Document:

Exhibit 10.7 Reader

RELEASE,
CONSULTING AND NONCOMPETITION
AGREEMENT

    This Release,
Consulting and Noncompetition Agreement (this “Agreement”) is entered into as of
April 12, 2005, by and between NewAlliance Bancshares, Inc., a Delaware
corporation (“NewAlliance”), NewAlliance Bank, a Connecticut savings bank and a
wholly-owned subsidiary of NewAlliance (“NewAlliance Bank”), Cornerstone
Bancorp, Inc., a Connecticut corporation (“Cornerstone”), Cornerstone Bank, a
Connecticut bank and a wholly-owned subsidiary of Cornerstone (“Cornerstone
Bank”), and Paul H. Reader (the “Consultant”).

RECITALS:

WHEREAS, the
Consultant is currently the Senior Vice President of Cornerstone and the Senior
Executive Vice President of Cornerstone Bank;

WHEREAS,
pursuant to an Agreement and Plan of Merger, dated as of April 12, 2005 (the
“Merger Agreement”), by and among NewAlliance, NewAlliance Bank, Cornerstone and
Cornerstone Bank, Cornerstone will merge with and into NewAlliance, with
NewAlliance being the surviving entity (the “Merger”), and Cornerstone Bank will
merge with and into NewAlliance Bank, with NewAlliance Bank being the surviving
entity;

WHEREAS, the
parties hereto recognize and acknowledge the interest of NewAlliance and
NewAlliance Bank in protecting the business and goodwill associated with
Cornerstone and Cornerstone Bank following the Merger by having the Consultant
enter into this Agreement; and

WHEREAS,
NewAlliance and NewAlliance Bank desire to have the Consultant provide, and the
Consultant is willing to provide NewAlliance and NewAlliance Bank with, the
consulting services on the terms and conditions set forth herein.

NOW
THEREFORE, in
consideration of the mutual covenants and agreements set forth herein and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties hereto agree as follows:

1. Defined
Terms.

Any
capitalized terms not defined in this Agreement shall have as their meanings the
definitions contained in the Merger Agreement.

2. Consultancy.

(a) Subject
to the provisions of Section 2(d) hereof, the parties hereto agree that, during
the six-month period immediately following the Effective Time of the Merger (the
“Consulting Period”), the Consultant undertakes to provide his personal advice
and counsel to NewAlliance and its subsidiaries and affiliates (including
NewAlliance Bank) in connection with the business of NewAlliance and its
subsidiaries, including, but not limited to, consulting with NewAlliance
regarding the operations and customer relationships of 

NewAlliance
and its subsidiaries, providing introductions to customers and providing
personal services similar to those the Consultant is currently providing
Cornerstone and Cornerstone Bank (collectively the “Consulting Services”),
subject to the terms and conditions which are set forth herein. The Consultant
shall provide such Consulting Services as may be requested from time to time by
the Executive Vice President - Business Banking of NewAlliance Bank, and if he
or she is not in the office on the date in question, then by the President and
Chief Executive Officer of NewAlliance, and if he or she is also not in the
office on the date in question, then by the Executive Vice President and Chief
Operating Officer of NewAlliance. During the Consulting Period, the Consultant
shall be available to devote his full business time, attention, skills and
effort (other than during holidays, vacations and periods of illness) to the
business and affairs of NewAlliance and its subsidiaries and affiliates and
shall use his reasonable best efforts to promote the interests of NewAlliance
and its subsidiaries and affiliates. Such Consulting Services may be provided in
person, telephonically, electronically or by correspondence as NewAlliance,
NewAlliance Bank and the Consultant may agree. The Consultant shall be available
for meetings at the principal executive offices of NewAlliance and NewAlliance
Bank at such times as shall be reasonable and appropriate.

(b) During
the Consulting Period, NewAlliance or NewAlliance Bank shall reimburse the
Consultant or otherwise provide for or pay for all reasonable expenses incurred
by the Consultant at the request of NewAlliance or NewAlliance Bank, subject to
such documentation and prior approval as may be required by NewAlliance or
NewAlliance Bank, including but not limited to payment of club membership dues
and assessments for the Executive (which shall not exceed an aggregate of $5,000
per year). In addition, during the Consulting Period, NewAlliance Bank shall
provide the Consultant with the continued use of an automobile of the same make,
year and model as provided by Cornerstone Bank to the Consultant as of the date
of this Agreement, with NewAlliance Bank paying the costs for fuel, insurance,
maintenance and repairs of the automobile during the Consulting
Period.

(c) During
the Consulting Period, the Consultant shall be treated as an independent
contractor and shall not be deemed to be an employee of NewAlliance or any
subsidiary or affiliate of NewAlliance.

(d) The
Consultant may terminate the Consulting Period by providing thirty (30) days
written notice to NewAlliance and NewAlliance Bank. In addition, the Consulting
Period shall automatically terminate by reason of the death of the Consultant
and no notice of termination shall be required. NewAlliance or NewAlliance Bank
may terminate the Consulting Services for Cause as hereinafter defined, in which
event the Consulting Period will end as of the date the Consulting Services are
terminated.

(e) For
purposes of this Agreement, termination for “Cause” shall mean a discharge
because the Board of Directors of NewAlliance or NewAlliance Bank (the
“NewAlliance Board”) determines that the Consultant has: (A) willfully
failed to perform his assigned duties under this Agreement, other than any
failure resulting from the Consultant's incapacity due to physical or mental
injury or illness; (B) committed an act involving moral turpitude in connection
with his Consulting Services; (C) engaged in willful misconduct;
(D) breached 

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his
fiduciary duties for personal profit; (E) willfully violated, in any
material respect, any law, rule or regulation (other than traffic violations or
similar offenses), written agreement or final cease-and-desist order with
respect to his performance of services for NewAlliance or its subsidiaries and
affiliates, as determined by the NewAlliance Board; or (F) materially
breached the terms of this Agreement and failed to cure such material breach
during a 15-day period following the date on which the NewAlliance Board gives
written notice to the Consultant of the material breach. For purposes of the
definition of Cause, no act or failure to act, on the part of the Consultant,
shall be considered "willful" unless it is done, or omitted to be done, by the
Consultant in bad faith or without reasonable belief that the Consultant's
action or omission was in the best interests of NewAlliance or its subsidiaries
and affiliates. Any act, or failure to act, based upon authority given pursuant
to a resolution duly adopted by the NewAlliance Board or based upon the written
advice of counsel for NewAlliance shall be conclusively presumed to be done, or
omitted to be done, by the Consultant in good faith and in the best interests of
NewAlliance or its subsidiaries and affiliates. The cessation of the Consulting
Services shall not be deemed to be for "Cause" within the meaning of this
Section 2(e) unless and until there shall have been delivered to the Consultant
a copy of a resolution duly adopted by the affirmative vote of three-fourths of
the members of the NewAlliance Board at a meeting of such Board called and held
for such purpose (after reasonable notice is provided to the Consultant and the
Consultant is given an opportunity, together with counsel, to be heard before
such Board), finding that, in the good faith opinion of such Board, the
Consultant is guilty of the conduct described in this Section 2(e), and
specifying the particulars thereof in detail.

(f) The
obligations of NewAlliance and NewAlliance Bank under this Agreement are subject
to and contingent upon the Consultant continuing to be employed by Cornerstone
and Cornerstone Bank from the date hereof until the Effective Time of the
Merger.

3. Non-Disclosure
of Confidential Information.

Except in
the course of his services to NewAlliance and NewAlliance Bank hereunder, and in
the pursuit of the business of NewAlliance or any of its subsidiaries or
affiliates, the Consultant shall not, except as required by law, at any time
during or following the Consulting Period, disclose or use any confidential
information or proprietary data of NewAlliance or any of its subsidiaries or
affiliates or predecessors, unless such confidential information or proprietary
data become publicly known through no fault of the Consultant. The Consultant
agrees that all information concerning the identity of the customers of
NewAlliance and its subsidiaries and affiliates and the relations of such
entities with their customers is confidential information. This Section 3 shall
survive the termination or expiration of the Consulting Period.

