Item 3.03. Material Modification to Rights of Security Holders.

In accordance with the provisions of an April 26, 2004 indenture ("Indenture") between TierOne Corporation ("Company") and Wilmington Trust Company ("Trustee"), on November 18, 2008, the Company notified the Trustee of its election to defer payments of interest on its floating rate junior subordinated deferrable debt securities due 2034 ("Debt Securities") relating to the trust preferred securities of TierOne Capital Trust I.

As permitted under the terms of the Indenture, the Company has the right to extend the interest payment period at any time for up to 20 consecutive quarterly periods. Accordingly, the Company's election to defer payments of interest does not constitute an event of default under the Indenture and upon expiration of the deferral period, all accrued and unpaid interest on the Debt Securities will be due and payable at the same contractual rate that would have been payable were it not for the extension. Pursuant to the Indenture and subject to limited exceptions, the Company, among other limitations, may not pay dividends or repurchase the Company's capital stock during the deferral period. The Company elected to defer payment of interest on the Debt Securities to further strengthen its capital position.

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