantee Trustee and Guarantor shall in all respects comply with the provisions of Section 310(b) of the Trust Indenture Act. SECTION 4.2 APPOINTMENT, REMOVAL AND RESIGNATION OF TRUST PREFERRED SECURITIES GUARANTEE TRUSTEE (a) Subject to Section 4.2(b), the Trust Preferred Securities Guarantee Trustee may be appointed or removed without cause at any time by the Guarantor except during a Guarantee Event of Default. (b) The Trust Preferred Securities Guarantee Trustee shall not be removed in accordance with Section 4.2(a) until a Successor Trust Preferred Securities Guarantee Trustee has been appointed and has accepted such appointment by written instrument executed by such Successor Trust Preferred Securities Guarantee Trustee and delivered to the Guarantor. (c) The Trust Preferred Securities Guarantee Trustee shall hold office until a Successor Trust Preferred Securities Guarantee Trustee shall have been appointed or until its removal or resignation. The Trust Preferred Securities Guarantee Trustee may resign from office (without need for prior or subsequent accounting) by an instrument in writing executed by the Trust Preferred Securities Guarantee Trustee and delivered to the Guarantor, which resignation shall not take effect until a Successor Trust Preferred Securities Guarantee Trustee has been appointed and has accepted such appointment by instrument in writing executed by such Successor Trust Preferred Securities Guarantee Trustee and delivered to the Guarantor and the resigning Trust Preferred Securities Guarantee Trustee. (d) If no Successor Trust Preferred Securities Guarantee Trustee shall have been appointed and accepted appointment as provided in this Section 4.2 within 60 days after delivery of an instrument of removal or resignation, the Trust Preferred Securities Guarantee Trustee resigning or being removed may petition any court of competent jurisdiction for appointment of a Successor Trust Preferred Securities Guarantee Trustee. Such court may thereupon, after prescribing such notice, if any, as it may deem proper, appoint a Successor Trust Preferred Securities Guarantee Trustee. (e) No Trust Preferred Securities Guarantee Trustee shall be liable for the acts or omissions to act of any Successor Trust Preferred Securities Guarantee Trustee. (f) Upon termination of this Trust Preferred Securities Guarantee or removal or resignation of the Trust Preferred Securities Guarantee Trustee pursuant to this Section 4.2, the Guarantor shall pay to the Trust Preferred Securities Guarantee Trustee all amounts due to the Trust Preferred Securities Guarantee Trustee for fees and reimbursement of expenses which have accrued to the date of such termination, removal or resignation. 13 ARTICLE V GUARANTEE SECTION 5.1 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 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. SECTION 5.2 WAIVER OF NOTICE AND DEMAND The Guarantor hereby waives notice of acceptance of this Trust Preferred 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 5.3 OBLIGATIONS NOT AFFECTED The obligations, covenants, agreements and duties of the Guarantor under this Trust Preferred Securities Guarantee shall be absolute and unconditional and shall remain in full force and effect until the entire liquidation amount of all Trust Preferred Securities shall have been paid and such obligations, covenants, agreements and duties shall in no way be affected or impaired by reason of the happening from time to time of any event, including without limitation the following, whether or not with notice to, or the consent of, the Guarantor: (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 Trust Preferred 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 (as defined in the Declaration) or any other sums payable under the terms of the Trust Preferred Securities or the extension of time for the performance of any other obligation under, arising out of, or in connection with, the Trust Preferred 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 Property Trustee or the Holders to enforce, assert or exercise any right, privilege, power or remedy conferred 14 on the Property Trustee or the Holders pursuant to the terms of the Trust Preferred 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 Trust Preferred Securities; (f) the settlement or compromise of any obligation guaranteed hereby or hereby incurred; (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 5.3 that the obligations of the Guarantor with respect to the Guarantee Payments 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. No set-off, counterclaim, reduction or diminution of any obligation, or any defense of any kind or nature that the Guarantor has or may have against any Holder shall be available hereunder to the Guarantor against such Holder to reduce the payments to it under this Trust Preferred Securities Guarantee. SECTION 5.4 RIGHTS OF HOLDERS (a) The Holders of a Majority in liquidation amount of the Trust Preferred Securities have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trust Preferred Securities Guarantee Trustee in respect of this Trust Preferred Securities Guarantee or exercising any trust or power conferred upon the Trust Preferred Securities Guarantee Trustee under this Trust Preferred Securities Guarantee. (b) If the Trust Preferred Securities Guarantee Trustee fails to enforce such Trust Preferred Securities Guarantee, any Holder may institute a legal proceeding directly against the Guarantor to enforce the Trust Preferred Securities Guarantee Trustee's rights under this Trust Preferred Securities Guarantee, without first instituting a legal proceeding against the Issuer, the Trust Preferred Securities Guarantee Trustee or any other Person or entity. Notwithstanding the foregoing, if the Guarantor has failed to make a Guarantee Payment, a Holder may directly institute a proceeding against the Guarantor for enforcement of the Trust Preferred Securities Guarantee for such payment to the Holder of the principal of or interest on the Debentures on or after the respective due dates specified in the Debentures, and the amount of the payment will be based on the Holder's pro rata share of the amount due and owing on all of the Trust Preferred Securities. The Guarantor 15 waives any right or remedy to require that any action be brought first