Email Address:
  
  Password:
  
  

Exhibit 4.1

 


 

 

AMENDED AND RESTATED DECLARATION

 

OF TRUST

 

FIRST UNITED STATUTORY TRUST III

 

Dated as of December 30, 2009

 

 


 

TABLE OF CONTENTS

(continued)

 

ARTICLE I

DEFINED TERMS

 

SECTION 1.1.

Definitions 

1

 

ARTICLE II

ESTABLISHMENT OF THE TRUST

 

SECTION 2.1.

Name 

9

 

SECTION 2.2.

Office of the Delaware Trustee; Principal Place of Business 

9

 

SECTION 2.3.

Initial Contribution of Trust Property; Organizational Expenses 

9

 

SECTION 2.4.

Issuance of the Preferred Securities 

9

 

SECTION 2.5.

Issuance of Common Securities; Subscription and Purchase of the Debentures 

10

 

SECTION 2.6.

Declaration of Trust 

10

 

SECTION 2.7.

Authorization to Enter Into Certain Transactions 

10

 

SECTION 2.8.

Assets of the Trust 

13

 

SECTION 2.9.

Title to Trust Property 

13

 

ARTICLE III

PAYMENT ACCOUNT

 

SECTION 3.1.

Payment Account 

14

 

ARTICLE IV

DISTRIBUTIONS; REDEMPTION

 

SECTION 4.1.

Distributions 

14

 

SECTION 4.2.

Redemption 

15

 

SECTION 4.3.

Subordination of the Common Securities 

17

 

SECTION 4.4.

Payment Proceedings 

17

 

SECTION 4.5.

Tax Returns and Reports 

17

 

SECTION 4.6.

Payment of Taxes, Duties, Etc. of the Trust 

18

 

SECTION 4.7.

Payments Under the Indenture 

18

 

i


 

TABLE OF CONTENTS

(continued)

 

ARTICLE V

THE TRUST SECURITIES CERTIFICATES

 

SECTION 5.1.

Initial Ownership 

18

 

SECTION 5.2.

The Trust Securities Certificates 

18

 

SECTION 5.3.

Execution, Authentication and Delivery of the Trust Securities Certificates 

18

 

SECTION 5.4.

Registration of Transfer and Exchange of the Preferred Securities Certificates 

19

 

SECTION 5.5.

Mutilated, Destroyed, Lost or Stolen Trust Securities Certificates20

 

SECTION 5.6.

Persons Deemed the Securityholders 

20

 

SECTION 5.7.

Access to List of the Securityholders’ Names and Addresses 

20

 

SECTION 5.8.

Maintenance of Office or Agency 

21

 

SECTION 5.9.

Appointment of the Paying Agent 

21

 

SECTION 5.10.

Ownership of the Common Securities by the Depositor 

22

 

SECTION 5.11.

The Trust Securities Certificates 

22

 

SECTION 5.12.

Notices 

22

 

SECTION 5.13.

Rights of the Securityholders 

22

 

ARTICLE VI

ACTS OF THE SECURITYHOLDERS; MEETINGS; VOTING

 

SECTION 6.1.

Limitations on Voting Rights 

23

 

SECTION 6.2.

Notices of Meetings 

24

 

SECTION 6.3.

Meetings of the Preferred Securityholders 

24

 

SECTION 6.4.

Voting Rights 

24

 

SECTION 6.5.

Proxies, Etc. 

24

 

SECTION 6.6.

Securityholder Action by Written Consent 

25

 

SECTION 6.7.

Record Date for Voting and Other Purposes 

25

 

ii


 

TABLE OF CONTENTS

(continued)

 

SECTION 6.8.

Acts of the Securityholders 

25

 

SECTION 6.9.

Inspection of Records 

26

 

ARTICLE VII

REPRESENTATIONS AND WARRANTIES

 

SECTION 7.1.

Representations and Warranties of the Bank and the Property Trustee 

26

 

SECTION 7.2.

Representations and Warranties of the Delaware Bank and the Delaware Trustee 

27

 

SECTION 7.3.

Representations and Warranties of the Depositor 

28

 

ARTICLE VIII

TRANSFER OF INTERESTS

 

SECTION 8.1.

General 

29

 

SECTION 8.2.

Transfer Procedures and Restrictions 

30

 

SECTION 8.3.

Deemed Security Holders 

31

 

SECTION 8.4.

Depositor Exchange 

31

 

ARTICLE IX

TRUSTEES

 

SECTION 9.1.

Certain Duties and Responsibilities 

32

 

SECTION 9.2.

Certain Notices 

34

 

SECTION 9.3.

Certain Rights of the Property Trustee 

34

 

SECTION 9.4.

Trustees’ Disclaimer 

36

 

SECTION 9.5.

May Hold Securities 

36

 

SECTION 9.6.

Compensation; Indemnity; Fees 

36

 

SECTION 9.7.

Corporate Property Trustee Required; Eligibility of Trustees 

37

 

SECTION 9.8.

Conflicting Interests 

38

 

SECTION 9.9.

Co-Trustees and Separate Trustees 

38

 

SECTION 9.10.

Resignation and Removal; Appointment of Successor 

39

 

SECTION 9.11.

Acceptance of Appointment by Successor 

40

 

iii


 

TABLE OF CONTENTS

(continued)

 

SECTION 9.12.

