Exhibit 4.8


 




 





GUARANTEE AGREEMENT



by and between



STATE STREET CORPORATION

as Guarantor





and





U.S. BANK NATIONAL ASSOCIATION

as Guarantee Trustee



relating to





STATE STREET CAPITAL TRUST III





Dated as of January 25, 2008


 




 




















 


CROSS-REFERENCE
TABLE*


 


	
  Section of Trust 

  Indenture Act of 

  1939, as amended

  	
   

  	
  Section of 

  Guarantee 

  Agreement

  
	
   

  	
   

  	
   

  	
   

  
	
  310(a)

  	
   

  	
   

  	
  4.1(a)

  
	
  (b)

  	
   

  	
   

  	
  2.8, 4.1(c)

  
	
  (c)

  	
   

  	
   

  	
  Inapplicable

  
	
  311(a)

  	
   

  	
   

  	
  2.2(b)

  
	
  (b)

  	
   

  	
   

  	
  2.2(b)

  
	
  (c)

  	
   

  	
   

  	
  Inapplicable

  
	
  312(a)

  	
   

  	
   

  	
  2.2(a)

  
	
  (b)

  	
   

  	
   

  	
  2.2(b)

  
	
  313

  	
   

  	
   

  	
  2.3

  
	
  314(a)

  	
   

  	
   

  	
  2.4

  
	
  (b)

  	
   

  	
   

  	
  Inapplicable

  
	
  (c)

  	
   

  	
   

  	
  2.5

  
	
  (d)

  	
   

  	
   

  	
  Inapplicable

  
	
  (e)

  	
   

  	
   

  	
  1.1, 2.5, 3.2

  
	
  (f)

  	
   

  	
   

  	
  2.1, 3.2

  
	
  315(a)

  	
   

  	
   

  	
  3.1(d)

  
	
  (b)

  	
   

  	
   

  	
  2.7

  
	
  (c)

  	
   

  	
   

  	
  3.1

  
	
  (d)

  	
   

  	
   

  	
  3.1(d)

  
	
  (e)

  	
   

  	
   

  	
  2.1(a)

  
	
  316(a)

  	
   

  	
   

  	
  1.1, 2.6, 5.4

  
	
  (b)

  	
   

  	
   

  	
  5.3

  
	
  (c)

  	
   

  	
   

  	
  8.2

  
	
  317(a)

  	
   

  	
   

  	
  Inapplicable

  
	
  (b)

  	
   

  	
   

  	
  Inapplicable

  
	
  318(a)

  	
   

  	
   

  	
  2.1(b)

  



 






*              This Cross-Reference Table does not constitute part of
the Guarantee Agreement and shall not affect the interpretation of any of its
terms or provisions.


 

















 




	
   

  	
   

  	
   

  	
   

  	
  Page

  






 


TABLE OF CONTENTS


 


ARTICLE
I



Definitions


	
  SECTION 1.1.

  	
   

  	
  Definitions

  	
   

  	
  1

  



 


ARTICLE II


 


Trust Indenture Act


 


	
  SECTION 2.1.

  	
   

  	
  Trust Indenture Act;
  Application

  	
   

  	
  4

  
	
  SECTION 2.2.

  	
   

  	
  List of Holders

  	
   

  	
  4

  
	
  SECTION 2.3.

  	
   

  	
  Reports by the Guarantee
  Trustee

  	
   

  	
  4

  
	
  SECTION 2.4.

  	
   

  	
  Periodic Reports to the
  Guarantee Trustee

  	
   

  	
  4

  
	
  SECTION 2.5.

  	
   

  	
  Evidence of Compliance
  with Conditions Precedent

  	
   

  	
  4

  
	
  SECTION 2.6.

  	
   

  	
  Events of Default; Waiver

  	
   

  	
  5

  
	
  SECTION 2.7.

  	
   

  	
  Events of Default; Notice

  	
   

  	
  5

  
	
  SECTION 2.8.

  	
   

  	
  Conflicting Interests

  	
   

  	
  5

  



 


ARTICLE III


 


Powers, Duties and Rights of the Guarantee Trustee


 


	
  SECTION 3.1.

  	
   

  	
  Powers and Duties of the
  Guarantee Trustee

  	
   

  	
  5

  
	
  SECTION 3.2.

  	
   

  	
  Certain Rights of
  Guarantee Trustee

  	
   

  	
  7

  
	
  SECTION 3.3.

  	
   

  	
  Indemnity

  	
   

  	
  8

  



 


ARTICLE IV


 


Guarantee Trustee


 


	
  SECTION 4.1.

  	
   

  	
  Guarantee Trustee;
  Eligibility

  	
   

  	
  8

  
	
  SECTION 4.2.

  	
   

  	
  Appointment, Removal and
  Resignation of the Guarantee Trustee

  	
   

  	
  9

  



 


ARTICLE V


 


Guarantee


 


	
  SECTION 5.1.

  	
   

  	
  Guarantee

  	
   

  	
  9

  
	
  SECTION 5.2.

  	
   

  	
  Waiver of Notice and
  Demand

  	
   

  	
  10

  



 


i

















 


	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 5.3.

  	
   

  	
  Obligations Not Affected

  	
   

  	
  10

  
	
  SECTION 5.4.

  	
   

  	
  Rights of Holders

  	
   

  	
  11

  
	
  SECTION 5.5.

  	
   

  	
  Guarantee of Payment

  	
   

  	
  11

  
	
  SECTION 5.6.

