Exhibit 4.12
FORM OF
PREFERRED SECURITIES GUARANTEE AGREEMENT
Unocal Capital Trust II
Dated as of ___________, ____
TABLE OF CONTENTS Page
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ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1. Definitions and Interpretation. . . . . . . . . . . . . . .1
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1. Trust Indenture Act; Application. . . . . . . . . . . . . .3
SECTION 2.2. Lists of Holders. . . . . . . . . . . . . . . . . . . . . .3
SECTION 2.3. Reports by Preferred Guarantee Trustee. . . . . . . . . . .4
SECTION 2.4. Periodic Reports to Preferred Guarantee Trustee . . . . . .4
SECTION 2.5. Evidence of Compliance with Conditions Precedent. . . . . .4
SECTION 2.6. Events of Default; Waiver . . . . . . . . . . . . . . . . .4
SECTION 2.7. Event of Default; Notice . . . . . . . . . . . . . . . . .4
SECTION 2.8. Conflicting Interests . . . . . . . . . . . . . . . . . . .5
ARTICLE III
POWERS, DUTIES AND RIGHTS OF PREFERRED GUARANTEE TRUSTEE
SECTION 3.1. Powers and Duties of the Preferred Guarantee Trustee. . . .5
SECTION 3.2. Certain Rights of Preferred Guarantee Trustee . . . . . . .7
SECTION 3.3. Not Responsible for Recitals or Issuance of Preferred
Securities Guarantee. . . . . . . . . . . . . . . . . . .9
ARTICLE IV
PREFERRED GUARANTEE TRUSTEE
SECTION 4.1. Preferred Guarantee Trustee Eligibility . . . . . . . . . .9
SECTION 4.2. Appointment Removal and Resignation of Preferred
Guarantee Trustee . . . . . . . . . . . . . . . . . . . 10
ARTICLE V
PREFERRED SECURITIES GUARANTEE
SECTION 5.1. Preferred Securities Guarantee. . . . . . . . . . . . . . 10
SECTION 5.2. Waiver of Notice and Demand . . . . . . . . . . . . . . . 11
SECTION 5.3. Obligations Not Affected. . . . . . . . . . . . . . . . . 11
SECTION 5.4. Rights of Holders . . . . . . . . . . . . . . . . . . . . 12
SECTION 5.5. Guarantee of Payment. . . . . . . . . . . . . . . . . . . 12
SECTION 5.6. Subrogation . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 5.7. Independent Obligations . . . . . . . . . . . . . . . . . 12
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1. Limitation of Transactions. . . . . . . . . . . . . . . . 13
SECTION 6.2. Subordination . . . . . . . . . . . . . . . . . . . . . . 13
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ARTICLE VII
TERMINATION
SECTION 7.1. Termination . . . . . . . . . . . . . . . . . . . . . . . 13
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1. Exculpation . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 8.2. Indemnification . . . . . . . . . . . . . . . . . . . . . 14
ARTICLE IX
MISCELLANEOUS
SECTION 9.1. Successors and Assigns. . . . . . . . . . . . . . . . . . 15
SECTION 9.2. Amendments. . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 9.3. Notices . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 9.4. Benefit . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 9.5. Governing Law . . . . . . . . . . . . . . . . . . . . . . 16
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PREFERRED SECURITIES GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT (the "Preferred Securities Guarantee") dated
as of __________, ____, is executed and delivered by Unocal Corporation, a
Delaware corporation (the "Guarantor"), and The Bank of New York, as trustee
(the "Preferred Guarantee Trustee"), for the benefit of the Holders (as defined
herein) from time to time of the Preferred Securities (as defined herein) of
Unocal Capital Trust II, a Delaware statutory business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of Trust (the
"Declaration") dated as of __________, ____, among the trustees of the Issuer
named therein, the Guarantor, as sponsor, and the holders from time to time of
undivided beneficial interests in the assets of the Issuer, the Issuer is
issuing to the Guarantor on the date hereof up to _________ preferred
securities, having an aggregate liquidation amount of up to $_______ designated
the "___% Trust [Convertible] Preferred Securities" (the "Preferred
Securities").
