Obligation Royal Bank of Canada 0% ( US780082AT05 ) en USD

Royal Bank of Canada

91 % ▼

Canada

US780082AT05 ( en USD )

24/11/2084

Prospectus brochure de l'obligation Royal Bank of Canada US780082AT05 en USD 0%, échéance 24/11/2084

200 000 USD

1 000 000 000 USD

780082AT0

BBB ( Qualité moyenne inférieure )

La Banque Royale du Canada (RBC) est une institution financière multinationale canadienne offrant une large gamme de services financiers, incluant les services bancaires aux particuliers et aux entreprises, la gestion de patrimoine, les marchés des capitaux et l'assurance.

L'Obligation émise par Royal Bank of Canada ( Canada ) , en USD, avec le code ISIN US780082AT05, paye un coupon de 0% par an.
Le paiement des coupons est annuel et la maturité de l'Obligation est le 24/11/2084
L'Obligation émise par Royal Bank of Canada ( Canada ) , en USD, avec le code ISIN US780082AT05, a été notée BBB ( Qualité moyenne inférieure ) par l'agence de notation Standard & Poor's ( S&P ).

424B2 1 d850670d424b2.htm 424B2
Table of Contents
Filed Pursuant to Rule 424(b)(2)
Registration Statement No. 333-275898
Prospectus Supplement to Prospectus Dated December 20, 2023
Royal Bank of Canada
US$1,000,000,000
6.350% Limited Recourse Capital Notes, Series 5
(Non-Viability Contingent Capital (NVCC))
(Subordinated Indebtedness)
1,000,000 Non-Cumulative 5-Year Fixed Rate Reset First Preferred Shares, Series BX
(Non-Viability Contingent Capital (NVCC))
Royal Bank of Canada ("we" or the "Bank") is offering $1,000,000,000 aggregate principal amount of 6.350% Limited Recourse Capital Notes,
Series 5 (Non-Viability Contingent Capital (NVCC)) (Subordinated Indebtedness) (the "Notes"). The Notes will mature on November 24, 2084. We will
pay interest on the Notes in equal (subject to the reset of the interest rate and the long first coupon) quarterly installments in arrears on February 24, May
24, August 24, and November 24 of each year, with the first payment on February 24, 2025. From the date of issue to, but excluding, November 24,
2034, the interest rate on the Notes will be fixed at 6.350% per annum. Starting on November 24, 2034 and on every fifth anniversary of such date
thereafter until November 24, 2079 (each such date, an "Interest Reset Date"), the interest rate on the Notes will be reset at an interest rate per annum
equal to the U.S. Treasury Rate on the business day prior to such Interest Reset Date (each, an "Interest Rate Calculation Date") plus 2.257%. See
page S-21 for a definition of U.S. Treasury Rate. Assuming the Notes are issued on November 1, 2024, the first interest payment on the Notes on
February 24, 2025 will be in an amount of $19.93194444 per $1,000 principal amount of Notes.
This prospectus supplement, together with the accompanying prospectus dated December 20, 2023 to which it relates (the "prospectus"), also
relates to the offering of 1,000,000 Non-Cumulative 5-Year Fixed Rate Reset First Preferred Shares, Series BX (Non-Viability Contingent Capital
(NVCC)) of the Bank (the "Preferred Shares Series BX"), at a price of $1,000 per share to be issued to the Limited Recourse Trustee (as defined
below) in connection with the issuance of the Notes. The Preferred Shares Series BX offered hereby will be issued concurrently with the closing of the
offering of the Notes.
The Notes are intended to qualify as our Additional Tier 1 capital within the meaning of the regulatory capital adequacy requirements to
which we are subject. In the event of a non-payment by the Bank of the principal amount of, interest on or redemption price for the Notes when
due, the sole remedy of holders of Notes shall be the delivery of the Limited Recourse Trust Assets (as defined below), which initially shall
consist of the Preferred Shares Series BX. See "Description of the Notes Limited Recourse".
The Notes will be our direct unsecured obligations which, if we become insolvent or are wound-up (prior to the occurrence of a Trigger Event (as
defined below)), will rank: (a) subordinate in right of payment to the prior payment of all our Higher Ranked Indebtedness (as defined below), including
certain Subordinated Indebtedness (as defined below) and (b) in right of payment equally with our Junior Subordinated Indebtedness (as defined below)
(other than Junior Subordinated Indebtedness which by its terms ranks subordinate to the Notes) and will be subordinate in right of payment to the
claims of our depositors and other unsubordinated creditors, provided that in any such case and in case of the Bank's non-payment of the principal
amount of, interest on or redemption price for the Notes when due, the sole remedy of the holders of Notes shall be the delivery of the Limited Recourse
Trust Assets. Upon the occurrence of a Recourse Event (as defined below), including if we become insolvent or are wound-up (prior to the occurrence
of a Trigger Event), the recourse of each holder of the Notes will be limited to such holder's proportionate share of the Limited Recourse Trust Assets
and the delivery of the applicable Limited Recourse Trust Assets to holders of the Notes will exhaust all remedies of such holders including in
connection with any such event. If the Limited Recourse Trust Assets that are delivered to holders of the Notes under such circumstances comprise
Preferred Shares Series BX or common shares of the Bank ("Common Shares"), such Preferred Shares Series BX or Common Shares will rank on
parity with all other first preferred shares of the Bank ("First Preferred Shares") or Common Shares, as applicable. See "Description of the Notes".

