Attached files
file | filename |
---|---|
8-K - FORM 8-K - Birmingham Bloomfield Bancshares | k50617e8vk.htm |
Exhibit 3.1
This is to Certify that the annexed copy has been compared by me with the record on file in this
Department and that the same is a true copy thereof.
This certificate is in due form, made by me as the proper officer, and is entitled to have full
faith and credit given it in every court and office within the United States.
In testimony whereof, I have hereunto
set my hand,
in the City of Lansing, this 26th day Of July, 2011
in the City of Lansing, this 26th day Of July, 2011
Director
Bureau
of Commercial Services
GOLD SEAL APPEARS ONLY ON ORIGINAL
JUL 26 2011
|
FILED JUL 26 2011 Administrator Bureau of Commercial Services |
CERTIFICATE OF DESIGNATION
OF
SENIOR NON-CUMULATIVE PERPETUAL PREFERRED STOCK, SERIES D
OF
OF
SENIOR NON-CUMULATIVE PERPETUAL PREFERRED STOCK, SERIES D
OF
BIRMINGHAM
BLOOMFIELD BANCSHARES, INC.
Birmingham Bloomfield Bancshares, Inc., a corporation organized and existing under the laws of
the Michigan (the Issuer), in accordance with the provisions of Section 302 of the
Michigan Business Corporation Act, does hereby certify:
The
board of directors of the Issuer (the Board of Directors) or an applicable committee of
the Board of Directors, in accordance with the articles of incorporation of the Issuer and
applicable law, adopted the following resolution on July 18, 2011 creating a series of 4,621 shares
of Preferred Stock of the Issuer designated as Senior Non-Cumulative Perpetual Preferred
Stock Series D.
RESOLVED, that pursuant to the provisions of the articles of incorporation and the bylaws of
the Issuer and applicable law, a series of Preferred Stock, par value no per share, of the Issuer
be and hereby is created, and that the designation and number of shares of such series, and the
voting and other powers, preferences and relative, participating, optional or other rights, and the
qualifications, limitations and restrictions thereof, of the shares of such series, are as follows:
Part 1. Designation and Number of Shares. There is hereby created out of the
authorized and unissued shares of preferred stock of the Issuer a series of preferred stock
designated as the Senior Non-Cumulative Perpetual Preferred Stock,
Series D (the Designed Preferred Stock). The authorized number of shares of
Designated Preferred Stock shall be 4,621.
Part 2.
Standard Provisions. The Standard Provisions contained in
Schedule A
attached hereto are incorporated herein by reference in their entirety and shall be deemed to be
a part of this [Certificate of Designation] to the same extent as if such provisions had been set
forth in full herein.
Part 3. Definitions. The following terms are used in this [Certificate of
Designation] (including the Standard Provisions in
Schedule A hereto) as defined below:
(a) Common Stock means the common stock, par value no per share, of
the Issuer.
(b) Definitive Agreement means that certain Securities Purchase
Agreement by and between Issuer and Treasury, dated as of the Signing Date.
(c) Junior Stock means the Common Stock, and any other class or series of stock of
the Issuer the terms of which expressly provide that it ranks junior to Designated
BAO.278967
SBLF Participant No. 0137
GOLD SEAL APPEARS ONLY ON ORIGINAL
Preferred Stock as to dividend and redemption, rights and/or as to rights on
liquidation,
dissolution or winding up of the Issuer.
(d) Liquidation Amount means $1,000 per share of Designated Preferred
Stock.
(e) Minimum Amount means (i) the amount equal to twenty-five percent
(25%) of the aggregate Liquidation Amount of Designated
Preferred Stock issued on the Original Issue Date or (ii) all of the outstanding Designated Preferred Stock, if the aggregate
liquidation preference of the outstanding Designated Preferred Stock is less than the
amount set forth in the preceding clause (i).
(f) Parity Stock means any class or series of stock
of the Issuer (other than
Designated Preferred Stock) the terms of which do not expressly provide that such
class or series
will rank senior or junior to Designated Preferred Stock as to dividend rights
and/or as to rights
on liquidation, dissolution or winding up of the Issuer (in each case without regard to whether dividends
accrue cumulatively or non-cumulatively). Without limiting the foregoing, Parity Stock shall include the
Issuers Fixed Rate Cumulative Preferred Stock, Series A, its Fixed Rate Cumulative
Preferred Stock, Series B, and its
Fixed Rate Cumulative Preferred Stock, Series C.
(g) Signing Date means July 28, 2011.
(h)
Treasury means the United States Department of the Treasury and any successor in interest thereto.
Part 4. Certain Voting Matters. Holders of shares of
Designated Preferred Stock will be entitled to one vote for each such share on any matter on which holders of Designated
Preferred Stock are entitled to vote, including any action by written
consent.
[Remainder of Page Intentionally Left Blank]
SBLF Participant No. 0137
GOLD SEAL APPEARS ONLY ON ORIGINAL
-2-
IN
WITNESS WHEREOF, Birmingham Bloomfield Bancshares, Inc. has caused
this Certificate of
Designation to be signed by Robert E. Farr, its President, this
19th day of
July, 2011.
BIRMINGHAM BLOOMFIELD BANCSHARES, INC. |
||||
By: | /s/ Robert E. Farr | |||
Name: | Robert E. Farr | |||
Title: | President | |||
SBLF
Participant No. 0137
GOLD
SEAL APPEARS ONLY ON ORIGINAL
Schedule A
STANDARD PROVISIONS
Section 1. General Matters. Each share of Designated Preferred Stock shall be
identical in all respects to every other share of Designated Preferred Stock. The Designated
Preferred Stock shall be perpetual, subject to the provisions of Section 5 of these Standard
Provisions that form a part of the Certificate of Designation. The Designated Preferred Stock
shall rank equally with Parity Stock and shall rank senior to Junior Stock with respect to
the payment of dividends and the distribution of assets in the event of any dissolution,
liquidation or winding up of the Issuer, as set forth below.
Section 2. Standard Definitions. As used herein with respect to Designated
Preferred Stock:
(a)
Acquiror, in any Holding Company Transaction, means the surviving or resulting
entity or its ultimate parent in the case of a merger or consolidation or the transferee in
the case of a sale, lease or other transfer in one transaction or a series of related
transactions of all or substantially all of the consolidated assets of the Issuer and its
subsidiaries, taken as a whole.