against the Issuer or any other Person or entity before proceeding directly against the Guarantor. SECTION 5.5 GUARANTEE OF PAYMENT This Trust Preferred Securities Guarantee creates a guarantee of payment and not of collection. SECTION 5.6 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 Trust Preferred 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 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 Trust Preferred Securities Guarantee, if, at the time of any such payment, any amounts are due and unpaid under this Trust Preferred 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. SECTION 5.7 INDEPENDENT OBLIGATIONS The Guarantor acknowledges that its obligations hereunder are independent of the obligations of the Issuer with respect to the Trust Preferred Securities, and that the Guarantor shall be liable as principal and as debtor hereunder to make Guarantee Payments pursuant to the terms of this Trust Preferred Securities Guarantee notwithstanding the occurrence of any event referred to in subsections (a) through (g), inclusive, of Section 5.3 hereof. ARTICLE VI LIMITATION OF TRANSACTIONS; SUBORDINATION SECTION 6.1 LIMITATION OF TRANSACTIONS So long as any Trust Preferred Securities remain outstanding, if there shall have occurred a Guarantee Event of Default or an Event of Default, or an event that, with the giving of notice or the lapse of time, or both, would be a Guarantee Event of Default or an Event of Default then, prior to the payment of all accrued interest on outstanding Debentures , the Guarantor shall not (i) 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 capital stock (which includes common and preferred stock), (ii) make any payment of principal, interest or premium, if any, on or repay or repurchase or redeem any debt securities of the Guarantor (including any Other Debentures) that rank PARI PASSU with or junior in right of payment to the Debentures or (iii) make any guarantee 16 payments with respect to any guarantee by the Guarantor of the debt securities of any Subsidiary (including under Other Guarantees) if such guarantee ranks equal or junior in right of payment to the Debentures (other than (a) dividends or distributions in shares of, or options, warrants, 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 stockholders' 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 Trust Preferred Securities Guarantee, (d) the purchase of fractional shares resulting from a reclassification 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). SECTION 6.2 RANKING This Trust Preferred Securities Guarantee will constitute an unsecured obligation of the Guarantor and will rank (i) subordinate and junior in right of payment to Senior and Subordinated Indebtedness (as defined in the Indenture), to the same extent and in the same manner that the Debentures are subordinated to Senior and Subordinated Indebtedness pursuant to the Indenture, (ii) PARI PASSU with the Debentures, the Other Debentures, the Common Securities Guarantee, any Other Guarantee and any Other Common Securities Guarantee, (iii) senior to the Guarantor's capital stock and (iv) effectively subordinated to the liabilities and obligations of the Guarantor's subsidiaries. If an Event of Default has occurred and is continuing, the rights of the holders of the Common Securities to receive any payments shall be subordinated to the rights of the Holders to receive Guarantee Payments hereunder. ARTICLE VII TERMINATION SECTION 7.1 TERMINATION This Trust Preferred Securities Guarantee shall terminate (i) upon full payment of the Redemption Price (as defined in the Declaration) of all Trust Preferred Securities or (ii) upon liquidation of the Issuer and the full payment of the amounts payable in accordance with the Declaration or the distribution of the Debentures to the Holders and the holders of Common Securities. Notwithstanding the foregoing, this Trust Preferred 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 Trust Preferred Securities or under this Trust Preferred Securities Guarantee. 17 ARTICLE VIII INDEMNIFICATION SECTION 8.1 EXCULPATION (a) 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 Trust Preferred Securities 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 Trust Preferred Securities 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. (b) An Indemnified Person shall be fully protected in relying in good faith upon the records of the Guarantor and upon such information, opinions, reports or statements presented to 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 has been selected with reasonable care by or on behalf of the Guarantor, 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 might properly be paid. SECTION 8.2 INDEMNIFICATION 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 bad faith on its part, arising out of or in connection with the acceptance or administration of the trust or trusts hereunder, including the costs and expenses (including reasonable legal fees and expenses) of defending itself against, or investigating, any claim or liability in connection with the exercise or performance of any of its powers or duties hereunder. The obligation to indemnify as set forth in this Section 8.2 shall survive the termination of this Trust Preferred Securities Guarantee. ARTICLE IX MISCELLANEOUS SECTION 9.1 SUCCESSORS AND ASSIGNS All guarantees and agreements contained in this Trust Preferred 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. 