Merger, Conversion, Consolidation or Succession to Business 

41

 

SECTION 9.13.

Preferential Collection of Claims Against the Depositor or the Trust 

41

 

SECTION 9.14.

Property Trustee May File Proofs of Claim 

41

 

SECTION 9.15.

Reports to the Property Trustee and to Securityholders 

42

 

SECTION 9.16.

Evidence of Compliance with Conditions Precedent 

42

 

SECTION 9.17.

Number of Trustees 

42

 

SECTION 9.18.

Delegation of Power 

43

 

SECTION 9.19.

Voting 

43

 

ARTICLE X

TERMINATION, LIQUIDATION AND MERGER

 

SECTION 10.1.

Dissolution Upon Expiration Date 

43

 

SECTION 10.2.

Early Dissolution 

43

 

SECTION 10.3.

Termination 

44

 

SECTION 10.4.

Liquidation 

44

 

SECTION 10.5.

Mergers, Consolidations, Amalgamations or Replacements of the Trust 

45

 

ARTICLE XI

MISCELLANEOUS PROVISIONS

 

SECTION 11.1.

Limitation of Rights of the Securityholders 

46

 

SECTION 11.2.

Amendment 

46

 

SECTION 11.3.

Separability 

47

 

SECTION 11.4.

Governing Law 

48

 

SECTION 11.5.

Payments Due on Non-Business Day 

48

 

SECTION 11.6.

Successors 

48

 

SECTION 11.7.

Headings 

48

 

SECTION 11.8.

Reports, Notices and Demands 

48

 

iv


 

TABLE OF CONTENTS

(continued)

 

SECTION 11.9.

Agreement Not to Petition 

49

 

SECTION 11.10.

Trust Indenture Act; Conflict with Trust Indenture Act 

49

 

SECTION 11.11.

Acceptance of Terms of the Declaration, the Guarantee and the Indenture 

50

 

SECTION 11.12.

Counterparts 

50

 

v


 

 

EXHIBITS

 

EXHIBIT A                                Form of Common Security Certificate

EXHIBIT B                                Form of Preferred Security Certificate

 

vi



 

AMENDED AND RESTATED DECLARATION OF TRUST

 

AMENDED AND RESTATED DECLARATION OF TRUST (this “Declaration”), dated and effective as of December 30, 2009, by (a) FIRST UNITED CORPORATION, a Maryland corporation (including any successors and assigns, the “Depositor”), (b) WILMINGTON TRUST COMPANY, a banking corporation duly organized and existing under the laws of Delaware, as property trustee (the “Property Trustee” and, in its separate corporate capacity and not in its capacity as Property Trustee, the “Bank”), (c) WILMINGTON TRUST COMPANY, a banking corporation duly organized and existing under the laws of the State of Delaware, as Delaware trustee (the “Delaware Trustee,” and, in its separate corporate capacity and not in its capacity as Delaware Trustee, the “Delaware Bank”), (d) WILLIAM B. GRANT, an individual, CARISSA L. RODEHEAVER, an individual, and TONYA K. STURM, an individual, each of whose address is c/o First United Corporation, 19 South Second Street, Oakland, Maryland 21550 (each an “Administrative Trustee” and collectively the “Administrative Trustees”) (the Property Trustee, the Delaware Trustee and the Administrative Trustees are collectively referred to herein as the “Trustees”), and (e) the several Holders (as hereinafter defined).

 

WHEREAS, the Delaware Trustee and the Depositor established First United Statutory Trust III (the “Trust”), a statutory trust under the Delaware Statutory Trust Act (as defined herein), pursuant to a Declaration of Trust, dated as of November 30, 2009 (the “Original Declaration”), and a Certificate of Trust filed with the Secretary of State of the State of Delaware on November 30, 2009, 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 the Debentures (as defined herein) of the Debenture Issuer (as defined herein) in connection with the issuance of the Preferred Securities (as defined herein);

 

WHEREAS, as of the date hereof, no interests in the assets of the Trust have been issued; and

 

WHEREAS, all of the Trustees and the Sponsor, by this Declaration, amend and restate 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 trust under the Delaware Statutory Trust Act and that this Declaration constitutes the governing instrument of such statutory trust, and that all assets contributed to the Trust will be held in trust for the benefit of the holders, from time to time, of the securities representing undivided beneficial interests in the assets of the Trust issued hereunder (the “Holders”), subject to the provisions of this Declaration, and, in consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt of which is hereby acknowledged, the parties, intending to be legally bound hereby, amend and restate in its entirety the Original Declaration and agree as follows:

 

ARTICLE I

DEFINED TERMS

 

SECTION 1.1.      Definitions .  For all purposes of this Declaration, except as otherwise expressly provided or unless the context otherwise requires:

 

1



 

(a)   the terms defined in this Article I have the meanings assigned to them in this Article I and include the plural as well as the singular;

 

(b)   all other terms used herein that are defined in the Trust Indenture Act, either directly or by reference therein, have the meanings assigned to them therein;

 

(c)   unless the context otherwise requires, any reference to an “Article” or a “Section” refers to an Article or a Section, as the case may be, of this Declaration; and

 

(d)   the words “herein”, “hereof” and “hereunder” and other words of similar import refer to this Declaration as a whole and not to any particular Article, Section or other subdivision.

 

“Act” has the meaning specified in Section 6.8.