4. Non-Competition
Provisions.

The
Consultant agrees that during the 18-month period immediately following the
Effective Date of the Merger (the “Non-Competition Period”), the Consultant will
not (i) without the prior written consent of NewAlliance Bank, engage in, become
interested in, directly or indirectly, as a sole proprietor, as a partner in a
partnership, or as a shareholder in a corporation, or become associated with, in
the capacity of employee, director, officer, principal, agent, trustee or in any
other capacity whatsoever, any enterprise or entity located in 

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any of
Fairfield, Hartford, Litchfield, Middlesex, New Haven, New London, Tolland or
Windham Counties in the State of Connecticut or Kent, Providence or Washington
Counties in the State of Rhode Island (collectively, the “Counties” and
individually a “County”) or in the New York, New York Primary Metropolitan
Statistical Area (“PMSA”), which proprietorship, partnership, corporation,
enterprise or other entity is, or may be deemed to be by NewAlliance Bank,
competitive with any business carried on by NewAlliance, NewAlliance Bank or any
of their subsidiaries, including but not limited to entities which lend money
and take deposits (in each case, a “Competing Business”), provided, however,
that this provision shall not prohibit the Consultant from owning bonds,
non-voting preferred stock or up to five percent (5%) of the outstanding common
stock of any Competing Business if such common stock is publicly traded, (ii)
solicit or induce, or cause others to solicit or induce, any employee of
NewAlliance or any of its subsidiaries to leave the employment of such entities,
or (iii) solicit (whether by mail, telephone, personal meeting or any other
means, excluding general solicitations of the public that are not based in whole
or in part on any list of customers of NewAlliance or any of its subsidiaries)
any customer of NewAlliance or any of its subsidiaries to transact business with
any other entity, whether or not a Competing Business, or to reduce or refrain
from doing any business with NewAlliance or its subsidiaries, or interfere with
or damage (or attempt to interfere with or damage) any relationship between
NewAlliance or its subsidiaries and any such customers. In the event the
Consultant desires to join a Competing Business and requests the written consent
of NewAlliance Bank to permit him to do so during the Non-Competition Period,
the Consultant shall provide the President and Chief Executive Officer of
NewAlliance Bank with the identity of the Competing Business, the nature of his
proposed position, duties and responsibilities with such entity, and such other
information as may be reasonably requested by NewAlliance Bank within fifteen
(15) days of receiving such request. NewAlliance Bank agrees to consider and
review any such request (provided that no more than one request may be submitted
within any 45 day period), and to notify the Consultant of its determination
within thirty (30) days of receiving the information requested pursuant to the
preceding sentence.

5. Compensation.

(a) On
December 30, 2005 and in consideration for the Consultant executing the General
Release attached hereto as Exhibit A in a timely manner so that it is effective
and irrevocable prior to the date of such payment, Cornerstone or Cornerstone
Bank shall pay to the Consultant a lump sum cash amount equal to $722,641, minus
applicable withholding, so that the full amount of such payment is included in
the Consultant’s taxable income for 2005.

(b) In
consideration of the obligations and commitments of the Consultant under this
Agreement, including the execution of the General Release attached hereto as
Exhibit A by the Consultant in a timely manner so that such release is effective
and irrevocable prior to the date of the payment pursuant to Section 5(a)
hereof, NewAlliance or NewAlliance Bank shall pay to the Consultant an amount
equal to $13,333.33 per month on the last business day of each month during the
Consulting Period.

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(c) During
the Consulting Period and for a period of thirty-six months following the
expiration or termination of the Consultant Period, NewAlliance or NewAlliance
Bank shall provide medical, dental, life and accidental death and dismemberment
coverage to the Consultant under the policies offered by NewAlliance and
NewAlliance Bank to their employees, on the same terms and conditions as if the
Consultant was an employee of NewAlliance Bank, with the Consultant responsible
for paying the employee share of any premiums, copayments or deductibles and
with the accident, disability and life insurance coverage subject to the maximum
coverage limits in the current policies of Cornerstone Bank. For purposes of
determining eligibility under such plans, the Consultant shall be credited with
his service as a Cornerstone Bank employee and shall not be subject to any
pre-existing condition limitation for conditions covered under such plans. In
addition, each such plan which provides health insurance benefits shall honor
any deductible and out-of-pocket expenses incurred by the Consultant under any
comparable Cornerstone Bank plan for the plan year in which the Effective Time
occurs.

(d) Notwithstanding
anything contained herein to the contrary, NewAlliance or NewAlliance Bank shall
pay to the Consultant his vested benefits under the Salary Continuation
Agreement between the Consultant and Cornerstone Bank adopted on or about June
7, 2002 and effective as of April 1, 2002 (the “SERP Agreement”), with the
benefits to be paid in the amounts and at the times set forth in the SERP
Agreement, provided that none of the events specified in Article 5 of the SERP
Agreement have occurred. NewAlliance and NewAlliance Bank agree that Cornerstone
Bank and the Executive may amend the SERP if deemed necessary to bring it into
compliance with Section 409A of the Code, provided that NewAlliance and its
counsel shall have an appropriate opportunity to review and comment on such
amendment prior to its adoption. Provided that the Consultant consents to any
amendment to the SERP Agreement that may be deemed necessary or appropriate by
NewAlliance or NewAlliance Bank to comply with Section 409A of the Code,
NewAlliance and NewAlliance Bank agree not to take any action, without the prior
written consent of the Consultant, that would result in any penalty tax or
interest being owed by the Consultant under Section 409A(a)(1)(B) of the Code
with respect to the Consultant’s benefits under the SERP Agreement.

 

6. Certain
Supplemental Payments by NewAlliance.

(a) In the
event that it is determined that part or all of the compensation and benefits to
be paid to the Consultant, whether or not payable hereunder, (i) constitute
“parachute payments” under Section 280G of the Code (the “Payments”), and (ii)
equal or exceed three (3) times the Consultant’s “Base Amount” (as such term is
used under Section 280G of the Code), NewAlliance, on or before the date for
payment of the excise tax imposed under Section 4999 of the Code, shall pay to
or on behalf of the Consultant, in a single lump sum, an amount (the “Gross-Up
Amount”) such that, after payment of all federal, state and local income tax and
any additional excise tax under Section 4999 of the Code in respect of the
Gross-Up Amount payment, the Consultant will be fully reimbursed for the amount
of such excise tax.

(b) The
determination of the Payments, the Base Amount and the Gross-Up Amount, as well
as any other calculations necessary to implement this Section 6 shall be made by
counsel to NewAlliance, with such counsel’s fee to be paid by
NewAlliance.

5

(c) As
promptly as practicable following the above determinations, NewAlliance shall
pay to or distribute to or for the benefit of the Consultant such amounts as are
then due to the Consultant under this Agreement and shall promptly pay to or
distribute for the benefit of the Consultant in the future such amounts as
become due to the Consultant under this Agreement.

(d) As a
result of the uncertainty in the application of Section 280G of the Code at the
time of an initial determination hereunder, it is possible that payments will
not have been made by NewAlliance which should have been made under clause (a)
of this Section 6 (“Underpayment”). In the event that there is a final
determination by the Internal Revenue Service, or a final determination by a
court of competent jurisdiction, that an Underpayment has been made and the
Consultant thereafter is required to make any payment of an excise tax, income
tax, any interest or penalty, the firm selected under clause (b) above shall
determine the amount of the Underpayment that has occurred and any such
Underpayment shall be promptly paid by NewAlliance to or for the benefit of the
Consultant. If and to the extent that the Consultant receives any tax refund
from the Internal Revenue Service that is attributable to payments by
NewAlliance pursuant to this Section 6 of amounts in excess of the actual
Gross-Up Amount as finally determined by the Internal Revenue Service or a court
of competent jurisdiction (“Overpayment”), the Consultant shall promptly pay to
NewAlliance the amount of such refund that is attributable to the Overpayment
(together with any interest paid or credited thereon after taxes applicable
thereto); provided, however, the Consultant shall not have any obligation to pay
NewAlliance any amount pursuant to this Section 6(d) if and to the extent that
any such obligation would cause the arrangement to be treated as a loan or
extension of credit prohibited by applicable law.

