FOURTH SUPPLEMENTAL JUNIOR SUBORDINATED INDENTURE

Exhibit 4.1

EXECUTION VERSION

BB&T CORPORATION

AND

U.S. BANK NATIONAL ASSOCIATION

as Trustee

 

FOURTH SUPPLEMENTAL JUNIOR SUBORDINATED INDENTURE

Dated as of September 10, 2008

to

JUNIOR SUBORDINATED INDENTURE

Dated as of August 18, 2005

 

TABLE OF CONTENTS

 

THIS FOURTH SUPPLEMENTAL JUNIOR SUBORDINATED INDENTURE, dated as of September 10, 2008 (this “ Fourth Supplemental Indenture ”), between BB&T CORPORATION, a North Carolina corporation (the “ Corporation ”) and U.S. BANK NATIONAL ASSOCIATION, a national banking association, as trustee (the “ Trustee ”) under the Junior Subordinated Indenture, dated as of August 18, 2005, between the Corporation and the Trustee (the “ Indenture ”).

WHEREAS, the Corporation desires to establish, under the terms of the Indenture, a series of its securities to be known as its Junior Subordinated Debentures (the “ Junior Subordinated Debentures ”), the form and substance of such Junior Subordinated Debentures and the terms, provisions and conditions thereof to be set forth as provided in the Indenture and this Fourth Supplemental Indenture;

WHEREAS, under the terms of an Underwriting Agreement, dated as of September 3, 2008 (the “ Underwriting Agreement ”), among the Corporation, BB&T Capital Trust V (the “ Trust ”) and the Underwriters named therein (the “ Underwriters ”), the Trust has agreed to sell to the Underwriters up to $500,000,000 aggregate liquidation amount of its Enhanced Trust Preferred Securities (the “ Capital Securities ”);

WHEREAS, under the terms of Section 2.5 of the Trust Agreement (as defined herein), the Corporation has committed to purchase all of the Trust’s common securities (the “ Trust Common Securities ”, and together with the Capital Securities, collectively referred to herein as the “ Trust Securities ”) with an aggregate liquidation amount of $10,000;

WHEREAS, the Trust proposes to invest the gross proceeds from such offering of Capital Securities, together with the gross proceeds from the issuance and sale by the Trust of the Trust Common Securities, in the Junior Subordinated Debentures, as a result of which the Trust shall purchase up to $500,010,000 aggregate principal amount of the Junior Subordinated Debentures;

WHEREAS, the Corporation has requested that the Trustee execute and deliver this Fourth Supplemental Indenture; and

WHEREAS, all requirements necessary to make this Fourth Supplemental Indenture a valid instrument in accordance with its terms and to make the Junior Subordinated Debentures, when executed by the Corporation and authenticated and delivered by the Trustee, the valid obligations of the Corporation, have been performed, and the execution and delivery of this Fourth Supplemental Indenture has been duly authorized in all respects.

NOW THEREFORE, in consideration of the purchase and acceptance of the Junior Subordinated Debentures by the Holders thereof, and for the purpose of setting forth, as provided in the Indenture, the form and substance of the Junior Subordinated Debentures and the terms, provisions and conditions thereof, the Corporation covenants and agrees with the Trustee as follows:

ARTICLE I

DEFINITIONS

Section 1.1 Definitions . For all purposes of this Fourth Supplemental Indenture, except as otherwise expressly provided or unless the context otherwise requires:

(a) a term defined in the Indenture has the same meaning when used in this Fourth Supplemental Indenture unless otherwise provided herein;

(b) a term defined anywhere in this Fourth Supplemental Indenture has the same meaning throughout;

(c) the singular includes the plural and vice versa;

(d) a reference to a Section or Article is to a Section or Article of this Fourth Supplemental Indenture unless otherwise provided herein;

(e) headings are for convenience of reference only and do not affect interpretation; and

(f) the following terms have the meanings given to them in this Section 1.1:

“ APM Commencement Date ” means, with respect to any Deferral Period, the earlier of (i) the first Interest Payment Date following the commencement of such Deferral Period on which the Corporation pays any current interest on the Junior Subordinated Debentures and (ii) the conclusion of 20 consecutive Interest Periods following the commencement of such Deferral Period.