  	
   

  	
  Subrogation

  	
   

  	
  11

  
	
  SECTION 5.7.

  	
   

  	
  Independent Obligations

  	
   

  	
  11

  



 


ARTICLE VI


 


Covenants and Subordination


 


	
  SECTION 6.1.

  	
   

  	
  Subordination

  	
   

  	
  11

  
	
  SECTION 6.2.

  	
   

  	
  Pari Passu Guarantees

  	
   

  	
  12

  



 


ARTICLE VII


 


Termination


 


	
  SECTION 7.1.

  	
   

  	
  Termination

  	
   

  	
  12

  



 


ARTICLE VIII


 


Miscellaneous


 


	
  SECTION 8.1.

  	
   

  	
  Successors and Assigns

  	
   

  	
  12

  
	
  SECTION 8.2.

  	
   

  	
  Amendments

  	
   

  	
  13

  
	
  SECTION 8.3.

  	
   

  	
  Notices

  	
   

  	
  13

  
	
  SECTION 8.4.

  	
   

  	
  Benefit

  	
   

  	
  14

  
	
  SECTION 8.5.

  	
   

  	
  Interpretation

  	
   

  	
  14

  
	
  SECTION 8.6.

  	
   

  	
  Governing Law

  	
   

  	
  14

  



 


ii

















 


This GUARANTEE AGREEMENT, dated as of January 25,
2008, is executed and delivered by State Street Corporation, a Massachusetts
corporation (the “Guarantor”), having its principal office at One Lincoln
Street, Boston, Massachusetts 02111, and U.S. Bank National Association, a national
banking association], as trustee (the “Guarantee Trustee”), for the benefit of
the Holders (as defined herein) from time to time of the Capital Securities of State
Street Capital Trust III, a Delaware statutory trust (the “Issuer Trust”).


 


WHEREAS, pursuant to an Amended
and Restated Trust Agreement, dated as of January 25, 2008 (the “Trust
Agreement”), among the Guarantor, as Depositor, the Property Trustee, the Delaware
Trustee and the Administrative Trustees and the Holders from time to time of
the Trust Securities, the Issuer Trust is issuing $500,000,000 aggregate
Liquidation Amount (as defined in the Trust Agreement) of Capital Securities
(the “Capital Securities”) having the terms set forth in the Trust Agreement;


 


WHEREAS, the proceeds of the Capital
Securities will be used to purchase the Junior Subordinated Debentures (as
defined herein), which initially will be pledged by the Issuer Trust, acting
through U.S. Bank National Association, as Property Trustee for the Issuer
Trust (the “Property Trustee”), to U.S. Bank National Association, as
collateral agent for the Guarantor, pursuant to the Collateral Agreement, dated
as of the date hereof, among the Guarantor, U.S. Bank National Association, as
Collateral Agent, Custodial Agent, Securities Intermediary and Securities
Registrar, and the Issuer Trust (acting through the Property Trustee).


 


WHEREAS, as an incentive for
the Holders to purchase the Capital Securities, the Guarantor desires
irrevocably and unconditionally to agree, to the extent set forth herein, to
pay to the Holders of the Capital Securities the Guarantee Payments (as defined
herein) and to make certain other payments on the terms and conditions set
forth herein.


 


NOW, THEREFORE, in
consideration of the purchase of Capital Securities by each Holder, which
purchase the Guarantor hereby agrees shall benefit the Guarantor, the Guarantor
executes and delivers this Guarantee Agreement for the benefit of the Holders
from time to time.


 


ARTICLE I


 


Definitions


 


SECTION 1.1.  Definitions.  As used in this Guarantee Agreement, the
terms set forth below shall, unless the context otherwise requires, have the
following meanings.  Capitalized or
otherwise defined terms used but not otherwise defined herein shall have the
meanings assigned to such terms in the Trust Agreement as in effect on the date
hereof.


 


“Affiliate” of any
specified Person means any other Person directly or indirectly controlling or
controlled by or under direct or indirect common control with such specified
Person; provided, however, that an Affiliate of the Guarantor shall not be
deemed to be an Affiliate of the Issuer Trust. 
For the purposes of this definition, “control” when used with 


 

















 


respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms “controlling” and “controlled”
have meanings correlative to the foregoing.


 


“Board of Directors”
means the board of directors of the Guarantor or any committee of that board
duly authorized to act hereunder.


 


“Event of Default” means
a default by the Guarantor on any of its payment or other obligations under
this Guarantee Agreement; provided, however, that, except with respect to a
default in payment of any Guarantee Payments, the Guarantor shall have received
notice of default and shall not have cured such default within 30 days after
receipt of such notice.


 


“Guarantee Agreement”
means this Guarantee Agreement, as modified, amended or supplemented from time
to time.


 


“Guarantee Payments”
means the following payments or distributions, without duplication, with
respect to the Capital Securities of any Series, to the extent not paid or made
by or on behalf of the Issuer Trust: (i) any accumulated and unpaid
Distributions required to be paid on the Capital Securities of such Series, to
the extent the Issuer Trust shall have funds on hand available therefor at such
time; (ii) the Redemption Price with respect to any Capital Securities
called for redemption by the Issuer Trust (other than in connection with the
redemption of Capital APEX in exchange for Junior Subordinated Debentures or,
if the Company elects to remarket the Junior Subordinated Debentures in the
form of New Capital Securities pursuant to Section 5.2(d) of the Supplement,
such New Capital Securities), to the extent the Issuer Trust shall have funds
on hand available therefor at such time; and (iii) upon a voluntary or
involuntary termination, winding-up or liquidation of the Issuer Trust, other
than in connection with the distribution of a Like Amount of Corresponding
Assets (as defined in the Trust Agreement) to the Holders of Capital Securities
and Trust Common Securities, the lesser of (a) the Liquidation
Distribution with respect to each Series of the Capital Securities, to the
extent that the Issuer Trust shall have funds on hand available therefor at
such time and (b) the amount of assets of the Issuer Trust remaining
available for distribution to Holders of the Capital Securities on liquidation
of the Issuer Trust.