Table of Contents
The Notes will be direct unsecured obligations of the Bank constituting subordinated indebtedness for the purposes of the Bank Act
(Canada) (the "Bank Act") and will not constitute savings accounts, deposits or other obligations that are insured by the United States Federal
Deposit Insurance Corporation, the Deposit Insurance Fund, the Canada Deposit Insurance Corporation (the "CDIC") or any other
governmental agency or under the Canada Deposit Insurance Corporation Act (Canada) (the "CDIC Act"), the Bank Act or any other deposit
insurance regime designed to ensure the payment of all or a portion of a deposit upon the insolvency of the deposit taking financial institution.
The Notes will not be subject to Bail-in Conversion (as defined herein).
In the event of the redemption of the Preferred Shares Series BX held by the Limited Recourse Trust (as defined below) prior to the Transfer Date
(as defined below), outstanding Notes with an aggregate principal amount equal to the aggregate face amount of the Preferred Shares Series BX
redeemed will be automatically redeemed. Upon the occurrence of certain regulatory and tax events, we may, with the approval of the Superintendent of
Financial Institutions (Canada) (the "Superintendent"), redeem all of the Notes. In the event that there is non-payment by us of interest on the Notes on
an Interest Payment Date (as defined below), and we have not cured such non-payment by subsequently paying such interest prior to the fifth business
day following such Interest Payment Date, a Recourse Event will have occurred and, on the Failed Coupon Payment Date (as defined below), the Notes
shall automatically and immediately be redeemed for a redemption price equal to the principal amount of the Notes together with accrued and unpaid
interest to, but excluding, the Failed Coupon Payment Date. From and after the Failed Coupon Payment Date, all Notes will cease to be outstanding,
each holder of the Notes will cease to be entitled to interest thereon, and any certificates representing the Notes will represent only the right to receive
upon surrender thereof the redemption price. If the Bank does not pay the applicable redemption price in cash under such circumstances, our obligation
to pay the redemption price will be satisfied by our delivery of the Limited Recourse Trust Assets to which the recourse of the holders of the Notes will
be limited. See "Description of the Notes Redemption" and "Description of Preferred Shares Series BX Redemption".
Prior to this offering, there has been no public market for the Notes. We do not intend to apply for listing of the Notes or the Preferred Shares
Series BX on any securities exchange or for inclusion in any automated quotation system and, consequently, there is no market through which the Notes
(or the Preferred Shares Series BX upon delivery of the Limited Recourse Trust Assets) may be sold and purchasers may not be able to resell the Notes
purchased under this prospectus supplement (or the Preferred Shares Series BX upon delivery of the Limited Recourse Trust Assets).
An investment in the Notes (and Preferred Shares Series BX and Common Shares upon delivery of the Limited
Recourse Trust Assets, including upon the occurrence of a Trigger Event) bears certain risks. See "Risk Factors"
beginning on page S-10 of this prospectus supplement and page 1 of the accompanying prospectus.
Underwriting
Net Proceeds to the
Price to the Public
Discount
Bank(1)
Per $1,000 principal amount of Notes(2)
$
1,000
$
10
$
990
Total
$ 1,000,000,000
$ 10,000,000
$
990,000,000
(1)
After deducting the underwriting discount shown in the table above, but before deducting expenses of the offering, estimated to be approximately
$560,000, all of which will be paid by the Bank.
(2)
The Notes will be issued only in minimum denominations of $200,000 and integral multiples of $1,000 in excess thereof.
The purchase price to be paid by the Limited Recourse Trust for the Preferred Shares Series BX offered hereby shall be satisfied by funds
deposited by the Bank with the Limited Recourse Trustee as Limited Recourse Trust Assets. As a result, no proceeds will be raised from the offering of
the Preferred Shares Series BX pursuant to this prospectus supplement.
Neither the Securities and Exchange Commission (the "SEC") nor any state securities commission has approved or disapproved of the
Notes or the Preferred Shares Series BX or passed upon the adequacy or accuracy of this prospectus supplement or the accompanying
prospectus. Any representation to the contrary is a criminal offense.
RBC Capital Markets, LLC is a wholly-owned subsidiary of the Bank. Accordingly, the Bank is a related issuer and connected issuer of
RBC Capital Markets, LLC under applicable Canadian securities legislation (see "Supplemental Plan of Distribution -- Conflicts of Interest"
on page S-42).
The underwriters expect to deliver the Notes through the book-entry delivery system of The Depository Trust Company and its direct and indirect
participants, including Euroclear or Clearstream, on or about November 1, 2024.
No underwriter has been involved in the issuance of the Preferred Shares Series BX to the Limited Recourse Trustee.
Lead Managers and Joint Bookrunners
RBC Capital Markets
BofA Securities
Citigroup
J.P. Morgan
Morgan Stanley
HSBC
Passive Bookrunners
Fifth Third Securities
NatWest Markets
SOCIETE GENERALE
US Bancorp
Co-Managers
ANZ Securities
BNY Mellon Capital Markets, LLC
CaixaBank
Capital One Securities
Comerica Securities
Commonwealth Bank of Australia
Credit Agricole CIB
Desjardins Capital Markets
Huntington Capital Markets
KeyBanc Capital Markets
M&T Securities
MUFG
nabSecurities, LLC
National Bank of Canada Financial Markets