“ Bankruptcy Event ” means any of the events set forth in Section 5.1(4) or (5) of the Indenture.

“ BB&T Capital IV Replacement Capital Covenant ” means the replacement capital covenant relating to the Fixed to Floating Rate Junior Subordinated Debentures held by BB&T Capital Trust IV.

“ Business Combination” shall have the meaning set forth in Section 2.4(c).

“ Business Day ” means any day other than (i) a Saturday, Sunday or Federal Reserve holiday and that is not a day on which banking institutions in the City of New York or Winston-Salem, North Carolina are generally authorized or obligated by law or executive order to remain closed, or (ii) a day on which the corporate trust office of the Property Trustee or the Trustee is closed for business; provided that during the Floating Rate Period the day is also a London banking day.

“ Calculation Agent ” means U.S. Bank National Association, or any other firm appointed by the Corporation, acting as calculation agent for the Junior Subordinated Debentures.

 

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“ Capital Securities ” has the meaning set forth in the Recitals.

“ Capital Stock ” for any entity means any and all shares, interests, rights to purchase, warrants, options, participations or other equivalents of or interests in (however designated) shares issued by that entity.

“ Common Equity Issuance Cap ” has the meaning set forth in Section 2.6(a)(i).

“ Corporation ” has the meaning set forth in the Preamble.

“ Current Stock Market Price ” of the Common Stock on any date shall mean (i) the closing sale price per share (or if no closing sale price is reported, the average of the bid and ask prices or, if more than one in either case, the average of the average bid and the average ask prices) on that date as reported in composite transactions by the New York Stock Exchange or, if the Common Stock is not then listed on the New York Stock Exchange, as reported by the principal U.S. securities exchange on which the Common Stock is traded, (ii) if the Common Stock is not listed on any U.S. securities exchange on the relevant date, the last quoted bid price for the Common Stock in the over-the-counter market on the relevant date as reported by the National Quotation Bureau or similar organization, or (iii) if the Common Stock is not so quoted, the average of the mid-point of the last bid and ask prices for the Common Stock on the relevant date from each of at least three nationally recognized independent investment banking firms selected by the Corporation for this purpose.

“ Deferral Period ” means each period beginning on an Interest Payment Date with respect to which the Corporation elects pursuant to Section 2.4(a) to defer all or part of any interest payment and ending on the earlier of (i) the conclusion of 40 consecutive Interest Periods following such Interest Payment Date and (ii) the next Interest Payment Date on which the Corporation has paid the deferred amount, all deferred amounts with respect to any subsequent period and all other accrued interest on the Junior Subordinated Debentures.

“ Distribution Date ” has the meaning set forth in the Trust Agreement.

“ Eligible Proceeds ” means, with respect to any Interest Payment Date, the net proceeds (after underwriters’ or placement agents’ fees, commissions or discounts and other expenses relating to the issuance or sale) the Corporation has received during the 180-day period prior to such Interest Payment Date from the issuance or sale of Common Stock or Qualifying Warrants up to the Maximum Share Number, Qualifying Preferred Stock up to the Preferred Stock Issuance Cap or Mandatorily Convertible Preferred Stock up to the Maximum Share Number or the Preferred Stock Issuance Cap to Persons that are not Subsidiaries.

“ Fixed Rate Period ” has the meaning set forth in Section 2.2.

“ Floating Rate Period ” has the meaning set forth in Section 2.2.

“ Fourth Supplemental Indenture ” has the meaning set forth in the Preamble.

 

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“ Guarantee Agreement ” means the Guarantee Agreement between the Corporation, as guarantor, and U.S. Bank National Association, as guarantee trustee, dated as of September 10, 2008.

“ Indenture ” has the meaning set forth in the Preamble.