WHEREAS, as an incentive to purchase such Preferred Securities, the
Guarantor desires fully and unconditionally to agree, to the extent set forth in
this Preferred Securities Guarantee, to pay to the Holders of the Preferred
Securities the Guarantee Payments (as defined herein) and to make certain other
payments on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing, the Guarantor
executes and delivers this Preferred Securities Guarantee for the benefit of the
Holders of Preferred Securities.
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1. DEFINITIONS AND INTERPRETATION
In this Preferred Securities Guarantee, unless the context otherwise
requires:
(a) Capitalized terms used in this Preferred Securities Guarantee but
not defined in the preamble above have the respective meanings
assigned to them in this Section 1.1;
(b) terms defined in the Declaration as of the date of execution of
this Preferred Securities Guarantee have the same meaning when
used in this Preferred Securities Guarantee unless otherwise
defined in this Preferred Securities Guarantee;
(c) a term defined anywhere in this Preferred Securities Guarantee
has the same meaning throughout;
(d) all references to "the Preferred Securities Guarantee" or "this
Preferred Securities Guarantee" are to this Preferred Securities
Guarantee as modified, supplemented or amended from time to time;
(e) all references in this Preferred Securities Guarantee to Articles
and Sections are to Articles and Sections of this Preferred
Securities Guarantee, unless otherwise specified;
(f) a term defined in the Trust Indenture Act of 1939, as amended
(the "Trust Indenture Act") has the same meaning when used in
this Preferred Securities Guarantee, unless otherwise defined in
this Preferred Securities Guarantee or unless the context
otherwise requires; and
(g) a reference to the singular includes the plural and vice versa.
"AUTHORIZED OFFICER" of a Person means any Person that is authorized
to bind such Person, PROVIDED, HOWEVER, that the Authorized Officer signing a
certificate furnished pursuant to Section 314(a)(4) of the Trust Indenture Act
shall be the principal executive, financial or accounting officer of such
Person.
"CORPORATE TRUST OFFICE" means the office of the Preferred
Guarantee Trustee at which the corporate trust business of the Preferred
Guarantee Trustee shall, at any particular time, be principally administered,
which office at the date of execution of this Agreement is located at 000
Xxxxxxx Xxxxxx (00 Xxxx), Xxx Xxxx, Xxx Xxxx 00000.
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"COVERED PERSON" means any Holder or beneficial owner of Preferred
Securities.
"EVENT OF DEFAULT" means a default by the Guarantor on any of its
payment or other obligations under this Preferred Securities Guarantee.
"GUARANTEE PAYMENTS" means the following payments or distributions,
without duplication, with respect to the Preferred Securities, to the extent
not paid or made by the Issuer: (i) any accumulated and unpaid Distributions
that are required to be paid on such Preferred Securities to the extent the
Issuer shall have funds available therefor, (ii) the redemption price (the
"Redemption Price"), and all accumulated and unpaid Distributions to the date
of redemption, to the extent the Issuer has funds available therefor, with
respect to any Preferred Securities called for redemption by the Issuer, and
(iii) upon a voluntary or involuntary dissolution, winding-up or termination
of the Issuer (other than in connection with the conversion of all of the
Trust Securities into the Guarantor's common stock or the distribution of
Debentures to the Holders in exchange for Preferred Securities as provided in
the Declaration), the lesser of (a) the aggregate of the liquidation amount
and all accrued and unpaid Distributions on the Preferred Securities to the
date of payment, to the extent the Issuer shall have funds available therefor
and (b) the amount of assets of the Issuer remaining available for
distribution to Holders in liquidation of the Issuer (in either case, the
"Liquidation Distribution"). If an Event of Default (as defined in the
Indenture) has occurred and is continuing, the rights of holders of the
Common Securities to receive payments under the Common Securities Guarantee
are subordinated to the rights of Holders of Preferred Securities to receive
Guarantee Payments.