(b) Affiliate means, with respect to any person, any person directly or
indirectly controlling, controlled by or under common control with, such other person. For
purposes of this definition, control (including, with correlative meanings, the
terms controlled by and under common control with) when used with respect
to any person, means the possession, directly or indirectly through one or more
intermediaries, of the power to cause the direction of management and/or policies of such
person, whether through the ownership of voting securities by contract or otherwise.
(c) Applicable Dividend Rate has the meaning set forth in Section 3(a).
(d) Appropriate Federal Banking Agency means the appropriate Federal
banking agency with respect to the Issuer as defined in Section 3(q) of the Federal Deposit
Insurance Act (12 U.S.C. Section 1813(q)), or any successor provision.
(e) Bank Holding Company means a company registered as such with the Board
of Governors of the Federal Reserve System pursuant to 12 U.S.C. §1842 and the regulations of
the Board of Governors of the Federal Reserve System thereunder.
(f) Baseline means the Initial Small Business Lending Baseline set forth on
the Initial Supplemental Report (as defined in the Definitive Agreement), subject to
adjustment pursuant to Section 3(a).
(g) Business Combination means a merger, consolidation, statutory
share exchange or similar transaction that requires the approval of the Issuers stockholders.
SBLF
Participant No. 0137
GOLD
SEAL APPEARS ONLY ON ORIGINAL
A-1
(h) Business Day means any day except Saturday, Sunday and any day on
which banking institutions in the State of New York or the District of Columbia
generally are
authorized or required by law or other governmental actions to close.
(i) Bylaws means the bylaws of the Issuer, as they may be amended
from time to time.
(j) Call Report has the meaning set forth in the
Definitive Agreement.
(k) Certificate of Designation means the Certificate of Designation or
comparable instrument relating to the Designated Preferred Stock, of which these Standard
Provisions form a part, as it may be amended from time to time.
(1) Charge-Offs means the net amount of loans charged off by the Issuer or,
if the Issuer is a Bank Holding Company or a Savings and Loan Holding Company, by the IDI
Subsidiary(ies) during quarters that begin on or after the Signing Date, determined as
follows:
(i) if the Issuer or the applicable IDI Subsidiary is a bank, by subtracting
(A) the aggregate dollar amount of recoveries reflected on line RIAD4605 of its
Call Reports for such quarters from (B) the aggregate dollar amount of charge-offs
reflected on line RIAD4635 of its Call Reports for such quarters (without
duplication as a result of such dollar amounts being reported on a year-to-date
basis); or
(ii) if the Issuer or the applicable IDI Subsidiary is a thrift, by
subtracting (A) the sum of the aggregate dollar amount of recoveries reflected on
line VA140 of its Call Reports for such quarters and the aggregate dollar amount of
adjustments reflected on line VA150 of its Call Reports for such quarters from (B)
the aggregate dollar amount of charge-offs reflected on line VA160 of its Call
Reports for such quarters.
(m) Charter means the Issuers certificate or articles of incorporation,
articles of association, or similar organizational document.
(n) CPP Lending Incentive Fee has the meaning set forth in
Section 3(e).
(o) Current Period has the meaning set forth in Section 3(a)(1)(2).
(p)
Dividend Payment Date means January 1, April 1, July 1, and October 1 of each year.
(q) Dividend Period means the period from and including any Dividend
Payment Date to, but excluding, the next Dividend Payment Date; provided,
however, the initial
Dividend Period shall be the period from and including the Original Issue Date to, but
excluding,
the next Dividend Payment Date (the Initial Dividend
Period).
(r) Dividend Record Date has the meaning set forth in Section 3(b).
SBLF Participant No. 0137
GOLD SEAL APPEARS ONLY ON ORIGINAL
A-2
(s) Dividend Reference Period has the meaning set forth in Section 3(a)(i)(2).
(t) GAAP means generally accepted accounting principles in the United States.
(u)
Holding Company Preferred Stock has the meaning set forth in Section 7(c)(v).
(v) Holding Company Transaction means, the occurrence of (a) any transaction (including,
without limitation, any acquisition, merger or consolidation) the result of which is that a person
or group within the meaning of Section 13(d) of the Securities Exchange Act of 1934, as amended,
(i) becomes the direct or indirect ultimate beneficial owner, as defined in Rule 13d-3 under that
Act, of common equity of the Issuer representing more than 50% of the voting power of the
outstanding Common Stock or (ii) is otherwise required to consolidate the Issuer for purposes of
generally accepted accounting principles in the United States, or (b) any consolidation or merger
of the Issuer or similar transaction or any sale, lease or other transfer in one transaction or a
series of related transactions of all or substantially all of the consolidated assets of the
Issuer and its subsidiaries, taken as a whole, to any Person other than one of the Issuers
subsidiaries; provided that, in the case of either clause (a) or (b), the issuer or the Acquiror
is or becomes a Bank Holding Company or Savings and Loan Holding Company.
(w) IDI Subsidiary means any Issuer Subsidiary that is an insured depository institution.
(x) Increase in QSBL means:
(i) with respect to the first (1st) Dividend Period, the difference obtained by subtracting (A) the
Baseline from (B) QSBL set forth in the Initial Supplemental Report (as defined in the Definitive
Agreement); and
(ii) with respect to each subsequent Dividend Period, the difference obtained by subtracting (A)
the Baseline from (B) QSBL for the Dividend Reference Period for the Current Period.
(y) Initial Dividend Period has the meaning set forth in the definition of
Dividend Period .
(z) Issuer Subsidiary means any subsidiary of the Issuer.
(aa) Liquidation Preference has the meaning set forth in Section 4(a).
(bb)Non-Qualifying Portion Percentage means, with respect to any particular Dividend
Period, the percentage obtained by subtracting the Qualifying Portion
Percentage from one (1).
SBLF Participant No. 0137
GOLD SEAL APPEARS ONLY ON ORIGINAL
A-3
(cc)
Original Issue Date means the date on which shares of Designated Preferred Stock
are first issued.
(dd) Percentage Change in QSBL has the meaning set forth in Section
3(a)(ii).
(ee) Person means a legal person, including any individual, corporation, estate,
partnership, Joint venture, association, joint-stock company, limited liability company or trust.
(ff) Preferred Director has the meaning set forth in Section 7(c).