 


“Guarantee Trustee”
means U.S. Bank National Association, solely in its capacity as Guarantee
Trustee and not in its individual capacity, until a successor Guarantee Trustee
has been appointed and has accepted such appointment pursuant to the terms of
this Guarantee Agreement, and thereafter means each such successor Guarantee
Trustee.


 


“Guarantor” has the
meaning specified in the preamble to this Guarantee Agreement.


 


“Holder” means any
Holder (as defined in the Trust Agreement) of any Capital Securities; provided,
however, that in determining whether the holders of the requisite percentage of
Capital Securities of any Series have given any request, notice, consent
or waiver hereunder, “Holder” shall not include the Guarantor, the Guarantee
Trustee, or any Affiliate of the Guarantor or the Guarantee Trustee.


 


2

















 


“Issuer Trust” has the
meaning specified in the preamble to this Guarantee Agreement.


 


“List of Holders” has the
meaning specified in Section 2.2(a).


 


“Majority in Liquidation
Amount of the Securities” means, except as provided by the Trust Indenture
Act, a vote by the Holder(s), voting separately as a class, of more than 50% of
the Liquidation Amount of all then outstanding Securities issued by the Issuer
Trust.


 


“Officers’ Certificate”
means, with respect to any Person, a certificate signed by the Chairman and Chief
Executive Officer, President or a Vice President, and by the Treasurer, an
Associate Treasurer, an Assistant Treasurer, the Controller, the Secretary or
an Assistant Secretary, of such Person, and delivered to the Guarantee Trustee.  One of the officers signing an Officer’s
Certificate given pursuant to Section 2.5 shall be the principal
executive, financial or accounting officer of the Guarantor.  Any Officers’ Certificate delivered with
respect to compliance with a condition or covenant provided for in this
Guarantee Agreement shall include:


 


(i)            a
statement that each officer signing the Officers’ Certificate has read the
covenant or condition and the definitions relating thereto;


 


(ii)           a
brief statement of the nature and scope of the examination or investigation
undertaken by each such officer in rendering the Officers’ Certificate;


 


(iii)          a
statement that each officer has made such examination or investigation as, in
such officer’s opinion, is necessary to enable such officer to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and


 


(iv)          a
statement as to whether, in the opinion of each officer, such condition or
covenant has been complied with.


 


“Responsible Officer”
means, with respect to the Guarantee Trustee, any officer within the corporate
trust department of the Guarantee Trustee, including any vice president,
assistant vice president, assistant treasurer, trust officer or any other
officer of the Guarantee Trustee who customarily performs functions similar to
those performed by the Persons who at the time shall be such officers,
respectively, or to whom any corporate trust matter is referred because of such
person’s knowledge of and familiarity with the particular subject and who shall
have direct responsibility for the administration of this Guarantee Agreement.


 


“Senior Indebtedness”
has the meaning specified in the Indenture.


 


“Stock Purchase Date”
has the meaning specified in the Stock Purchase Contract Agreement, dated as of
the date hereof, between the Guarantor and the Issuer Trust (acting through the
Property Trustee).


 


“Successor Guarantee Trustee”
means a successor Guarantee Trustee possessing the qualifications to act as
Guarantee Trustee under Section 4.1.


 


3

















 


“Trust Agreement” means
the Amended and Restated Trust Agreement of the Issuer Trust referred to in the
recitals to this Guarantee Agreement, as modified, amended or supplemented from
time to time.


 


“Trust Indenture Act”
means the Trust Indenture Act of 1939, as amended.


 


ARTICLE II


 


Trust
Indenture Act


 


SECTION 2.1.  Trust Indenture Act; Application.  (a)  This Guarantee Agreement is
subject to the provisions of the Trust Indenture Act that are required to be
part of this Guarantee Agreement and shall, to the extent applicable, be
governed by such provisions.


 


(b)           If and to the extent that any provision of this Guarantee
Agreement limits, qualifies or conflicts with the duties imposed by Sections
310 to 317, inclusive, of the Trust Indenture Act, such imposed duties shall
control.


 


SECTION 2.2.  List of Holders.  (a)  The Guarantor will furnish or
cause to be furnished to the Guarantee Trustee: (i) semi-annually, not
more than 15 days after April 15 and October 15 in each year, a list,
in such form as the Guarantee Trustee may reasonably require, of the names and
addresses of the Holders as of such April 15 and October 15, and (ii) at
such other times as the Guarantee Trustee may request in writing, within 30
days after the receipt by the Guarantor of any such request, a list of similar
form and content as of a date not more than 15 days prior to the time such list
is furnished, excluding from any such list names and addresses received by the
Guarantee Trustee in its capacity as Securities Registrar.


 


(b)           The Guarantee Trustee shall comply with its obligations
under Section 311(a), Section 311(b) and Section 312(b) of
the Trust Indenture Act.