"HOLDER" shall mean any holder, as registered on the books and records
of the Issuer, of any Preferred Securities; PROVIDED, HOWEVER, that, in
determining whether the holders of the requisite percentage of Preferred
Securities have given any request, notice, consent or waiver hereunder, "Holder"
shall not include the Guarantor or any Affiliate of the Guarantor.
"INDEMNIFIED PERSON" means the Preferred Guarantee Trustee, any
Affiliate of the Preferred Guarantee Trustee, or any officers, directors,
shareholders, members, partners, employees, representatives, nominees,
custodians or agents of the Preferred Guarantee Trustee.
"INDENTURE" means the Multiple-Series Indenture dated as of September
11, 1996, of the Guarantor, as supplemented by the Second Supplemental Indenture
dated as of _________ ____, between the Guarantor (the "Debenture Issuer") and
The Bank of New York, as trustee, relating to the Debentures.
"MAJORITY IN LIQUIDATION AMOUNT OF THE PREFERRED SECURITIES" means,
except as provided in the terms of the Preferred Securities, or except as
provided by the Trust Indenture Act, a vote by Holder(s), voting separately as a
class, of more than 50% of the liquidation amount (including the stated amount
that would be paid on redemption, liquidation or otherwise, plus accumulated and
unpaid Distributions to the date upon which the voting percentages are
determined) of all outstanding Preferred Securities.
"PREFERRED GUARANTEE TRUSTEE" means The Bank of New York, until a
Successor Preferred Guarantee Trustee has been appointed and has accepted such
appointment pursuant to
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the terms of this Preferred Securities Guarantee and thereafter means each
such Successor Preferred Guarantee Trustee.
"RESPONSIBLE OFFICER" means, with respect to the Preferred Guarantee
Trustee, any officer within the Corporate Trust Office of the Preferred
Guarantee Trustee, including any vice president, any assistant vice president,
any assistant secretary, the treasurer, any assistant treasurer or other officer
within the Corporate Trust Office of the Preferred Guarantee Trustee customarily
performing functions similar to those performed by any of the above designated
officers, and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of that officer's
knowledge of and familiarity with the particular subject.
"SUCCESSOR PREFERRED GUARANTEE TRUSTEE" means a successor Preferred
Guarantee Trustee possessing the qualifications to act as Preferred Guarantee
Trustee under Section 4.1.
"TRUST SECURITIES" means, collectively, the Common Securities and the
Preferred Securities.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1. TRUST INDENTURE ACT; APPLICATION
(a) This Preferred Securities Guarantee is subject to the provisions
of the Trust Indenture Act that are required to be part of this Preferred
Securities Guarantee and shall, to the extent applicable, be governed by such
provisions; and
(b) if and to the extent that any provision of this Preferred
Securities Guarantee limits, qualifies or conflicts with the duties imposed by
Section 310 to 317, inclusive, of the Trust Indenture Act, such imposed duties
shall control.
SECTION 2.2. LISTS OF HOLDERS
(a) The Guarantor shall provide the Preferred Guarantee Trustee
with a list, in such form as the Preferred Guarantee Trustee may reasonably
require, of the names and addresses of the Holders ("List of Holders") (i)
within 1 Business Day after each record date for payment of Distributions as
long as the Preferred Securities remain in book-entry only form, otherwise
within 14 days after each record date for payment of Distributions, and (ii)
at any other time within 30 days of receipt by the Guarantor of a written
request for a List of Holders as of a date no more than 14 days before such
List of Holders is given to the Preferred Guarantee Trustee, PROVIDED, that
the Guarantor shall not be obligated to provide such List of Holders at any
time the List of Holders does not differ from the most recent List of Holders
given to the Preferred Guarantee Trustee by the Guarantor. The Preferred
Guarantee Trustee may destroy any List of Holders previously given to it on
receipt of a new List of Holders.