 

    7.
Successors and Assigns

 

(a) Each of
NewAlliance and NewAlliance Bank will require any successor or assign (whether
direct or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of its business and/or assets, by agreement in form and
substance satisfactory to the Consultant, expressly, absolutely and
unconditionally to assume and agree to perform this Agreement in the same manner
and to the same extent that NewAlliance or NewAlliance Bank would be required to
perform it if no such succession or assignment had taken place. Any failure of
NewAlliance or NewAlliance Bank to obtain such agreement prior to the
effectiveness of any such succession or assignment shall be a material breach of
this Agreement.

(b) This
Agreement and all rights of the Consultant shall inure to the benefit of and be
enforceable by the Consultant’s personal or legal representatives, estate,
executors, administrators, heirs and beneficiaries. All amounts payable to the
Consultant hereunder shall be paid, in the event of the Consultant’s death, to
the Consultant’s estate, heirs and representatives. Except as provided in this
Section 7, no party may assign this Agreement or any rights, interests, or
obligations hereunder without the prior written approval of the other party.
Subject to the preceding sentence, this Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective successors
and permitted assigns pursuant to Section 7(a). This Agreement shall not be
terminated by the voluntary or involuntary dissolution of NewAlliance or
NewAlliance Bank.

6

8. Enforcement.

(a) This
Agreement shall be construed, enforced and interpreted in accordance with and
governed by the laws of the State of Connecticut, without reference to its
principles of conflict of laws, except to the extent that federal law shall be
deemed to preempt such state laws.

(b) It is the
intention of the parties hereto that the provisions of this Agreement shall be
enforced to the fullest extent permissible under all applicable laws and public
policies, but that the unenforceability or the modification to conform with such
laws or public policies of any provision hereof shall not render unenforceable
or impair the remainder of the Agreement. The covenants in Section 4 of this
Agreement with respect to the Counties and the PMSA shall be deemed to be
separate covenants with respect to each County and PMSA, and should any court of
competent jurisdiction conclude or find that this Agreement or any portion is
not enforceable with respect to any of the Counties or PMSA, such conclusion or
finding shall in no way render invalid or unenforceable the covenants herein
with respect to any other County or PMSA. Accordingly, if any provision shall be
determined to be invalid or unenforceable either in whole or in part, this
Agreement shall be deemed amended to delete or modify as necessary the invalid
or unenforceable provisions to alter the balance of this Agreement in order to
render the same valid and enforceable.

(c) The
Consultant acknowledges that NewAlliance and NewAlliance Bank would not have
entered into the Merger Agreement or intend to consummate the Merger unless the
Consultant had, among other things, entered into this Agreement. Any breach of
Sections 3 or 4 of this Agreement will result in irreparable damage to
NewAlliance and NewAlliance Bank for which NewAlliance and NewAlliance Bank will
not have an adequate remedy at law. In addition to any other remedies and
damages available to NewAlliance and NewAlliance Bank, the Consultant further
acknowledges that NewAlliance and NewAlliance Bank shall be entitled to seek
injunctive relief hereunder to enjoin any breach of Sections 3 or 4 of this
Agreement, and the parties hereby consent to any injunction issued in favor of
NewAlliance and NewAlliance Bank by any court of competent jurisdiction, without
prejudice to any other right or remedy to which NewAlliance and NewAlliance Bank
may be entitled. The Consultant represents and acknowledges that, in light of
his experience and capabilities, the Consultant can obtain employment with other
than a Competing Business or in a business engaged in other lines and/or of a
different nature than those engaged in by NewAlliance or its subsidiaries or
affiliates, and that the enforcement of a remedy by way of injunction will not
prevent the Consultant from earning a livelihood. In the event of a breach of
this Agreement by the Consultant, the Consultant acknowledges that in addition
to or in lieu of NewAlliance or NewAlliance Bank seeking injunctive relief,
NewAlliance or NewAlliance Bank may also seek to recoup any or all amounts paid
by NewAlliance or NewAlliance Bank to the Consultant pursuant to Section 5
hereof. Each of the remedies available to NewAlliance and NewAlliance Bank in
the event of a breach by the Consultant shall be cumulative and not mutually
exclusive.

7

9. Amendment.

This
Agreement may be amended or modified at any time by a written instrument
executed by the parties prior to the Effective Time of the Merger and thereafter
by NewAlliance, NewAlliance Bank and the Consultant; provided, however, that if
the NewAlliance Board determines, after a review of Section 409A of the Code and
all applicable Internal Revenue Service guidance, that this Agreement should be
amended to comply with Section 409A of the Code, the NewAlliance Board may amend
this Agreement to make any changes required to comply with Section 409A of the
Code.

 

10. Withholding.

NewAlliance
and NewAlliance Bank shall be entitled to withhold from amounts to be paid to
the Consultant hereunder any federal, state or local withholding or other taxes,
or charge which it is from time to time required to withhold. NewAlliance and
NewAlliance Bank shall be entitled to rely on an opinion of counsel if any
question as to the amount or requirement of any such withholding shall
arise.

11. Notice.

Any
communication required or permitted to be given under this Agreement, including
any notice, direction, designation, consent, instruction, objection or waiver,
shall be in writing and shall be deemed to have been given at such time as it is
delivered personally, or five days after mailing if mailed, postage prepaid, by
registered or certified mail, return receipt requested, addressed to such party
at the address listed below or at such other address as one such party may by
written notice specify to the other party:

	 	 
	 	
      If
      to the Consultant:

	 	 
	 	
      Paul
      H. Reader

	 	
      At
      the address last appearing

	 	
      on
      the records of NewAlliance

	 	 
	 	
      If
      to Cornerstone and Cornerstone Bank:

	 	 
	 	
      Cornerstone
      Bancorp, Inc.

	 	
      Cornerstone
      Bank

	 	
      550
      Summer Street

	 	
      Stamford,
      Connecticut 06901

	 	 
	 	
      Attention:
      Chairman of the Compensation Committee of the
Board

 

8

 

	 	 
	 	
      If
      to NewAlliance and NewAlliance Bank:

	 	 
	 	
      NewAlliance
      Bancshares, Inc.

	 	
      NewAlliance
      Bank

	 	
      195
      Church Street

	 	
      New
      Haven, Connecticut 06510

	 	 
	 	
      (or
      the address of their principal executive office, if
    different)

	 	
      Attention:
      Chairman of the Compensation Committee of the Board

	 	 
	 	
      with
      a copy, in the case of a notice to NewAlliance and NewAlliance Bank,
      to:

	 	
      Elias,
      Matz, Tiernan & Herrick L.L.P.

	 	
      734
      15th
      Street, N.W.

	 	
      Washington,
      D.C. 20005

	 	
      Attention:
      Raymond A. Tiernan, Esq.

	 	
        
      Gerald F. Heupel, Jr., Esq.

     12. Waiver.

Failure
to insist upon strict compliance with any of the terms, covenants or conditions
hereof shall not be deemed a waiver of such term, covenant or condition. A
waiver of any provision of this Agreement must be made in writing, designated as
a waiver, and signed by the party against whom its enforcement is sought. Any
waiver or relinquishment of any right or power hereunder at any one or more
times shall not be deemed a waiver or relinquishment of such right or power at
any other time or times.

13. Counterparts.

This
Agreement may be executed in two or more counterparts, each of which shall be
deemed an original, and all of which shall constitute one and the same
Agreement.

14. Governing
Law.

This
Agreement shall be governed by and construed and enforced in accordance with the
laws of the State of Connecticut applicable to contracts entered into and to be
performed entirely within the State of Connecticut, except to the extent that
federal law controls.

15. Headings
and Construction.

The
headings of sections in this Agreement are for convenience of reference only and
are not intended to qualify the meaning of any section. Any reference to a
section number shall refer to a section of this Agreement, unless otherwise
stated.

9

16. Entire
Agreement.

This
instrument contains the entire agreement of the parties relating to the subject
matter hereof, and supersedes in its entirety any and all prior agreements,
understandings or representations relating to the subject matter hereof,
including but not limited to that certain employment agreement dated as of May
17, 2001 between Cornerstone, Cornerstone Bank and the Consultant (the
“Cornerstone Employment Agreement”). Notwithstanding anything contained herein
to the contrary, this Agreement does not supersede the SERP
Agreement.