Rabo Securities
Regions Securities LLC
UBS Investment Bank
Westpac Banking Corporation
Independence Point Securities
Penserra Securities LLC
Prospectus Supplement dated October 17, 2024

Table of Contents
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
ABOUT THIS PROSPECTUS SUPPLEMENT
S-1
INCORPORATION BY REFERENCE
S-3
SUMMARY OF THE NOTES
S-5
RISK FACTORS
S-10
USE OF PROCEEDS
S-19
CONSOLIDATED CAPITALIZATION
S-20
DESCRIPTION OF THE NOTES
S-21
DESCRIPTION OF PREFERRED SHARES SERIES BX
S-30
U.S. FEDERAL INCOME TAX CONSIDERATIONS
S-35
CANADIAN FEDERAL INCOME TAX CONSIDERATIONS
S-38
SUPPLEMENTAL PLAN OF DISTRIBUTION
S-41
VALIDITY OF THE SECURITIES
S-46
EXPERTS
S-46
PROSPECTUS
DOCUMENTS INCORPORATED BY REFERENCE
i
WHERE YOU CAN FIND MORE INFORMATION
ii
FURTHER INFORMATION
ii
ABOUT THIS PROSPECTUS
ii
RISK FACTORS
1
ROYAL BANK OF CANADA
1
PRESENTATION OF FINANCIAL INFORMATION
1
CAUTION REGARDING FORWARD-LOOKING STATEMENTS
2
USE OF PROCEEDS
3
DESCRIPTION OF DEBT SECURITIES
4
DESCRIPTION OF COMMON SHARES
25
DESCRIPTION OF FIRST PREFERRED SHARES
27
DESCRIPTION OF WARRANTS
29
NON-VIABILITY CONTINGENT CAPITAL PROVISIONS
37
OWNERSHIP AND BOOK-ENTRY ISSUANCE
38
TAX CONSEQUENCES
44
PLAN OF DISTRIBUTION
58
BENEFIT PLAN INVESTOR CONSIDERATIONS
61
LIMITATIONS ON ENFORCEMENT OF U.S. LAWS AGAINST THE BANK, OUR MANAGEMENT AND
OTHERS
62
VALIDITY OF SECURITIES
63
EXPERTS
63
OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
63
ABOUT THIS PROSPECTUS SUPPLEMENT
In this prospectus supplement, unless the context otherwise indicates, the "Bank", "we", "us" or "our" means Royal Bank of Canada together, if
the context requires, with its subsidiaries.
In this prospectus supplement, currency amounts are stated in U.S. dollars ("$"), unless specified otherwise.
This prospectus supplement describes the specific terms of the Notes. The prospectus, dated December 20, 2023 (the "prospectus") provides you
with more general information, some of which may not apply to the Notes. If there is any inconsistency between the information in this prospectus
supplement and the accompanying prospectus, you should rely on the information in this prospectus supplement. We urge you to read carefully both this
prospectus supplement and the accompanying prospectus, together with the information incorporated herein and in the accompanying prospectus by
reference, before deciding whether to invest in any Notes.
S-1