(b) The Preferred Guarantee Trustee shall comply with its obligations
under Sections 311(a), 311(b) and Section 312(b) of the Trust Indenture Act.
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SECTION 2.3. REPORTS BY THE PREFERRED GUARANTEE TRUSTEE
Within 60 days after May 15 of each year, the Preferred Guarantee
Trustee shall provide to the Holders such reports as are required by Section
313 of the Trust Indenture Act if any, in the form and in the manner provided
by Section 313 of the Trust Indenture Act. The Preferred Guarantee Trustee
shall also comply with the requirements of Section 313(d) of the Trust
Indenture Act.
SECTION 2.4. PERIODIC REPORTS TO PREFERRED GUARANTEE TRUSTEE
The Guarantor shall provide to the Preferred Guarantee Trustee such
documents, reports and information as are required by Section 314 (if any) and
the compliance certificate required by Section 314 of the Trust Indenture Act in
the form, in the manner and at the times required by Section 314 of the Trust
Indenture Act.
Delivery of such reports, information and documents to the
Preferred Guarantee Trustee is for informational purposes only and the
Preferred Guarantee Trustee's receipt of such shall not constitute
constructive notice of any information contained therein, including the
Guarantor's compliance with any of its covenants hereunder (as to which the
Preferred Guarantee Trustee is entitled to rely exclusively on Officers'
Certificates).
SECTION 2.5. EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT
The Guarantor shall provide to the Preferred Guarantee Trustee such
evidence of compliance with any conditions precedent, if any, provided for in
this Preferred Securities Guarantee that relate to any of the matters set forth
in Section 314(c) of the Trust Indenture Act. Any certificate or opinion
required to be given by an officer pursuant to Section 314(c)(1) may be given in
the form of an Officers' Certificate.
SECTION 2.6. EVENTS OF DEFAULT: WAIVER
The Holders of Majority in liquidation amount of the Preferred
Securities may, by vote, on behalf of the Holders of all of the Preferred
Securities, waive any past Event of Default and its consequences. Upon such
waiver, any such Event of Default shall cease to exist, and any Event of Default
arising therefrom shall be deemed to have been cured, for every purpose of the
Preferred Securities Guarantee, but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon.
SECTION 2.7. EVENT OF DEFAULT; NOTICE
(a) The Preferred Guarantee Trustee shall, within 90 days after
the occurrence of an Event of Default, transmit by mail, first class postage
prepaid, to the Holders, notices of all Events of Default actually known to a
Responsible Officer of the Preferred Guarantee Trustee, unless such defaults
have been cured before the giving of such notice, PROVIDED, that, the
Preferred Guarantee Trustee shall be protected in withholding such notice if
and so long as a Responsible Officer of the Preferred Guarantee Trustee in
good faith determines that the withholding of such notice is in the interests
of the Holders.
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(b) The Preferred Guarantee Trustee shall not be deemed to have
knowledge of any Event of Default unless the Preferred Guarantee Trustee
shall have received written notice thereof, or a Responsible Officer of the
Preferred Guarantee Trustee charged with the administration of the
Declaration shall have obtained actual knowledge thereof.
SECTION 2.8. CONFLICTING INTERESTS
The Declaration shall be deemed to be specifically described in this
Preferred Securities Guarantee for the purposes of clause (i) of the first
proviso contained in Section 310(b) of the Trust Indenture Act.