 


SECTION 2.3.  Reports by the Guarantee Trustee.  Not later than May 31 of each year,
commencing May 31, 2008, the Guarantee Trustee shall provide to the
Holders such reports as are required by Section 313 of the Trust Indenture
Act, if any, in the form and in the manner provided by Section 313 of the
Trust Indenture Act.  The Guarantee
Trustee shall also comply with the requirements of Section 313(d) of
the Trust Indenture Act.


 


SECTION 2.4.  Periodic Reports to the Guarantee Trustee.  The Guarantor shall provide to the Guarantee
Trustee, the Commission and the Holders such documents reports and information,
if any, as required by Section 314 of the Trust Indenture Act and the
compliance certificate required by Section 314 of the Trust Indenture Act,
in the form, in the manner and at the times required by Section 314 of the
Trust Indenture Act.


 


SECTION 2.5.  Evidence of Compliance with Conditions
Precedent.  The Guarantor shall
provide to the Guarantee Trustee such evidence of compliance with such
conditions precedent, if any, provided for in this Guarantee Agreement that
relate to any of the matters set forth in Section 314(c) of the Trust
Indenture Act.  Any certificate or
opinion 


 


4

















 


required to be given by an officer of the
Guarantor pursuant to Section 314(c)(1) may be given in the form of
an Officers’ Certificate.


 


SECTION 2.6.  Events of Default; Waiver.  The Holders of a Majority in Liquidation
Amount of the Capital Securities may, by vote, on behalf of the Holders of all
the Capital Securities, waive any past default or Event of Default and its
consequences; provided that each Series of Capital Securities shall be
entitled, in the case of any default or Event of Default that affects such Series differently
from the other Series, to vote separately as a Series with respect thereto.  Upon such waiver, any such default or Event
of Default shall cease to exist, and any default or Event of Default arising
therefrom shall be deemed to have been cured, for every purpose of this
Guarantee Agreement, but no such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent therefrom.


 


SECTION 2.7.  Events of Default; Notice.  (a) The Guarantee Trustee shall, within
90 days after the occurrence of an Event of Default, transmit by mail, first
class postage prepaid, to the Holders, notice of any such Event of Default
actually known to a Responsible Officer of the Guarantee Trustee, unless such
defaults have been cured before the giving of such notice, provided that,
except in the case of a default in the payment of a Guarantee Payment, the
Guarantee Trustee shall be protected in withholding such notice if and so long
as a committee of Responsible Officers of the Guarantee Trustee in good faith
determines that the withholding of such notice is in the interests of the Holders.


 


(b)           The Guarantee Trustee shall not be deemed to have
knowledge of any Event of Default unless a Responsible Officer charged with the
administration of this Guarantee Agreement shall have obtained written notice
of such Event of Default.


 


SECTION 2.8.  Conflicting Interests.  The Trust Agreement and the Indenture shall be
deemed to be specifically described in this Guarantee Agreement for the
purposes of clause (i) of the first proviso contained in Section 310(b) of
the Trust Indenture Act.


 


ARTICLE III


 


Powers, Duties
and Rights of the Guarantee Trustee


 


SECTION 3.1.  Powers and Duties of the Guarantee Trustee.  (a)  This Guarantee Agreement
shall be held by the Guarantee Trustee for the benefit of the Holders, and the
Guarantee Trustee shall not transfer this Guarantee Agreement to any Person
except a Holder exercising his or her rights pursuant to Section 5.4(iv) or
to a successor Guarantee Trustee on acceptance by such successor Guarantee
Trustee of its appointment to act as successor Guarantee Trustee.  The right, title and interest of the
Guarantee Trustee shall automatically vest in any successor Guarantee Trustee,
upon acceptance by such successor Guarantee Trustee of its appointment
hereunder, and such vesting and cessation of title shall be effective whether
or not conveyancing documents have been executed and delivered pursuant to the
appointment of such successor Guarantee Trustee.


 


(b)           If an Event of Default has occurred and is continuing, the
Guarantee Trustee shall enforce this Guarantee Agreement for the benefit of the
Holders.


 


5

















 


(c)           The Guarantee Trustee, before the occurrence of any Event
of Default and after the curing of all Events of Default that may have
occurred, shall undertake to perform only such duties as are specifically set
forth in this Guarantee Agreement, and no implied covenants shall be read into
this Guarantee Agreement against the Guarantee Trustee.  In case an Event of Default has occurred
(that has not been cured or waived pursuant to Section 2.6), the Guarantee
Trustee shall exercise such of the rights and powers vested in it by this
Guarantee Agreement, and use the same degree of care and skill in its exercise
thereof, as a prudent person would exercise or use under the circumstances in
the conduct of his or her own affairs.


 


(d)           No provision of this Guarantee Agreement shall be
construed to relieve the Guarantee Trustee from liability for its own negligent
action, its own negligent failure to act or its own willful misconduct, except
that:


 


(i)            prior to the
occurrence of any Event of Default and after the curing or waiving of all such
Events of Default that may have occurred:


 


(A)          the duties and
obligations of the Guarantee Trustee shall be determined solely by the express provisions
of this Guarantee Agreement, and the Guarantee Trustee shall not be liable
except for the performance of such duties and obligations as are specifically
set forth in this Guarantee Agreement; and


 


(B)           in the absence of
bad faith on the part of the Guarantee Trustee, the Guarantee Trustee may
conclusively rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or opinions furnished to the
Guarantee Trustee and conforming to the requirements of this Guarantee
Agreement (but in the case of any such certificates or opinions that by any
provision hereof or of the Trust Indenture Act are specifically required to be
furnished to the Guarantee Trustee, the Guarantee Trustee shall be under a duty
to examine the same to determine whether or not they conform on their face to
the requirements of this Guarantee Agreement);