Table of Contents
You should not consider any information in this prospectus supplement, the accompanying prospectus or any free writing prospectus we have
authorized to be investment, tax, legal, business or financial advice. You should consult your own counsel, accountant and other advisors for investment,
tax, legal, business, financial and related advice regarding the purchase of the Notes. We are not making any representation to you regarding the legality
of an investment in the Notes by you under applicable investment or similar laws.
S-2

Table of Contents
INCORPORATION BY REFERENCE
The SEC allows us to "incorporate by reference" the information we file with it, which means we can disclose important information to you by
referring you to those documents. Copies of the documents incorporated herein by reference may be obtained upon written or oral request without
charge from Investor Relations, Royal Bank of Canada, 200 Bay Street South Tower, 20th Floor, Toronto, Ontario, Canada M5J 2J5 (416-955-7808).
The documents incorporated by reference are available over the Internet at https://www.sec.gov.
We incorporate by reference the documents listed below:
·
Annual Report on Form 40-F for the fiscal year ended October 31, 2023, filed on November 30, 2023 (the "2023 Annual Report");
·
Report on Form 6-K filed on December 20, 2023 (Acc-no 0001193125-23-299534);
·
Report on Form 6-K filed on December 20, 2023 (Acc-no 0001193125-23-299536);
·
Report on Form 6-K filed on December 21, 2023 (Acc-no 0001140361-23-058741);
·
Report on Form 6-K filed on December 22, 2023 (Acc-no 0001193125-23-301730);
·
Report on Form 6-K filed on January 16, 2024 (Acc-no 0001193125-24-008207);
·
Report on Form 6-K filed on January 19, 2024 (Acc-no 0001214659-24-001020);
·
Report on Form 6-K filed on February 28, 2024 (Acc-no 0001193125-24-049063);
·
Report on Form 6-K filed on March 5, 2024 (Acc-no 0001214659-24-004070);
·
Report on Form 6-K filed on March 29, 2024 (Acc-no 0001214659-24-005552);
·
Report on Form 6-K filed on April 8, 2024 (Acc-no 0001214659-24-006266);
·
Report on Form 6-K filed on April 24, 2024 (Acc-no 0001193125-24-109984);
·
Report on Form 6-K filed on May 16, 2024 (Acc-no 0000950103-24-006775);
·
Report on Form 6-K filed on May 30, 2024 (Acc-no 0001193125-24-149735);
·
Report on Form 6-K filed on July 11, 2024 (Acc-no 0001214659-24-012210);
·
Report on Form 6-K filed on July 23, 2024 (Acc-no 0001214659-24-012867);
·
Report on Form 6-K filed on August 28, 2024 (Acc-no 0001193125-24-208204); and
·
Report on Form 6-K filed on September 12, 2024 (Acc-no 0001214659-24-016353).
In addition, we will incorporate by reference into this prospectus all documents that we file under Section 13(a), 13(c), 14 or 15(d) of the United
States Securities Exchange Act of 1934, as amended (the "Exchange Act") and, to the extent, if any, we designate therein, reports on Form 6-K we
furnish to the SEC after the date of this prospectus and prior to the termination of any offering contemplated in this prospectus.
Any statement contained in this prospectus or in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be
modified or superseded, for purposes of this prospectus, to the extent that a statement contained herein or in any other subsequently filed or furnished
document that also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. The modifying or superseding
statement need not state that it has modified or superseded a prior statement or include any other information set forth in the document that it modifies or
supersedes. The making of a modifying or superseding statement shall not be deemed an admission for any purposes that the modified or superseded
statement, when made, constituted a misrepresentation, an untrue statement of a material fact or an omission to state a material fact that is required to be
stated or that is necessary to make a statement not misleading in light of the circumstances in which it was made. Any statement so modified or
superseded shall not be deemed, except as so modified or superseded, to constitute a part of this prospectus.
S-3