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
PREFERRED GUARANTEE TRUSTEE
SECTION 3.1. POWERS AND DUTIES OF THE PREFERRED GUARANTEE TRUSTEE
(a) This Preferred Securities Guarantee shall be held by the
Preferred Guarantee Trustee for the benefit of the Holders, and the Preferred
Guarantee Trustee shall not transfer this Preferred Securities Guarantee to
any Person except a Holder exercising his or her rights pursuant to Section
5.4(b) or to a Successor Preferred Guarantee Trustee upon acceptance by such
Successor Preferred Guarantee Trustee of its appointment to act as Successor
Preferred Guarantee Trustee. The right, title and interest of the Preferred
Guarantee Trustee shall automatically vest in any Successor Preferred
Guarantee Trustee, and such vesting and succession of title shall be
effective whether or not conveyance documents have been executed and
delivered pursuant to the appointment of such Successor Preferred Guarantee
Trustee.
(b) If an Event of Default actually known to a Responsible Officer of
the Preferred Guarantee Trustee has occurred and is continuing, the Preferred
Guarantee Trustee shall enforce this Preferred Securities Guarantee for the
benefit of the Holders.
(c) The Preferred Guarantee Trustee, before the occurrence of any
Event of Default and after the curing of all Events of Default that may have
occurred, shall undertake to perform only such duties as are specifically
set forth in this Preferred Securities Guarantee, and no implied covenants shall
be read into this Preferred Securities Guarantee against the Preferred Guarantee
Trustee. In case an Event of Default has occurred (that has not been cured or
waived pursuant to Section 2.6) and is actually known to a Responsible Officer
of the Preferred Guarantee Trustee, the Preferred Guarantee Trustee shall
exercise such of the rights and powers vested in it by this Preferred Securities
Guarantee, and shall use the same degree of care and skill in its exercise
thereof as a prudent person would exercise or use under the circumstances in the
conduct of his or her own affairs.
(d) No provision of this Preferred Securities Guarantee shall be
construed to relieve the Preferred Guarantee Trustee from liability for its
own negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
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(i) prior to the occurrence of any Event of Default and after
the curing or waiving of all such Events of Default that may have
occurred:
(A) the duties and obligations of the Preferred
Guarantee Trustee shall be determined solely by the express
provisions of this Preferred Securities Guarantee, and the
Preferred Guarantee Trustee shall not be liable except for the
performance of such duties and obligations as are specifically set
forth in this Preferred Securities Guarantee, and no implied
covenants or obligations shall be read in this Preferred Securities
Guarantee against the Preferred Guarantee Trustee; and
(B) in the absence of bad faith on the part of the
Preferred Guarantee Trustee, the Preferred Guarantee Trustee may
conclusively rely, as to the truth of the statements and
correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Preferred Guaranteed
Trustee and conforming to the requirements of this Preferred
Securities Guarantee; but in the case of any such certificates or
opinions that by any provision hereof are specifically required to
be furnished to the Preferred Guarantee Trustee, the Preferred
Guarantee Trustee shall be under a duty to examine the same to
determine whether or not they conform to the requirements of this
Preferred Securities Guarantee;
(ii) the Preferred Guarantee Trustee shall not be liable for
any error of judgment made in good faith by a Responsible Officer of the
Preferred Guarantee Trustee, unless it shall be proved that the
Preferred Guarantee Trustee was negligent in ascertaining the pertinent
facts upon which such judgment was made;
(iii) the Preferred Guarantee Trustee shall not be liable with
respect to any action taken or omitted to be taken by it in good faith
in accordance with the direction of the Holders of not less than a
Majority in liquidation amount of the Preferred Securities relating to
the time, method and place of conducting any proceeding for any remedy
available to the Preferred Guarantee Trustee, or exercising any trust or
power conferred upon the Preferred Guarantee Trustee under this
Preferred Securities Guarantee; and
(iv) no provision of this Preferred Securities Guarantee shall
require the Preferred Guarantee Trustee to expend or risk its own funds
or otherwise incur personal financial liability in the performance of
any of its duties or in the exercise of any of its duties or in the
exercise of any of its rights or powers, if the Preferred Guarantee
Trustee shall have reasonable grounds for believing that the repayment
of such funds or liability is not reasonably assured to it under the
terms of this Preferred Securities Guarantee or indemnity, reasonably
satisfactory to the Preferred Guarantee Trustee, against such risk or
liability is not reasonably assured to it.