17. Effectiveness.

Notwithstanding
anything to the contrary contained in this Agreement, the effectiveness of this
Agreement shall be subject to consummation of the Merger in accordance with the
terms of the Merger Agreement, as the same may be amended by the parties thereto
in accordance with its terms, except that Section 5(a) hereof shall be effective
immediately. In the event the Merger Agreement is terminated for any reason,
this Agreement shall be deemed null and void, including Section 5(a) hereof if
the Merger Agreement is terminated prior to the time the payment pursuant to
Section 5(a) hereof is made.

[Signature
Page Follows]

 

10

IN
WITNESS WHEREOF, each of NewAlliance, NewAlliance Bank, Cornerstone and
Cornerstone Bank has caused this Agreement to be executed by its duly authorized
officer, and the Consultant has signed this Agreement, effective as of the date
first above written.

	
      WITNESS:
	
      CONSULTANT:

	 	 
	
      /s/
      Leigh A. Hardisty
	
      /s/
      Paul H. Reader

	
      Name:
	
      Name:
      Paul H. Reader

	
      Title:
      Secretary
	
       

	 	 
	 	 
	
      ATTEST:
	
      NEWALLIANCE
      BANCSHARES, INC.

	 	 
	
      /s/
      Noel Rendell
	
      By:
      /s/ Merrill B. Blanksteen

	
      Name:
      Noel Rendell
	
      Name:
      Merrill B. Blanksteen

	
      Title:
      Corporate Secretary
	
      Title:
      Executive Vice President and CFO

	 	 
	 	 
	
      ATTEST:
	
      NEWALLIANCE
      BANK

	 	 
	 	 
	
      /s/
      Noel Rendell
	
      By:
      /s/ Merrill B. Blanksteen

	
      Name:
      Noel Rendell
	
      Name:
      Merrill B. Blanksteen

	
      Title:
      Corporate Secretary
	
      Title:
      Executive Vice President and CFO

	 	 
	 	 
	
      ATTEST:
	
      CORNERSTONE
      BANCORP, INC.

	 	 
	
      /s/
      Leigh A. Hardisty
	
      By:
      /s/ Merrill J. Forgotson

	
      Name:
      Leigh A. Hardisty
	
      Name:
      Merrill J. Forgotson

	
      Title:
      Secretary
	
      Title:
      President and CEO

	 	 
	 	 
	
      ATTEST:
	
      CORNERSTONE
      BANK

	 	 
	
      /s/
      Leigh A. Hardisty
	
      By:
      /s/ Merrill J. Forgotson

	
      Name:
      Leigh A. Hardisty
	
      Name:
      Merrill J. Forgotson

	
      Title:
      Senior Vice President and
	
      Title:
      Chairman and COO

	
      Secretary
	 

11Exhibit 4.2

 

 

 

MACK-CALI REALTY, L.P.,

 

Issuer

 

to

 

WILMINGTON TRUST COMPANY,

 

Trustee

 

_________________________

 

Supplemental Indenture No. 11

 

Dated as of April 15, 2005

 

_________________________

 

 

$150,000,000

of

5.05% Notes due 2010

 

 

 

 

 

 

 

 

 

 

SUPPLEMENTAL INDENTURE NO. 11 dated as of April 15, 2005 (the “Supplemental Indenture”), between MACK-CALI REALTY, L.P., a limited partnership duly organized and existing under the laws of the State of Delaware (herein called the “Issuer”), and WILMINGTON TRUST COMPANY, a Delaware banking corporation duly organized and existing under the laws of the State of Delaware, as Trustee (herein called the “Trustee”).

 

	
            RECITALS OF THE ISSUER
  

 

The Issuer and Mack-Cali Realty Corporation, a corporation duly organized and existing under the laws of the State of Maryland (herein called the “Corporation”), have heretofore delivered to the Trustee an Indenture dated as of March 16, 1999 (the “Original Indenture”), a form of which has been incorporated by reference in the Issuer's Registration Statement on Form S-3 (Registration No. 333-117047) filed with the Securities and Exchange Commission under the Securities Act of 1933, as amended, providing for the issuance from time to time of debt securities of the Issuer (the “Securities”).

 

Section 301 of the Original Indenture provides for various matters with respect to any series of Securities issued under the Original Indenture to be established in an indenture supplemental to the Original Indenture.

 

Section 901(7) of the Original Indenture provides for the Issuer and the Trustee to enter into an indenture supplemental to the Original Indenture to establish the form or terms of Securities of any series as provided by Sections 201 and 301 of the Original Indenture.

 

The Board of Directors of the Corporation, the general partner of the Issuer, has duly adopted resolutions authorizing the Issuer to execute and deliver this Supplemental Indenture.

 

All the conditions and requirements necessary to make this Supplemental Indenture, when duly executed and delivered, a valid and binding agreement in accordance with its terms and for the purposes herein expressed, have been performed and fulfilled.

 

	
            NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE WITNESSETH:
 

 

For and in consideration of the premises and the purchase of the Notes provided for herein by the Holders thereof, it is mutually covenanted and agreed, for the equal and proportionate benefit of all Holders of the Notes, as follows:

 

 

 

 

 

 

	
            ARTICLE ONE
  

 

	
            RELATION TO ORIGINAL INDENTURE; DEFINITIONS
 

 

Section 1.1  Relation to Original Indenture.

 

This Supplemental Indenture constitutes an integral part of the Original Indenture.

 

Section 1.2  Definitions.

 

For all purposes of this Supplemental Indenture, except as otherwise expressly provided for or unless the context otherwise requires:

 

(1)             Capitalized terms used but not defined herein shall have the respective meanings assigned to them in the Original Indenture; and

 

(2)             All references herein to Articles and Sections, unless otherwise specified, refer to the corresponding Articles and Sections of this Supplemental Indenture.

 

“Acquired Indebtedness” means Indebtedness of a Person (i) existing at the time such Person becomes a Subsidiary or (ii) assumed in connection with the acquisition of assets from such Person, in each case, other than Indebtedness incurred in connection with, or in contemplation of, such Person becoming a Subsidiary or such acquisition.  Acquired Indebtedness shall be deemed to be incurred on the date of the related acquisition of assets from any Person or the date the acquired Person becomes a Subsidiary.

 

“Annual Service Charge” for any period means the aggregate interest expense for such period in respect of, and the amortization during such period of any original issue discount of, Indebtedness of the Issuer and its Subsidiaries.

 

“Business Day” means any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions in The City of New York or the State of Delaware are authorized or required by law, regulation or executive order to close.

 

“Consolidated Income Available for Debt Service” for any period means Earnings from Operations of the Issuer and its Subsidiaries plus amounts which have been deducted, and minus amounts which have been added, for the following (without duplication):  (i) interest on Indebtedness of the Issuer and its Subsidiaries, (ii) provision for taxes of the Issuer and its Subsidiaries based on income, (iii) amortization of debt discount and deferred financing costs, (iv) provisions for gains and losses on properties and depreciation and amortization, (v) increases in deferred taxes and other non-cash items, (vi) depreciation and amortization with respect to interests in joint venture and partially owned entity investments, (vii) the effect of any charge resulting from a change in accounting principles in 

 

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determining Earnings from Operations for such period and (viii) amortization of deferred charges.

 

“Corporate Trust Office” means the office of the Trustee at which, at any particular time, its corporate trust business shall be principally administered, which office at the date hereof is located at Rodney Square North, 1100 North Market Street, Wilmington, Delaware 19890-0001, Attention: Corporate Trust Administration and, for purposes of the Place of Payment provisions of Sections 305 and 1002 of the Original Indenture, is located at Rodney Square North, 1100 North Market Street, Wilmington, Delaware 19890-0001, Attention: Corporate Trust Administration.

 

“Earnings from Operations” for any period means net income excluding provisions for gains and losses on sales of investments or joint ventures, extraordinary and non-recurring items, and property valuation losses, as reflected in the consolidated financial statements of the Issuer and its Subsidiaries for such period determined in accordance with GAAP.