(gg)
Preferred Stock means any and all series of
preferred stock of the Issuer,
including the Designated Preferred Stock.
(hh) Previously Acquired Preferred Shares has the meaning set forth in the Definitive
Agreement.
(ii) Private Capital means, if the Issuer is Matching Private Investment Supported (as
defined in the Definitive Agreement), the equity capital received by the Issuer or the applicable
Affiliate of the Issuer from one or more non-governmental investors in accordance with Section 1.3(m) of the Definitive Agreement.
(jj)
Publicly-traded means a company that (i) has a class of securities that is traded on
a national securities exchange and (ii) is required to file periodic reports with either the
Securities and Exchange Commission or its primary federal bank regulator.
(kk) Qualified Small Business Lending or OSBL means, with respect to any
particular Dividend Period, the Quarter-End Adjusted Qualified Small Business Lending for such
Dividend Period set forth an the applicable Supplemental Report.
(ll) Qualifying Portion Percentage means, with respect to any particular Dividend Period,
the percentage obtained by dividing (i) the Increase in QSBL for such Dividend Period by (ii) the
aggregate Liquidation Amount of then-outstanding Designated Preferred Stock.
(mm) Savings and Loan Holding Company means a company registered as such with the Office
of Thrift Supervision pursuant to 12 U.S.C. §1467a(b) and the regulations of the Office of Thrift
Supervision promulgated thereunder.
(nn) Share Dilution Amount means the increase in the number of diluted shares outstanding
(determined in accordance with GAAP applied on a consistent basis, and as measured from the date of
the Issuers most recent consolidated financial statements prior
to the Signing, Data) resulting
from the grant, vesting or exercise of equity-based compensation to employees and equitably
adjusted for any stock split, stock dividend, reverse stock split, reclassification or similar
transaction.
(oo) Signing Date Tier 1 Capital Amount means $6,160,125.
SBLF Participant No. 0137
GOLD SEAL APPEARS ONLY ON ORIGINAL
A-4
(pp) Standard Provisions mean these Standard Provisions that form a part
of the Certificate of Designation relating to the Designated Preferred Stock.
(qq) Supplemental Report means a Supplemental Report delivered by the Issuer to
Treasury pursuant to the Definitive Agreement.
(rr) Tier 1 Dividend Threshold means, as of any particular date, the result of
the following formula:
((A + B C) * 0.9) D | |||
where: | |||
A = | Signing Date Tier 1 Capital Amount; | ||
B = | the aggregate Liquidation Amount of the Designated Preferred Stock issued to Treasury; | ||
C = | the aggregate amount of Charge-Offs since the Signing Date; and | ||
D = | (i) beginning on the first day of the eleventh (11th) Dividend Period, the amount equal to ten percent (10%) of the aggregate Liquidation Amount of the Designated Preferred Stock issued to Treasury as of the Effective Date (without regard to any redemptions of Designated Preferred Stock that may have occurred thereafter) for every one percent (1%) of positive Percentage Change in Qualified Small Business Lending between the ninth (9th) Dividend Period and the Baseline; and |
(ii) zero (0) at all other times. |
(ss) Voting Parity Stock means, with regard to any matter as to
which the holders of Designated Preferred Stock are entitled to vote as specified in
Section 7(d) of these Standard Provisions that form a part of the Certificate of
Designation, any and all series of Parity Stock upon which like voting rights have been
conferred and are exercisable with respect to such matter.
Section 3. Dividends.
(a) | Rate. |
(i) | The Applicable Dividend Rate shall be determined as follows: |
(1) | With respect to the Initial Dividend Period, the Applicable Dividend Rate shall be one percent (1%). |
SBLF Participant No. 0137
GOLD SEAL APPEARS ONLY ON ORIGINAL
A-5
(2) | With respect to each of the second (2nd) through the tenth (10th) Dividend Periods, inclusive (in each case, the Current Period), the Applicable Dividend Rate shall be: |
(A) (x) the applicable rate set forth in column A of the table in Section 3(a)(iii), based on
the Percentage Change in QSBL between the Dividend Period that was two Dividend Periods prior to
the Current Period (the Dividend Reference Period) and the Baseline, multiplied by (y)
the Qualifying Portion Percentage; plus
(B) (x) five percent (5%) multiplied by (y) the Non-Qualifying Portion Percentage.
In each such case, the Applicable Dividend Rate shall be determined at the time the Issuer delivers
a complete and accurate Supplemental Report to Treasury with respect to the Dividend Reference
Period.
(3) | With respect to the eleventh (11th) through the eighteenth (18th) Dividend Periods, inclusive, and that portion of the nineteenth (19th) Dividend Period prior to, but not including, the four and one half (4 1/2) year anniversary of the original Issue Date, the Applicable Dividend Rate shall be: |
(A)
(x) the applicable rate set forth in column B of the
table in Section 3 (a)(iii), based on the
Percentage Change in QSBL between the ninth (9th) Dividend Period and the Baseline, multiplied by
(y) the Qualifying Portion Percentage, calculated as of the last day of the ninth (9th) Dividend
Period; plus
(B) (x) five percent (5%) multiplied by (y) the Non-Qualifying Portion Percentage, calculated as of
the last day of the ninth (9th) Dividend Period.
In such case, the Applicable Dividend Rate shall be determined at the time the Issuer delivers a
complete and accurate Supplemental Report to Treasury with respect to the ninth (9th) Dividend
Period.