 


(ii)           the Guarantee
Trustee, its officers, directors, shareholders, employees and agents shall not
be liable for any error of judgment made in good faith by a Responsible Officer
of the Guarantee Trustee, unless it shall be proved that the Guarantee Trustee
was negligent in ascertaining the pertinent facts upon which such judgment was
made;


 


(iii)          the Guarantee
Trustee shall not be liable with respect to any action taken or omitted to be
taken by it in good faith in accordance with the direction of the Holders of
not less than a Majority in Liquidation Amount of the relevant Series of Capital
Securities relating to the time, method and place of conducting any proceeding
for any remedy available to the Guarantee Trustee, or exercising any trust or
power conferred upon the Guarantee Trustee under this Guarantee Agreement; and


 


(iv)          no provision of this
Guarantee Agreement shall require the Guarantee Trustee to expend or risk its
own funds or otherwise incur personal financial liability in the performance of
any of its duties or in the exercise of any of its rights or powers.


 


6

















 


SECTION 3.2.  Certain Rights of Guarantee Trustee.  (a)  Subject to the provisions of Section 3.1:


 


(i)            The Guarantee
Trustee may conclusively rely and shall be fully protected in acting or
refraining from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, judgment, bond,
debenture, note, other evidence of indebtedness or other paper or document
(including e-mail, facsimile or other electronic transmission) reasonably
believed by it to be genuine and to have been signed, sent or presented by the
proper Person or Persons (without being required to determine the correctness
of any fact stated therein).


 


(ii)           Any direction or
act of the Guarantor contemplated by this Guarantee Agreement shall be sufficiently
evidenced by an Officers’ Certificate unless otherwise prescribed herein.


 


(iii)          Whenever, in the
administration of this Guarantee Agreement, the Guarantee Trustee shall deem it
desirable that a matter be proved or established before taking, suffering or
omitting to take any action hereunder, the Guarantee Trustee (unless other
evidence is herein specifically prescribed) may, in the absence of bad faith on
its part, request and rely upon an Officers’ Certificate which, upon receipt of
such request from the Guarantee Trustee, shall be promptly delivered by the
Guarantor.


 


(iv)          The Guarantee
Trustee may consult with legal counsel of its own selection, and the advice or
opinion of such legal counsel, in writing or subsequently confirmed in writing,
with respect to legal matters shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted to be taken by
it hereunder in good faith and in accordance with such advice or opinion.  Such legal counsel may be legal counsel to
the Guarantor or any of its Affiliates and may be one of its employees.  The Guarantee Trustee shall have the right at
any time to seek instructions concerning the administration of this Guarantee
Agreement from any court of competent jurisdiction.


 


(v)           The Guarantee
Trustee shall be under no obligation to exercise any of the rights or powers
vested in it by this Guarantee Agreement at the request or direction of any
Holder unless such Holder shall have provided to the Guarantee Trustee such adequate
security and indemnity satisfactory to the Guarantee Trustee against the costs,
expenses (including attorneys’ fees and expenses) and liabilities that might be
incurred by it in complying with such request or direction, including such
reasonable advances as may be requested by the Guarantee Trustee; provided that nothing contained in this Section 3.2(a)(v) shall
be taken to relieve the Guarantee Trustee, upon the occurrence of an Event of
Default, of its obligation to exercise the rights and powers vested in it by
this Guarantee Agreement.


 


(vi)          The Guarantee
Trustee shall not be bound to make any investigation into the facts or matters
stated in any resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note, other
evidence of 


 


7

















 


indebtedness
or other paper or document, but the Guarantee Trustee, in its discretion, may
make such further inquiry or investigation into such facts or matters as it may
see fit.


 


(vii)         The Guarantee
Trustee may execute any of the trusts or powers hereunder or perform any duties
hereunder either directly or by or through its agents or attorneys, and the
Guarantee Trustee shall not be responsible for any misconduct or negligence on
the part of any such agent or attorney appointed with due care by it hereunder.


 


(viii)        Whenever in the
administration of this Guarantee Agreement the Guarantee Trustee shall deem it
desirable to receive instructions with respect to enforcing any remedy or right
or taking any other action hereunder, the Guarantee Trustee (A) may
request instructions from the Holders, (B) may refrain from enforcing such
remedy or right or taking such other action until such instructions are
received, and (C) shall be fully protected in acting in accordance with
such instructions.


 


(b)           No provision of this Guarantee Agreement shall be deemed
to impose any duty or obligation on the Guarantee Trustee to perform any act or
acts or exercise any right, power, duty or obligation conferred or imposed on
it in any jurisdiction in which it shall be illegal, or in which the Guarantee
Trustee shall be unqualified or incompetent in accordance with applicable law,
to perform any such act or acts or to exercise any such right, power, duty or
obligation.  No permissive power or
authority available to the Guarantee Trustee shall be construed to be a duty to
act in accordance with such power and authority.