 

“Encumbrance” means any mortgage, lien, charge, pledge or security interest of any kind.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder by the Commission.

 

“GAAP” means generally accepted accounting principles as used in the United States applied on a consistent basis as in effect from time to time; provided that solely for purposes of any calculation required by the financial covenants contained herein, “GAAP” shall mean generally accepted accounting principles as used in the United States on the date hereof, applied on a consistent basis.

 

“Indebtedness” of the Issuer or any Subsidiary means, without duplication, any indebtedness of the Issuer or any Subsidiary, whether or not contingent, in respect of: (i) borrowed money evidenced by bonds, notes, debentures or similar instruments whether or not such indebtedness is secured by any Encumbrance existing on property owned by the Issuer or any Subsidiary, (ii) indebtedness for borrowed money of a Person other than the Issuer or a Subsidiary which is secured by any Encumbrance existing on property owned by the Issuer or any Subsidiary, to the extent of the lesser of (x) the amount of indebtedness so secured and (y) the fair market value of the property subject to such Encumbrance, (iii) the reimbursement obligations, contingent or otherwise, in connection with any letters of credit actually issued or amounts representing
the balance deferred and unpaid of the purchase price of any property or services, except any such balance that constitutes an accrued expense or trade payable, or (iv) any lease of property by the Issuer or any Subsidiary as lessee which is reflected on the Issuer's consolidated balance sheet as a capitalized lease in accordance with GAAP; and also includes, to the extent not otherwise included, any obligation by the Issuer or any Subsidiary to be liable for, or to pay, as obligor, guarantor or otherwise (other than for purposes of 

 

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collection in the ordinary course of business), Indebtedness of another Person (other than the Issuer or any Subsidiary; it being understood that Indebtedness shall be deemed to be incurred by the Issuer or any Subsidiary whenever the Issuer or such Subsidiary shall create, assume, guarantee or otherwise become liable in respect thereof; Indebtedness of a Subsidiary of the Issuer existing prior to the time it became a Subsidiary of the Issuer shall be deemed to be incurred upon such Subsidiary's becoming a Subsidiary of the Issuer; and Indebtedness of a person existing prior to a merger or consolidation of such person with the Issuer or any Subsidiary of the Issuer in which such person is the successor to the Issuer or such Subsidiary shall be deemed to be incurred upon the consummation of such merger or consolidation; provided, however, the term “Indebtedness” shall not include any such
indebtedness that has been the subject of an “in substance” defeasance in accordance with GAAP).

 

“Intercompany Indebtedness” means Indebtedness to which the only parties are the Issuer, the Corporation and any Subsidiary (but only so long as such Indebtedness is held solely by any of the Issuer, the Corporation and any Subsidiary) that is subordinate in right of payment to the Notes.

 

“Make-Whole Premium” means, in connection with any optional redemption of any Notes, the excess, if any, of (i) the aggregate present value as of the date of such redemption of each dollar of principal of such Notes being redeemed and the amount of interest (exclusive of interest accrued to the date of redemption) that would have been payable in respect of such dollar if such redemption had not been made, determined by discounting, on a semi-annual basis, such principal and interest at the Reinvestment Rate (determined on the third Business Day preceding the date such notice of redemption is given) from the respective dates on which such principal and interest would have been payable if such redemption had not been made, over (ii) the aggregate principal amount of such Notes being redeemed.

 

“Notes” has the meaning specified in Section 2.1 hereof.

 

“Reinvestment Rate” means 0.2% (two tenths of one percent) plus the arithmetic mean of the yields under the respective headings “This Week” and “Last Week” published in the Statistical Release under the caption “Treasury Constant Maturities” for the maturity (rounded to the nearest month) corresponding to the remaining life to maturity of such Notes, as of the payment date of the principal of such Notes being redeemed.  If no maturity exactly corresponds to such maturity, yields for the two published maturities most closely corresponding to such maturity shall be calculated pursuant to the immediately preceding sentence and the Reinvestment Rate shall be obtained by linear interpolation, rounding in each of such relevant periods to the nearest month.  For such purposes of calculating the Reinvestment
Rate, the most recent Statistical Release published prior to the date of determination of the Make-Whole Premium shall be used.

 

“Statistical Release” means the statistical release designated “H.15(519)” or any successor publication which is published weekly by the Federal Reserve System and which establishes yields on actively traded United States government securities adjusted to constant maturities or, if such statistical release is 

 

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not published at the time of any determination of the Make-Whole Premium, then such other reasonably comparable index which shall be designated by the Issuer.

 

“Subsidiary” means, with respect to any Person, any corporation or other entity of which a majority of the voting power of the voting equity securities or the outstanding equity interests of which are owned, directly or indirectly, by such Person.  For the purposes of this definition, “voting equity securities” means equity securities having voting power for the election of directors, whether at all times or only so long as no senior class of security has such voting power by reason of any contingency.

 

“Total Assets” as of any date means the sum of (i) the Undepreciated Real Estate Assets and (ii) all other assets of the Issuer and its Subsidiaries determined in accordance with GAAP (but excluding accounts receivable and intangibles).

 

“Total Unencumbered Assets” means the sum of (i) those Undepreciated Real Estate Assets not subject to an Encumbrance for borrowed money and (ii) all other assets of the Issuer and its Subsidiaries not subject to an Encumbrance for borrowed money, determined in accordance with GAAP (but excluding accounts receivable and intangibles).

 

“Undepreciated Real Estate Assets” as of any date means the cost (original cost plus capital improvements) of real estate assets of the Issuer and its Subsidiaries on such date, before depreciation and amortization, determined on a consolidated basis in accordance with GAAP.

 

“Unsecured Indebtedness” means Indebtedness which is not secured by any Encumbrance upon any of the properties of the Issuer or any Subsidiary.

 

	
            ARTICLE TWO
  

 

	
            THE SERIES OF NOTES
 

 

Section 2.1  Title of the Securities.

 

There shall be a series of Securities designated the “5.05% Notes due 2010” (the “Notes”).

 

Section 2.2  Limitation on Aggregate Principal Amount.

 

Except as provided in this Section and in Section 306 of the Original Indenture, (i) the aggregate principal amount of the Notes shall be limited to $150,000,000, and (ii) the Issuer shall not execute and the Trustee shall not authenticate or deliver Notes in excess of such aggregate principal amount.

 

Nothing contained in this Section 2.2 or elsewhere in this Supplemental Indenture, or in the Notes, is intended to or shall limit execution by the 

 

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Issuer or authentication or delivery by the Trustee of Notes under the circumstances contemplated by Sections 303, 304, 305, 306, 906, 1107 and 1305 of the Original Indenture.  Furthermore, the Issuer may from time to time, without the consent of existing Holders, create and issue further Securities having the same terms and conditions in all respects as the Notes issued as of the date hereof pursuant to this Supplemental Indenture, except for issue date, issue price and the first payment of interest thereon.  Additional Securities issued in this manner will be consolidated with and will form a single series with the previously outstanding Notes.

 

Section 2.3  Interest and Interest Rates; Maturity Date of Notes.

 

The Notes will bear interest at a rate of 5.05% per annum from April 15, 2005 or from the immediately preceding Interest Payment Date to which interest has been paid or duly provided for, payable semi-annually in arrears on April 15 and October 15 of each year, commencing on October 15, 2005 (each, an “Interest Payment Date”), to the Person in whose name such Note is registered at the close of business on April 1 or October 1 (whether or not a Business Day), as the case may be, next preceding such Interest Payment Date (each, a “Regular Record Date”).  Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months.  The interest so payable on any Note which is not punctually paid or duly provided for on any Interest Payment Date shall forthwith cease
to be payable to the Person in whose name such Note is registered on the relevant Regular Record Date, and such defaulted interest shall instead be payable to the Person in whose name such Note is registered on the Special Record Date or other specified date determined in accordance with the Original Indenture.

 

If any Interest Payment Date or Maturity falls on a day that is not a Business Day, the required payment shall be made on the next Business Day as if it were made on the date such payment was due and no interest shall accrue on the amount so payable for the period from and after such Interest Payment Date or Maturity, as the case may be.  

 

	
            The Notes will mature on April 15, 2010.
 