“ Intent-Based Replacement Disclosure ” means, as to any Qualifying Preferred Stock, that the issuer has publicly stated its intention, either in the prospectus or other offering document under which such securities were initially offered for sale or in filings with the Commission made by the issuer under the Exchange Act, prior to or contemporaneously with the issuance of such securities, that to the extent that the Qualifying Preferred Stock provides the issuer with rating agency equity credit at the time of redemption or purchase, the issuer shall redeem or purchase such securities only with the proceeds of replacement capital securities that have terms and provisions at the time of such redemption or purchase that are as or more equity-like than the securities then being redeemed or purchased, raised within 180 days prior to the applicable redemption or purchase date. Notwithstanding the use of the term Intent-Based Replacement Disclosure in the definition of Qualifying Preferred Stock herein, the requirement in such definition that a particular security or the related transaction documents include Intent-Based Replacement Disclosure shall be disregarded and given no force or effect for so long as the Corporation is a bank holding company within the meaning of the Bank Holding Company Act of 1956, as amended.

“ Interest Payment Date ” has the meaning set forth on Section 2.3(b).

“ Interest Period ” means the period from and including any Interest Payment Date (or, in the case of the first Interest Payment Date, September 10, 2008) to but excluding the next Interest Payment Date.

“ Junior Subordinated Debentures ” has the meaning set forth in the Recitals.

“ LIBOR Interest Determination Date ” means the second London banking day preceding each Interest Payment Date in the Floating Rate Period.

“ Liquidation Amount ” has the meaning set forth in the Trust Agreement.

“ London banking day ” means a day on which commercial banks are open for business, including dealings in U.S. dollars, in London, England.

“ Mandatorily Convertible Preferred Stock ” means Preferred Stock with (i) no prepayment obligation on the part of the Corporation, whether at the election of the Holders or otherwise and (ii) a requirement that the Preferred Stock convert into Common Stock within three years from the date of its issuance at a conversion ratio within a range established at the time of issuance of the Preferred Stock, subject to customary anti-dilution adjustments.

 

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“ Make-Whole Redemption Price ” means the sum of the present values of the principal amount of the Junior Subordinated Debentures being redeemed and each scheduled payment of interest thereon (not including any portion of such payments of interest accrued as of the Redemption Date) from the Redemption Date to and including September 15, 2013, discounted to the Redemption Date from September 15, 2013 or the applicable Interest Payment Date on a quarterly basis (assuming a 360-day year consisting of twelve 30-day months) at a discount rate equal to the Treasury Rate plus 0.50%.

“ Market Disruption Event ” means the occurrence or existence of any of the following events or sets of circumstances:

(i) trading in securities generally (or in the Common Stock or the Qualifying Preferred Stock specifically) on the New York Stock Exchange or any other national securities exchange, or in the over-the-counter market, on which the Common Stock and/or the Preferred Stock is then listed or traded shall have been suspended or its settlement generally shall have been materially disrupted or minimum prices shall have been established on any such exchange or market by the relevant exchange or market or by any other regulatory body or governmental agency having jurisdiction, and the establishment of such minimum prices materially disrupts or otherwise has a material adverse effect on trading in, or the issuance and sale of, the Qualifying APM Securities;

(ii) the Corporation would be required to obtain the consent or approval of its stockholders or a regulatory body (including, without limitation, any securities exchange) or governmental authority to issue Qualifying APM Securities pursuant to Section 2.6, and the Corporation fails to obtain such consent or approval notwithstanding its commercially reasonable efforts to obtain such consent or approval (including, without limitation, failing to obtain approval for such issuance if required from the Federal Reserve after having given notice to the Federal Reserve as required under Section 2.6);

(iii) a banking moratorium shall have been declared by the federal or state authorities of the United States and such moratorium materially disrupts or otherwise has a material adverse effect on trading in, or the issuance and sale of, the Qualifying APM Securities;

(iv) a material disruption shall have occurred in commercial banking or securities settlement or clearance services in the United States and such disruption materially disrupts or otherwise has a material adverse effect on trading in, or the issuance and sale of, the Qualifying APM Securities;

(v) the United States shall have become engaged in hostilities, there shall have been an escalation in hostilities involving the United States, there shall have been a declaration of a national emergency or war by the United States or there shall have occurred any other national or international calamity or crisis and such event materially disrupts or otherwise has a material adverse effect on trading in, or the issuance and sale of, the Qualifying APM Securities;

 

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(vi) there shall have occurred such a material adverse change in general domestic or international economic, political or financial conditions, including as a result of terrorist activities, and such change materially disrupts or otherwise has a material adverse effect on trading in, or the issuance and sale of, the Qualifying APM Securities;