SECTION 3.2. CERTAIN RIGHTS OF PREFERRED GUARANTEE TRUSTEE
(a) Subject to the provisions of Section 3.1:
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(i) The Preferred Guarantee Trustee may conclusively rely, and
shall be fully protected in acting or refraining from acting upon, any
resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document or document believed
by it to be genuine and to have been signed, sent or presented by the
proper party or parties.
(ii) Any direction or act of the Guarantor contemplated by
this Preferred Securities Guarantee shall be sufficiently evidenced by
an Officers' Certificate.
(iii) Whenever, in the administration of this Preferred
Securities Guarantee, the Preferred Guarantee Trustee shall deem it
desirable that a matter be proved or established before taking,
suffering or omitting any action hereunder, the Preferred Guarantee
Trustee (unless other evidence is herein specifically prescribed) may,
in the absence of bad faith on its part, request and conclusively rely
upon an Officers Certificate which, upon receipt of such request, shall
be promptly delivered by the Guarantor.
(iv) The Preferred Guarantee Trustee shall have no duty to see
to any recording, filing or registration of any instrument (or any
rerecording, refiling or reregistration thereof).
(v) The Preferred Guarantee Trustee may consult with counsel
of its selection, and the advice or opinion of such counsel with respect
to legal matters shall be full and complete authorization and protection
in respect of any action taken, suffered or omitted by it hereunder in
good faith and in accordance with such advice or opinion. Such counsel
may be counsel to the Guarantor or any of its Affiliates and may include
any of its employees. The Preferred Guarantee Trustee shall have the
right at any time to seek instructions concerning the administration of
this Preferred Securities Guarantee from any court of competent
jurisdiction.
(vi) The Preferred Guarantee Trustee shall be under no
obligation to exercise any of the rights or powers vested in it by this
Preferred Securities Guarantee at the request or direction of any
Holder, unless such Holder shall have provided to the Preferred
Guarantee Trustee such security and indemnity, reasonably satisfactory
to the Preferred Guarantee Trustee, against the costs, expenses
(including attorneys fees and expenses and the expenses of the Preferred
Guarantee Trustee's agents, nominees or custodians) and liabilities that
might be incurred by it in complying with such request or direction,
including such reasonable advances as may be requested by the Preferred
Guarantee Trustee; PROVIDED that, nothing contained in this Section
3.2(a)(vi) shall be taken to relieve the Preferred Guarantee Trustee,
upon the occurrence of an Event of Default, of its obligations to
exercise the rights and powers vested in it by this Preferred Securities
Guarantee.
(vii) The Preferred Guarantee Trustee shall not be bound to
make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document, but the Preferred
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Guarantee Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit.
(viii) The Preferred Guarantee Trustee may execute any of the
trusts or powers hereunder or perform any duties hereunder either
directly or by or through agents, nominees, custodians or attorneys, and
the Preferred Guarantee Trustee shall not be responsible for any
misconduct or negligence on the part of any agent or attorney appointed
with due care by it hereunder.
(ix) Any action taken by the Preferred Guarantee Trustee or
its agents hereunder shall bind the Holders and the signature of the
Preferred Guarantee Trustee or its agents alone shall be sufficient and
effective to perform any such action. No third party shall be required
to inquire as to the authority of the Preferred Guarantee Trustee to so
act or as to its compliance with any of the terms and provisions of this
Preferred Securities Guarantee, both of which shall be conclusively
evidenced by the Preferred Guarantee Trustee's or its agent's taking
such action.