Table of Contents
Upon a new Annual Report and the related annual financial statements being filed by us with, and, where required, accepted by, the SEC, the
previous Annual Report shall be deemed no longer to be incorporated by reference into this prospectus for purposes of future offers and sales of
securities hereunder.
All documents incorporated by reference, or to be incorporated by reference, have been filed with or furnished to, or will be filed with or
furnished to, the SEC.
S-4

Table of Contents
SUMMARY OF THE NOTES
This summary highlights information about the Notes contained elsewhere in this prospectus supplement and the accompanying prospectus. As a result,
it does not contain all of the information that may be important to you or that you should consider before investing in the Notes, and this summary is
qualified by the detailed information appearing elsewhere in this prospectus supplement, the accompanying prospectus, and the documents incorporated
by reference herein. You should read carefully this entire prospectus supplement and the accompanying prospectus, including the "Risk Factors" section
of this prospectus supplement, and the documents incorporated by reference into this prospectus supplement, which are described under "Incorporation
of Certain Information by Reference" in this prospectus supplement.
Issuer:
Royal Bank of Canada
Title of the Series:
6.350% Limited Recourse Capital Notes, Series 5 (Non-Viability Contingent Capital (NVCC)) (Subordinated
Indebtedness)
Principal Amount:
$1,000,000,000
Maturity Date:
November 24, 2084
Interest Rate:
From the date of issue to, but excluding, November 24, 2034, the Notes will bear interest at the rate of 6.350% per
annum. Starting on November 24, 2034 and on every fifth anniversary of such date thereafter until November 24, 2079
(each such date, an "Interest Reset Date"), the interest rate on the Notes will be reset at an interest rate per annum
equal to the U.S. Treasury Rate on the business day prior to such Interest Reset Date plus 2.257%. Assuming the Notes
are issued on November 1, 2024, the first interest payment on the Notes on February 24, 2025 will be in an amount of
$19.93194444 per $1,000 principal amount of Notes.
Interest Payment Dates
Quarterly on each February 24, May 24, August 24 and November 24, beginning February 24, 2025.
Interest Deferability:
Interest payments are non-deferrable.
If there is non-payment by the Bank of interest on the Notes when due and the Bank has not cured such non-payment
by subsequently paying such interest prior to the fifth business day immediately following the applicable interest
payment date, a Recourse Event will have occurred and, on a Failed Coupon Payment Date, the Notes will
automatically and immediately be redeemed for a redemption price equal to the principal amount of the Notes together
with accrued and unpaid interest to, but excluding, the Failed Coupon Payment Date. From and after a Failed Coupon
Payment Date, all Notes shall cease to be outstanding, each holder of Notes shall cease to be entitled to interest
thereon, and any certificates representing the Notes shall represent only the right to receive upon surrender thereof the
redemption price equal to the principal amount of the Notes together with accrued and unpaid interest to, but
excluding, the Failed Coupon Payment Date.
If the Bank does not pay the applicable redemption price in cash under such circumstances, its obligation to pay the
redemption price will be satisfied by the Bank's delivery of the Limited Recourse Trust Assets to which the recourse of
the holders of the Notes will be limited. The Limited Recourse Trust Assets will consist of Preferred Shares Series BX
except under certain circumstances, as described below, where the Limited Recourse Trust Assets may consist of the
Bank's Common Shares or cash. (See "Description of Notes Limited Recourse").
Redemption:
The Notes shall be redeemable by the Bank on November 24, 2034, and on each February 24, May 24, August 24 and
November 24 thereafter, in whole but not in part on not less than 10 nor more than 60 days' prior notice at the
redemption price, only upon the redemption by the Bank of the Preferred Shares Series BX held by the Limited
Recourse Trustee in the Limited Recourse Trust in accordance with the terms of such shares and with the prior written
approval of the Superintendent.
S-5