18 SECTION 9.2 AMENDMENTS Except with respect to any changes that do not adversely affect the rights of Holders (in which case no consent of Holders will be required), this Trust Preferred Securities Guarantee may only be amended with the prior approval of the Holders of a Majority in liquidation amount of the Trust Preferred Securities (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). The provisions of the Declaration with respect to consents to amendments thereof (whether at a meeting or otherwise) shall apply to the giving of such approval. Prior to executing any amendment hereto, the Trust Preferred Securities Guarantee Trustee shall be entitled to receive and rely upon an Opinion of Counsel stating that the execution of such amendment is authorized or permitted by this Trust Preferred Securities Guarantee Agreement. SECTION 9.3 NOTICES All notices provided for in this Trust Preferred Securities 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 Issuer, in care of the Trustee at the Issuer's mailing address set forth below (or such other address as the Issuer may give notice of to the Holders and the Trust Preferred Securities Guarantee Trustee): Independent Capital Trust II c/o The Bank of New York 101 Barclay Street 21st Floor West New York, New York 10286 Attention: Corporate Trustee Administration Telecopy: (212) 815-5917 19 (b) If given to the Trust Preferred Securities Guarantee Trustee, at the Trust Preferred Securities Guarantee Trustee's mailing address set forth below (or such other address as the Trust Preferred Securities Guarantee Trustee may give notice of to the Holders, the Guarantor and the Issuer): The Bank of New York 101 Barclay Street 21st Floor West New York, New York 10286 Attention: Corporate Trust Trustee Administration Telecopy: (212) 815-5917 (c) 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 and the Trust Preferred Securities Guarantee Trustee): Independent Bank Corp. 288 Union Street Rockland, Massachusetts 02370 Attention: Richard J. Seaman Chief Financial Officer Telecopy: (781) 878-6100 (d) 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. SECTION 9.4 BENEFIT This Trust Preferred Securities Guarantee is solely for the benefit of the Holders and, subject to Section 3.1(a), is not separately transferable from the Trust Preferred Securities. SECTION 9.5 GOVERNING LAW THIS TRUST PREFERRED 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. 20 THIS TRUST PREFERRED SECURITIES GUARANTEE is executed as of the day and year first above written. INDEPENDENT BANK CORP., as Guarantor By: ------------------------------------------ Richard J. Seaman Chief Financial Officer THE BANK OF NEW YORK, as Trust Preferred Securities Guarantee Trustee By: ------------------------------------------ Name: Title: 21 EX-5.1 7 EXHIBIT 5.1 EXHIBIT 5.1 Law Offices ELIAS, MATZ, TIERNAN & HERRICK L.L.P. 12th Floor 734 15th Street, N.W. Washington, D.C. 20005 Telephone (202) 347-0300 October 28, 1999 Board of Directors Independent Bank Corp. 288 Union Street Rockland, Massachusetts 02370 Re: Registration Statement on Form S-3 Ladies and Gentlemen: In connection with the registration under the Securities Act of 1933, as amended (the "Act"), of up to $23,000,000 aggregate principal amount of Junior Subordinated Deferrable Interest Debentures (the "Junior Subordinated Debentures") of Independent Bank Corp., a Massachusetts corporation (the "Corporation"), up to $23,000,000 aggregate liquidation amount of Cumulative Trust Preferred Securities (the "Trust Preferred Securities") of Independent Capital Trust II, a business trust created under the laws of the State of Delaware (the "Issuer"), and the Guarantee with respect to the Trust Preferred Securities (the "Guarantee") to be executed and delivered by the Corporation for the benefit of the holders from time to time of the Trust Preferred Securities, we, as your counsel, have examined such corporate records, certificates and other documents, and such questions of law, as we have considered necessary or appropriate for the purposes of this opinion. Upon the basis of such examination, we advise you that, when: (i) the Registration Statement relating to the Junior Subordinated Debentures, the Trust Preferred Securities and the Guarantee has become effective under the Act; (ii) the Guarantee Agreement relating to the Guarantee with respect to the Trust Preferred Securities of the Issuer has been duly executed and delivered; (iii) the Junior Subordinated Debentures have been duly executed and authenticated in accordance with the Indenture and issued and delivered as contemplated in the Registration Statement; and Board of Directors October 28, 1999 Page 2 (iv) the Trust Preferred Securities have been duly executed in accordance with the Amended and Restated Declaration of Trust of the Issuer and issued and delivered as contemplated in the Registration Statement, the Junior Subordinated Debentures and the Guarantee relating to the Trust Preferred Securities of the Issuer will constitute valid and legally binding obligations of the Corporation, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors' rights and to general equity principles. We understand that you have received an opinion regarding the Trust Preferred Securities from Richards, Layton & Finger, P.A., special Delaware counsel for the Corporation and the Issuer. We are expressing no opinion with respect to the matters contained in such opinion. Also, we have relied as to certain matters on information obtained from public officials, officers of the Corporation and other sources believed by us to be responsible. We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the references to us under the heading "Legal Matters" in the Prospectus. In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Act. Very truly yours, ELIAS, MATZ, TIERNAN & HERRICK L.L.P By: /s/ Norman B. Antin -------------------------------------- Norman B. Antin, a Partner EX-5.2 8 EXHIBIT 5.2 Exhibit 5.2 [Letterhead of Richards, Layton & Finger, P.A.] October 28, 1999 Independent Capital Trust II c/o Independent Bank Corp. 288 Union Street Rockland, Massachusetts 02370 Re: INDEPENDENT CAPITAL TRUST II Ladies and Gentlemen: We have acted as special Delaware counsel for Independent Bank Corp., a Massachusetts corporation (the "Company"), and Independent Capital Trust II, a Delaware business trust (the "Trust"), in connection with the matters set forth herein. At your request, this opinion is being furnished to you. For purposes of giving the opinions hereinafter set forth, our examination of documents has been limited to the examination of originals or copies of the following: (a) The Certificate of Trust of the Trust, dated as of October 22, 1999 (the "Certificate"), as filed in the office of the Secretary of State of the State of Delaware (the "Secretary of State") on October 22, 1999; (b) The Declaration of Trust of the Trust, dated as of October 22, 1999, among the Company and the trustees of the Trust named therein; (c) A form of Amended and Restated Declaration of Trust of the Trust (including Annex I and Exhibits A-1 and A-2) (the "Declaration"), to be entered into among the Company, as sponsor, the