 


SECTION 3.3.  Indemnity.  The Guarantor agrees to indemnify the Guarantee
Trustee, its officers, directors, shareholders, employees and agents for, and
to hold them harmless against, any loss, liability or expense incurred without
negligence or bad faith on the part of the Guarantee Trustee arising out of or
in connection with the acceptance or administration of this Guarantee
Agreement, including the costs and expenses of defending itself against any
claim or liability in connection with the exercise or performance of any of its
powers or duties hereunder.  The Guarantee
Trustee will not claim or exact any lien or charge on any Guarantee Payments as
a result of any amount due to it under this Guarantee Agreement.  This indemnity shall survive the termination
of this Guarantee Agreement or the earlier resignation or removal of the
Guarantee Trustee.


 


ARTICLE IV


 


Guarantee
Trustee


 


SECTION 4.1.  Guarantee Trustee; Eligibility.  (a)  There shall at all times be a
Guarantee Trustee that shall:


 


(i)            not be an Affiliate
of the Guarantor; and


 


(ii)           be a Person that is
eligible pursuant to the Trust Indenture Act to act as such and has a combined
capital and surplus of at least $50,000,000, and shall be a corporation meeting
the requirements of Section 310(a) of the Trust Indenture Act.  If such corporation publishes reports of condition
at least annually, pursuant to law or to the 


 


8

















 


requirements
of its supervising or examining authority, then, for the purposes of this Section 4.1
and to the extent permitted by the Trust Indenture Act, the combined capital
and surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published.


 


(b)           If at any time the Guarantee Trustee shall cease to be
eligible to so act under Section 4.1(a), the Guarantee Trustee shall
immediately resign in the manner and with the effect set out in Section 4.2
(c).


 


(c)           If the Guarantee Trustee has or shall acquire any “conflicting
interest” within the meaning of Section 310(b) of the Trust Indenture
Act, the Guarantee Trustee and Guarantor shall in all respects comply with the
provisions of Section 310(b) of the Trust Indenture Act.


 


SECTION 4.2.  Appointment, Removal and Resignation of
the Guarantee Trustee.  (a)  Subject
to Section 4.2(b), the Guarantee Trustee may be removed by the Guarantor (i) without
cause at any time when an Event of Default has not occurred and is not
continuing and (ii) at any time when the Guarantee Trustee ceases to be
eligible to act as the Guarantee Trustee pursuant to Section 4.1 hereof or
becomes incapable of acting or is adjudged a bankrupt or insolvent or a
receiver of the Guarantee Trustee or of its property is appointed or any public
officer takes charge or control of the Guarantee Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation.


 


(b)           The Guarantee Trustee shall not be removed until a successor
Guarantee Trustee has been appointed and has accepted such appointment by
written instrument executed by such successor Guarantee Trustee and delivered
to the Guarantor.


 


(c)           The Guarantee Trustee may resign from office (without need
for prior or subsequent accounting) by an instrument in writing executed by the
Guarantee Trustee and delivered to the Guarantor, which resignation shall not
take effect until a successor Guarantee Trustee has been appointed and has
accepted such appointment by instrument in writing executed by such successor
Guarantee Trustee and delivered to the Guarantor and the resigning Guarantee
Trustee.


 


(d)           If no successor Guarantee Trustee shall have been
appointed and accepted appointment as provided in this Section 4.2 within
60 days after delivery to the Guarantor of an instrument of resignation, the
resigning Guarantee Trustee may petition, at the expense of the Guarantor, any
court of competent jurisdiction for appointment of a Successor Guarantee
Trustee.  Such court may thereupon, after
prescribing such notice, if any, as it may deem proper, appoint a successor
Guarantee Trustee.


 


ARTICLE V




Guarantee


 


SECTION 5.1.  Guarantee.  The Guarantor irrevocably and unconditionally
agrees to pay in full to the Holders the Guarantee Payments (without
duplication of amounts 


 


9

















 


theretofore paid by or on behalf of the
Issuer Trust), as and when due, regardless of any defense, right of set-off or
counterclaim which the Issuer Trust may have or assert.  The Guarantor’s obligation to make a
Guarantee Payment may be satisfied by direct payment of the required amounts by
the Guarantor to the Holders or by causing the Issuer Trust to pay such amounts
to the Holders.


 


SECTION 5.2.  Waiver of Notice and Demand.  The Guarantor hereby waives notice of
acceptance of this Guarantee Agreement and of any liability to which it applies
or may apply, presentment, demand for payment, any right to require a
proceeding first against the Guarantee Trustee, the Issuer Trust or any other
Person before proceeding against the Guarantor, protest, notice of nonpayment,
notice of dishonor, notice of redemption and all other notices and demands.


 


SECTION 5.3.  Obligations Not Affected.  The obligations, covenants, agreements and
duties of the Guarantor under this Guarantee Agreement shall in no way be
affected or impaired by reason of the happening from time to time of any of the
following:


 


(a)           the release or
waiver, by operation of law or otherwise, of the performance or observance by
the Issuer Trust of any express or implied agreement, covenant, term or
condition relating to the Capital Securities to be performed or observed by the
Issuer Trust;


 


(b)           the extension of
time for the payment by the Issuer Trust of all or any portion of the
Distributions (other than an extension of time for payment of Distributions
that results from the extension of any interest payment period on the Junior
Subordinated Debentures as provided in the Indenture), Redemption Price,
Liquidation Distribution or any other sums payable under the terms of the Capital
Securities or the extension of time for the performance of any other obligation
under, arising out of, or in connection with, the Capital Securities;


 


(c)           any failure,
omission, delay or lack of diligence on the part of the Holders to enforce,
assert or exercise any right, privilege, power or remedy conferred on the
Holders pursuant to the terms of the Capital Securities, or any action on the
part of the Issuer Trust granting indulgence or extension of any kind;


 


(d)           the voluntary or
involuntary liquidation, dissolution, sale of any collateral, receivership,
insolvency, bankruptcy, assignment for the benefit of creditors,
reorganization, arrangement, composition or readjustment of debt of, or other
similar proceedings affecting, the Issuer Trust or any of the assets of the
Issuer Trust;


 


(e)           any invalidity of,
or defect or deficiency in, the Capital Securities;


 


(f)            the settlement or
compromise of any obligation guaranteed hereby or hereby incurred; or


 


(g)           any other
circumstance whatsoever that might otherwise constitute a legal or equitable
discharge or defense of a guarantor, it being the intent of this Section 5.3
that


 


10

















 


the
obligations of the Guarantor hereunder shall be absolute and unconditional
under any and all circumstances.