(4) | With respect to (A) that portion of the nineteenth (19th) Dividend Period beginning on the four and one half (4 1/2) year anniversary of the Original Issue Date and (B) all Dividend Period thereafter, the Applicable Dividend Rate shall be nine percent (9%). |
(5) | Notwithstanding anything herein to the contrary, if the Issuer fails to submit a Supplemental Report that is due during any of the second (2nd) through tenth (10th) |
SBLF Participant No. 0137
GOLD SEAL APPEARS ONLY ON ORIGINAL
A -6
Dividend Periods on or before the sixtieth (60th) day of such Dividend Period, the Issuers QSBL for the Dividend Period that would have been covered by such Supplemental Report shall be zero (0) for purposes hereof. |
(6) | Notwithstanding anything herein to the contrary, but subject to Section 3(a)(i)(5) above, if the Issuer fails to submit the Supplemental Report that is due during the tenth (10th) Dividend Period, the Issuers QSBL shall be zero (0) for purposes of calculating the Applicable Dividend Rate pursuant to Section 3(a)(i)(3) and (4). The Applicable Dividend Rate shall be re-determined effective as of the first day of the calendar quarter following the date such failure is remedied, provided it is remedied prior the four and one half (4½) anniversary of the Original Issue Date. | ||
(7) | Notwithstanding anything herein to the contrary, if the Issuer fails to submit any of the certificates required by Sections 3.1(d)(ii) or 3.1(d)(iii) of the Definitive Agreement when and as required thereby, the Issuers QSBL shall be zero (0) for purposes of calculating the Applicable Dividend Rate pursuant to Section 3(a)(i)(2) or (3) above until such failure is remedied. |
(ii) The
Percentage Change in Qualified Lending between any
given Dividend Period and the Baseline shall be
the result of the following formula, expressed as a percentage:
(iii) The following table shall be used for determining the Applicable Dividend Rate:
The Applicable Dividend Rate shall be | ||||
Column A | Column B | |||
(each of the | (11th 18th and | |||
If the Percentage Change in | 2nd 10th | the first part of the 19th, | ||
Qualified Lending is: | Dividend Periods) | Dividend Periods) | ||
0% or less |
5% | 7% | ||
More than 0%, but less than 2.5% |
5% | 5% | ||
2.5% or more, but less than 5% |
4% | 4% | ||
5% or more, but less than 7.5% |
3% | 3% | ||
7.5% or more, but less than 10% |
2% | 2% | ||
10% or more |
1% | 1% |
SBLF Participant No. 0137
GOLD SEAL APPEARS ONLY ON ORIGINAL
A-7
(iv)
If the Issuer consuminates a Business Combination, a purchase of loans or a purchase of
participations in loans and the Designated Preferred Stock remains outstanding thereafter, then
the Baseline shall thereafter be the Quarter-End Adjusted Small Business Lending Baseline set
forth on the Quarterly Supplemental Report (as defined in the Definitive Agreement).
(b) Payment Holders of Designated Preferred Stock shall be entitled to receive, on each share of
Designated Preferred Stock if, as and when declared by the Board of Directors or any duly
authorized committee of the Board of Directors, but only out of assets legally available
therefore, non-cumulative cash dividends with respect to:
(i) each Dividend Period (other than the Initial Dividend Period) at a rate equal to one-fourth
(¼) of the Applicable Dividend Rate with respect to each Dividend Period on the Liquidation
Amount per share of Designated Preferred Stock, and no more, payable quarterly in arrears on each
Dividend Payment Date, and
(ii) the Initial Dividend Period, on the first such Dividend Payment Date to occur at least twenty
(20) calendar days after the Original Issue Date, an amount equal to (A) the Applicable Dividend
Rate with respect to the Initial Dividend Period multiplied by (B) the number of days from the
Original Issue Date to the last day of the Initial Dividend Period
(inclusive) divided by 360.
In the event that any Dividend Payment Date would otherwise fall on a day that is not a Business
Day, the dividend payment due on that date will be postponed to the next day that is a Business Day
and no additional dividends will accrue as a result of that
postponement. For avoidance of doubt,
payable quarterly in arrears means that, with respect to any particular Dividend Period,
dividends begin accruing on the first day of such Dividend Period and
are payable on the first day
of the next Dividend Period.
The amount of dividends payable on Designated Preferred Stock on any date prior to the end of a
Dividend Period, and for the initial Dividend Period, shall be computed on the basis of a 360-day
year consisting of tour 90-day quarters, and actual days elapsed over
a 90-day quarter.
Dividends
that are payable on Designated Preferred Stock on any Dividend Payment Date will be
payable to holders of record of Designated Preferred Stock as they appear on the stock register of
the Issuer on the applicable record date, which shall be the 15th calendar day immediately
preceding such Dividend Payment Date or such other record date fixed by the Board of Directors or
any duly authorized committee of the Board of Directors that is not more than 60 nor less than 10
days prior to such Dividend Payment Date (each, a Dividend
Record Date). Any such day that is a
Dividend Record Date shall be a Dividend Record Date whether
or not such day is a Business Day.
Holders
of Designated Preferred Stock shall not be entitled to any dividends,
whether payable in cash, securities or other property, other than
dividends (if any) declared
and
SBLF
Participant No. 0137
GOLD
SEAL APPEARS ONLY ON ORIGINAL
A-8
payable on Designated Preferred Stock as specified in this Section 3 (subject to the other
provisions of the Certificate of Designation).
(c) Non-Cumulative. Dividends on shares of Designated Preferred Stock shall be
non-cumulative. If the Board of Directors or any duly authorized committee of the Board of Directors
does not declare a dividend on the Designated Preferred Stock in respect of any Dividend Period:
(i) the holders of Designated Preferred Stock shall have no right to receive any dividend for such
Dividend Period, and the Issuer shall have no obligation to pay a dividend for such Dividend
Period, whether or not dividends are declared for any subsequent Dividend Period with respect to
the Designated Preferred Stock; and
(ii) the Issuer shall, within five (5) calendar days, deliver to the holders of the Designated
Preferred Stock a written notice executed by the Chief Executive Officer and the Chief Financial
Officer of the Issuer stating the Board of Directors rationale
for not declaring dividends.
(d)
Priority of Dividends: Restrictions on Dividends.
(i)
Subject to Sections 3(d)(ii), (iii) and (v) and any restrictions imposed by the Appropriate
Federal Banking Agency or, if applicable, the Issuers state bank supervisor (as defined in Section
3(r) of the Federal Deposit Insurance Act (12 U.S.C. § 1813(q)), so long as any share of Designated
Preferred Stock remains outstanding, the Issuer may declare and pay dividends on the Common Stock,
any other shares of Junior Stock, or Parity Stock, in each case only if (A) after giving effect to
such dividend the Issuers Tier 1 capital would be at least equal to the Tier 1 Dividend Threshold,
and (B) full dividends on all outstanding shares of Designated Preferred Stock for the most
recently completed Dividend Period have been or are contemporaneously
declared and paid.