 

“Additional Amount” means, with respect to Trust Securities of a given Liquidation Amount and/or a given period, the amount of additional interest accrued on interest in arrears and paid by the Depositor on a Like Amount of Debentures for such period.

 

“Additional Payments” has the meaning specified in Section 1.1 of the Indenture.

 

“Administrative Trustee” means each of William B. Grant, Carissa L. Rodeheaver, and Tonya K. Sturm, solely in his or her capacity as Administrative Trustee of the Trust formed and continued hereunder and not in his or her individual capacity, or such Administrative Trustee’s successor in interest in such capacity, or any successor trustee appointed as herein provided.

 

“Affiliate” has the same meaning as given to that term in Rule 405 of the Securities Act or any successor rule thereunder.

 

“Authenticating Agent” means an authenticating agent with respect to the Preferred Securities appointed by the Property Trustee pursuant to Section 5.3.

 

“Bank” has the meaning specified in the Preamble to this Declaration.

 

“Bankruptcy Event” means, with respect to any Person:

 

(a)   the entry of a decree or order by a court having jurisdiction in the premises adjudging such Person a bankrupt or insolvent, or approving as properly filed a petition seeking liquidation or reorganization of or in respect of such Person under the United States Bankruptcy Code of 1978, as amended, or any other similar applicable federal or state law, and the continuance of any such decree or order unvacated and unstayed for a period of ninety (90) days; or the commencement of an involuntary case under the United States Bankruptcy Code of 1978, as amended, in respect of such Person, which shall continue undismissed for a period of ninety (90) days or entry of an order for relief in such case; or the entry of a decree or order of a court having jurisdiction in the premises for the appointment on the ground of insolvency or bankruptcy of a receiver, custodian, liquidator, trustee or assignee in bankruptcy or insolvency of such Person or of its property, or for the winding up or liquidation of its affairs, and such decree or order shall have remained in force unvacated and unstayed for a period of ninety (90) days; or

 

2


 

(b)   the institution by such Person of proceedings to be adjudicated a voluntary bankrupt, or the consent by such Person to the filing of a bankruptcy proceeding against it, or the filing by such Person of a petition or answer or consent seeking liquidation or reorganization under the United States Bankruptcy Code of 1978, as amended, or other similar applicable Federal or State law, or the consent by such Person to the filing of any such petition or to the appointment on the ground of insolvency or bankruptcy of a receiver or custodian or liquidator or trustee or assignee in bankruptcy or insolvency of such Person or of its property, or shall make a general assignment for the benefit of creditors.

 

“Bankruptcy Laws” has the meaning specified in Section 11.9.

 

“Business Day” means any day other than a Saturday or Sunday or a day on which federal or state banking institutions in the Borough of Manhattan, the City of New York, are authorized or required by law, executive order or regulation to close, or a day on which the Corporate Trust Office of the Property Trustee or the Corporate Trust Office of the Debenture Trustee is closed for business.

 

“Certificate of Trust” means the certificate of trust filed with the Secretary of State of the State of Delaware with respect to the Trust, as amended or restated from time to time.

 

“Closing Date” means, as applicable, the First Closing Date or the Second Closing Date.

 

“Commission” means the Securities and Exchange Commission, as from time to time constituted, created under the Exchange Act, or, if at any time after the execution of this instrument 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 Certificate” means a certificate evidencing ownership of Common Securities, substantially in the form attached as Exhibit B .

 

“Common Security” means an undivided beneficial interest in the assets of the Trust, having a Liquidation Amount of $1,000 and having the rights provided therefor in this Declaration, including the right to receive Distributions and a Liquidation Distribution as provided herein.

 

“Common Securityholder” means a holder of a Common Security.

 

“Company” means First United Corporation, a Maryland corporation and registered financial holding company under the Bank Holding Company Act of 1956, as amended.

 

“Corporate Trust Office” means the office at which, at any particular time, the corporate trust business of the Property Trustee or the Debenture Trustee, as the case may be, shall be principally administered, which office at the date hereof, in each such case, is located at Rodney Square North, 1100 North Market Street, Wilmington, Delaware, 19890-0001, Attention: Corporate Trust Administration.

 

“Debenture Redemption Date” means, with respect to any Debentures to be redeemed under the Indenture, the date fixed for redemption under the Indenture.

 

3



 

“Debenture Trustee” means Wilmington Trust Company, a banking corporation organized under the laws of the State of Delaware and any successor thereto, as trustee under the Indenture.

 

“Debenture Event of Default” means an “Event of Default” as defined in Section 7.1 of the Indenture.

 

“Debentures” means up to $30,930,000 aggregate principal amount of the Depositor’s 9.875% Subordinated Debentures due 2045, issued pursuant to the Indenture.

 

“Declaration” means this Amended and Restated Declaration, as the same may be modified, amended or supplemented in accordance with the applicable provisions hereof, including all exhibits hereto, including, for all purposes of this Declaration and any such modification, amendment or supplement, the provisions of the Trust Indenture Act that are deemed to be a part of and govern this Declaration and any such modification, amendment or supplement, respectively.

 

“Delaware Bank” has the meaning specified in the Preamble to this Declaration.

 

“Delaware Statutory Trust Act” means Chapter 38 of Title 12 of the Delaware Code, 12 Delaware Code Sections 3801 et seq. as it may be amended from time to time.