(vii) an event occurs and is continuing as a result of which the offering document for the offer and sale of Qualifying APM Securities would, in the Corporation’s reasonable judgment, contain an untrue statement of a material fact or omit to state a material fact required to be stated in such offering document or necessary to make the statements in such offering document not misleading and either (A) the disclosure of such event at such time, in the Corporation’s reasonable judgment, is not otherwise required by law and would have a material adverse effect on its business or (B) the disclosure relates to a previously undisclosed proposed or pending development or material business transaction, and the Corporation has a bona fide business reason for keeping the same confidential or the disclosure of which would impede the Corporation’s ability to consummate such transaction; provided that no single suspension period described in this clause (vii) shall exceed 90 consecutive days and multiple suspension periods described in this clause (vii) shall not exceed an aggregate of 90 days in any 180-day period with respect to the Corporation’s obligations pursuant to Section 2.6; or

(viii) the Corporation reasonably believes that the offering document for the offer and the sale of Qualifying APM Securities would not be in compliance with a rule or regulation of the Commission (for reasons other than those referred to in clause (vii) above) and the Corporation is unable to comply with such rule or regulation or such compliance would be unduly burdensome; provided that no single suspension period described in this clause (viii) shall exceed 90 consecutive days and multiple suspension periods described in this clause (viii) shall not exceed an aggregate of 90 days in any 180-day period with respect to the Corporation’s obligations pursuant to Section 2.6.

“ Maturity Date ” has the meaning set forth in Section 2.2.

“ Maximum Share Number ” has the meaning set forth in Section 2.6(a)(v).

“ Parity Securities ” means debt securities or guarantees of the Corporation that rank upon liquidation of the Corporation on parity with the Junior Subordinated Debentures.

“ Permitted Remedies ” means, with respect to any securities, one or more of the following remedies: (i) rights in favor of the holders of such securities permitting such holders to elect one or more directors of the issuer (including any such rights required by the listing requirements of any securities exchange or market on which such securities may be listed or traded) and (ii) complete or partial prohibitions on the issuer paying distributions on or repurchasing common stock or other securities that rank pari passu with or junior as to distributions to such securities for so long as distributions on such securities, including unpaid distributions, remain unpaid.

 

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“ Preferred Stock ” means the preferred stock of the Corporation.

“ Preferred Stock Issuance Cap ” has the meaning set forth in Section 2.6(a)(ii).

“ Qualifying APM Securities ” means Common Stock, Qualifying Preferred Stock and Qualifying Warrants, provided that the Corporation may, without the consent of the holders of the Capital Securities or the Junior Subordinated Debentures, amend this definition of Qualifying APM Securities to eliminate Common Stock or Qualifying Warrants (but not both) from the definition if, after September 10, 2008, an accounting standard or interpretive guidance of an existing accounting standard issued by an organization or regulator that has responsibility for establishing or interpreting accounting standards followed by the Corporation becomes effective such that there is more than an insubstantial risk that failure to eliminate Common Stock or Qualifying Warrants from the definition would result in a reduction in the Corporation’s earnings per share as calculated in accordance with generally accepted accounting principles.

“ Qualifying Preferred Stock ” means the Corporation’s non-cumulative perpetual preferred stock that (i) ranks pari passu with or junior to the Corporation’s other preferred stock, (ii) as to which the transaction documents provide for no remedies as a consequence of non-payment of dividends other than Permitted Remedies, and (iii)(A) is subject to Intent-Based Replacement Disclosure and has a provision that prohibits the Corporation from making any distributions thereon upon the Corporation’s failure to satisfy one or more of the financial tests set forth therein, or (B) is subject to a Qualifying Replacement Capital Covenant.

“ Qualifying Replacement Capital Covenant ” means a replacement capital covenant that is substantially similar to the BB&T Capital Trust IV Replacement Capital Covenant or a replacement capital covenant, as identified by the Corporation’s Board of Directors acting in good faith and in its reasonable discretion and reasonably construing the definitions and other terms of the BB&T Capital Trust IV Replacement Capital Covenant, (i) entered into by a company that at the time it enters into such replacement capital covenant is a reporting company under the Exchange Act and (ii) that restricts the company and its subsidiaries from redeeming or purchasing a series of the Corporation’s non-cumulative perpetual preferred stock except to the extent of the applicable percentage of the net proceeds from the issuance of specified replacement capital securities that have terms and provisions at the time of redemption or purchase that are as or more equity-like than the securities then being redeemed or purchased within the 180-day period prior to the applicable redemption or purchase date.