(ii) If a dividend is not declared and paid in full on the Designated Preferred Stock in respect
of any Dividend Period, then from the last day of such Dividend Period until the last day of the
third (3rd) Dividend Period immediately following it, no dividend or distribution shall be declared
or paid on the Common Stock or any other shares of Junior Stock (other than dividends payable
solely in shares of Common Stock) or Parity Stock, provided
however, that in any such Dividend
Period in which a dividend is declared and paid on the Designated Preferred Stock, dividends may be
paid on Parity Stock to the extent necessary to avoid any material breach of a covenant
by which the Issuer is bound.
(iii) When dividends have not been declared and paid in full for an aggregate of four (4) Dividend
Periods or more, and during such time the Issuer was not subject to a regulatory determination
that prohibits the declaration and payment of dividends, the Issuer shall, within five (5) calendar
days of each missed payment, deliver to the holders of the Designated Preferred Stock a
certificate executed by at least a majority of the Board of Directors stating that the Board of
Directors used its best efforts
SBLF
Participant No. 0137
GOLD SEAL APPEARS ONLY ON ORIGINAL
A-9
to declare and pay such dividends in a manner consistent with (A) safe and sound
banking practices and (B) the directors fiduciary obligations.
(iv) Subject to the foregoing and Section 3(e) below and not otherwise, such dividends (payable
in cash, securities or other property) as may be determined by the Board of Directors or any duly
authorized committee of the Board of Directors may be declared and paid on any securities,
including Common. Stock and other 3 junior Stock, from time to time out of any funds legally
available for such payment, and holders of Designated Preferred Stock shall not be entitled to
participate in any such dividends
(v) If the Issuer is not Publicly-Traded, then after. the tenth (10th) anniversary of the Signing
Date, so long as any share of Designated Preferred Stock remains outstanding, no dividend or
distribution shall be declared or paid. on the Common Stock or any other shares of Junior Stock
(other than dividends payable solely in shares of Common Stock) or Parity Stock
(e) Special Lending Incentive Fee Related to CPP. If Treasury held Previously Acquired
Preferred Shares immediately prior to the Original Issue Date and the Issuer did not apply to
Treasury to redeem such Previously Acquired Preferred Shares prior to December 16, 2010, and if the
Issuer a Supplemental Report with respect to the ninth (9th) Dividend Period reflects an amount of
Qualified Small Business Lending that is less than or equal to the Baseline (or if the Issuer fails
to timely file a Supplemental Report with respect to the ninth (9th) Dividend Period), then
beginning on July 1, 2014 and on. all Dividend Payment Dates thereafter ending on April 1, 2016,
the Issuer shall pay to the Holders of Designated Preferred Stock, on each share of Designated
Preferred Stock, but only out of assets legally available therefore, a fee equal to 05% of the
Liquidation Amount per share of Designated Preferred Stock
(CPP Lending Incentive Fee). All
references in Section 3(d) to dividends on the Designated Preferred Stock shall be deemed to
include the CPP Lending Incentive Fee.
Section 4 Liquidation Rights
(a)
Voluntary Involuntary Liquidation. In the event of any liquidation dissolution or
winding up of the affairs of the Issuer, whether voluntary or involuntary, holders of Designated
Preferred Stock shall be entitled to receive for each share of Designated Preferred Stock, out of
the assets of the Issuer or proceeds thereof (whether capital or surplus) available for
distribution to stockholders of the Issuer, subject to the rights of any creditors of the Issuer,
before any distribution of such assets or proceeds is made to or set aside for the holders of
Common Stock and any other stock of the Issuer ranking junior to Designated Preferred Stock as to
such distribution, payment in full in an amount equal to the sum of (i) the Liquidation Amount per
share and (ii) the amount of any accrued and unpaid dividends on each such share (such amounts
collectively, the Liquidation Preference)
(b)
Partial Payment If in any distribution described in Section 4(a) above the assets of the
Issuer or proceeds thereof are not sufficient to pay in full the amounts payable with
respect to all outstanding shares of Designated Preferred Stock and the corresponding amounts
payable with respect of any other stock of the Issuer ranking equally with Designated Preferred
stock as to such distribution, holders of Designated Preferred Stock and the holders of such other
SBLF Participant No. 0137
GOLD SEAL APPEARS ONLY ON ORIGINAL
A-10
stock
shall share ratably in any such distribution in proportion to the full respective distributions to which
they are entitled
(c) Residual
Distributions. If the Liquidation Preference has been paid in full to all
holders of Designated Preferred Stock and the corresponding amounts payable with respect of any
other stock of the Issuer ranking equally with Designated Preferred Stock as to such distribution
has been paid in full, the holders of other stock of the Issuer shall be entitled to receive all
remaining assets of the Issuer (or proceeds thereof) according to their respective rights and
preferences.
(d) Merger, Consolidation and Sale of Assets Is Not Liquidation. For purposes of this
Section 4, the merger or consolidation of the Issuer with any other corporation or other entity,
including a merger or consolidation in which the holders of Designated Preferred Stock receive
cash, securities or other property for their shares, or the sale, lease or exchange (for cash,
securities or other property) of all or substantially all of the assets of the Issuer, shall not
constitute a liquidation, dissolution or winding up of the Issuer.
Section 5.
Redemption.
(a) Optional
Redemption.
(i) Subject
to the other provisions of this Section 5.
(1) | The Issuer, at its option, subject to the approval of the Appropriate Federal Banking Agency, may redeem, in whole or in part, at any time and from time to time, out of funds legally available therefore, the shares of Designated Preferred Stock at the time outstanding, and | ||
(2) | If, after the Signing Date, there is a change in law that modifies the terms of Treasurys investment in the Designated Preferred Stock or the terms of Treasurys Small Business Lending Fund program in a materially adverse respect for the Issuer, the Issuer may, after consultation with the Appropriate Federal Banking Agency, redeem all of the shares of Designated Preferred Stock at the time outstanding. |
(ii) The
per-share redemption price for shares of Designated Preferred Stock shall be equal to the
sum of:
(1) | the Liquidation Amount per share, | ||
(2) | the per-share amount of any unpaid dividends for the then current Dividend Period at the Applicable Dividend Rate to, but excluding, the date fixed for redemption (regardless of whether any dividends are actually declared for that Dividend Period; and |
SBLF Participant No. 0137
GOLD SEAL APPEARS ONLY ON ORIGINAL
A-11
(3) the pro rata amount of CPP Leading Incentive Fees for the current Dividend Period.