 


There shall be no obligation of
the Holders to give notice to, or obtain the consent of, the Guarantor with
respect to the happening of any of the foregoing.


 


SECTION 5.4.  Rights of Holders.  The Guarantor expressly acknowledges that: (i) this
Guarantee Agreement will be deposited with the Guarantee Trustee to be held for
the benefit of the Holders; (ii) the Guarantee Trustee has the right to
enforce this Guarantee Agreement on behalf of the Holders; (iii) the
Holders of a Majority in Liquidation Amount of the Capital Securities of the
affected Series have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Guarantee Trustee in
respect of this Guarantee Agreement or exercising any trust or power conferred
upon the Guarantee Trustee under this Guarantee Agreement; and (iv) any
Holder may institute a legal proceeding directly against the Guarantor to
enforce its rights under this Guarantee Agreement, without first instituting a
legal proceeding against the Issuer Trust or any other Person.


 


SECTION 5.5.  Guarantee of Payment.  This Guarantee Agreement creates a guarantee
of payment and not of collection.  This
Guarantee Agreement will not be discharged except by payment of the Guarantee
Payments in full (without duplication of amounts theretofore paid by the Issuer
Trust) or upon the distribution of Junior Subordinated Debentures to Holders as
provided in the Trust Agreement.


 


SECTION 5.6.  Subrogation.  The Guarantor shall be subrogated to all (if
any) rights of the Holders against the Issuer Trust in respect of any amounts
paid to the Holders by the Guarantor under this Guarantee Agreement and shall
have the right to waive payment by the Issuer Trust pursuant to Section 5.1;
provided, however, that the Guarantor shall not (except to the extent required
by mandatory provisions of law) be entitled to enforce or exercise any rights
which it may acquire by way of subrogation or any indemnity, reimbursement or
other agreement, in all cases as a result of payment under this Guarantee
Agreement, if, at the time of any such payment, any amounts are due and unpaid
under this Guarantee Agreement.  If any
amount shall be paid to the Guarantor in violation of the preceding sentence,
the Guarantor agrees to hold such amount in trust for the Holders and to pay
over such amount to the Holders.


 


SECTION 5.7.  Independent Obligations.  The Guarantor acknowledges that its
obligations hereunder are independent of the obligations of the Issuer Trust
with respect to the Capital Securities and that the Guarantor shall be liable
as principal and as debtor hereunder to make Guarantee Payments pursuant to the
terms of this Guarantee Agreement notwithstanding the occurrence of any event
referred to in subsections (a) through (g), inclusive, of Section 5.3
hereof.


 


ARTICLE VI



Covenants and Subordination


 


SECTION 6.1.  Subordination.  The obligations of the Guarantor under this
Guarantee Agreement will constitute unsecured obligations of the Guarantor and
at all times 


 


11

















 


prior to the Stock Purchase Date will rank
subordinate and junior in right of payment and upon liquidation to all Senior Indebtedness
of the Guarantor to the extent and in the manner set forth in the Indenture
with respect to the Junior Subordinated Debentures, and the provisions of the
Indenture will apply, mutatis mutandis, to the obligations of the Guarantor
hereunder.  The obligations of the
Guarantor hereunder do not constitute Senior Indebtedness of the Guarantor.


 


SECTION 6.2.  Pari Passu Guarantees.  At all times prior to the Stock Purchase
Date, the obligations of the Guarantor under this Guarantee Agreement shall
rank pari passu with the obligations of the Guarantor under (i) any
similar guarantee agreements issued by the Guarantor on behalf of the holders
of preferred or capital securities issued by any statutory trust the assets of
which consist of debt securities that are pari passu to the Junior Subordinated
Debentures and the proceeds thereof, (ii) any expense agreements entered
into by the Guarantor in connection with the offering of preferred or capital
securities by any statutory trust the assets of which consists of debt
securities that are pari passu to the Junior Subordinated Debentures and the
proceeds thereof, and (iii) any other security, guarantee or other
agreement or obligation that is expressly stated to rank pari passu with the
obligations of the Guarantor under this Guarantee Agreement or with any
obligation that ranks pari passu with the obligations of the Guarantor under
this Guarantee Agreement.  At all times
after the Stock Purchase Date, the obligations of the Guarantor under this
Guarantee Agreement shall rank pari passu with the obligations of the Guarantor
under (i) any similar guarantee agreements issued by the Guarantor on
behalf of the holders of preferred or capital securities issued by any
statutory trust the assets of which consist of preferred stock issued by
Guarantor that is pari passu to the Preferred Stock and the proceeds thereof,
and (ii) any security, guarantee or other agreement or obligation with
regard to preferred stock issued by the Guarantor that, by its express terms,
is pari passu to the Preferred Stock and the proceeds thereof.