“ Qualifying Warrants ” means net share settled warrants to purchase the Common Stock that (i) have an exercise price greater than the Current Stock Market Price of the Common Stock as of the date the Corporation agrees to issue the warrants, and (ii) the Corporation is not entitled to redeem for cash and the holders of which are not entitled to require the Corporation to repurchase for cash in any circumstances. If the Corporation issues Qualifying Warrants, the Corporation shall be required to use commercially reasonable efforts, subject to the Common Equity Issuance Cap, to set the terms of such Qualifying Warrants so as to raise sufficient proceeds from their issuance to pay all deferred interest on the Junior Subordinated Debentures in accordance with Section 2.6. The Corporation intends that any Qualifying Warrants issued in accordance with Section 2.6 shall have exercise prices at least 10% above the Current Stock Market Price of the Common Stock on the date of issuance.

 

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“ Rating Agency Event ” means that any nationally recognized statistical rating organization within the meaning of Section 3(a)(62) of the Exchange Act that then publishes a rating for the Corporation (a “ Rating Agency ”) amends, clarifies or changes the criteria it uses to assign equity credit to securities such as the Junior Subordinated Debentures, which amendment, clarification or change results in:

(i) the shortening of the length of time the Junior Subordinated Debentures are assigned a particular level of equity credit by that Rating Agency as compared to the length of time they would have been assigned that level of equity credit by that Rating Agency or its predecessor on the issue date of the Capital Securities; or

(ii) the lowering of the equity credit (including up to a lesser amount) assigned to the Junior Subordinated Debentures by that Rating Agency as compared to the equity credit assigned by that Rating Agency or its predecessor on the issue date of the Capital Securities.

“ Reuters Page LIBOR01 ” means the display designated as “LIBOR01” on Reuters 3000 Xtra Service (or such other page as may replace “LIBOR01” on the service or any successor service) for the purpose of displaying the London Inter-Bank offered rates of major banks for U.S. dollars.

“ Senior Debt ” has the meaning set forth in Section 4.1.

“ Subsidiary ” means, with respect to any Person:

(i) any corporation or company a majority of whose Capital Stock with voting power, under ordinary circumstances, to elect directors is, at the date of determination, directly or indirectly, owned by such Person (a “ subsidiary ”), by one or more subsidiaries of such Person or by such Person and one or more subsidiaries of such Person;

(ii) any partnership in which such Person or a subsidiary of such Person is, at the date of determination, a general partner of such partnership; or

(iii) any partnership, limited liability company or other Person in which such Person, a subsidiary of such Person or such Person and one or more subsidiaries of such Person, directly or indirectly, at the date of determination, have (x) at least a majority ownership interest or (y) the power to elect or appoint or direct the election or appointment of the managing partner or member of such Person or, if applicable, a majority of the directors or other governing body of such Person.

 

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“ Tax Event ” means, for purposes of the Junior Subordinated Debentures, the Corporation has requested and received an Opinion of Counsel experienced in such matters to the effect that, as a result of any:

(i) amendment to or change in the laws or regulations of the United States or any political subdivision or taxing authority of or in the United States that is enacted or issued or becomes effective after September 3, 2008;

(ii) proposed change in those laws or regulations that is announced after September 3, 2008;

(iii) official administrative decision or judicial decision or administrative action or other official pronouncement interpreting or applying those laws or regulations that is announced after September 3, 2008; or

(iv) threatened challenge asserted in connection with an audit of the Trust, the Corporation or its Subsidiaries, or a threatened challenge asserted in writing against any other taxpayer that has raised capital through the issuance of securities that are substantially similar to the Junior Subordinated Debentures or the Capital Securities, there is more than an insubstantial risk that:

 

(A)

the Trust is, or shall be, subject to United States federal income tax with respect to income received or accrued on the Junior Subordinated Debentures,

 

(B)

interest payable by the Corporation on the Junior Subordinated Debentures is not, or shall not be, deductible by the Corporation, in whole or in part, for United States federal income tax purposes, or

 

(C)

the Trust is, or shall be, subject to more than a de minimis amount of other taxes, duties or other governmental charges.

“ Three-Month LIBOR Rate ” means the rate determined in accordance with the following provisions. On the LIBOR Interest Determination Date, the Calculation Agent or its affiliate shall determine the Three-Month LIBOR Rate which shall be the rate for deposits in U.S. dollars having a three-month maturity which appears on the Reuters Page LIBOR01 as of 11:00 a.m., London time, on the LIBOR Interest Determination Date. If no rate appears on Reuters Page LIBOR01 on the LIBOR Interest Determination Date, the Calculation Agent or its affiliate shall request the principal London offices of four major reference banks in the London Inter-Bank Market to provide it with their offered quotations for deposits in U.S. dollars for the period of three months, commencing on the applicable interest payment date in the floating rate period, to prime banks in the London Inter-Bank Market at approximately 11:00 a.m., London time, on that LIBOR Interest Determination Date and in a principal amount that is representative for a single transaction in U.S. dollars in that market at that time. If at least two quotations are provided, then the Three-Month LIBOR Rate shall be the average (rounded, if necessary, to the nearest one hundredth (0.01) of a percent) of those quotations. If fewer than two quotations are provided, then the Three-Month

 

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LIBOR Rate shall be the average (rounded, if necessary, to the nearest one hundredth (0.01) of a percent) of the rates quoted at approximately 11:00 a.m., New York City time, on the LIBOR Interest Determination Date by three major banks in the City of New York selected by the Calculation Agent or its affiliate for loans in U.S. dollars to leading European banks, having a three-month maturity and in a principal amount that is representative for a single transaction in U.S. dollars in that market at that time. If the banks selected by the Calculation Agent or its affiliate are not providing quotations in the manner described by this paragraph, the rate for the quarterly interest period following the LIBOR Interest Determination Date shall be the rate in effect on that LIBOR Interest Determination Date.

“ Trading Day ” means a day on which the Common Stock is traded on The New York Stock Exchange, or if not then listed on The New York Stock Exchange, a day on which the Common Stock is traded or quoted on the principal U.S. securities exchange on which it is listed or quoted, or if not then listed or quoted on a U.S. securities exchange, a day on which the Common Stock is quoted in the over-the-counter market.

“ Treasury Dealer ” means Merrill Lynch Government Securities Inc. (or its successor) or, if Merrill Lynch Government Securities Inc. (or its successor) refuses to act as Treasury Dealer for the purpose of determining the Make-Whole Redemption Price or ceases to be a primary U.S. government securities dealer, another nationally recognized investment banking firm that is a primary U.S. government securities dealer specified by the Corporation for these purposes.

“ Treasury Price ” means the bid-side price for the Treasury Security as of the third Trading Day preceding the Redemption Date, as set forth in the daily statistical release (or any successor release) published by the Wall Street Journal in the table entitled “Treasury Bonds, Notes and Bills,” except that: (i) if that release (or any successor release) is not published or does not contain that price information on that Trading Day; or (ii) if the Treasury Dealer determines that the price information is not reasonably reflective of the actual bid-side price of the Treasury Security prevailing at 3:30 p.m., New York City time, on that Trading Day, then Treasury Price shall instead mean the bid-side price for the Treasury Security at or around 3:30 p.m., New York City time, on that Trading Day (expressed on a next Trading Day settlement basis) as determined by the Treasury Dealer through such alternative means as are commercially reasonable under the circumstances.

“ Treasury Rate ” means the quarterly equivalent yield to maturity of the Treasury Security that corresponds to the Treasury Price (calculated in accordance with standard market practice and computed as of the second Trading Day preceding the Redemption Date).

“ Treasury Security ” means the United States Treasury security that the Treasury Dealer determines would be appropriate to use, at the time of determination and in accordance with standard market practice, in pricing the Junior Subordinated Debentures being redeemed in a tender offer based on a spread to United States Treasury yields.

“ Trust ” has the meaning set forth in the Recitals.

 

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“ Trust Agreement ” means the Amended and Restated Trust Agreement, dated as of September 10, 2008, among the Corporation, as Depositor, U.S. Bank National Association, as the Property Trustee, Wilmington Trust Corporation, as the Delaware Trustee, and the Administrative Trustees.

“ Trust Common Securities ” has the meaning set forth in the Recitals.

“ Trustee ” has the meaning set forth in the Preamble.

“ Trust Securities ” has the meaning set forth in the Recitals.

“ Underwriters ” has the meaning set forth in the Recitals.

“ Underwriting Agreement ” has the meaning set forth in the Recitals.

ARTICLE II

GENERAL TERMS AND CONDITIONS OF THE JUNIOR SUBORDINATED

DEBENTURES

Section 2.1 Designation, Principal Amount and Authorized Denominations . There is hereby authorized and established under the terms of the Indenture a series of the Corporation’s securities designated as the “Junior Subordinated Debentures” (the “ Junior Subordinated Debentures ”) limited in aggregate principal amount to no more than $500,010,000, which amount shall be as set forth in one or more written orders of the Corporation for the authentication and delivery of the Junior Subordinated Debentures pursuant to Section 3.3 of the Indenture. Junior Subordinated Debentures shall be issuable in minimum denomination of $25.00 and integral multiples thereof.

Section 2.2 Maturity Date . The maturity date (the “ Maturity Date ”) for the Junior Subordinated Debentures is initially September 15, 2063, but shall be automatically extended, without the consent of the holders of the Capital Securities or the Junior Subordinated Debentures, for an additional quarterly period on each of March 15, June 15, September 15 and December 15 beginning September 15, 2013 and through and including June 15, 2018, unless (i) earlier redeemed or (ii) at least 30, but no more than 60, days prior to any such extension date, the Corporation gives notice of its election to discontinue the automatic extension of the Maturity Date. If the Maturity Date is automatically extended on all extension dates, the Junior Subordinated Debentures shall mature on September 15, 2068. The principal amount of, and all accrued and unpaid interest on, the Junior Subordinated Debentures shall be payable in full on the Maturity Date, or if such day is not a Business Day, the following Business Day.

Section 2.3 Rate of Interest; Interest Payment Dates .

(a) Rate of Interest . The Junior Subordinated Debentures shall bear interest (i) at an annual rate of 8.95% from and including September 10, 2008 to but excluding September 15, 2063 (the “ Fixed Rate Period ”), and (ii) at an annual rate equal to the Three-Month LIBOR Rate plus 4.19%, from and including September 15, 2063 to but excluding September 15, 2068 (the “ Floating Rate Period ”). Interest shall accrue from September 10, 2008 or from the most recent Interest Payment Date to which interest has been paid or duly provided for, as the case may

 

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be, until the principal thereof is paid or made available for payment. Interest shall be computed on the basis of (i) a 360-day year comprised of twelve 30-day months with respect to any Fixed Rate Period and (ii) a 360-day year and the actual number of days elapsed with respect to any Floating Rate Period. Accrued interest that is not paid on the applicable Interest Payment Date (after giving effect to the adjustments described in the last sentence of Section 2.3(b)), including interest deferred pursuant to Section 2.4, shall bear Additional Interest, to the extent permitted by law, compounded on each subsequent Interest Payment Date from the relevant Interest Payment Date (i) at the annual rate of 8.95% during the Fixed Rate Period; and (ii) at the prevailing Three-Month LIBOR Rate plus 4.19% during the Floating Rate Period.

(b) Interest Payment Dates . Subject to Section 2.4 hereof, interest on the Junior Subordinated Debentures during the Fixed Rate Period shall be payable quarterly in arrears on March 15, June 15, September 15 and December 15 of each year, beginning on December 15, 2008 to but excluding September 15, 2063 (each such date, a “ Fixed Rate Interest Payment Date ”). Subject to Section 2.4 hereof, interest on the Junior Subordinated Debentures during the Floating Rate Period shall be payable quarterly in arrears on March 15, June 15, September 15 and December 15 of each year, beginning on December 15, 2063 (each such date, a “ Floating Rate Interest Payment Date, ” and together with a Fixed Rate Interest Payment Date, “ Interest Payment Dates ”). If any Interest Payment Date scheduled on or prior to the regularly scheduled Interest Payment Date on September 15, 2063 occurs on a day that is not a Business Day, the payment of interest for such Interest Payment Date shall be made (or such interest shall be made available for payment) on the next Business Day without any interest or other payment in respect of the delay; provided that for any Interest Payment Date scheduled after the regularly scheduled Interest Payment Date on September 15, 2063, if that next Business Day is in the next succeeding calendar month, the Interest Payment Date shall be the immediately preceding Business Day.