 

Section 2.4  Limitations on Incurrence of Indebtedness.

 

(a)             The Issuer will not, and will not permit any Subsidiary to, incur any Indebtedness, other than Intercompany Indebtedness, if, immediately after giving effect to the incurrence of such additional Indebtedness and the application of the proceeds thereof, the aggregate principal amount of all outstanding Indebtedness of the Issuer and its Subsidiaries on a consolidated basis determined in accordance with GAAP is greater than 60% of the sum of (without duplication) (i) the Total Assets of the Issuer and its Subsidiaries as of the end of the calendar quarter covered in the Issuer's Annual Report on Form 10-K or Quarterly Report on Form 10-Q, as the case may be, most recently filed with the Commission (or, if such filing is not permitted under the Exchange Act, with the
Trustee) prior to the incurrence of such additional Indebtedness and (ii) the purchase price of any assets included in the definition of Total Assets acquired, and the amount of any securities offering 

 

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proceeds received (to the extent such proceeds were not used to acquire items  included in the definition of Total Assets or used to reduce indebtedness), by the Issuer or any Subsidiary since the end of such calendar quarter, including those proceeds obtained in connection with the incurrence of such additional Indebtedness.

 

(b)             In addition to the limitation set forth in subsection (a) of this Section 2.4, the Issuer will not, and will not permit any Subsidiary to, incur any Indebtedness if the ratio of Consolidated Income Available for Debt Service to the Annual Service Charge for the four consecutive fiscal quarters most recently ended prior to the date on which such additional Indebtedness is to be incurred shall have been less than 1.5:1, on a pro forma basis after giving effect thereto and to the application of the proceeds therefrom, and calculated on the assumption that (i) such Indebtedness and any other Indebtedness incurred by the Issuer and its Subsidiaries since the first day of such four-quarter period and the application of the proceeds
therefrom, including to refinance other Indebtedness, had occurred at the beginning of such period; (ii) the repayment or retirement of any other Indebtedness by the Issuer and its Subsidiaries since the first day of such four-quarter period had been repaid or retired at the beginning of such period (except that, in making such computation, the amount of Indebtedness under any revolving credit facility shall be computed based upon the average daily balance of such Indebtedness during such period); (iii) in the case of Acquired Indebtedness or Indebtedness incurred in connection with any acquisition since the first day of such four-quarter period, the related acquisition had occurred as of the first day of such period with the appropriate adjustments with respect to such acquisition being included in such pro forma calculation; and (iv) in the case of any acquisition or disposition by the Issuer or its Subsidiaries of any asset or group
of assets since the first day of such four-quarter period, whether by merger, stock purchase or sale, or asset purchase or sale, such acquisition or disposition or any related repayment of Indebtedness had occurred as of the first day of such period with the appropriate adjustments with respect to such acquisition or disposition being included in such pro forma calculation.

 

(c)             In addition to the limitations set forth in subsections (a) and (b) of this Section 2.4, the Issuer will not, and will not permit any Subsidiary to, incur any Indebtedness secured by any Encumbrance upon any of the property of the Issuer or any Subsidiary, whether owned at the date of the Indenture or thereafter acquired, if, immediately after giving effect to the incurrence of such additional Indebtedness secured by an Encumbrance and the application of the proceeds thereof, the aggregate principal amount of all outstanding Indebtedness of the Issuer and its Subsidiaries on a consolidated basis which is secured by any Encumbrance on property of the Issuer or any Subsidiary is greater than 40% of the sum of (without duplication) (i) the Total Assets of the Issuer and its
Subsidiaries as of the end of the calendar quarter covered in the Issuer's Annual Report on Form 10-K or Quarterly Report on Form 10-Q, as the case may be, most recently filed with the Commission (or, if such filing is not permitted under the Exchange Act, with the Trustee) prior to the incurrence of such additional Indebtedness and (ii) the purchase price of any assets included in the definition of Total Assets acquired, and the amount of any securities offering proceeds received (to the extent such proceeds were not used to 

 

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acquire items included in the definition of Total Assets or used to reduce Indebtedness), by the Issuer or any Subsidiary since the end of such calendar quarter, including those proceeds obtained in connection with the incurrence of such additional Indebtedness.

 

(d)             The Issuer and its Subsidiaries may not at any time own Total Unencumbered Assets equal to less than 150% of the aggregate outstanding principal amount of the Unsecured Indebtedness of the Issuer and its Subsidiaries on a consolidated basis.

 

(e)             For purposes of this Section 2.4, Indebtedness shall be deemed to be “incurred” by the Issuer or a Subsidiary whenever the Issuer or such Subsidiary shall create, assume, guarantee or otherwise become liable in respect thereof.

 

Section 2.5  Redemption.

 

The Notes may be redeemed at any time and from time to time at the option of the Issuer, in whole or in part, at a redemption price equal to the sum of (i) the principal amount of the Notes being redeemed plus accrued and unpaid interest thereon up to but not including the Redemption Date and (ii) the Make-Whole Premium, if any, with respect to such Notes (the “Redemption Price”).

 

Section 2.6  Places of Payment.

 

The Places of Payment where the Notes may be presented or surrendered for payment, where the Notes may be surrendered for registration of transfer or exchange and where notices and demands to and upon the Issuer in respect of the Notes and the Original Indenture may be served shall be in Wilmington, Delaware, and the office or agency for such purpose shall initially be located at the Corporate Trust Office.

 

Section 2.7  Method of Payment.

 

Payment of the principal of and interest on the Notes will be made at the office or agency of the Issuer maintained for that purpose in Wilmington, Delaware (which shall initially be an office or agency of the Trustee), 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; provided, however, that at the option of the Issuer, payments of principal and interest on the Notes (other than payments of principal and interest due at Maturity) may be made (i) by check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register or (ii) by wire transfer to an account maintained by the Person entitled thereto located within the United States.

 

Section 2.8  Currency.

 

Principal and interest on the Notes shall be payable in Dollars.

 

 

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Section 2.9  Registered Securities; Global Form.

 

The Notes shall be issuable and transferable in fully registered form as Registered Securities, without coupons.  The Notes shall each be issued in the form of one or more permanent global Securities.  The depository for the Notes shall be The Depository Trust Company (“DTC”).  The Notes shall not be issuable in definitive form except as provided in Section 305 of the Original Indenture.

 

Section 2.10  Form of Notes.

 

The Notes shall be substantially in the form attached as Exhibit A hereto.

 

Section 2.11  Registrar and Paying Agent.

 

The Trustee shall initially serve as Security Registrar and Paying Agent for the Notes.

 

Section 2.12  Defeasance.

 

The provisions of Sections 1402 and 1403 of the Original Indenture, together with the other provisions of Article Fourteen of the Original Indenture, shall be applicable to the Notes.  The provisions of Section 1403 of the Original Indenture shall apply to the covenants set forth in Sections 2.4 and 2.15 of this Supplemental Indenture and to those covenants specified in Section 1403 of the Original Indenture.

 

Section 2.13  Events of Default

 

The provisions of clause (5) of Section 501 of the Original Indenture as applicable with respect to the Notes shall be deemed to be amended and restated in their entirety to read as follows:

 

(5)             default under any bond, debenture, note, mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any indebtedness (other than non-recourse indebtedness) for money borrowed by the Issuer (or by any Subsidiary, the repayment of which the Issuer has guaranteed or for which the Issuer is directly responsible or liable as obligor or guarantor), having an aggregate principal amount outstanding of at least $10,000,000, whether such recourse indebtedness now exists or shall hereafter be created, which default shall have resulted in such indebtedness becoming or being declared due and payable prior to the date on which it would otherwise have become due and payable, without such indebtedness having been discharged, or such
acceleration having been rescinded or annulled, within a period of 10 days after there shall have been given written notice, by registered or certified mail, to the Issuer by the Trustee or to the Issuer and the Trustee by the Holders of at least a majority in principal amount of the Outstanding Securities of that series specifying such default and requiring the Issuer to cause such indebtedness to be discharged or cause such 

 

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acceleration to be rescinded or annulled and stating that such notice is a “Notice of Default” hereunder; or 

 

Section 2.14  Acceleration of Maturity; Rescission and Annulment.  