 


ARTICLE VII



Termination


 


SECTION 7.1.  Termination.  This Guarantee Agreement shall terminate and
be of no further force and effect upon (i) full payment of the Redemption
Price of all Capital Securities or (ii) full payment of the amounts
payable in accordance with the Trust Agreement upon liquidation of the Issuer
Trust.  Notwithstanding the foregoing,
this Guarantee Agreement will continue to be effective or will be reinstated,
as the case may be, if at any time any Holder must restore payment of any sums
paid with respect to Capital Securities or this Guarantee Agreement.


 


ARTICLE VIII



Miscellaneous


 


SECTION 8.1.  Successors and Assigns.  All guarantees and agreements contained in
this Guarantee Agreement shall bind the successors, assigns, receivers,
trustees and representatives of the Guarantor and shall inure to the benefit of
the Holders of the Capital Securities then outstanding.  Except in connection with (i) a
consolidation, merger or sale involving the Guarantor that is permitted under
the Indenture and pursuant to which the 


 


12

















 


successor or assignee agrees in writing to
perform the Guarantor’s obligations hereunder or (ii) the First Step
Merger, the Guarantor shall not assign its obligations hereunder.


 


SECTION 8.2.  Amendments.  This Guarantee Agreement may be amended by a
written instrument executed by the Guarantor and the Guarantee Trustee.  Except with respect to any changes which do
not adversely affect the rights of the Holders in any material respect (in
which case no consent of the Holders will be required), this Guarantee
Agreement may only be amended with the prior approval of the Holders of not
less than a Majority in Liquidation Amount of the outstanding Capital
Securities.  The holders of each Series of
Capital Securities will also be entitled to vote separately as a class to the
extent that any proposed amendment would not affect them in the same or
substantially the same manner.  The
provisions of Article VI of the Trust Agreement concerning meetings of the
Holders shall apply to the giving of such approval.


 


SECTION 8.3.  Notices.  Any notice, request or other communication
required or permitted to be given hereunder shall be in writing, duly signed by
the party giving such notice, and delivered, telecopied or mailed by
first-class mail as follows:


 


(a)           if given to the
Guarantor, to the address set forth below or such other address, facsimile
number or to the attention of such other Person as the Guarantor may give
notice to the Guarantee Trustee and the Holders:


 


State Street Corporation

One Lincoln Street

Boston, Massachusetts 02111

Attention: Chief Legal Officer 

Facsimile:  (617) 664-8209


 


(b)           if given to the
Issuer Trust, in care of the Guarantee Trustee, at the Issuer Trust’s (and the
Guarantee Trustee’s) address set forth below or such other address as the
Guarantee Trustee on behalf of the Issuer may give notice to the Guarantor and
Holders:


 


U.S. Bank National Association


100 Wall Street, Suite 1600,
New York, New York 10005


 


with a copy to:


 


State Street Capital Trust III

c/o State Street Corporation

2 World Financial Center, 225 Liberty Street


New York, New York 10281 

Attention: Administrative Trustees of State Street Capital Trust III

Facsimile: (617) 786-2120


 


(c)           if given to any
Holder, at the address set forth on the books and records of the Issuer Trust.


 


13

















 


All notices hereunder shall be
deemed to have been given when received in person, telecopied with receipt
confirmed, or delivered by first-class mail, postage prepaid, except that if a
notice or other document is refused delivery or cannot be delivered because of
a changed address of which no notice was given, such notice or other document
shall be deemed to have been delivered on the date of such refusal or inability
to deliver.


 


SECTION 8.4.  Benefit.  This Guarantee Agreement is solely for the
benefit of the Holders and is not separately transferable from the Capital
Securities.


 


SECTION 8.5.  Interpretation.  In this Guarantee Agreement, unless the
context otherwise requires:


 


(a)           capitalized terms
used in this Guarantee Agreement but not defined in the preamble hereto have
the respective meanings assigned to them in Section 1.1;


 


(b)           a term defined
anywhere in this Guarantee Agreement has the same meaning throughout;


 


(c)           all references to “the
Guarantee Agreement” or “this Guarantee Agreement” are to this Guarantee
Agreement as modified, supplemented or amended from time to time;


 


(d)           all references in
this Guarantee Agreement to Articles and Sections are to Articles and Sections
of this Guarantee Agreement unless otherwise specified;


 


(e)           a term defined in
the Trust Indenture Act has the same meaning when used in this Guarantee
Agreement unless otherwise defined in this Guarantee Agreement or unless the
context otherwise requires;


 


(f)            a reference to the
singular includes the plural and vice versa; and


 


(g)           the masculine,
feminine or neuter genders used herein shall include the masculine, feminine
and neuter genders.


 


SECTION 8.6.  Governing Law.  THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK WITHOUT REGARD TO THE CONFLICT OF LAW PRINCIPLES THEREOF.


 


* * * *


 


This instrument may be executed
in any number of counterparts, each of which so executed shall be deemed to be
an original, but all such counterparts shall together constitute but one and
the same instrument.


 


14

















 


THIS GUARANTEE AGREEMENT is
executed as of the day and year first above written.


 


 


	
   

  	
  STATE STREET CORPORATION as Guarantor,

  	
   

  
	
   

  	
   

  
	
  by

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					



 


 


	
   

  	
  U.S. BANK NATIONAL ASSOCIATION 

  individually and as Guarantee Trustee,

  	
   

  



 


	
  by

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title: