exhibit4-2.htm


    EXHIBIT
      4.2

    Temecula
      Valley Bancorp Inc.

     

    Fixed
      Rate Junior Subordinated Note due 20__

     

    No.
      _____________                                                                                                                                $__________

     

    


     

    THIS
      SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
      (THE “SECURITIES ACT”), ANY STATE SECURITIES LAWS OR ANY OTHER APPLICABLE
      SECURITIES LAW. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN
      MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
      DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION
      IS
      EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
      ACT AND ANY APPLICABLE STATE SECURITIES LAWS. THE HOLDER OF THIS SECURITY BY
      ITS
      ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER THIS SECURITY
      ONLY
      (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN
      DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) TO A PERSON WHOM THE SELLER
      REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING
      THE REQUIREMENTS OF RULE 144A SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE
      PURSUANT TO RULE 144A IN ACCORDANCE WITH RULE 144A, (D) TO A NON-U.S. PERSON
      IN
      AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904 (AS APPLICABLE)
      OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL “ACCREDITED
      INVESTOR” WITHIN THE MEANING OF SUBPARAGRAPH (A) OF RULE 501 UNDER THE
      SECURITIES ACT THAT IS ACQUIRING THIS SECURITY FOR ITS OWN ACCOUNT, OR FOR
      THE
      ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, FOR INVESTMENT PURPOSES
      AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY
      DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT TO ANY OTHER
      AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
      SUBJECT TO THE COMPANY’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER TO
      REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER
      INFORMATION SATISFACTORY TO IT IN ACCORDANCE WITH THE INDENTURE, A COPY OF
      WHICH
      MAY BE OBTAINED FROM THE COMPANY.

     

    THE
      HOLDER OF THIS SECURITY, OR ANY INTEREST THEREIN, BY ITS ACCEPTANCE HEREOF
      OR
      THEREOF AGREES, REPRESENTS AND WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT
      PLAN,
      INDIVIDUAL RETIREMENT ACCOUNT OR OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE
      I OF
      THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED
      (“ERISA”), OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
      AMENDED (THE “CODE”) (EACH A “PLAN”), OR AN ENTITY WHOSE
      UNDERLYING ASSETS INCLUDE “PLAN ASSETS” BY REASON OF ANY PLAN’S INVESTMENT IN
      THE ENTITY, AND NO PERSON INVESTING “PLAN ASSETS” OF ANY PLAN MAY ACQUIRE OR
      HOLD THIS SECURITY OR ANY INTEREST THEREIN, UNLESS SUCH PURCHASER OR HOLDER
      IS
      ELIGIBLE FOR THE EXEMPTIVE RELIEF AVAILABLE UNDER U.S. DEPARTMENT OF LABOR
      PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1 OR 84-14 OR
      ANOTHER APPLICABLE EXEMPTION OR ITS PURCHASE AND HOLDING OF THIS SECURITY,
      OR
      ANY INTEREST THEREIN, ARE NOT PROHIBITED BY SECTION 406 OF ERISA OR SECTION
      4975
      OF THE CODE WITH RESPECT TO SUCH PURCHASE AND HOLDING. ANY PURCHASER OR HOLDER
      OF THE SECURITIES OR ANY

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     INTEREST
      THEREIN WILL BE DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND HOLDING THEREOF
      THAT EITHER (i) IT IS NOT AN EMPLOYEE BENEFIT PLAN OR OTHER PLAN TO WHICH TITLE
      I OF ERISA OR SECTION 4975 OF THE CODE IS APPLICABLE, A TRUSTEE OR OTHER PERSON
      ACTING ON BEHALF OF ANY SUCH EMPLOYEE BENEFIT PLAN OR PLAN, OR ANY OTHER PERSON
      OR ENTITY USING THE “PLAN ASSETS” OF ANY SUCH EMPLOYEE BENEFIT PLAN OR PLAN TO
      FINANCE SUCH PURCHASE, OR (ii) SUCH PURCHASE OR HOLDING WILL NOT RESULT IN
      A
      PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE
      FOR WHICH FULL EXEMPTIVE RELIEF IS NOT AVAILABLE UNDER AN APPLICABLE STATUTORY
      OR ADMINISTRATIVE EXEMPTION.

     

    THIS
      OBLIGATION IS NOT A DEPOSIT AND IS NOT INSURED BY THE UNITED STATES OR ANY
      AGENCY OR FUND OF THE UNITED STATES, INCLUDING THE FEDERAL DEPOSIT INSURANCE
      CORPORATION.

     

    


     

    Temecula
      Valley Bancorp Inc., a corporation organized and existing under the laws of
      California (hereinafter called the “Company,” which term includes any
      successor Person under the Indenture hereinafter referred to), for value
      received, hereby promises to pay to Wilmington Trust Company, not in its
      individual capacity but solely as Trustee for Temecula Valley Statutory Trust
      VI
      (the “Holder”), or registered assigns, the principal sum of $__________or such
      other principal amount represented hereby as may be set forth in the records
      of
      the Securities Registrar hereinafter referred to in accordance with the
      Indenture on ________ __, 203__. The Company further promises to pay interest
      on
      said principal sum from ____________ __, 2007, or from the most recent Interest
      Payment Date to which interest has been paid or duly provided for, quarterly
      (subject to deferral as set forth herein) in arrears on March 30th, June 30th,
      September 30th and December
      30th of each
      year, commencing on June 30, 2008, or if any such day is not a Business Day,
      on
      the next succeeding Business Day (and no interest shall accrue in respect of
      the
      amounts whose payment is so delayed for the period from and after such Interest
      Payment Date until such next succeeding Business Day), except that, if such
      Business Day falls in the next succeeding calendar year, such payment shall
      be
      made on the immediately preceding Business Day, in each case, with the same
      force and effect as if made on the Interest Payment Date, together with
      Additional Tax Sums, if any, as provided in Section 10.5 of the
      Indenture, until the principal hereof is paid or duly provided for or made
      available for payment; provided, that any overdue principal, premium,
      if any, or Additional Tax Sums and any overdue installment of interest shall
      bear interest at the Increased Interest rate (to the extent that the payment
      of
      such interest shall be legally enforceable) until they are paid or made
      available for payment, and such interest shall be payable on
      demand.

     

    The
      amount of interest payable for any interest period shall be computed and paid
      on
      the basis of a 360-day year and the actual number of days elapsed in the
      relevant interest period. The interest so payable, and punctually paid or duly
      provided for, on any Interest Payment Date shall, as provided in the Indenture,
      be paid to the Person in whose name this Security (or one or more Predecessor
      Securities) is registered at the close of business on the Regular Record Date
      for such interest installment. Any such interest not so punctually paid or
      duly
      provided for shall forthwith cease to be payable to the Holder on such Regular
      Record Date and may either be paid to the Person in whose name this Security
      (or
      one or more Predecessor Securities) is registered at the close of business
      on a
      Special Record Date for the payment of such Defaulted Interest to be fixed
      by
      the Trustee, notice whereof shall be given to Holders of Securities not less
      than ten (10) days prior to such Special Record Date, or be paid at any time
      in
      any other lawful manner not inconsistent with the requirements of any securities
      exchange or automated quotation system on which the Securities may be listed,
      traded or quoted and upon such notice as may be required by such exchange or
      automated quotation system, all as more fully provided in the
      Indenture.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    So
      long
      as no Event of Default pursuant to Sections 5.1(c), (e),
(f), (g) or (h) of the Indenture has occurred and
      is
      continuing, the Company shall have the right, at any time and from time to
      time
      during the term of this Security, to defer the payment of interest on this
      Security for a period of up to twenty (20) consecutive quarterly interest
      payment periods (each such period, an “Extension Period”), during which
      Extension Period(s), no interest shall be due and payable (except any Additional
      Tax Sums that may be due and payable). No Extension Period shall end on a date
      other than an Interest Payment Date, and no Extension Period shall extend beyond
      the Stated Maturity of the principal of this Security. No interest shall be
      due
      and payable during an Extension Period (except any Additional Tax Sums that
      may
      be due and payable), except at the end thereof, but each installment of interest
      that would otherwise have been due and payable during such Extension Period
      shall bear Increased Interest (to the extent payment of such interest would
      be
      legally enforceable) from the dates on which amounts would have otherwise been
      due and payable until paid or made available for payment. At the end of any
      such
      Extension Period, the Company shall pay all interest then accrued and unpaid
      on
      this Security, together with such Increased Interest.  Prior to the
      termination of any such Extension Period, the Company may further defer the
      payment of interest; provided, that (i) all such previous and further
      extensions comprising such Extension Period do not exceed twenty (20) quarterly
      interest payment periods, (ii) no Extension Period shall end on a date other
      than an Interest Payment Date and (iii) no Extension Period shall extend beyond
      the Stated Maturity of the principal of this Security. Upon the termination
      of
      any such Extension Period and upon the payment of all accrued and unpaid
      interest and any Increased Interest then due on any Interest Payment Date,
      the
      Company may elect to begin a new Extension Period; provided, that (i)
      such Extension Period does not exceed twenty (20) quarterly interest payment
      periods, (ii) no Extension Period shall end on a date other than an Interest
      Payment Date, (iii) no Extension Period shall extend beyond the Stated Maturity
      of the principal of this Security and (iv) no Event of Default pursuant to
      Sections 5.1(c), (e), (f), (g) or (h) has
      occurred and is continuing. The Company shall give (i) the Holder of this
      Security, (ii) the Trustee, (iii) the Property Trustee and (iv) any beneficial
      owner of the Preferred Securities reasonably identified to the Company (which
      identification may be made by such beneficial owner) written notice of its
      election to begin any such Extension Period no later than the close of business
      on the fifteenth (15th) Business
      Day
      prior to the next succeeding Interest Payment Date on which interest on this
      Security would be payable but for such deferral.

     

    During
      any such Extension Period, the Company shall not (i) declare or pay any
      dividends or distributions on, or redeem, purchase, acquire or make a
      liquidation payment with respect to, any of the Company’s Equity Interests, (ii)
      vote in favor of or permit or otherwise allow any of its Subsidiaries to declare
      or pay any dividends or distributions on, or redeem, purchase, acquire or make
      a
      liquidation payment with respect to or otherwise retire, any of such
      Subsidiary’s Equity Interests entitling the holders thereof to a stated rate of
      return, other than dividends or distributions on Equity Interests issued by
      any
      Subsidiary solely payable to the Company or any Subsidiary thereof (for the
      avoidance of doubt, whether such Equity Interests are perpetual or otherwise),
      or (iii) make any payment of principal of or any interest or premium on or
      repay, repurchase or redeem any debt securities of the Company that rank
pari passu in all respects with or junior in interest to this Security
      (other than (a) repurchases, redemptions or other acquisitions of Equity
      Interests of the Company in connection with (1) any employment contract, benefit
      plan or other similar arrangement with or for the benefit of any one or more
      employees, officers, directors or consultants, (2) a dividend reinvestment
      or
      stockholder stock purchase or similar plan with respect to any Equity Interests
      or (3) the issuance of Equity Interests of the Company (or securities
      convertible into or exercisable for such Equity Interests) as consideration
      in
      an acquisition transaction entered into prior to the applicable Extension
      Period, (b) as a result of an exchange or conversion of any class or series
      of
      the Company’s Equity Interests (or any Equity Interests of a Subsidiary of the
      Company) for any class or series of the Company’s Equity Interests or of any
      class or series of the Company’s indebtedness for any class or series of the
      Company’s Equity Interests, (c) the purchase of fractional interests in Equity
      Interests of the Company pursuant to the conversion or exchange provisions
      of
      such Equity Interests or the security being converted or exchanged, (d) any
      declaration of a dividend in connection with any

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Rights
      Plan, the issuance of rights, Equity Interests or other property under any
      Rights Plan, or the redemption or repurchase of rights pursuant thereto, (e)
      any
      dividend in the form of Equity Interests, warrants, options or other rights
      where the dividend Equity Interests or the Equity Interests issuable upon
      exercise of such warrants, options or other rights are the same Equity Interests
      as those on which the dividend is being paid or rank pari passu with or
      junior to such Equity Interests, or (f) if the failure to do so would cause
      an
      event of default.

     

    Payment
      of principal of, premium, if any, and interest on this Security shall be made
      in
      such coin or currency of the United States of America as at the time of payment
      is legal tender for payment of public and private debts. Payments of principal,
      premium, if any, and interest due at the Maturity of this Security shall be
      made
      at the office or agency of the Company maintained for that purpose in the Place
      of Payment upon surrender of such Securities to the Paying Agent, and payments
      of interest shall be made, subject to such surrender where applicable, by wire
      transfer at such place and to such account at a banking institution in the
      United States as may be designated in writing to the Paying Agent at least
      ten
      (10) Business Days prior to the date for payment by the Person entitled thereto
      unless proper written wire transfer instructions have not been received by
      the
      relevant record date, in which case such payments shall be made by check mailed
      to the address of such Person as such address shall appear in the Security
      Register.  Notwithstanding the foregoing, so long as the Holder of
      this Security is the Property Trustee, the payment of the principal of (and
      premium, if any) and interest (including any overdue installment of interest
      and
      Additional Tax Sums, if any) on this Security will be made at such place and
      to
      such account as may be designated by the Property Trustee.

     

    The
      indebtedness evidenced by this Security is, to the extent provided in the
      Indenture, subordinate and junior in right of payment to the prior payment
      in
      full of all Senior Debt, and this Security is issued subject to the provisions
      of the Indenture with respect thereto. Each Holder of this Security, by
      accepting the same, (a) agrees to and shall be bound by such provisions, (b)
      authorizes and directs the Trustee on his or her behalf to take such actions
      as
      may be necessary or appropriate to effectuate the subordination so provided
      and
      (c) appoints the Trustee his or her attorney-in-fact for any and all such
      purposes. Each Holder hereof, by his or her acceptance hereof, waives all notice
      of the acceptance of the subordination provisions contained herein and in the
      Indenture by each holder of Senior Debt, whether now outstanding or hereafter
      incurred, and waives reliance by each such holder upon said
      provisions.

     

    Unless
      the certificate of authentication hereon has been executed by the Trustee by
      manual signature, this Security shall not be entitled to any benefit under
      the
      Indenture or be valid or obligatory for any purpose.

     

    This
      Security is one of a duly authorized issue of securities of the Company (the
      “Securities”) issued under the Junior Subordinated Indenture, dated as
      of ____________ __, 2007 (the “Indenture”), between the Company and
      Wilmington Trust Company, as Trustee (in such capacity, the “Trustee,”
which term includes any successor trustee under the Indenture), to
      which
      Indenture and all indentures supplemental thereto reference is hereby made
      for a
      statement of the respective rights, limitations of rights, duties and immunities
      thereunder of the Company, the Trustee, the holders of Senior Debt and the
      Holders of the Securities, and of the terms upon which the Securities are,
      and
      are to be, authenticated and delivered.

     

    All
      terms
      used in this Security that are defined in the Indenture or in the Amended and
      Restated Trust Agreement, dated as of ____________ __, 2007 (as modified,
      amended or supplemented from time to time, the “Trust Agreement”),
      relating to Temecula Valley Statutory Trust VI (the “Trust”), among the
      Company, as Depositor, the trustees named therein and the holders from time
      to
      time of the Trust

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Securities
      issued pursuant thereto, shall have the meanings assigned to them in the
      Indenture or the Trust Agreement, as the case may be.

     

    The
      Company may, on any Interest Payment Date, at its option, upon not less than
      thirty (30) days’ nor more than sixty (60) days’ written notice to the Holders
      of the Securities (unless a shorter notice period shall be satisfactory to
      the
      Trustee) on or after December 30, 2012 and subject to the terms and conditions
      of Article XI of the Indenture, redeem this Security in whole at any time
      or in part from time to time at a Redemption Price equal to one hundred percent
      (100%) of the principal amount hereof, together, in the case of any such
      redemption, with accrued interest, including any Increased Interest, to but
      excluding the date fixed for redemption; provided, that the Company
      shall have received the prior approval of the Federal Reserve if then
      required.

     

    In
      addition, upon the occurrence and during the continuation of a Special Event,
      the Company may, at its option, upon not less than thirty (30) days’ nor more
      than sixty (60) days’ written notice to the Holders of the Securities (unless a
      shorter notice period shall be satisfactory to the Trustee), redeem this
      Security, in whole but not in part, subject to the terms and conditions of
      Article XI of the Indenture at the Special Event Redemption Price;
provided, that the Company shall have received the prior approval
      of
      the Federal Reserve if then required.