 

“Delaware Trustee” means the commercial bank or trust company identified as the “Delaware Trustee” in the Preamble to this Declaration solely in its capacity as Delaware Trustee of the Trust formed and continued hereunder and not in its individual capacity, or its successor in interest in such capacity, or any successor trustee appointed as herein provided.

 

“Depositor” has the meaning specified in the Preamble to this Declaration.

 

“Distribution Date” has the meaning specified in Section 4.1(a).

 

“Distributions” means amounts payable in respect of the Trust Securities as provided in Section 4.1.

 

“Early Termination Event” has the meaning specified in Section 10.2.

 

“Event of Default” means any one of the following events (whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body):

 

(a)   the occurrence of an Debenture Event of Default; or

 

(b)   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 thirty (30) days; or

 

(c)   default by the Trust in the payment of any Redemption Price of any Trust Security when it becomes due and payable; or

 

4


 

(d)   default in the performance, or breach, in any material respect, of any covenant or warranty of the Trustees in this Declaration (other than a covenant or warranty a default in the performance of which or the breach of which is dealt with in clause (b) or (c), above) and continuation of such default or breach for a period of sixty (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 Preferred 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

 

(e)   the occurrence of a Bankruptcy Event with respect to the Property Trustee and the failure by the Depositor to appoint a successor Property Trustee within sixty (60) days thereof.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

 

“Expiration Date” has the meaning specified in Section 10.1.

 

“Extended Interest Period” has the meaning specified in Section 4.1 of the Indenture.

 

“First Closing Date” means the date of execution and delivery of this Declaration.

 

“Guarantee” means the Preferred Securities Guarantee Agreement executed and delivered by the Depositor and Wilmington Trust Company, as trustee, contemporaneously with the execution and delivery of this Declaration, for the benefit of the Holders of the Preferred Securities, as amended from time to time.

 

“Indenture” means the Indenture, dated as of even date herewith between the Depositor and the Debenture Trustee, as trustee, as amended or supplemented from time to time, pertaining to the Debentures of the Depositor.

 

“Investment Company Act,” means the Investment Company Act of 1940, as amended, as in effect at the date of execution of this instrument.

 

“Lien” means any lien, pledge, charge, encumbrance, mortgage, deed of trust, adverse ownership interest, hypothecation, assignment, security interest or preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever.

 

“Like Amount” means (a) with respect to a redemption of Trust Securities, Trust Securities having an aggregate Liquidation Amount equal to the aggregate principal amount of Debentures to be contemporaneously redeemed in accordance with the Indenture and the proceeds of which shall be used to pay the Redemption Price of such Trust Securities; and (b) with respect to a distribution of Debentures to Holders of Trust Securities in connection with a termination or liquidation of the Trust, Debentures having a principal amount equal to the Liquidation Amount of the Trust Securities of the Holder to whom such Debentures are distributed. Each Debenture distributed pursuant to clause (b) above shall carry with it accrued interest in an amount equal to the accrued and unpaid interest then due on such Debenture.

 

“Liquidation Amount” means the stated amount of $1,000 per Trust Security.

 

5


 

“Liquidation Date” means the date on which Debentures are to be distributed to Holders of Trust Securities in connection with a termination and liquidation of the Trust pursuant to Section 10.4(a).

 

“Liquidation Distribution” has the meaning specified in Section 10.4(d).

 

“Officers’ Certificate” means a certificate signed by the Chief Executive Officer, President, Chief Financial Officer or an Executive Vice President and by the Treasurer or an Assistant Treasurer or the Secretary or an Assistant Secretary of the Depositor, or with respect to any Administrative Trustee, signed by such Administrative Trustee and delivered to the appropriate Trustee.  One of the officers signing an Officers’ Certificate given pursuant to Section 9.15 shall be the principal executive, financial or accounting officer of the Depositor. 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;

 

(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 an opinion in writing of independent outside legal counsel, who may be counsel for the Trust, the Property Trustee, the Delaware Trustee or the Depositor, and who shall be reasonably acceptable to the Property Trustee.

 

“Original Declaration” has the meaning specified in the Recitals to this Declaration.

 

“Outstanding”, when used with respect to the Preferred Securities, means, as of the date of determination, all of the Preferred Securities theretofore executed and delivered under this Declaration, except:

 

(a)   the Preferred Securities theretofore canceled by the Property Trustee or delivered to the Property Trustee for cancellation;

 

(b)   the Preferred Securities for whose payment or redemption money in the necessary amount has been theretofore deposited with the Property Trustee or any Paying Agent for the Holders of such Preferred Securities; provided that, if such Preferred Securities are to be redeemed, notice of such redemption has been duly given pursuant to this Declaration; and

 

6


 

(c)   the Preferred Securities which have been paid or in exchange for or in lieu of which other Preferred Securities have been executed and delivered pursuant to Sections 5.4, 5.5, 5.11 and 5.13; provided , however , that in determining whether the Holders of the requisite Liquidation Amount of the Outstanding Preferred Securities have given any request, demand, authorization, direction, notice, consent or waiver hereunder, the Preferred Securities owned by the Depositor, any Trustee or any Affiliate of the Depositor or any Trustee shall be disregarded and deemed not to be Outstanding, except that (i) in determining whether any Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only the Preferred Securities that such Trustee knows to be so owned shall be so disregarded; and (ii) the foregoing shall not apply at any time when all of the Outstanding Preferred Securities are owned by the Depositor, one or more of the Trustees and/or any such Affiliate. The Preferred Securities so owned which have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the Administrative Trustees the pledgee’s right so to act with respect to such Preferred Securities and the pledgee is not the Depositor or any other Obligor upon the Preferred Securities or a Person directly or indirectly controlling or controlled by or under direct or indirect common control with the Depositor or any Affiliate of the Depositor.