Table of Contents
Upon redemption by the Bank of the Preferred Shares Series BX held by the Limited Recourse Trustee as described
above prior to the Maturity Date (such redemption will be subject to the prior written approval of the Superintendent),
outstanding Notes with an aggregate principal amount equal to the aggregate face amount of Preferred Shares Series
BX redeemed by the Bank shall automatically and immediately be redeemed, for a cash amount equal to the
redemption price thereof, without the consent of the holders of the Notes. Subject to the provisions of the Bank Act,
the consent of the Superintendent and various restrictions on the retirement of the Preferred Shares Series BX, the
Preferred Shares Series BX are redeemable at the option of the Bank on November 24, 2034 and on each February 24,
May 24, August 24 and November 24 thereafter and in certain other circumstances. See "Description of Preferred
Shares Redemption" for circumstances under which the Preferred Shares Series BX may be redeemed by the Bank.
For certainty, to the extent that the Bank has immediately prior to or concurrently with such Preferred Shares Series
BX redemption redeemed or purchased for cancellation a corresponding number of Notes in accordance with the terms
of the Indenture (as defined below), such requirement to redeem a corresponding number of Notes shall be deemed
satisfied.
The Bank may also, at its option, with the prior written approval of the Superintendent, redeem the Notes, in whole but
not in part, at any time on or within 90 days following a Special Event Date and on not less than 10 nor more than 60
days' prior notice, at the redemption price. Any Notes redeemed by the Bank shall be cancelled and may not be
reissued.
Limited Recourse:
If (i) there is non-payment by the Bank of the principal amount of the Notes, together with any accrued and unpaid
interest, on the maturity date, (ii) a Failed Coupon Payment Date occurs, (iii) in connection with the redemption of the
Notes, on the redemption date for such redemption, the Bank does not pay the applicable redemption price in cash,
(iv) the occurrence of an event of default under the Indenture, or (v) the occurrence of a Trigger Event (each such
event, a "Recourse Event"), the recourse of each holder of Notes will be limited to such holder's proportionate share of
the Limited Recourse Trust Assets held by the Limited Recourse Trustee in respect of the Notes in the Limited
Recourse Trust. The Limited Recourse Trustee will hold assets in the Limited Recourse Trust in respect of more than
one series of limited recourse capital notes, and the assets (including the Bank's preferred shares) for each such series
will be held separate from the assets for other series. Computershare Trust Company of Canada is the Limited
Recourse Trustee.
Initially, at the time of issuance of the Notes, the Limited Recourse Trust Assets will consist of the Bank's Preferred
Shares Series BX issued at an issue price of $1,000 per Preferred Shares Series BX. The Limited Recourse Trust
Assets may alternatively consist of (i) Preferred Shares Series BX, (ii) cash if the Preferred Shares Series BX are
redeemed for cash by the Bank with the prior written approval of the Superintendent, (iii) Common Shares upon the
conversion of the Preferred Shares Series BX into Common Shares as a result of a Trigger Event or (iv) any
combination thereof, depending on the circumstances.
The number of Preferred Shares Series BX issued at the time of issuance of the Notes will be equal to the total
principal amount of the Notes divided by $1,000. If the Limited Recourse Trust Assets consist of Preferred Shares
Series BX at the time a Recourse Event occurs, the Bank will deliver, or cause the Limited Recourse Trustee to deliver,
to each holder of Notes one Preferred Share for each $1,000 principal amount of Notes held, which shall be applied to
the payment of the principal amount of the Notes, and such delivery of Preferred Shares Series BX will be each holder
of Notes' sole remedy against the Bank for repayment of the principal amount of the Notes and any accrued but unpaid
interest thereon then due and payable.
Upon the occurrence of a Recourse Event that is a Trigger Event, the Bank will deliver, or cause the Limited Recourse
Trustee to deliver, to each holder of Notes that holder's proportionate share of the Common Shares issued in
connection with the Trigger Event. The number of Common Shares issuable in connection with the Trigger Event will
be calculated based on a Share Value of $1,000. Such Common Shares shall be applied to the payment of the principal
amount of the Notes, and such delivery of Common Shares will be each holder of Notes' sole remedy against the Bank
for repayment of the principal amount of the Notes and any accrued but unpaid interest thereon then due and payable.
See "Description of Preferred Shares Series BX Conversion Upon Occurrence of a Non-Viability Contingent Capital
Trigger Event".
The receipt by a holder of Notes of its proportionate share of the Limited Recourse Trust Assets upon the occurrence
of a Recourse Event shall exhaust the remedies of that holder of the Notes under the terms of the Notes. If a holder of
Notes does not receive its proportionate share of the Limited Recourse Trust Assets under such circumstances, the sole
remedy of the holder of Notes for any claims against the Bank shall be limited to a claim for the delivery of such
Limited Recourse Trust Assets.
S-6

