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U.S. Capital Securities


Northgroup Preferred Capital Corporation

The information in this section is a summary only and is qualified in its entirety by the more detailed information appearing in the Articles of Incorporation of the Company.

Outstanding Investor-Held Securities

500,000 shares of Fixed-to-Floating Rate Exchangeable Non-cumulative Perpetual Preferred Stock, Series A ("Series A Preferred Stock") issued by Northgroup Preferred Capital Corporation (the "Company"), a Maine corporation and an indirect subsidiary of TD.

CUSIP Number

66644P AA 5

Transfer Agent

The Bank of New York Mellon Trust Company, N.A.
One Wall Street
New York, NY 10286
USA

Liquidation Preference

US$1,000 per share

Description

The Series A Preferred Stock are preferred equity securities of the Company.  The Company believes it has been qualified as a Real Estate Investment Trust ("REIT") under the Internal Revenue Code of 1986, as amended (the "Code").  The Series A Preferred Stock currently qualify as Tier 1 capital of TD Bank, N.A., the Company's parent and an indirect subsidiary of TD, and as Tier 1 capital of TD.

Dividends

Holders of Series A Preferred Stock are entitled to receive, if, when and as declared by the Board of Directors of the Company, non-cumulative semi-annual dividends at an annual rate of 6.378% up to October 15, 2017, payable on April 15 and October 15 of each year.  Commencing the dividend period starting on October 15, 2017 and for every dividend period thereafter, dividends, if, when and as declared by the Board of Directors of the Company, will be payable quarterly at an annual rate of 3-Month LIBOR plus 1.1725%, on January 15, April 15, June 15 and October 15 of each year.

TD Bank US Holding Company ("TD US Holdco"), the parent of TD Bank, N.A., has covenanted in favor of the Company and the holders of Series A Preferred Stock that, so long as any shares of the Series A Preferred Stock are outstanding,  if full dividends on the Series A Preferred Stock  have not been declared and paid for any dividend period, TD US Holdco will not declare or pay dividends or other distributions with respect to, or redeem, repurchase, or otherwise acquire any shares of common stock or preferred stock of TD US Holdco during the next succeeding dividend period, except to declare or pay dividends or distributions in additional shares of TD US Holdco's common stock.

Redemption

After October 15, 2012 but prior to October 15, 2017, the Company may, with regulatory approval, at its option, redeem the Series A Preferred Stock in whole or in part at a cash redemption price equal to the greater of (a) US$1,000 per share, or (b) a price per share calculated as the sum of the present value of $1,000 per share of Series A Preferred Stock, discounted from October 15, 2017 to the redemption date, and the present value of all undeclared dividends for each dividend period from the redemption date to and including October 15, 2017, discounted from their applicable dividend payment dates to the redemption date at the Treasury Rate plus 0.25%  and any accumulated dividends.

On October 15, 2017, and every 5 years thereafter, the Company may, with regulatory approval, at its option, redeem the Series A Preferred Stock in whole or in part for a cash redemption price equal to US$1,000 per share of Series A Preferred Stock.

After October 15, 2017, on any date that is not a five-year anniversary date, the Company may, with regulatory approval, at its option redeem the Series A Preferred Stock in whole or in part at a cash redemption price equal to the greater of (a) US$1,000 per share, or (b) a price per share calculated as the sum of the present value of US$1,000 per share of Series A Preferred Stock, discounted from the next succeeding five-year anniversary date to the redemption date, and the present value of all undeclared dividends for each dividend period from the redemption date to and including the next succeeding five-year anniversary date, discounted from their applicable dividend payment dates to the redemption date at the three-month LIBOR rate applicable to the dividend period immediately preceding such redemption date and any accumulated dividends.

Upon the reasonable determination of the Company that there is a more than insubstantial risk that the Series A Preferred Stock will no longer constitute Tier 1 capital of TD Bank N.A. due to amendments or changes in applicable laws or related regulations, guidelines, policies or official interpretations thereof, the Company may, with regulatory approval, at its option, redeem the Series A Preferred Stock, in whole but not in part, at a redemption price equal to US$1,000 per Series A Preferred Stock, plus any accumulated dividends on the Series A Preferred Stock to the date of redemption.

The Company also has the right to redeem the Series A Preferred Stock, in whole but not in part, under certain circumstances relating to a change in the treatment of the Company as an Investment Company, a change in the taxation of the Company or the taxation of dividends paid on the Series A Preferred Stock, or in the event of a change in the ratings criteria for the Series A Preferred Stock that results in a downgrade.  The ability to redeem and the redemption price is dependent upon the type of event and the date the event takes place.  Please see the Articles of Incorporation of the Company for the specific terms of these redemption rights.

The Series A Preferred Stock is not be redeemable at the option of the holders.

Exchange

The Series A Preferred Stock may be automatically exchanged for preferred stock of TD Bank N.A., if the Office of the Comptroller of the Currency ("OCC") so directs following the occurrence of certain events related to the solvency and capital levels of TD Bank N.A.

Voting Rights

Holders of the Series A Preferred Stock are entitled to 1/100 of one vote per share on all matters submitted to a vote of the holders of shares of the Company's common stock.  However, TD Bank, N.A. expects that under all circumstances it will own directly or indirectly sufficient shares of the Company's common stock to control a majority of the voting power of the Company on matters submitted to a vote of the holders of the Company's common stock and Series A Preferred Stock, voting together.  The Company is prohibited by the Articles of Incorporation from taking certain actions without the consent or vote of at least two-thirds of the Series A Preferred Stock.

Transfer Restrictions

The Articles of Incorporation prohibit any acquisition or transfer of shares of the Company's capital stock that would result in more than 50% in value of the Company's outstanding shares of capital stock being owned by five or fewer individuals, under applicable attribution rules of the Code, or that would cause its shares of capital stock to be beneficially owned by fewer than 100 persons.  The prohibition is necessary to maintain the Company's status as a REIT.  Any purported acquisition or transfer of Series A Preferred Stock that would violate this prohibition will be null and void ab initio and the purported acquirer or transferee will acquire no rights or economic interest in such shares of Series A Preferred Stock.

The shares of Series A Preferred Stock have not been registered under the Securities Act of 1933, as amended, and are deemed to be restricted securities.  Holders of Series A Preferred Stock may not offer, sell, pledge, or otherwise transfer the Series A Preferred Stock other than (a) to a qualified institutional buyer within the meaning of Rule 144A of the Securities Act, (b) in accordance with an applicable exemption from the registration requirements of the Securities Act, or (c) to TD Bank, N.A. or to one of its affiliates, and in any case in accordance with exemptions from any applicable state securities or blue sky laws.


Carolina First Mortgage Loan Trust

The information in this section is a summary only and is qualified in its entirety by the more detailed information appearing in the prospectus or similar document related to the security.

Outstanding Investor-Held Securities

263 shares of Series 2000A Cumulative Fixed Rate Preferred Shares ("Series 2000A Preferred Shares") issued by Carolina First Mortgage Loan Trust (the "Trust"), an indirect subsidiary of TD.

Transfer Agent

The Bank of New York Mellon Trust Company, N.A.
One Wall Street
New York, NY 10286
USA

Stated Value

US$100,000 per share

Description

The Series 2000A Preferred Shares represent preferred equity interests in the Trust.  The Trust was organized for the purpose of seeking real estate investment trust income as defined in the REIT provisions of the Code.  The Series 2000A Preferred Shares qualify as Tier 2 capital of TD Bank N.A., an indirect subsidiary of TD and as Tier 2 capital of TD.

Dividends

Holders of Series 2000A Preferred Shares are entitled to receive, when, as and if declared by the Board of Trustees of the Trust, cumulative cash dividends at an annual rate of 11.125%, payable on the last day of January, April, July and October of each year. 

Redemption

The Series 2000A Preferred Shares are mandatorily redeemable in whole (but not in part), subject to receipt of all necessary regulatory consents, on January 31, 2031 for a cash amount equal to US$100,000 plus all accrued but unpaid dividends, whether earned or declared.
Upon the occurrence of certain circumstances, the Trust may, with regulatory approval, redeem all, or a portion of, the Series 2000A Preferred Shares for an amount in cash per Series 2000A Preferred Share equal to the greater of (a) US$100,000 or (b) a price per Series 2000A Preferred Share calculated as the sum of the present values of $100,000 and remaining dividends up to January 31, 2031 discounted to the actual redemption date on a quarterly basis at the prevailing yield to maturity on the US Treasury security of closest comparable maturity plus 50 basis points.

The Series 2000A Preferred Shares will not be redeemable at the option of the holders.

Exchange

The Series 2000A Preferred Shares will be exchanged automatically for newly issued Series 2000A Cumulative Fixed Rate Preferred Stock of TD Bank N.A. upon certain events related to the solvency and capital levels of TD Bank N.A.

Voting Rights

Holders of the Series 2000A Preferred Shares are entitled to 1/10 of one vote per share on all matters submitted to a vote of the Trust's shareholders.  However, TD Bank, N.A. expects that under all circumstances it will own directly or indirectly sufficient shares of the Trust's common shares to control a majority of the voting power of the Trust on matters submitted to a vote of the Trust's shareholders.  The Trust is prohibited by the First Amended and Restated Declaration of Trust from taking certain actions without the consent or vote of at least two-thirds of the Series 2000A Preferred Shares.

Transfer Restrictions

The Series 2000A Preferred Shares have not been registered under the Securities Act of 1933, as amended, and are deemed to be restricted securities.  Holders of Series 2000A Preferred Shares may not offer, sell, pledge, or otherwise transfer the Series 2000A Preferred Shares other than (a) to a qualified institutional buyer within the meaning of Rule 144A of the Securities Act, (b) in accordance with an applicable exemption from the registration requirements of the Securities Act, or (c) to TD Bank, N.A. or to one of its affiliates, and in any case in accordance with exemptions from any applicable state securities or blue sky laws.