COMMON SECURITY CERTIFICATE
THIS COMMON SECURITY HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS OR ANY OTHER
APPLICABLE SECURITIES LAWS AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED EXCEPT PURSUANT TO AN EXEMPTION FROM REGISTRATION.
EXCEPT AS SET FORTH IN SECTION 8.1(b) OF THE DECLARATION (AS
DEFINED BELOW), THIS SECURITY MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED.
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Certificate Number C-1 Number of Common Securities 310
Certificate Evidencing Common Securities
of
Texas Capital Statutory Trust II
Texas Capital Statutory Trust II, a statutory trust created
under the laws of the State of Delaware (the "Trust"), hereby certifies that
Texas Capital Bancshares, Inc. (the "Holder") is the registered owner of 310
common securities of the Trust representing undivided beneficial interests in
the assets of the Trust (liquidation amount $1,000 per Common Security)(the
"Common Securities"). The Common Securities represented hereby are issued
pursuant to, and the designation, rights, privileges, restrictions, preferences
and other terms and provisions of the Common Securities shall in all respects be
subject to, the provisions of the Amended and Restated Declaration of Trust of
the Trust, dated as of April 10, 2003, among Raleigh Hortenstine III and Joseph
M. Grant, as Administrators, Wilmington Trust Company, as Delaware Trustee,
Wilmington Trust Company, as Institutional Trustee, the Holder, as Sponsor, and
the holders from time to time of undivided beneficial interests in the assets of
the Trust, including the designation of the terms of the Common Securities as
set forth in Annex I to the Declaration, as the same may be amended from time to
time (the "Declaration"). Capitalized terms used herein but not defined shall
have the meaning given them in the Declaration. The Sponsor will provide a copy
of the Declaration and the Indenture to the Holder without charge upon written
request to the Sponsor at its principal place of business.
As set forth in the Declaration, when an Event of Default has
occurred and is continuing, the rights of Holders of Common Securities to
payment in respect of Distributions and payments upon Liquidation, redemption or
otherwise are subordinated to the rights of payment of Holders of the Capital
Securities.
By acceptance of this Certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.
By acceptance of this Certificate, the Holder agrees to treat,
for United States federal income tax purposes, the Debentures as indebtedness
and the Common Securities as evidence of undivided beneficial ownership in the
Debentures.
This Common Security is governed by, and shall be construed in
accordance with, the laws of the State of Delaware, without regard to principles
of conflict of laws.
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IN WITNESS WHEREOF, the Trust has executed this certificate
this 10th day of April, 2003.
Texas Capital Statutory Trust II
By: /s/ RALEIGH HORTENSTINE III
-----------------------------
Name: Raleigh Hortenstine III
Title: Administrator
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[REVERSE OF SECURITY]
Distributions payable on each Common Security will be
identical in amount to the Distributions payable on each Capital Security, which
is at a variable per annum rate of interest, reset quarterly, equal to LIBOR (as
defined in the Declaration) plus 3.25% (the "Coupon Rate") of the stated
liquidation amount of $1,000 per Capital Security, such rate being the rate of
interest payable on the Debentures to be held by the Institutional Trustee.
Except as set forth below in respect of an Extension Period, Distributions in
arrears for more than one quarterly period will bear interest thereon compounded
quarterly at the applicable Coupon Rate for each such quarterly period (to the
extent permitted by applicable law). The term "Distributions" as used herein
includes cash distributions, any such compounded distributions and any
Additional Amounts payable on the Debentures unless otherwise stated. A
Distribution is payable only to the extent that payments are made in respect of
the Debentures held by the Institutional Trustee and to the extent the
Institutional Trustee has funds legally available in the Property Account
therefor. The amount of Distributions payable for any period will be computed
for any full quarterly Distribution period on the basis of a 360-day year and
the actual number of days elapsed in the relevant Distribution period.
Except as otherwise described below, Distributions on the
Common Securities will be cumulative, will accrue from the date of original
issuance and will be payable quarterly in arrears on January 24, April 24, July
24 and October 24 of each year, commencing on July 24, 2003 (each, a
"Distribution Payment Date"). The Debenture Issuer has the right under the
Indenture to defer payments of interest on the Debentures by extending the
interest payment period for up to 20 consecutive quarterly periods (each, an
"Extension Period") at any time and from time to time on the Debentures, subject
to the conditions described below, during which Extension Period no interest
shall be due and payable. During any Extension Period, interest will continue to
accrue on the Debentures, and interest on such accrued interest (such accrued
interest and interest thereon referred to herein as "Deferred Interest") will
accrue at an annual rate equal to the Coupon Rate in effect for each such
Extension Period, compounded quarterly from the date such Deferred Interest
would have been payable were it not for the Extension Period, to the extent
permitted by law. No Extension Period may end on a date other than a
Distribution Payment Date. At the end of any such Extension Period, the
Debenture Issuer shall pay all Deferred Interest then accrued and unpaid on the
Debentures; provided, however, that no Extension Period may extend beyond the
Maturity Date, Redemption Date or Special Redemption Date. Prior to the
termination of any Extension Period, the Debenture Issuer may further extend
such period, provided, that such period together with all such previous and
further consecutive extensions thereof shall not exceed 20 consecutive quarterly
periods, or extend beyond the Maturity Date. Upon the termination of any
Extension Period and upon the payment of all Deferred Interest, the Debenture
Issuer may commence a new Extension Period, subject to the foregoing
requirements. No interest or Deferred Interest shall be due and payable during
an Extension Period, except at the end thereof, but Deferred Interest shall
accrue upon each installment of interest that would otherwise have been due and
payable during such Extension Period until such installment is paid. The
deferral of the payment of interest during and Extension Period shall not defer
the payment of any Additional Amounts that may be due. If Distributions are
deferred, the Distributions due shall be paid on the date that the related
Extension Period terminates to Holders of the Securities as they appear on the
books and records of the Trust on the record date immediately preceding such
date. Distributions on the Securities
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must be paid on the dates payable (after giving effect to any Extension Period)
to the extent that the Trust has funds legally available for the payment of such
distributions in the Property Account of the Trust. The Trust's funds legally
available for Distribution to the Holders of the Securities will be limited to
payments received from the Debenture Issuer. The payment of Distributions out of
moneys held by the Trust is guaranteed by the Guarantor pursuant to the
Guarantee.
The Common Securities shall be redeemable as provided in the
Declaration.
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ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this
Common Security Certificate to:
(Insert assignee's social security or tax identification number)
(Insert address and zip code of assignee),
and irrevocably appoints ______as agent to transfer this Common Security
Certificate on the books of the Trust. The agent may substitute another to act
for him or her.
Date:
Signature:
(Sign exactly as your name appears on the other side of this
Common Security Certificate)
Signature Guarantee:(2)
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(2) Signature must be guaranteed by an "eligible guarantor institution"
that is a bank, stockbroker, savings and loan association or credit union,
meeting the requirements of the Security registrar, which requirements include
membership or participation in the Securities Transfer Agents Medallion Program
("STAMP") or such other "signature guarantee program" as may be determined by
the Security registrar in addition to, or in substitution for, STAMP, all in
accordance with the Securities Exchange Act of 1934, as amended.
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