 

The provisions of the first paragraph of Section 502 of the Original Indenture as applicable with respect to the Notes shall be deemed to be amended and restated in their entirety to read as follows:

 

If an Event of Default with respect to Securities of any series at the time Outstanding occurs and is continuing, then in every such case the Trustee or the Holders of not less than a majority in principal amount of the Outstanding Securities of that series may declare the principal (or, if any Securities are Original Issue Discount Securities or Indexed Securities, such portion of the principal as may be specified in the terms thereof) of all the Securities of that series to be due and payable immediately, by a notice in writing to the Issuer (and to the Trustee if given by the Holders), and upon any such declaration such principal or specified portion thereof shall become immediately due and payable.  If an Event of Default with respect to the Securities of any series set forth in Section 501(6) or (7) of the Original Indenture occurs and is continuing, then in every such case all the
Securities of that series shall become immediately due and payable, without notice to the Issuer, at the principal amount thereof (or, if any Securities are Original Issue Discount Securities or Indexed Securities, such portion of the principal as may be specified in the terms thereof) plus accrued interest to the date the Securities of that series are paid plus the Make-Whole Premium, if any, on the Securities of that series. 

 

Section 2.15  Provision of Financial Information.

 

Whether or not the Issuer is subject to Section 13 or 15(d) of the Exchange Act, the Issuer shall, to the extent permitted under the Exchange Act, file with the Commission the annual reports, quarterly reports and other documents which the Issuer would have been required to file with the Commission pursuant to such Section 13 or 15(d) if the Issuer were so subject, such documents to be filed with the Commission on or prior to the respective dates (the “Required Filing Dates”) by which the Issuer would have been required so to file such documents if the Issuer were so subject.

 

The Issuer shall also in any event (x) within 15 days of each Required Filing Date (i) if the Issuer is not then subject to Section 13 or 15(d) of the Exchange Act, transmit by mail to all Holders, as their names and addresses appear in the Security Register, without cost to such Holders, copies of the annual reports and quarterly reports which the Issuer would have been required to file with the Commission pursuant to Section 13 or 15(d) of the Exchange Act if the Issuer were subject to such Sections, and (ii) file with the Trustee copies of annual reports, quarterly reports and other documents which the Issuer would have been required to file with the Commission pursuant to Section 13 or 15(d) of the Exchange Act if the Issuer were subject to such Sections and (y) if filing such documents by the Issuer with the Commission is not permitted under the Exchange Act, promptly upon written request 

 

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and payment of the reasonable cost of duplication and delivery, supply copies of such documents to any prospective Holder.

 

Section 2.16  Waiver of Certain Covenants.

 

Notwithstanding the provisions of Section 1010 of the Original Indenture, the Issuer may omit in any particular instance to comply with any term, provision or condition set forth in the Original Indenture and in this Supplemental Indenture and with any other term, provision or condition with respect to the Notes (except any such term, provision or condition which could not be amended without the consent of all Holders of the Notes), if before or after the time for such compliance the Holders of at least a majority in principal amount of all Outstanding Notes by Act of such Holders, either waive such compliance in such instance or generally waive compliance with such covenant or condition.  Except to the extent so expressly waived, and until such waiver shall become effective, the obligations of the Issuer and the duties of the Trustee in respect of any such term, provision or condition
shall remain in full force and effect.

 

Section 2.17  No Guaranty by the Corporation.

 

The Guarantee set forth in Article Sixteen of the Original Indenture shall not be in effect with respect to the Notes.

 

	
            ARTICLE THREE
 

 

	
            MISCELLANEOUS PROVISIONS
 

 

Section 3.1.  Ratification of Original Indenture.

 

Except as expressly modified or amended hereby, the Original Indenture continues in full force and effect and is in all respects confirmed and preserved.

 

Section 3.2.  Governing Law.

 

This Supplemental Indenture and each Note shall be governed by and construed in accordance with the laws of the State of New York.  This Supplemental Indenture is subject to the provisions of the Trust Indenture Act of 1939, as amended, and shall, to the extent applicable, be governed by such provisions.

 

Section 3.3.  Counterparts.

 

This Supplemental Indenture 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.

 

Section 3.4.  Certain Rights of Trustee.

 

 

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Except as otherwise expressly provided herein, no duties, responsibilities or liabilities are assumed, or shall be construed to be assumed, by the Trustee by reason of this Supplemental Indenture.  This Supplemental Indenture is executed and accepted by the Trustee subject to all the terms and conditions set forth in the Original Indenture with the same force and effect as if those terms and conditions were repeated at length herein and made applicable to the Trustee with respect hereto.

 

Section 3.5.  Trustee Not Responsible.

 

The Trustee shall not be responsible in any manner for or in respect of the validity or sufficiency of this Supplemental Indenture.

 

[REMAINDER OF PAGE INTENTIONALLY BLANK; SIGNATURE PAGE FOLLOWS]

 

 

 

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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed by their respective officers hereunto duly authorized, all as of the day and year first written above.

 

MACK-CALI REALTY, L.P.

 

By:  Mack-Cali Realty Corporation, its 

General Partner

 

By: /S/ ROGER W. THOMAS

	
            Name:
 	
            Roger W. Thomas
 	
             

	
            Title:
 	
            Executive Vice President
 

 

Attest:

 

/S/ DANIEL J. WAGNER

	
            Name:
 	
            Daniel J. Wagner
 	
             

	
            Title:
 	
            Assistant Secretary
 

 

 

	
            WILMINGTON TRUST COMPANY,
 

as Trustee

 

 

	
            By: /S/ JAMES D. NESCI
 	
             

	
             
	
            Name: James D. Nesci
 
			

Title:   Authorized Signer

 

 

 

 

Exhibit A to

Supplemental Indenture

 

Unless this Security is presented by an authorized representative of The Depository Trust Company, a New York corporation (“DTC”), 55 Water Street, New York, New York, to the Issuer (as defined below) or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or in such other name as is requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein.

 

This Security is a global Security within the meaning set forth in the Indenture hereinafter referred to and is registered in the name of DTC or a nominee of DTC.  This Security is exchangeable for Securities registered in the name of a person other than DTC or its nominee only in the limited circumstances described in the Indenture, and may not be transferred except as a whole by DTC to a nominee of DTC or another nominee of DTC or by DTC or its nominee to a successor depository or its nominee.

 

	
            Registered No.  ________
 	
            PRINCIPAL AMOUNT
 
	
            CUSIP No.:  __________
 	
            $____________
 	
             

 

	
            MACK-CALI REALTY, L.P.
 

 

	
            5.05% NOTE DUE 2010
 

 

 

MACK-CALI REALTY, L.P., a limited partnership duly organized and existing under the laws of the State of Delaware (herein referred to as the “Issuer” which term shall include any successor Person under the Indenture hereinafter referred to), for value received, hereby promises to pay to CEDE & CO., or registered assigns, upon presentation, the principal sum of __________ DOLLARS on April 15, 2010, and to pay interest on the outstanding principal amount thereon from April 15, 2005, or from the immediately preceding Interest Payment Date to which interest has been paid or duly provided for, semi-annually in arrears on April 15 and October 15 in each year, commencing October 15, 2005, at the rate of 5.05% per annum, until the entire principal hereof is paid or made available for payment.
 The interest so payable and punctually paid or duly provided for on any Interest Payment Date will, as provided in the Indenture, be paid to the Person in whose name this Security is registered at the close of business on the Regular Record Date for such interest which shall be the April 1 or October 1 (whether or not a Business Day), as the case may be, next preceding such Interest Payment Date.  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 is registered at the close of business on a Special Record Date for 

 

A-1

 

 

the payment of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to Holders of the Securities not more than 15 days and not less than 10 days prior to such Special Record Date, or may be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Securities may be listed, and upon such notice as may be required by such exchange, all as more fully provided in the Indenture.  Payment of the principal of and interest on this Security will be made at the office or agency maintained for that purpose in the City of Wilmington, Delaware or elsewhere as provided in the Indenture, 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; provided, however, that at the option of the Issuer payments of principal and interest on the Notes (other than payments of principal and interest due at Maturity) may be made (i) by check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register or (ii) by wire transfer to an account of the Person entitled thereto located within the United States.