 

“Paying Agent” means any paying agent or co-paying agent appointed pursuant to Section 5.9 and shall initially be the Bank.

 

“Payment Account” means a segregated non-interest-bearing corporate trust account maintained by the Property Trustee with the Bank in its trust department for the benefit of the Securityholders in which all amounts paid in respect of the Debentures shall be held and from which the Property Trustee shall make payments to the Securityholders in accordance with Sections 4.1 and 4.2.

 

“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” means an undivided beneficial interest in the assets of the Trust, having a Liquidation Amount of $1,000 and having the rights provided therefor in this Declaration, including the right to receive Distributions and a Liquidation Distribution as provided herein.

 

“Preferred Securityholder” means a holder of a Preferred Security.

 

“Preferred Securities Certificate” means a certificate evidencing ownership of Preferred Securities, substantially in the form attached as Exhibit C .

 

“Property Trustee” means the commercial bank or trust company identified as the “Property Trustee,” in the Preamble to this Declaration solely in its capacity as Property Trustee of the Trust heretofore formed and continued hereunder and not in its individual capacity, or its successor in interest in such capacity, or any successor property trustee appointed as herein provided.

 

“Redemption Date” means, with respect to any Trust Security to be redeemed, the date fixed for such redemption by or pursuant to this Declaration; provided that each Debenture Redemption Date and the stated maturity of the Debentures shall be a Redemption Date for a Like Amount of Trust Securities.

 

7


 

“Redemption Price” means, with respect to any Trust Security, the Liquidation Amount of such Trust Security, plus accumulated and unpaid Distributions to the Redemption Date, paid by the Depositor upon the concurrent redemption of a Like Amount of Debentures, allocated on a pro rata basis (based on Liquidation Amounts) among the Trust Securities.

 

“Relevant Trustee” shall have the meaning specified in Section 9.10.

 

“Second Closing” has the meaning set forth in Section 2.4(b).

 

“Second Closing Date” means the date on which the Second Closing occurs.

 

“Securities Act” means the Securities Act of 1933, as amended from time to time, or any successor legislation.

 

“Securities Register” and “Securities Registrar” have the respective meanings specified in Section 5.4.

 

“Securityholder” or “Holder” means a Person in whose name a Trust Security is or Trust Securities are registered in the Securities Register; any such Person is a beneficial owner within the meaning of the Delaware Statutory Trust Act.

 

“State Acts” means state securities or “Blue Sky” laws and regulations.

 

“Subscription Agreement” means that form of Preferred Securities Subscription Agreement executed by the Preferred Securityholders and the Trust.

 

“Trust” means the Delaware statutory trust continued hereby and identified on the cover page to this Declaration.

 

“Trust Indenture Act” means the Trust Indenture Act of 1939, as amended, as in force at the date as of which this instrument was executed; provided , however , that in the event the Trust Indenture Act of 1939, as amended, is amended after such date, “Trust Indenture Act” means, to the extent required by any such amendment, the Trust Indenture Act of 1939 as so amended.

 

“Trust Property” means (a) the Debentures; (b) the rights of the Property Trustee under the Guarantee; (c) any cash on deposit in, or owing to, the Payment Account; and (d) all proceeds and rights in respect of the foregoing and any other property and assets for the time being held or deemed to be held by the Property Trustee pursuant to the terms of this Declaration.

 

“Trust Security” means any one of the Common Securities or the Preferred Securities.

 

“Trust Securities Certificate” means any one of the Common Securities Certificates or the Preferred Securities Certificates.

 

“Trustees” means, collectively, the Property Trustee, the Delaware Trustee and the Administrative Trustees.

 

8


 

ARTICLE II

ESTABLISHMENT OF THE TRUST

 

SECTION 2.1.      Name .  The Trust continued hereby shall be known as “FIRST UNITED STATUTORY TRUST III”, as such name may be modified from time to time by the Administrative Trustees following written notice to the Holders of Trust Securities and the other Trustees, in which name the Trustees may engage in the transactions contemplated hereby, make and execute contracts and other instruments on behalf of the Trust and sue and be sued.

 

SECTION 2.2.      Office of the Delaware Trustee; Principal Place of Business .  The address of the Delaware Trustee in the State of Delaware is c/o Wilmington Trust Company, Rodney Square North, 1100 North Market Street, Wilmington, Delaware 19890-0001, Attention:  Corporate Trust Administration, or such other address in the State of Delaware as the Delaware Trustee may designate by written notice to the Securityholders and the Depositor. The principal executive office of the Trust is c/o First United Corporation, 19 South Second Street, Oakland, Maryland 21550, Attention:  Chief Financial Officer.

 

SECTION 2.3.      Initial Contribution of Trust Property; Organizational Expenses .  The Trustees acknowledge receipt in trust from the Depositor in connection with the Original Declaration of the sum of $10, which constituted the initial Trust Property. The Depositor shall pay organizational expenses of the Trust as they arise or shall, upon request of any Trustee, promptly reimburse such Trustee for any such expenses paid by such Trustee. The Depositor shall make no claim upon the Trust Property for the payment of such expenses.