The redemption price for any shares of Designated Preferred Stock shall be payable on the
redemption date to the holder of such shares against surrender of the certificate(s) evidencing
such shares to the Issuer or its agent. Any declared but unpaid dividends for the then current
Dividend Period payable on a redemption date that occurs subsequent to the Dividend Record Date
for a Dividend Period shall not be paid to the holder entitled to receive the redemption price on
the redemption date, but rather shall be paid to the holder of record of the redeemed shares on
such Dividend Record Date relating to the Dividend Payment Date as
provided in Section 3 above.
(b)
No Sinking Fund. The Designated Preferred Stock will not be subject to any
mandatory redemption, sinking fund or other similar provisions. Holders of Designated Preferred
Stock will have no right to require redemption or repurchase of any shares of Designated Preferred
Stock.
(c) Notice of Redemption. Notice of every redemption of shares of Designated Preferred
Stock shall be given by first class mail, postage prepaid, addressed to the holders of record of
the shares to be redeemed at their respective last addresses
appearing on the books of the Issuer.
Such mailing shall be at least 30 days and not more than 60 days before the date fixed for
redemption. Any notice mailed as provided in this Subsection shall be conclusively presumed to have
been duly given, whether or not the holder receives such notice, but failure duly to give such
notice by mail, or any defect in such notice or in the mailing thereof, to any holder of shares of
Designated Preferred Stock designated for redemption shall not affect the validity of the
proceedings for the redemption of any other shares of Designated
Preferred Stock. Notwithstanding
the foregoing, if shares of Designated Preferred Stock are issued in book-entry form through The
Depository Trust Company or any other similar facility, notice of redemption may be given to the
holders of Designated Preferred Stock at such time and in any manner
permitted by such facility.
Each notice of redemption given to a holder shall state: (1) the
redemption date; (2) the number of
shares of Designated Preferred Stock to be redeemed and, if less than all the shares held by such
holder are to be redeemed, the number of such shares to be redeemed
from such holder; (3) the
redemption price; and (4) the place or place where certificates for such shares are to be
surrendered for payment of the redemption price.
(d) Partial Redemption. In case of any redemption of part of the shares of Designated
Preferred Stock at the time outstanding, the shares to be redeemed
shall be selected either pro
rata or in such other manner as the Board of Directors or a duly authorized committee thereof may
determine to be fair and equitable, but in any event the shares to be redeemed shall not be less
than the Minimum Amount Subject to the provisions hereof, the Board of Directors or a duly
authorized committee thereof shall have full power and authority to prescribe the terms and
conditions upon which shares of Designated Preferred Stock shall be
redeemed from time to time,
subject to the approval of the Appropriate Federal Banking Agency. If fewer than all the shares
represented by any certificate are redeemed, a new certificate shall be issued representing the unredeemed shares
without charge to the holder thereof.
SBLF Participant No. 0137
GOLD SEAL APPEARS ONLY ON ORIGINAL
A-12
(e) Effectiveness
of Redemption. If notice of redemption has been duly given and if on
or before the redemption date specified in the notice all funds necessary for the redemption have
been deposited by the Issuer, in trust for the pro rata benefit of the holders of the shares called
for redemption, with a bank or trust company doing business in the
Borough of Manhattan, The City of
New York, and having a capital and surplus of at least
$500 million and selected by the Board of
Directors, so as to be and continue to be available solely therefor,
then, notwithstanding that
any certificate for any share so called for redemption has not been surrendered for cancellation,
on and after the redemption date dividends shall cease to accrue on all shares so called for
redemption, all shares so called for redemption shall no longer be
deemed outstanding and all
rights with respect to such shares shall forthwith on such redemption
date cease and terminate, except
only the right of the holders thereof to receive the amount payable on such redemption from such
bank or trust company, without interest. Any funds unclaimed at the end of three years from the
redemption date shall, to the extent permitted by law, be released to the Issuer, after which time
the holders of the shares so called for redemption shall look only to the Issuer for payment of the
redemption price of such shares.
(f) Status
of Redeemed Shares. Shares of Designated Preferred Stock that are redeemed,
repurchased or otherwise acquired by the Issuer shall revert to authorized but unissued shares of
Preferred Stock (provided that any such cancelled shares of Designated Preferred Stock may be
reissued only as shares of any series of Preferred Stock other than Designated Preferred Stock).
Section 6.
Conversion. Holders of Designated Preferred Stock shares shall have no right
to exchange or convert such shares into any other securities.
Section 7.
Voting Rights.
(a) General. The holders of Designated Preferred Stock shall not have any voting
rights except as set forth below or as otherwise from time to time
required by law.
(b) Board Observation Rights. Whenever, at any time or times, dividends on the shares of
Designated Preferred Stock have not been declared and paid in fall within five (5) Business Days
after each Dividend Payment Date for an aggregate of five (5) Dividend Periods or more, whether or
not consecutive, the Issuer shall invite a representative selected by the holders of a majority of
the outstanding shares of Designated Preferred Stock, voting as a single class, to attend all
meetings of its Board of Directors in a nonvoting observer capacity
and, in this respect, shall give
such representative copies of all notices, minutes, consents, and other materials that it provides to
its directors in connection with such meetings; provided, that the holders of the Designated
Preferred Stock shall not be obligated to select such a representative, nor shall such
representative, if selected, be obligated to attend any meeting to which he/she is invited. The
rights of the holders of the Designated Preferred Stock set forth in this Section 7(b) shall
terminate when full dividends have been timely paid on the Designated Preferred Stock for at least
four consecutive Dividend Periods, subject to revesting in the event of each and every subsequent
default of the character above mentioned.
(c)
Preferred Stock Directors. Whenever, at any time or times, (i) dividends on the
shares of Designated Preferred Stock have not been declared and paid in full within five
SBLF
Participant No. 0137
GOLD SEAL APPEARS ONLY ON ORIGINAL
A-13
(5) Business Days after each Dividend Payment Date for an aggregate of six (6) Dividend Periods
or more, whether or not consecutive, and (ii) the aggregate liquidation preference of the
then-outstanding shares of Designated Preferred Stock is greater than or equal to $25,000,000, the
authorized number of directors of the Issuer shall automatically be increased by two and the
holders of the Designated Preferred Stock, voting as a single class, shall have the right, but not
the obligation, to elect two directors (hereinafter the Preferred Directors and each a
Preferred Director) to fill such newly created directorships at the Issuers next annual
meeting of stockholders (or, if the next annual meeting is not yet scheduled or is scheduled to
occur more than thirty days later, the President of the Company shall promptly call a special
meeting for that purpose) and at each subsequent annual meeting of stockholders until full
dividends have been timely paid on the Designated Preferred Stock for at least four consecutive
Dividend Periods, at which time such right shall terminate with respect to the Designated Preferred
Stock, except as herein or by law expressly provided, subject to revesting in the event of each and
every subsequent default of the character above mentioned; provided that it shall be a
qualification for election for any Preferred Director that the election of such Preferred Director
shall not cause the Issuer to violate any corporate governance requirements of any securities
exchange or other trading facility on which securities of the Issuer may then be listed or traded
that listed or traded companies must have a majority of independent directors. Upon any termination
of the right of the holders of shares of Designated Preferred Stock to vote for directors as
provided above, the Preferred Directors shall cease to be qualified as directors, the term of
office of all Preferred Directors then in office shall terminate immediately and the authorized
number of directors shall be reduced by the number of Preferred Directors elected pursuant hereto.
Any Preferred Director may be removed at any time, with or without cause, and any vacancy created
thereby may be filled, only by the affirmative vote of the holders a majority of the shares of
Designated Preferred Stock at the time outstanding voting separately as a class. If the office of
any Preferred Director becomes vacant for any reason other than removal from office as aforesaid,
the holders of a majority of the outstanding shares of Designated Preferred Stock, voting as a
single class, may choose a successor who shall hold office for the unexpired term in respect
of which such vacancy occurred.
(d) Class Voting Rights as to Particular Matters. So long as any shares of Designated
Preferred Stock are outstanding, in addition to any other vote or consent of stockholders required
by law or by the Charter, the written consent of (x) Treasury if Treasury holds any shares of
Designated Preferred Stock, or (y) the holders of a majority of the outstanding shares of
Designated Preferred Stock, voting as a single class, if Treasury does not hold any shares of
Designated Preferred Stock, shall be necessary for effecting or validating:
(i) Authorization of Senior Stock. Any amendment or alteration of the
Certificate of Designation for the Designated Preferred Stock or the Charter to authorize
or create or increase the authorized amount of, or any issuance of, any shares of, or any
securities convertible into or exchangeable or exercisable for shares of, any class or
series of capital stock of the Issuer ranking senior to Designated Preferred Stock with
respect to either or both the payment of dividends and/or the distribution of assets on any
liquidation, dissolution or winding up of the Issuer;
(ii)
Amendment of Designated Preferred Stock. Any amendment, alteration
or repeal of any provision of the Certificate of Designation for the Designated
SBLF
Participant No. 0137
GOLD SEAL APPEARS ONLY ON ORIGINAL
A-14
Preferred Stock or the Charter (including, unless no vote on such merger or consolidation is
required by Section 7(d)(iii) below, any amendment, alteration
or repeal by means of a merger, consolidation or otherwise) so
adversely, affect the rights, preferences, privileges or voting powers of the Designated Preferred
Stock;
(iii) Share Exchanges Reclassifications, Mergers and Consolidations. Subject to Section
7(d)(v) below, any consummation of a binding share exchange or reclassification involving the
Designated Preferred Stock, or of a merger or consolidation of the Issuer with another corporation
or other entity, unless in each case (X) the shares of Designated Preferred Stock remain
outstanding or, in the case of any such merger or consolidation with respect to which the Issuer is
not the surviving or resulting entity, are converted into or its
ultimate parent, and (y) such shares remaining outstanding or
such preference securities, as the case may be, have such rights,
preferences, privileges and voting, powers, and limitations and restrictions thereof that are the
same as the rights, preferences, privileges and voting powers, and limitations and restrictions
thereof, of Designated Preferred Stock immediately prior to such
consummation, taken as a whole;
provided that in all cases; the obligations of the Issuer are assumed (by operation of law or by
express written assumption) by the resulting entity or its ultimate parent;
(iv) Certain Asset Sales. Any sale of all, substantially all, or any material portion of,
the assets of the Company, if the Designated Preferred Stock will not be redeemed in full
contemporaneously with the consummation of such sale; and
(v) Holding Company Transactions. Any consummation of a Holding Company Transaction, unless
as a result of the Holding Company Transaction each share of Designated Preferred Stock shall be
converted into or exchanged for one share with an equal liquidation preference of preference
securities of the Issuer or the Acquiror (the Holding
Company Preferred Stock). Any such Holding
Company Preferred Stock shall entitle holders thereof to dividends from the date of issuance of such
Holding Company Preferred Stock on terms that are equivalent to the terms set forth herein, and
shall have such other rights, preferences, privileges and voting powers, and limitations and
restrictions thereof that are the same as the rights, preferences, privileges and voting powers, and
limitations and restrictions thereof, of Designated Preferred Stock immediately prior to such
conversion or exchange, taken as a whole;
provided, however, that for all purposes of this Section 7(d), any increase in the amount of the
authorized Preferred Stock, including any increase in the authorized amount of Designated
Preferred Stock necessary to satisfy preemptive or similar rights
granted by the Issuer to other
persons prior to the Signing Date, or the creation and issuance, or an increase in the authorized
or issued amount, whether pursuant to preemptive or similar rights or otherwise, of any other
series of Preferred Stock, or any securities convertible into or exchangeable or exercisable for
any other series of Preferred Stock, ranking equally with and/or junior to Designated Preferred
Stock with respect to the payment of dividends (whether such
dividends adversely are cumulative or
non-cumulative) and the distribution of assets upon liquidation,
dissolution or winding up of the
Issuer will not be deemed to affect the rights, preferences, privileges of voting powers, and shall
not
SBLF
Participant No. 0137
GOLD SEAL APPEARS ONLY ON ORIGINAL
A-15
require
the affirmative vote or consent of, the holders of outstanding shares of the
Designated Preferred Stock.
(e)
Changes after Provision for Redemption. No vote or consent of the holders of
Designated Preferred Stock shall be required pursuant to Section 7(d)
above if, at or prior to the time
when any such vote or consent would otherwise be required pursuant to such Section, all outstanding
shares of the Designated Preferred Stock shall have been redeemed, or
shall have been called for
redemption upon proper notice and sufficient funds shall have been
deposited in trust for such
redemption, in each case pursuant to Section 5 above.
(f)
Procedures for Voting and Consents. The rules and procedures for calling and
conducting any meeting of the holders of Designated Preferred Stock
(including, without limitation, the fixing of a record date in
connection therewith), the solicitation and use of proxies at such a
meeting, the obtaining of written consents and any other aspect or
matter with regard to such a
meeting or such consents shall be governed by any rules of the Board of Directors or any duly
authorized committee of the Board of Directors, in its discretion,
may adopt from time to time,
which rules and procedures shall conform to the requirements of the
Charter, the Bylaws, and
applicable law and the rules of any national securities exchange or other trading facility on winch
Designated Preferred Stock is listed or traded at the time.
Section 8.
Restriction on Redemptions and Repurchases.
(a) Subject
to Sections 8(b) and (c), so long as any share of Designated Preferred Stock remains
outstanding, the Issuer may repurchase or redeem any shares of Capital Stock (as defined below), in
each case only if (i) after giving effect to such dividend, repurchase or redemption, the Issuers
Tier 1 capital would be at least equal to the Tier 1 Dividend
Threshold and (ii) dividends on all
outstanding shares of Designated Preferred Stock for the most recently completed Dividend Period
have been or are contemporaneously declared and paid (or have been declared and a sum sufficient
for the payment thereof has been set aside for the benefit of the holders of shares of Designated
Preferred Stock on the applicable record date).
(b) If a dividend is not declared and paid on the Designated Preferred Stock in respect of any
Dividend Period, then from the last day of such Dividend Period until
the last day of the third
(3rd) Dividend Period immediately following it, neither the Issuer nor any Issuer Subsidiary shall,
redeem, purchase or acquire any shares of Common Stock, Junior Stock, Parity Stock or other capital
stock or other equity securities of any kind of the Issuer or any Issuer Subsidiary, or any trust
preferred securities issued by the Issuer or any Affiliate of the
Issuer (Capital Stock), (other
than (i) redemptions, purchases, repurchases or other acquisitions of the Designated Preferred
Stock and (ii) repurchases of Junior Stock or Common Stock in connection with the administration of
any employee benefit plan in the ordinary course of business (including purchases to offset any
Share Dilution Amount pursuant to a publicly announced repurchase plan) and consistent -with past
practice, provided that any purchases to offset the Share Dilution Amount shall in
no event exceed the Share Dilution Amount, (iii) the acquisition by the issuer or any of the Issuer
Subsidiaries of record ownership in Junior Stock or Parity stock for the beneficial ownership of
any other persons (other than the Issuer or any other issuer subsidiary) including as trustees or
custodians, (iv) the exchange or conversion of Junior Stock for or into other Junior Stock or of
Parity Stock or trust preferred securities for or into other
SBLF Participant No. 0137
GOLD SEAL APPEARS ONLY ON ORIGINAL
A-16
Parity
Stock (with the same or lesser aggregate liquidation amount) or Junior Stock, in each
case set forth in this clause (iv), solely to the extent required pursuant to binding contractual
agreements entered into prior to the Signing Date or any subsequent agreement for the
accelerated exercise, settlement or exchange thereof for Common Stock, (v) redemptions of
securities held by the Issuer or any wholly-owned Issuer Subsidiary or (vi) redemptions purchases
or other acquisitions of capital stock or other equity securities of any kind of any Issuer
Subsidiary required pursuant to binding contractual agreements entered into prior to (x) if
Treasury held Previously Acquired Preferred Shares immediately prior to the Original Issue Date,
the original issue date of such Previously Acquired Preferred Shares, or (y) otherwise, the Signing
Date).
(c) If
the Issuer is not Publicly-Traded, then after the tenth (10th) anniversary of the Signing
Date, so long as any share of Designated Preferred Stock remains outstanding, no Common Stock,
Junior Stock or Parity Stock shall be, directly or indirectly, purchased, redeemed or otherwise
acquired for consideration by the Issuer or any of its subsidiaries.
Section 9. No Preemptive Rights. No share of Designated Preferred Stock shall have any rights of
preemption whatsoever as to any securities of the Issuer, or any warrants, rights or options issued
or granted with respect thereto, regardless of how such securities, or such warrants, rights or
options, may be designated, issued or granted.
Section 10. References to Line Items of Supplemental Reports. If Treasury modifies the form of
Supplemental Report, pursuant to its rights under the Definitive Agreement, and any such
modification includes a change to the caption or number of any line item on the Supplemental
Report, then any reference herein to such line item shall thereafter be a reference to such
re-captioned or re-numbered line item.
Section 11.
Record Holders. To the fullest extent permitted by applicable law, the issuer and the
transfer agent for Designated Preferred Stock may deem and treat the record holder of any share of
Designated Preferred Stock as the true and lawful owner thereof for all purposes, and neither the
Issuer nor such transfer agent shall be affected by any notice to the
contrary.
Section 12. Notices. All notices or communications in respect of Designated Preferred Stock shall be
sufficiently given if given in writing and delivered in person or by first class mail, postage
prepaid, or if given in such other manner as may be permitted in this Certificate of Designation,
in the Charter or Bylaws or by applicable law. Notwithstanding the foregoing, if shares of
Designated Preferred Stock are issued in book-entry form through The Depository Trust Company or
any similar facility, such notices may be given to the holders of Designated Preferred Stock any
manner permitted by such facility.
Section 13. Replacement Certificates. The Issuer shall replace any mutilated certificate at the holders expense upon
surrender of that certificate to the Issuer. The Issuer shall replace certificates
that become destroyed, stolen or lost at the holders expense
upon delivery to the Issuer of reasonably satisfactory
evidence that the certificate has been destroyed, stolen, or lost,
together with any indemnity that may be reasonably
required by the Issuer.
SBLF Participant No 0137
GOLD SEAL APPEARS ONLY ON ORIGINAL
A-17
Section 14. Other Rights. The shares of Designated Preferred Stock shall not have any rights,
preferences, privileges or voting powers or relative, participating, optional or other special
rights, or qualifications, limitations or restrictions thereof, other than as set forth herein or
in the Charter or as provided by applicable law.
SBLF
Participant No. 0137
GOLD SEAL APPEARS ONLY ON ORIGINAL
A-18