     

    In
      the
      event of redemption of this Security in part only, a new Security or Securities
      for the unredeemed portion hereof will be issued in the name of the Holder
      hereof upon the cancellation hereof. If less than all the Securities are to
      be
      redeemed, the particular Securities to be redeemed shall be selected not more
      than sixty (60) days prior to the Redemption Date by the Trustee from the
      Outstanding Securities not previously called for redemption, by such method
      as
      the Trustee shall deem fair and appropriate and which may provide for the
      selection for redemption of a portion of the principal amount of any
      Security.

     

    The
      Indenture permits, with certain exceptions as therein provided, the Company
      and
      the Trustee at any time to enter into a supplemental indenture or indentures
      for
      the purpose of modifying in any manner the rights and obligations of the Company
      and of the Holders of the Securities, with the consent of the Holders of not
      less than a majority in principal amount of the Outstanding Securities. The
      Indenture also contains provisions permitting Holders of specified percentages
      in principal amount of the Securities, on behalf of the Holders of all
      Securities, to waive compliance by the Company with certain provisions of the
      Indenture and certain past defaults under the Indenture and their consequences.
      Any such consent or waiver by the Holder of this Security shall be conclusive
      and binding upon such Holder and upon all future Holders of this Security and
      of
      any Security issued upon the registration of transfer hereof or in exchange
      herefor or in lieu hereof, whether or not notation of such consent or waiver
      is
      made upon this Security.

     

    No
      reference herein to the Indenture and no provision of this Security or of the
      Indenture shall alter or impair the obligation of the Company, which is absolute
      and unconditional, to pay the principal of and any premium and interest,
      including any Increased Interest, on this Security at the times, place and
      rate,
      and in the coin or currency, herein prescribed.

     

    As
      provided in the Indenture and subject to certain limitations therein set forth,
      the transfer of this Security is registrable in the Securities Register, upon
      surrender of this Security for registration of transfer at the office or agency
      of the Company maintained for such purpose, duly endorsed by, or accompanied
      by
      a written instrument of transfer in form satisfactory to the Company and the
      Securities Registrar and duly executed by, the Holder hereof or such Holder’s
      attorney duly authorized in writing, and thereupon one or more new Securities,
      of like tenor, of authorized denominations and for the same aggregate principal
      amount, will be issued to the designated transferee or transferees.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    The
      Securities are issuable only in registered form without coupons in minimum
      denominations of $__________ and any integral multiple of $______ in excess
      thereof. As provided in the Indenture and subject to certain limitations therein
      set forth, Securities are exchangeable for a like aggregate principal amount
      of
      Securities and of like tenor of a different authorized denomination, as
      requested by the Holder surrendering the same.

     

    No
      service charge shall be made for any such registration of transfer or exchange,
      but the Company and the Trustee may require payment of a sum sufficient to
      cover
      any tax or other governmental charge payable in connection
      therewith.

     

    The
      Company, the Trustee and any agent of the Company or the Trustee may treat
      the
      Person in whose name this Security is registered as the owner hereof for all
      purposes, whether or not this Security be overdue, and neither the Company,
      the
      Trustee nor any such agent shall be affected by notice to the
      contrary.

     

    The
      Company and, by its acceptance of this Security or a beneficial interest herein,
      the Holder of, and any Person that acquires a beneficial interest in, this
      Security agree that, for United States federal, state and local tax purposes,
      it
      is intended that this Security constitute indebtedness.

     

    This
      Security shall be construed and enforced in accordance with and governed by
      the
      laws of the State of Delaware, without reference to its conflict of laws
      provisions.

     

    IN
      WITNESS WHEREOF, the Company has duly executed this certificate this ____ day
      of
      ____________, 2007.

     

    Temecula
      Valley Bancorp Inc.


     

    By:

    Name:

    Title:


     

    CERTIFICATE
      OF AUTHENTICATION

     

    This
      represents Securities referred to in the within-mentioned
      Indenture.

     

    Dated:

     

    WILMINGTON
      TRUST COMPANY, not in its individual capacity but solelyas
      Trustee

    


    By:                                                                           

    Authorized
      Officer