 

SECTION 2.4.      Issuance of the Preferred Securities .

 

(a)   On December 30, 2009, the Depositor, on behalf of the Trust and pursuant to the Original Declaration, executed and delivered the Subscription Agreements which action is hereby authorized, approved and ratified in all respects.  Contemporaneously with the execution and delivery of this Declaration, an Administrative Trustee, on behalf of the Trust, shall execute in accordance with Section 5.2, and, after authenticated by the Property Trustee, deliver in accordance with the Subscription Agreements, Preferred Securities Certificates, registered in the name of the Persons entitled thereto, in an aggregate amount of up to 6,875 Preferred Securities, each having a Liquidation Amount of $1,000, for an aggregate Liquidation Amount of up to $6,975,000, against receipt of the aggregate purchase price of such Preferred Securities of $1,000 per Preferred Security or up to $6,975,000 in the aggregate, which amount such Administrative Trustee shall promptly deliver to the Depositor as partial payment for the Debentures to be issued to the Trust in accordance with Section 2.5(a).

 

(b)   If the Depositor elects to have a second closing (the “Second Closing”), then, upon the order of the Depositor, an Administrative Trustee, on behalf of the Trust, shall execute in accordance with Section 5.2 and, after authenticated by the Property Trustee, deliver in accordance with the additional Subscription Agreements, Preferred Securities, registered in the name of the Persons entitled thereto, in a specified aggregate amount not to exceed 23,025 against receipt of the aggregate purchase price of such Preferred Securities of up to $23,025,000, which amount such Administrative Trustee shall promptly deliver to the Depositor as partial payment for the Debentures to be issued to the Trust in accordance with Section 2.5(b).

 

9


 

SECTION 2.5.      Issuance of Common Securities; Subscription and Purchase of the Debentures .

 

(a)   Contemporaneously with the execution and delivery of this Declaration, an Administrative Trustee, on behalf of the Trust, shall execute in accordance with Section 5.2 and deliver to the Depositor, Common Securities Certificates, registered in the name of the Depositor, in an aggregate amount of up to 217 Common Securities, each having a Liquidation Amount of $1,000, for an aggregate Liquidation Amount of $217,000.  Contemporaneously therewith, an Administrative Trustee, on behalf of the Trust, shall subscribe to and purchase Debentures from the Depositor, registered in the name of the Property Trustee on behalf of the Trust and having an aggregate principal amount of up to $7,192,000, and, in satisfaction of the purchase price for such Debentures, the Administrative Trustees, on behalf of the Trust, shall, in addition to the Common Securities described herein, deliver to the Depositor the aggregate purchase price of the Preferred Securities referred to in Section 2.4(a) above of up to $6,975,000.

 

(b)   If the Depositor elects to have a Second Closing, then an Administrative Trustee, on behalf of the Trust, shall execute in accordance with Section 5.2 and deliver to the Depositor, Common Securities Certificates, registered in the name of the Depositor, in an additional aggregate amount of up to 713 Common Securities, having an aggregate Liquidation Amount of up to $713,000.  Contemporaneously therewith, an Administrative Trustee, on behalf of the Trust, shall subscribe to and purchase from the Depositor additional Debentures, registered in the name of the Property Trustee on behalf of the Trust and having an aggregate principal amount of up to $23,738,000, and, in satisfaction of the purchase price of such Debentures, the Administrative Trustees, on behalf of the Trust, shall, in addition to the Common Securities described herein, deliver to the Depositor the aggregate purchase price of the Preferred Securities referred to in Section 2.4(b) above of up to $23,025,000.

 

SECTION 2.6.      Declaration of Trust . The exclusive purposes and functions of the Trust are (a) to issue and sell Trust Securities and use the proceeds from such sale to acquire the Debentures; and (b) to engage in those activities necessary, convenient or incidental thereto. The Depositor hereby appoints the Trustees as trustees of the Trust, to have all the rights, powers and duties to the extent set forth herein, and the Trustees hereby accept such appointment. The Property Trustee hereby declares that it shall hold the Trust Property in trust upon and subject to the conditions set forth herein for the benefit of the Securityholders. The Administrative Trustees shall have all rights, powers and duties set forth herein and in accordance with applicable law with respect to accomplishing the purposes of the Trust. 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 Property Trustee or the Administrative Trustees set forth herein. The Delaware Trustee shall be one of the Trustees of the Trust for the sole and limited purpose of fulfilling the requirements of Section 3807 of the Delaware Statutory Trust Act.

 

SECTION 2.7.      Authorization to Enter Into Certain Transactions .