Table of Contents
In case of any shortfall resulting from the value of the Limited Recourse Trust Assets being less than the principal
amount of and any accrued and unpaid interest on the Notes, all losses arising from such shortfall shall be borne by the
holders of the Notes.
All claims of holders of the Notes against the Bank under the Notes will be extinguished upon receipt of the Limited
Recourse Trust Assets.
Purchase for Cancellation:
The Bank may, at its option and at any time, with the prior written approval of the Superintendent, purchase the Notes
in the market, by tender (available to all holders of Notes) or by private contract at any price.
NVCC Automatic
Upon the occurrence of a Trigger Event, each Preferred Share Series BX held in the Limited Recourse Trust will be
Conversion:
automatically converted, without the consent of the holders of the Notes, the Limited Recourse Trustee or the trustee,
into the number of fully-paid and freely-tradeable Common Shares of the Bank based on the Conversion Price.
Immediately following such Trigger Event conversion, each $1,000 principal amount of Notes will be automatically
redeemed, without the consent of holders of the Notes, for the number of Common Shares into which each Preferred
Share was converted.
Events of Default:
The only events of default under the Notes shall be the bankruptcy, insolvency or liquidation of the Bank.
An event of default under the Notes will not include any non-payment by the Bank of the principal amount of or
interest on the Notes, the non-performance by the Bank of any other covenant of the Bank in the Indenture, or the
occurrence of a Trigger Event.
The occurrence of an event of default is a Recourse Event for which the sole remedy of the holders of the Notes shall
be the delivery of the Limited Recourse Trust Assets. In case of an event of default, the delivery of the Limited
Recourse Trust Assets to the holders of the Notes will exhaust all remedies of such holders of the Notes in connection
with such event of default.
Status and Subordination:
The Notes will be direct unsecured subordinated indebtedness of the Bank and will rank subordinate to all of the
Bank's deposit liabilities and all of the Bank's other indebtedness (including all of the Bank's other unsecured and
subordinated indebtedness) from time to time issued and outstanding, except for such indebtedness which by its terms
ranks equally in right of payment with, or is subordinate to, the Notes.
Upon the occurrence of a Recourse Event, including if the Bank becomes insolvent or is wound-up (prior to the
occurrence of a Trigger Event), the recourse of each holder of Notes will be limited to such holder's proportionate
share of the Limited Recourse Trust Assets. As mentioned above, the receipt by a holder of Notes of its proportionate
share of the Limited Recourse Trust Assets upon the occurrence of a Recourse Event shall exhaust the remedies of
such holder of Notes under the Notes. If a holder of Notes does not receive its proportionate share of the Limited
Recourse Trust Assets under such circumstances, the sole remedy of the holder of Notes for any claims against the
Bank shall be limited to a claim for the delivery of such Limited Recourse Trust Assets. If the Limited Recourse Trust
Assets that are delivered to the holders of the Notes under such circumstances comprise Preferred Shares Series BX or
Common Shares, such Preferred Shares Series BX or Common Shares will rank on parity with the Bank's other First
Preferred Shares or Common Shares, as applicable.
Prohibited Owners:
The terms and conditions of the Notes will include mechanics to allow the Bank to attempt to facilitate a sale of
Preferred Shares Series BX or Common Shares (issued upon a Recourse Event) on behalf of those holders of the Notes
who are Ineligible Persons or who, by virtue of that delivery, would become Significant Shareholders. The net
proceeds received by the Bank from the sale of any such Preferred Shares Series BX or Common Shares will be
divided among the applicable persons in proportion to the number of Preferred Shares Series BX or Common Shares
that would otherwise have been delivered to them after deducting the costs of sale and any applicable withholding
taxes.
S-7