 

Securities of this series are one of a duly authorized issue of securities of the Issuer (herein called the “Securities”), issued and to be issued in one or more series under an Indenture, dated as of March 16, 1999, among the Issuer, Mack-Cali Realty Corporation and Wilmington Trust Company (herein called the “Trustee”, which term includes any successor trustee under the Indenture), as supplemented by Supplemental Indenture No. 1, dated as of March 16, 1999, as further supplemented by Supplemental Indenture No. 2, dated as of August 2, 1999, as further supplemented by Supplemental Indenture No. 3, dated as of December 21, 2000, as further supplemented by Supplemental Indenture No. 4, dated as of January 29, 2001, as further supplemented by Supplemental Indenture No. 5,
dated as of December 20, 2002, as further supplemented by Supplemental Indenture No. 6, dated as of March 14, 2003, as further supplemented by Supplemental Indenture No. 7, dated as of June 12, 2003, as further supplemented by Supplemental Indenture No. 8, dated as of February 9, 2004, as further supplemented by Supplemental Indenture No. 9, dated as of March 22, 2004, as further supplemented by Supplemental Indenture No. 10, dated as of January 25, 2005, and as further supplemented by Supplemental Indenture No. 11, dated as of April 15, 2005 (as so supplemented, herein called the “Indenture”), between the Issuer and the Trustee 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 Issuer, the Trustee and the Holders of the Securities and of the terms upon which the Securities are authenticated
and delivered.  This Security is one of the series designated in Section 2.1 of Supplemental Indenture No. 11 referred to above, limited in aggregate principal amount to $150,000,000, except as the aggregate principal amount may be increased pursuant to Section 2.2 of Supplemental Indenture No. 11 referred to above.

 

Securities of this series may be redeemed at any time at the option of the Issuer, in whole or in part, upon notice of not more than 60 nor less than 30 days prior to the Redemption Date, at a redemption price equal to the sum of (i) the principal amount of the Securities being redeemed plus accrued and unpaid interest thereon up to but not including the Redemption Date and (ii) the Make-Whole Premium, if any, with respect to such Securities.

 

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The Indenture contains provisions for defeasance at any time of (a) the entire indebtedness of the Issuer on this Security and (b) certain restrictive covenants and the related defaults and Events of Default applicable to the Issuer, in each case, upon compliance by the Issuer with certain conditions set forth in the Indenture, which provisions apply to this Security.

 

If an Event of Default with respect to the Securities shall occur and be continuing, the principal of the Securities may be declared due and payable in the manner and with the effect provided in the Indenture.

 

As provided in and subject to the provisions of the Indenture, the Holder of this Security shall not have the right to institute any proceeding with respect to the Indenture or for the appointment of a receiver or trustee or for any other remedy thereunder, unless such Holder shall have previously given written notice to the Trustee of a continuing Event of Default with respect to the Securities, the Holders of not less than a majority in principal amount of the Securities of this series at the time Outstanding shall have made written request to the Trustee to institute proceedings in respect of such Event of Default as Trustee and offered the Trustee reasonable indemnity and the Trustee shall not have received from the Holders of a majority in principal amount of Securities of this series at the time Outstanding a direction inconsistent with such request, and shall have failed to institute
any such proceeding, for 60 days after receipt of such notice, request and offer of indemnity.  The foregoing shall not apply to any suit instituted by the Holder of this Security for the enforcement of any payment of principal hereof or any interest on or after the respective due dates expressed herein.

 

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Issuer and the rights of the Holders of the Securities of each series to be affected under the Indenture at any time by the Issuer and the Trustee with the consent of the Holders of not less than a majority in principal amount of the Outstanding Securities of each series of Securities then Outstanding affected thereby.  The Indenture also contains provisions permitting the Holders of specified percentages in principal amount of the Securities of each series at the time Outstanding, on behalf of the Holders of all Securities of such series, to waive compliance by the Issuer 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 Issuer, which is absolute and unconditional, to pay the principal of (and Make-Whole Premium, if any) and interest on this Security at the times, place and rate, and in the coin or currency, herein prescribed.

 

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As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Security is registrable in the Security Register, upon surrender of this Security for registration of transfer at the office or agency of the Issuer in any Place of Payment where the principal of (and Make-Whole Premium, if any) and interest on this Security are payable, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Issuer and the Security Registrar duly executed by the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Securities of this series, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees.

 

Except as set forth in Section 302 of the Indenture, the Securities of this series are issuable only in registered form without coupons in denominations of $1,000 and any integral multiple thereof.  As provided in the Indenture and subject to certain limitations therein set forth, Securities of this series are exchangeable for a like aggregate principal amount of Securities of this series 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 Issuer may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith.

 

Prior to due presentment of this Security for registration of transfer, the Issuer, the Trustee and any agent of the Issuer 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 Issuer, the Trustee nor any such agent shall be affected by notice to the contrary.

 

No recourse under or upon any obligation, covenant or agreement contained in the Indenture or in this Security, or because of any indebtedness evidenced hereby or thereby, shall be had against any promoter, as such, or against any past, present or future shareholder, officer or director, as such, of the Issuer or of any successor, either directly or through the Issuer or any successor, under any rule of law, statute or constitutional provision or by the enforcement of any assessment or by any legal or equitable proceeding or otherwise, all such liability being expressly waived and released by the acceptance of this Security by the Holder thereof and as part of the consideration for the issue of the Securities of this series.

 

All capitalized terms used in this Security which are defined in the Indenture shall have the meanings assigned to them in the Indenture.

 

THE INDENTURE AND THE SECURITIES, INCLUDING THIS SECURITY, SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Issuer has caused “CUSIP” numbers 

 

A-4

 

 

to be printed on the Securities of this series as a convenience to the Holders of such Securities.  No representation is made as to the correctness or accuracy of such CUSIP numbers as printed on the Securities, and reliance may be placed only on the other identification numbers printed hereon.

 

Unless the certificate of authentication hereon has been executed by or on behalf of 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. 

 

[REMAINDER OF PAGE INTENTIONALLY BLANK; SIGNATURE PAGE FOLLOWS]

 

 

 

A-5

 

 

 

IN WITNESS WHEREOF, MACK-CALI REALTY, L.P. has caused this instrument to be duly executed.

 

Dated: April 15, 2005

 

MACK-CALI REALTY, L.P.

 

By:  Mack-Cali Realty Corporation, its

  General Partner

 

By: _________________________

Name:  

Title:  

Attest:

 

_________________________

Name:  

Title:  

 

TRUSTEE'S CERTIFICATE OF AUTHENTICATION:

 

This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture.

 

WILMINGTON TRUST COMPANY,

as Trustee

 

By: _________________________

Authorized Signatory

 

A-6

 

 

 

 

	
            ASSIGNMENT FORM
 

 

	
            FOR VALUE RECEIVED, the undersigned hereby
 
	
             
	
            sells, assigns and transfers unto
 	
             

			

 

  PLEASE INSERT SOCIAL

  SECURITY OR OTHER IDENTIFYING

  NUMBER OF ASSIGNEE

	
             

 
 	
             

                                                                                                                                                                                                                                                        
 
	
            

 	
            

 

 

 

	
            (Please Print or Typewrite Name and Address including
 
	
             
	
            Zip Code of Assignee)
 	
             

			

 

 

the within Security of Mack-Cali Realty, L.P. and hereby does irrevocably constitute and appoint

 

	
            Attorney
 

to transfer said Security on the books of the within-named Issuer with full power of substitution in the premises.

 

	
            Dated:  
 

 

 

NOTICE:  The signature to this assignment must correspond with the name as it appears on the first page of the within Security in every particular, without alteration or enlargement or any change whatever.

 

Signature(s) must be guaranteed by an institution which is a member of one of the following recognized signature Guarantee Programs:  (i) The Securities Transfer Agent Medallion Program (STAMP); (ii) The New York Stock Exchange Medallion Program (MNSP); (iii) The Stock Exchange Medallion Program (SEMP); or (iv) another guarantee program acceptable to the Trustee.

_______________________________

Signature Guarantee

 

 

 

 

413423

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