trustees of the Trust named therein, and the holders, from time to time, of undivided beneficial interests in the assets of the Trust, attached as an exhibit to the Registration Statement (as defined below); Independent Capital Trust II October 28, 1999 Page 2 (d) The Registration Statement on Form S-3 (the "Registration Statement"), including a prospectus (the "Prospectus"), relating to the trust preferred securities of the Trust representing undivided beneficial interests in the assets of the Trust (each, a "Preferred Security" and collectively, the "Preferred Securities"), as proposed to be filed by the Company and the Trust with the Securities and Exchange Commission on or about October 28, 1999; and (e) A Certificate of Good Standing for the Trust, dated October 28, 1999, obtained from the Secretary of State. Capitalized terms used herein and not otherwise defined are used as defined in the Declaration. For purposes of this opinion, we have not reviewed any documents other than the documents listed in paragraphs (a) through (e) above. In particular, we have not reviewed any document (other than the documents listed in paragraphs (a) through (e) above) that is referred to in or incorporated by reference into the documents reviewed by us. We have assumed that there exists no provision in any document that we have not reviewed that is inconsistent with the opinions stated herein. We have conducted no independent factual investigation of our own but rather have relied solely upon the foregoing documents, the statements and information set forth therein and the additional matters recited or assumed herein, all of which we have assumed to be true, complete and accurate in all material respects. With respect to all documents examined by us, we have assumed (i) the authenticity of all documents submitted to us as authentic originals, (ii) the conformity with the originals of all documents submitted to us as copies or forms, and (iii) the genuineness of all signatures. For purposes of this opinion, we have assumed (i) that the Declaration and the Certificate are in full force and effect and have not been amended, (ii) except to the extent provided in paragraph 1 below, the due creation or due organization or due formation, as the case may be, and valid existence in good standing of each party to the documents examined by us under the laws of the jurisdiction governing its creation, organization or formation, (iii) the legal capacity of natural persons who are parties to the documents examined by us, (iv) that each of the parties to the documents examined by us has the power and authority to execute and deliver, and to perform its obligations under, such documents, (v) the due authorization, execution and delivery by all parties thereto of all documents examined by us, (vi) the receipt by each Person to whom a Preferred Security is to be issued by the Trust (collectively, the "Preferred Security Holders") of a preferred security certificate for such Preferred Security and the payment for the Preferred Security acquired by it, in accordance with the Declaration and the Registration Statement, and (vii) that the Preferred Securities are issued and sold to the Independent Capital Trust II October 28, 1999 Page 3 Preferred Security Holders in accordance with the Declaration and the Registration Statement. We have not participated in the preparation of the Registration Statement and assume no responsibility for its contents. This opinion is limited to the laws of the State of Delaware (excluding the securities laws of the State of Delaware), and we have not considered and express no opinion on the laws of any other jurisdiction, including federal laws and rules and regulations relating thereto. Our opinions are rendered only with respect to Delaware laws and rules, regulations and orders thereunder that are currently in effect. Based upon the foregoing, and upon our examination of such questions of law and statutes of the State of Delaware as we have considered necessary or appropriate, and subject to the assumptions, qualifications, limitations and exceptions set forth herein, we are of the opinion that: 1. The Trust has been duly created and is validly existing in good standing as a business trust under the Business Trust Act. 2. The Preferred Securities will represent valid and, subject to the qualifications set forth in paragraph 3 below, fully paid and nonassessable undivided beneficial interests in the assets of the Trust. 3. The Preferred Security Holders, as beneficial owners of the Trust, will be entitled to the same limitation of personal liability extended to stockholders of private corporations for profit organized under the General Corporation Law of the State of Delaware. We note that the Preferred Security Holders may be obligated to make payments as set forth in the Declaration. We consent to the filing of this opinion with the Securities and Exchange Commission as an exhibit to the Registration Statement. In addition, we hereby consent to the use of our name under the heading "Legal Matters" in the Prospectus. In giving the foregoing consents, we do not thereby admit that we come within the category of Persons whose consent is required under Section 7 of the Securities Act of 1933, as amended, or the rules and regulations of the Securities and Exchange Commission thereunder. Except as stated above, without our prior written consent, this opinion may not be furnished or quoted to, or relied upon by, any other Person for any purpose. Very truly yours, /s/ Richards, Layton & Finger, P.A. BJK/JRS EX-8. 9 EXHIBIT 8 EXHIBIT 8 Law Offices ELIAS, MATZ, TIERNAN & HERRICK L.L.P. 12th Floor 734 15th Street, N.W. Washington, D.C. 20005 Telephone (202) 347-0300 October 28, 1999 Board of Directors Independent Bank Corp. 288 Union Street Rockland, Massachusetts 02370 Re: Registration Statement on Form S-3 Ladies and Gentlemen: As special federal tax counsel to Independent Capital Trust II (the "Issuer") and Independent Bank Corp. in connection with the issuance by the Issuer of up to $23,000,000 of its Cumulative Trust Preferred Securities pursuant to the prospectus (the "Prospectus") contained in the Registration Statement, and assuming the operative documents described in the Prospectus will be performed in accordance with the terms described therein, we hereby confirm to you our opinion as set forth under the heading "Certain Federal Income Tax Consequences" in the Prospectus, subject to the limitations set forth therein. We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the references to us under the heading "Certain Federal Income Tax Consequences" in the Prospectus. In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Act. Very truly yours, ELIAS, MATZ, TIERNAN & HERRICK L.L.P By: /s/ Norman B. Antin -------------------------------- Norman B. Antin, a Partner EX-12.1 10 EXHIBIT 12.1 Exhibit 12.1 INDEPENDENT BANK CORP. COMPUTATION OF CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES EXCLUDING INTEREST ON DEPOSITS