 

(a)   The Trustees shall conduct the affairs of the Trust in accordance with the terms of this Declaration. Subject to the limitations set forth in paragraph (b) of this Section 2.7 and Article VIII, and in accordance with the following provisions (i) and (ii) of this Section 2.7(a), the Administrative Trustees shall have the authority to enter into all transactions and agreements determined by the Administrative Trustees to be appropriate in exercising the authority, express or implied, otherwise granted to the Administrative Trustees under this Declaration, and to perform all acts in furtherance thereof, including without limitation, the following:

 

10


 

(i)   As among the Trustees, each Administrative Trustee, acting singly or jointly, shall have the power and authority to act on behalf of the Trust with respect to the following matters:

 

(A)   the issuance and sale of the Trust Securities and the compliance with the Subscription Agreements in connection therewith;

 

(B)   to cause the Trust to enter into, and to execute, deliver and perform on behalf of the Trust, such agreements or documents as may be necessary or desirable in connection with the purposes and function of the Trust;

 

(C)   assisting in obtaining registration exemptions for the Preferred Securities under the Securities Act, and under state securities or blue sky laws, and the qualification of this Declaration as a trust indenture under the Trust Indenture Act;

 

(D)   the sending of notices (other than notices of default) and other information regarding the Trust Securities and the Debentures to the Securityholders in accordance with this Declaration;

 

(E)   the appointment of a Paying Agent and Securities Registrar in accordance with this Declaration;

 

(F)   to the extent provided in this Declaration, the winding up of the affairs of and liquidation of the Trust and the preparation, execution and filing of the certificate of cancellation with the Secretary of State of the State of Delaware;

 

(G)   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 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 of the Preferred Securities or to enable the Trust to effect the purposes for which the Trust was created; and

 

(H)   the taking of any action incidental to the foregoing as the Administrative Trustees may from time to time determine is necessary or advisable to give effect to the terms of this Declaration for the benefit of the Securityholders (without consideration of the effect of any such action on any particular Securityholder).

 

(ii)   As among the Trustees, the Property Trustee shall have the power, duty and authority to act on behalf of the Trust with respect to the following matters:

 

11


 

(A)   the establishment of the Payment Account;

 

(B)   the receipt of the Debentures;

 

(C)   the collection of interest, principal and any other payments made in respect of the Debentures in the Payment Account;

 

(D)   the distribution of amounts owed to the Securityholders in respect of the Trust Securities in accordance with the terms of this Declaration;

 

(E)   the exercise of all of the rights, powers and privileges of a holder of the Debentures;

 

(F)   the sending of notices of default and other information regarding the Trust Securities and the Debentures to the Securityholders in accordance with this Declaration;

 

(G)   the distribution of the Trust Property in accordance with the terms of this Declaration;

 

(H)   to the extent provided in this Declaration, the winding up of the affairs of and liquidation of the Trust;

 

(I)   after an Event of Default, the taking of any action incidental to the foregoing as the Property Trustee may from time to time determine is necessary or advisable to give effect to the terms of this Declaration and protect and conserve the Trust Property for the benefit of the Securityholders (without consideration of the effect of any such action on any particular Securityholder);

 

(J)   registering transfers of the Trust Securities in accordance with this Declaration; and

 

(K)   except as otherwise provided in this Section 2.7(a)(ii), the Property Trustee shall have none of the duties, liabilities, powers or the authority of the Administrative Trustees set forth in Section 2.7(a)(i).

 

(b)   So long as this Declaration remains in effect, the Trust (or the Trustees acting on behalf of the Trust) shall not undertake any business, activities or transaction except as expressly provided herein or contemplated hereby. In particular, the Trustees shall not (i) acquire any investments or engage in any activities not authorized by this Declaration; (ii) sell, assign, transfer, exchange, mortgage, pledge, set-off or otherwise dispose of any of the Trust Property or interests therein, including to Securityholders, except as expressly provided herein; (iii) take any action that would cause the Trust to fail or cease to qualify as a “grantor trust” for United States federal income tax purposes; (iv) incur any indebtedness for borrowed money or issue any other debt; or (v) take or consent to any action that would result in the placement of a Lien on any of the Trust Property. The Administrative Trustees shall defend all claims and demands of all Persons at any time claiming any Lien on any of the Trust Property adverse to the interest of the Trust or the Securityholders in their capacity as Securityholders.

 

12


 

(c)   In connection with the issue and sale of the Preferred Securities, the Depositor shall have the right and responsibility to assist the Trust with respect to, or effect on behalf of the Trust, the following (and any actions taken by the Depositor in furtherance of the following prior to the date of this Declaration are hereby ratified and confirmed in all respects):

 

(i)   the preparation and filing by the Trust with the Commission and applicable state securities regulators the documents necessary to secure applicable state and federal registration exemptions in relation to the Preferred Securities and the Debentures (the “Exemptions”), including any amendments thereto;

 

(ii)   the determination of the states in which to take appropriate action to qualify for Exemptions and to do any and all such acts, other than actions which must be taken by or on behalf of the Trust, and advise the Trustees of actions they must take on behalf of the Trust, and prepare for execution and filing any documents to be executed and filed by the Trust or on behalf of the Trust, as the Depositor deems necessary or advisable in order to comply with the applicable laws of any such states;

 

(iii)   the negotiation of the terms of, and the execution and delivery of, the Subscription Agreements providing for the sale of the Preferred Securities;

 

(iv)   the taking of any other actions necessary or desirable to carry out any of the foregoing activities; and,

 

(v)   taking such steps as may be necessary to ensure compliance with applicable federal and state securities laws, or exemptions therefrom, in connection with the transfer of the Preferred Securities.

 

(d)   Notwithstanding anything herein to the contrary, the Administrative Trustees are authorized and directed to conduct the affairs of the Trust and to operate the Trust so that the Trust shall not be deemed to be an “investment company” required to be registered under the Investment Company Act, shall be classified as a “grantor trust” and not as an association taxable as a corporation for United States federal income tax purposes and so that the Debentures shall be treated as indebtedness of the Depositor for United States federal income tax purposes. In this connection, subject to Section 11.2, the Depositor and the Administrative Trustees are authorized to take any action and the Administrative Trustees are authorized to direct the Property Trustee in writing to take any action, not inconsistent with applicable law or this Declaration, that each of the Depositor and the Administrative Trustees determines in their discretion to be necessary or desirable for such purposes. The Property Trustee shall take any action so directed by one or more of the Administrative Trustees.

 

SECTION 2.8.      Assets of Trust .  The assets of the Trust shall consist of the Trust Property.

 

SECTION 2.9.      Title to Trust Property .  Legal title to all Trust Property shall be vested at all times in the Property Trustee (in its capacity as such) and shall be held and administered by the Property Trustee for the benefit of the Securityholders in accordance with this Declaration.

 

13


 

ARTICLE III

PAYMENT ACCOUNT

 

SECTION 3.1.      Payment Account .

 

(a)   On or prior to the First Closing Date, the Property Trustee shall establish the Payment Account. The Property Trustee and any agent of the Property Trustee shall have exclusive control and sole right of withdrawal with respect to the Payment Account for the purpose of making deposits and withdrawals from the Payment Account in accordance with this Declaration. All monies and other property deposited or held from time to time in the Payment Account shall be held by the Property Trustee in the Payment Account for the exclusive benefit of the Securityholders and for distribution as herein provided, including (and subject to) any priority of payments provided for herein.

 

(b)   The Property Trustee shall deposit in the Payment Account, promptly upon receipt, all payments of principal of or interest on, and any other payments or proceeds with respect to, the Debentures. Amounts held in the Payment Account shall not bear interest or be invested by the Property Trustee pending distribution thereof.

 

ARTICLE IV                                

DISTRIBUTIONS; REDEMPTION

 

SECTION 4.1.      Distributions .

 

(a)   Distributions on the Trust Securities shall be cumulative, and shall accumulate whether or not there are funds of the Trust available for the payment of Distributions. Distributions shall accumulate from the date of issuance of the Trust Securities, and, except during any Extended Interest Period with respect to the Debentures, shall be payable quarterly in arrears on March 15, June 15, September 15 and December 15 of each year, commencing on March 15, 2010. If any date on which a Distribution is otherwise payable on the Trust Securities is not a Business Day, then the payment of such Distribution shall 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 such Business Day is in the next succeeding calendar year, such payment shall be made on the immediately preceding Business Day (and without any reduction in interest or any other payment in respect of any such acceleration), 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 this Section 4.1(a), a “Distribution Date”).

 

(b)   The Trust Securities represent undivided beneficial interests in the Trust Property. Distributions on the Trust Securities shall be payable at a rate of 9.875% per annum of the Liquidation Amount of the Trust Securities. The amount of Distributions payable for any full period shall be computed on the basis of a 360-day year of twelve 30-day months. The amount of Distributions for any partial period shall be computed on the basis of the number of days elapsed in a 360-day year of twelve 30-day months. During any Extended Interest Period with respect to the Debentures, Distributions on the Preferred Securities shall be deferred for a period equal to the Extended Interest Period. The amount of Distributions payable for any period shall include the Additional Amounts, if any.

 

14


 

(c)   Distributions on the Trust Securities shall be made by the Property Trustee solely from the Payment Account and shall be payable on each Distribution Date only to the extent that the Trust has funds then on hand and immediately available by 12:30 p.m. on each Distribution Date in the Payment Account for the payment of such Distributions.

 

(d)   Distributions on the Trust Securities with respect to a Distribution Date shall be payable to the Holders thereof as they appear on the Securities Register for the Trust Securities on the relevant record date, which shall be one Business Day immediately preceding the Distribution Date.

 

SECTION 4.2.      Redemption .

 

(a)   On each Debenture Redemption Date and at maturity of the Debentures, the Trust shall be required to redeem a Like Amount of Trust Securities at the Redemption Price.

 

(b)   Notice of redemption shall be given by the Property Trustee by first-class mail, postage prepaid, mailed not less than thirty (30) nor more than sixty (60) days prior to the Redemption Date to each Holder of Trust Securities to be redeemed, at such Holder’s address appearing in the Securities Register. The Property Trustee shall have no responsibility for the accuracy of any CUSIP number contained in such notice. All notices of redemption shall state:

 

(i)   the Redemption Date;

 

(ii)   the Redemption Price;

 

(iii)   the CUSIP number;

 

(iv)   if less than all the outstanding Trust Securities are to be redeemed, the identification and the aggregate Liquidation Amount of the particular Trust Securities to be redeemed;

 

(v)   that, on the Redemption Date, the Redemption Price shall become due and payable upon each such Trust Security to be redeemed and that Distributions thereon shall cease to accumulate on and after said date, except as provided in Section 4.2(d); and

 

(vi)   the place or places at which Trust Securities are to be surrendered for the payment of the Redemption Price.

 

(c)   The Trust Securities redeemed on each Redemption Date shall be redeemed at the Redemption Price with the proceeds from the contemporaneous redemption of the Debentures. Redemptions of the Trust Securities shall be made and the Redemption Price shall be pa


This is only a partial view of this document. We have millions of legal documents and clauses drafted by top law firms. learn more search for free browse for free learn more