(c) Percentages . All percentages resulting from any calculations referred to in this Fourth Supplemental Indenture shall be rounded, if necessary, to the nearest one ten-thousandth of a percentage point, with five hundred-thousandths of a percentage point being rounded upwards (e.g., 6.87655% (or .0687655) would be rounded to 6.8766% (or .068766)), and all U.S. dollar amounts used in or resulting from such calculations shall be rounded to the nearest cent (with one-half cent or more being rounded upwards).

(d) To Whom Is Interest Payable . Interest shall be payable to the Person in whose name the Junior Subordinated Debentures are registered at the close of business on the Regular Record Date next preceding the relevant Interest Payment Date, except that interest payable on the Maturity Date shall be paid to the Person to whom principal is paid. The Regular Record Dates for the Junior Subordinated Debentures shall be the date 15 calendar days, whether or not a Business Day, before the relevant Interest Payment Date. Interest shall be payable at the office or agency of the Corporation maintained for such purpose in the City of New York and at any other office or agency maintained by the Corporation for such purpose; provided that at the option of the Corporation payment of interest may be made by check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register or by wire transfer to such account as may have been appropriately designated by such Person. The principal of and interest on the Junior Subordinated Debentures payable on the Maturity Date shall be made against presentation of the Junior Subordinated Debentures at the office or agency of the Corporation maintained for that purpose in the City of New York.

 

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Section 2.4 Interest Deferral.

(a) Option to Defer Interest Payments. The following provisions shall apply to the Junior Subordinated Indentures in lieu of Section 3.12 and the first paragraph of Section 10.7 of the Indenture:

(i) The Corporation shall have the right, at any time and from time to time, to defer the payment of interest on the Junior Subordinated Debentures for one or more consecutive Interest Periods that do not exceed 40 consecutive Interest Periods; provided that no Deferral Period shall extend beyond the Maturity Date or the earlier redemption in full of the Junior Subordinated Debentures. Upon termination of any Deferral Period and upon the payment of all deferred interest (including, Additional Interest thereon) then due on any Interest Payment Date, the Corporation may elect to begin a new Deferral Period pursuant to this Section 2.4.

(ii) Except as provided in Section 2.4(c), at the end of any Deferral Period, the Corporation shall pay all deferred interest on the Junior Subordinated Debentures (together with Additional Interest thereon, if any, at the rate specified for the Junior Subordinated Debentures) to the extent permitted by applicable law, to the Persons in whose names the Junior Subordinated Debentures are registered at the close of business on the Regular Record Date with respect to the Interest Payment Date at the end of such Deferral Period.

(iii) The Corporation may elect to pay interest on any Interest Payment Date during any Deferral Period to the extent permitted by Section 2.4(b).

(b) Payment of Deferred Interest . The Corporation shall not pay deferred interest (including Additional Interest thereon) on the Junior Subordinated Debentures on any Interest Payment Date during any Deferral Period prior to the Maturity Date or at any time an Event of Default has occurred and is continuing from any source other than Eligible Proceeds. Notwithstanding the foregoing, (i) the Corporation may pay current interest during a Deferral Period from any available funds and (ii) if the Federal Reserve disapproves of the Corporation’s sale of Qualifying APM Securities, the Corporation may pay deferred interest on the Junior Subordinated Debentures with cash from any source and if the Federal Reserve disapproves of the use of proceeds of the Corporation’s sale of Qualifying APM Securities to pay deferred interest on the Junior Subordinated Debentures, the Corporation may use the proceeds for other purposes and continue to defer interest on the Junior Subordinated Debentures. To the extent that the Corporation applies proceeds from the sale of Qualifying APM Securities to pay inte