Year to Date 1998 1997 1996 1995 1994 9/30/99 (Dollars in Thousands) Net Income (loss) 12,386 16,139 14,158 11,597 10,387 8,113 Income tax expense (benefit) 5,423 7,804 7,326 6,153 4,729 1,533 ------ ------ ------ ------ ------ ------ Pretax earnings (loss) 17,809 23,943 21,484 17,750 15,116 9,646 ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ Fixed Charges: One-third of rental expense which approximated the interest factor 423 667 767 768 682 509 Interest on borrowed funds 14,609 18,137 9,881 4,684 3,101 1,562 ------ ------ ------ ------ ------ ------ Total Fixed charges 15,032 18,804 10,648 5,452 3,783 2,071 ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ Earnings (for ratio calculation) 32,841 42,747 32,132 23,202 18,899 11,717 ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ Ratio of earnings to fixed charges 2.18 2.27 3.02 4.26 5.00 5.66
EX-12.2 11 EXHIBIT 12.2 Exhibit 12.2 INDEPENDENT BANK CORP. COMPUTATION OF CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES INCLUDING INTEREST ON DEPOSITS
Year to Date 1998 1997 1996 1995 1994 9/30/99 (Dollars in Thousands) Net Income (loss) 12,386 16,139 14,158 11,597 10,387 8,113 Income tax expense (benefit) 5,423 7,804 7,326 6,153 4,729 1,533 ------ ------ ------ ------ ------ ------ Pretax earnings (loss) 17,809 23,943 21,484 17,750 15,116 9,646 ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ Fixed Charges: One-third of rental expense which approximated the interest factor 423 667 767 768 682 509 Interest on borrowed funds 37,620 49,569 41,578 32,354 29,143 22,029 ------ ------ ------ ------ ------ ------ Total Fixed charges 38,043 50,236 42,345 33,122 29,825 22,538 ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ Earnings (for ratio calculation) 55,852 74,179 63,829 50,872 44,941 32,184 ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ Ratio of earnings to fixed charges 1.47 1.48 1.51 1.54 1.51 1.43
EX-23.1 12 EXHIBIT 23.1 EXHIBIT 23.1 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation by reference in this registration statement (No. 333-XXXXX), filed on Form S-3, of our reports dated January 27, 1999 included in Independent Bank Corp.'s Form 10-K for the year ended December 31, 1998 and to all references to our firm included in this registration statement. /s/ Arthur Andersen LLP Boston, Massachusetts October 26, 1999 EX-25.1 13 EXHIBIT 25.1 Exhibit 25.1 ================================================================================ FORM T-1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) |__| ---------- THE BANK OF NEW YORK (Exact name of trustee as specified in its charter) New York 13-5160382 (State of incorporation (I.R.S. employer if not a U.S. national bank) identification no.) One Wall Street, New York, N.Y. 10286 (Address of principal executive offices) (Zip code) ---------- INDEPENDENT BANK CORP. (Exact name of obligor as specified in its charter) Massachusetts 04-2870273 (State or other jurisdiction of (I.R.S. employer incorporation or organization) identification no.) 288 Union Street Rockland, Massachusetts 02370 (Address of principal executive offices) (Zip code) ---------- Junior Subordinated Deferrable Interest Debentures (Title of the indenture securities) ================================================================================ 1. GENERAL INFORMATION. FURNISH THE FOLLOWING INFORMATION AS TO THE TRUSTEE: (a) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING AUTHORITY TO WHICH IT IS SUBJECT. - -------------------------------------------------------------------------------- Name Address - -------------------------------------------------------------------------------- Superintendent of Banks of the State of 2 Rector Street, New York, New York N.Y. 10006, and Albany, N.Y. 12203 Federal Reserve Bank of New York 33 Liberty Plaza, New York, N.Y. 10045 Federal Deposit Insurance Corporation Washington, D.C. 20429 New York Clearing House Association New York, New York 10005 (b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS. Yes. 2. AFFILIATIONS WITH OBLIGOR. IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH AFFILIATION. None. 16. LIST OF EXHIBITS. EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION, ARE INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO RULE 7A-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17 C.F.R. 229.10(d). 1. A copy of the Organization Certificate of The Bank of New York (formerly Irving Trust Company) as now in effect, which contains the authority to commence business and a grant of powers to exercise corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1 to Form T-1 filed with Registration Statement No. 33-29637.) 4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1 filed with Registration Statement No. 33-31019.) 6. The consent of the Trustee required by Section 321(b) of the Act. (Exhibit 6 to Form T-1 filed with Registration Statement No. 33-44051.) 7. A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority. -2- SIGNATURE Pursuant to the requirements of the Act, the Trustee, The Bank of New York, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of New York, and State of New York, on the 21st day of October, 1999. THE BANK OF NEW YORK By: /s/ MICHAEL CULHANE -------------------------- Name: MICHAEL CULHANE Title: VICE PRESIDENT Exhibit 7 - ------------------- --------------------- ---------------------- Consolidated Report of Condition of THE BANK OF NEW YORK of One Wall Street, New York, N.Y. 10286 And Foreign and Domestic Subsidiaries, a member of the Federal Reserve System, at the close of business June 30, 1999, published in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act.
ASSETS Dollar Amounts In Thousands Cash and balances due from depository institutions: Noninterest-bearing balances and currency and coin.. $ 5,597,807 Interest-bearing balances........................... 4,075,775 Securities: Held-to-maturity securities......................... 785,167 Available-for-sale securities....................... 4,159,891 Federal funds sold and Securities purchased under agreements to resell................................ 2,476,963 Loans and lease financing receivables: Loans and leases, net of unearned income...............38,028,772 LESS: Allowance for loan and lease losses............568,617 LESS: Allocated transfer risk reserve........................16,352 Loans and leases, net of unearned income, allowance, and reserve............................ 37,443,803 Trading Assets......................................... 1,563,671 Premises and fixed assets (including capitalized leases)............................................. 683,587 Other real estate owned................................ 10,995 Investments in unconsolidated subsidiaries and associated companies................................ 184,661 Customers' liability to this bank on acceptances outstanding......................................... 812,015 Intangible assets...................................... 1,135,572 Other assets........................................... 5,607,019 ----------- Total assets........................................... $64,536,926 ----------- -----------
LIABILITIES Deposits: In domestic offices................................. $26,488,980 Noninterest-bearing.......................10,626,811 Interest-bearing..........................15,862,169 In foreign offices, Edge and Agreement subsidiaries, and IBFs............................ 20,655,414 Noninterest-bearing..........................156,471 Interest-bearing..........................20,498,943 Federal funds purchased and Securities sold under agreements to repurchase............................ 3,729,439 Demand notes issued to the U.S.Treasury................ 257,860 Trading liabilities.................................... 1,987,450 Other borrowed money: With remaining maturity of one year or less......... 496,235 With remaining maturity of more than one year through three years............................... 465 With remaining maturity of more than three years.... 31,080 Bank's liability on acceptances executed and outstanding......................................... 822,455 Subordinated notes and debentures...................... 1,308,000 Other liabilities...................................... 2,846,649 --------- Total liabilities...................................... 58,624,027 ---------- ---------- EQUITY CAPITAL Common stock........................................... 1,135,284 Surplus................................................ 815,314 Undivided profits and capital reserves................. 4,001,767 Net unrealized holding gains (losses) on available-for-sale securities....................... (7,956) Cumulative foreign currency translation adjustments.... (31,510) ----------- Total equity capital................................... 5,912,899 ----------- Total liabilities and equity capital................... $64,536,926 ----------- -----------
I, Thomas J. Mastro, Senior Vice President and Comptroller of the above-named bank do hereby declare that this Report of Condition has been prepared in conformance with the instructions issued by the Board of Governors of the Federal Reserve System and is true to the best of my knowledge and belief. Thomas J. Mastro We, the undersigned directors, attest to the correctness of this Report of Condition and declare that it has been examined by us and to the best of our knowledge and belief has been prepared in conformance with the instructions issued by the Board of Governors of the Federal Reserve System and is true and correct. --- Thomas A. Reyni / Alan R. Griffith / Directors Gerald L. Hassell / --- - -------------------- ---------------------- ---------------------- EX-25.2 14 EXHIBIT 25.2 Exhibit 25.2 ================================================================================ FORM T-1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) |__| ---------- THE BANK OF NEW YORK (Exact name of trustee as specified in its charter) New York 13-5160382 (State of incorporation (I.R.S. employer if not a U.S. national bank) identification no.) One Wall Street, New York, N.Y. 10286 (Address of principal executive offices) (Zip code) ---------- INDEPENDENT CAPITAL TRUST II (Exact name of obligor as specified in its charter) Delaware Applied for (State or other jurisdiction of (I.R.S. employer incorporation or organization) identification no.) 288 Union Street Rockland, Massachusetts 02370 (Address of principal executive offices) (Zip code) ---------- Trust Preferred Securities (Title of the indenture securities) ================================================================================ 1. GENERAL INFORMATION. FURNISH THE FOLLOWING INFORMATION AS TO THE TRUSTEE: (a) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING AUTHORITY TO WHICH IT IS SUBJECT. - -------------------------------------------------------------------------------- Name Address - -------------------------------------------------------------------------------- Superintendent of Banks of the State of 2 Rector Street, New York, New York N.Y. 10006, and Albany, N.Y. 12203 Federal Reserve Bank of New York 33 Liberty Plaza, New York, N.Y. 10045 Federal Deposit Insurance Corporation Washington, D.C. 20429 New York Clearing House Association New York, New York 10005 (b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS. Yes. 2. AFFILIATIONS WITH OBLIGOR. IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH AFFILIATION. None. 16. LIST OF EXHIBITS. EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION, ARE INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO RULE 7A-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17 C.F.R. 229.10(d). 1. A copy of the Organization Certificate of The Bank of New York (formerly Irving Trust Company) as now in effect, which contains the authority to commence business and a grant of powers to exercise corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1 to Form T-1 filed with Registration Statement No. 33-29637.) 4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1 filed with Registration Statement No. 33-31019.) 6. The consent of the Trustee required by Section 321(b) of the Act. (Exhibit 6 to Form T-1 filed with Registration Statement No. 33-44051.) 7. A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority. -2- SIGNATURE Pursuant to the requirements of the Act, the Trustee, The Bank of New York, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of New York, and State of New York, on the 21st day of October, 1999. THE BANK OF NEW YORK By: /s/ MICHAEL CULHANE -------------------------- Name: MICHAEL CULHANE Title: VICE PRESIDENT Exhibit 7 - ------------------- --------------------- ---------------------- Consolidated Report of Condition of THE BANK OF NEW YORK of One Wall Street, New York, N.Y. 10286 And Foreign and Domestic Subsidiaries, a member of the Federal Reserve System, at the close of business June 30, 1999, published in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act.
ASSETS Dollar Amounts In Thousands Cash and balances due from depository institutions: Noninterest-bearing balances and currency and coin.. $ 5,597,807 Interest-bearing balances........................... 4,075,775 Securities: Held-to-maturity securities......................... 785,167 Available-for-sale securities....................... 4,159,891 Federal funds sold and Securities purchased under agreements to resell................................ 2,476,963 Loans and lease financing receivables: Loans and leases, net of unearned income...............38,028,772 LESS: Allowance for loan and lease losses............568,617 LESS: Allocated transfer risk reserve........................16,352 Loans and leases, net of unearned income, allowance, and reserve............................ 37,443,803 Trading Assets......................................... 1,563,671 Premises and fixed assets (including capitalized leases)............................................. 683,587 Other real estate owned................................ 10,995 Investments in unconsolidated subsidiaries and associated companies................................ 184,661 Customers' liability to this bank on acceptances outstanding......................................... 812,015 Intangible assets...................................... 1,135,572 Other assets........................................... 5,607,019 ----------- Total assets........................................... $64,536,926 ----------- -----------
LIABILITIES Deposits: In domestic offices................................. $26,488,980 Noninterest-bearing.......................10,626,811 Interest-bearing..........................15,862,169 In foreign offices, Edge and Agreement subsidiaries, and IBFs............................ 20,655,414 Noninterest-bearing..........................156,471 Interest-bearing..........................20,498,943 Federal funds purchased and Securities sold under agreements to repurchase............................ 3,729,439 Demand notes issued to the U.S.Treasury................ 257,860 Trading liabilities.................................... 1,987,450 Other borrowed money: With remaining maturity of one year or less......... 496,235 With remaining maturity of more than one year through three years............................... 465 With remaining maturity of more than three years.... 31,080 Bank's liability on acceptances executed and outstanding......................................... 822,455 Subordinated notes and debentures...................... 1,308,000 Other liabilities...................................... 2,846,649 --------- Total liabilities...................................... 58,624,027 ---------- ---------- EQUITY CAPITAL Common stock........................................... 1,135,284 Surplus................................................ 815,314 Undivided profits and capital reserves................. 4,001,767 Net unrealized holding gains (losses) on available-for-sale securities....................... (7,956) Cumulative foreign currency translation adjustments.... (31,510) ----------- Total equity capital................................... 5,912,899 ----------- Total liabilities and equity capital................... $64,536,926 ----------- -----------
I, Thomas J. Mastro, Senior Vice President and Comptroller of the above-named bank do hereby declare that this Report of Condition has been prepared in conformance with the instructions issued by the Board of Governors of the Federal Reserve System and is true to the best of my knowledge and belief. Thomas J. Mastro We, the undersigned directors, attest to the correctness of this Report of Condition and declare that it has been examined by us and to the best of our knowledge and belief has been prepared in conformance with the instructions issued by the Board of Governors of the Federal Reserve System and is true and correct. --- Thomas A. Reyni / Alan R. Griffith / Directors Gerald L. Hassell / --- - -------------------- ---------------------- ---------------------- EX-25.3 15 EXHIBIT 25.3 Exhibit 25.3 ================================================================================ FORM T-1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) |__| ---------- THE BANK OF NEW YORK (Exact name of trustee as specified in its charter) New York 13-5160382 (State of incorporation (I.R.S. employer if not a U.S. national bank) identification no.) One Wall Street, New York, N.Y. 10286 (Address of principal executive offices) (Zip code) ---------- INDEPENDENT BANK CORP. (Exact name of obligor as specified in its charter) Massachusetts 04-2870273 (State or other jurisdiction of (I.R.S. employer incorporation or organization) identification no.) 288 Union Street Rockland, Massachusetts 02370 (Address of principal executive offices) (Zip code) ---------- Guarantee of the Trust Preferred Securities of Independent Capital Trust II (Title of the indenture securities) ================================================================================ 1. GENERAL INFORMATION. FURNISH THE FOLLOWING INFORMATION AS TO THE TRUSTEE: (a) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING AUTHORITY TO WHICH IT IS SUBJECT. - -------------------------------------------------------------------------------- Name Address - -------------------------------------------------------------------------------- Superintendent of Banks of the State of 2 Rector Street, New York, New York N.Y. 10006, and Albany, N.Y. 12203 Federal Reserve Bank of New York 33 Liberty Plaza, New York, N.Y. 10045 Federal Deposit Insurance Corporation Washington, D.C. 20429 New York Clearing House Association New York, New York 10005 (b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS. Yes. 2. AFFILIATIONS WITH OBLIGOR. IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH AFFILIATION. None. 16. LIST OF EXHIBITS. EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION, ARE INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO RULE 7A-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17 C.F.R. 229.10(d). 1. A copy of the Organization Certificate of The Bank of New York (formerly Irving Trust Company) as now in effect, which contains the authority to commence business and a grant of powers to exercise corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1 to Form T-1 filed with Registration Statement No. 33-29637.) 4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1 filed with Registration Statement No. 33-31019.) 6. The consent of the Trustee required by Section 321(b) of the Act. (Exhibit 6 to Form T-1 filed with Registration Statement No. 33-44051.) 7. A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority. -2- SIGNATURE Pursuant to the requirements of the Act, the Trustee, The Bank of New York, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of New York, and State of New York, on the 21st day of October, 1999. THE BANK OF NEW YORK By: /s/ MICHAEL CULHANE -------------------------- Name: MICHAEL CULHANE Title: VICE PRESIDENT Exhibit 7 - ------------------- --------------------- ---------------------- Consolidated Report of Condition of THE BANK OF NEW YORK of One Wall Street, New York, N.Y. 10286 And Foreign and Domestic Subsidiaries, a member of the Federal Reserve System, at the close of business June 30, 1999, published in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act.
ASSETS Dollar Amounts In Thousands Cash and balances due from depository institutions: Noninterest-bearing balances and currency and coin.. $ 5,597,807 Interest-bearing balances........................... 4,075,775 Securities: Held-to-maturity securities......................... 785,167 Available-for-sale securities....................... 4,159,891 Federal funds sold and Securities purchased under agreements to resell................................ 2,476,963 Loans and lease financing receivables: Loans and leases, net of unearned income...............38,028,772 LESS: Allowance for loan and lease losses............568,617 LESS: Allocated transfer risk reserve........................16,352 Loans and leases, net of unearned income, allowance, and reserve............................ 37,443,803 Trading Assets......................................... 1,563,671 Premises and fixed assets (including capitalized leases)............................................. 683,587 Other real estate owned................................ 10,995 Investments in unconsolidated subsidiaries and associated companies................................ 184,661 Customers' liability to this bank on acceptances outstanding......................................... 812,015 Intangible assets...................................... 1,135,572 Other assets........................................... 5,607,019 ----------- Total assets........................................... $64,536,926 ----------- -----------
LIABILITIES Deposits: In domestic offices................................. $26,488,980 Noninterest-bearing.......................10,626,811 Interest-bearing..........................15,862,169 In foreign offices, Edge and Agreement subsidiaries, and IBFs............................ 20,655,414 Noninterest-bearing..........................156,471 Interest-bearing..........................20,498,943 Federal funds purchased and Securities sold under agreements to repurchase............................ 3,729,439 Demand notes issued to the U.S.Treasury................ 257,860 Trading liabilities.................................... 1,987,450 Other borrowed money: With remaining maturity of one year or less......... 496,235 With remaining maturity of more than one year through three years............................... 465 With remaining maturity of more than three years.... 31,080 Bank's liability on acceptances executed and outstanding......................................... 822,455 Subordinated notes and debentures...................... 1,308,000 Other liabilities...................................... 2,846,649 --------- Total liabilities...................................... 58,624,027 ---------- ---------- EQUITY CAPITAL Common stock........................................... 1,135,284 Surplus................................................ 815,314 Undivided profits and capital reserves................. 4,001,767 Net unrealized holding gains (losses) on available-for-sale securities....................... (7,956) Cumulative foreign currency translation adjustments.... (31,510) ----------- Total equity capital................................... 5,912,899 ----------- Total liabilities and equity capital................... $64,536,926 ----------- -----------
I, Thomas J. Mastro, Senior Vice President and Comptroller of the above-named bank do hereby declare that this Report of Condition has been prepared in conformance with the instructions issued by the Board of Governors of the Federal Reserve System and is true to the best of my knowledge and belief. Thomas J. Mastro We, the undersigned directors, attest to the correctness of this Report of Condition and declare that it has been examined by us and to the best of our knowledge and belief has been prepared in conformance with the instructions issued by the Board of Governors of the Federal Reserve System and is true and correct. --- Thomas A. Reyni / Alan R. Griffith / Directors Gerald L. Hassell / --- - -------------------- ---------------------- ---------------------- -----END PRIVACY-ENHANCED MESSAGE-----