(x) Whenever in the administration of this Preferred
Securities Guarantee the Preferred Guarantee Trustee shall deem it
desirable to receive instructions with respect to enforcing any remedy
or right or taking any other action hereunder, the Preferred Guarantee
Trustee (i) may request instructions from the Holders of a Majority in
liquidation amount of the Preferred Securities, (ii) may refrain from
enforcing such remedy or right or taking such other action until such
instructions are received, and (iii) shall be protected in conclusively
relying on or acting in accordance with such instructions.
(xi) The Preferred Guarantee Trustee may execute any of the
trusts or powers hereunder or perform any duties hereunder either
directly or by or through agents or attorneys, and the Preferred
Guarantee Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care
by it hereunder.
(xii) The Preferred Guarantee Trustee shall not be liable for
any action taken, suffered, or omitted to be taken by it in good faith
and reasonably believed by it to be authorized or within the discretion
or rights or powers conferred upon it by this Preferred Securities
Guarantee.
(b) No provision of this Preferred Securities Guarantee shall be
deemed to impose any duty or obligation on the Preferred Guarantee Trustee to
perform any act or acts or exercise any right, power, duty or obligation
conferred or imposed on it in any jurisdiction in which it shall be illegal,
or in which the Preferred Guarantee Trustee shall be unqualified or
incompetent in accordance with applicable law, to perform any such act or
acts or to exercise any such right, power, duty or obligation. No permissive
power or authority available to the Preferred Guarantee Trustee shall be
construed to be a duty.
SECTION 3.3. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF PREFERRED SECURITIES
GUARANTEE
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The recitals contained in this Preferred Securities Guarantee shall be
taken as the statements of the Guarantor, and the Preferred Guarantee Trustee
does not assume any responsibility for their correctness. The Preferred
Guarantee Trustee makes no representation as to the validity or sufficiency
of this Preferred Securities Guarantee.
ARTICLE IV
PREFERRED GUARANTEE TRUSTEE
SECTION 4.1. PREFERRED GUARANTEE TRUSTEE ELIGIBILITY
(a) There shall at all times be a Preferred Guarantee Trustee
which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business under the
laws of the United States of America or any State or Territory thereof or
of the District of Columbia, or a corporation or Person permitted by the
Securities and Exchange Commission to act as an institutional trustee
under the Trust Indenture Act, authorized under such laws to exercise
corporate trust powers, having a combined capital and surplus of at
least 50 million U.S. dollars ($50,000,000), and subject to supervision
or examination by federal, state, territorial or District of Columbia
authority. If such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of the supervising or
examining authority referred to above, then, for the purposes of this
Section 4.1(a)(ii), the combined capital and surplus of such corporation
shall be deemed to be its combined capital and surplus as set forth in its
most recent report of condition so published.
(b) If at any time the Preferred Guarantee Trustee shall cease to be
eligible to so act under Section 4.1(a), the Preferred Guarantee Trustee
shall immediately resign in the manner and with the effect set out in Section
4.2(c).
(c) If the Preferred Guarantee Trustee has or shall acquire any
"conflicting interest" within the meaning of Section 310(b) of the Trust
Indenture Act, the Preferred Guarantee Trustee and Guarantor shall in all
respects comply with the provisions of Section 310(b) of the Trust Indenture
Act.
SECTION 4.2. APPOINTMENT REMOVAL AND RESIGNATION OF PREFERRED GUARANTEE
TRUSTEE
(a) Subject to Section 4.2(b), the Preferred Guarantee Trustee may be
appointed or removed without cause at any time by the Guarantor.
(b) The Preferred Guarantee Trustee shall not be removed in accordance
with Section 4.2(a) until a Successor Preferred Guarantee Trustee has been
appointed and has accepted such appointment by written instrument executed by
such Successor Preferred Guarantee Trustee and delivered to the Guarantor.
(c) The Preferred Guarantee Trustee appointed to office shall hold
office until a Successor Preferred Guarantee Trustee shall have been
appointed or until its removal or
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resignation. The Preferred Guarantee Trustee may resign from office (without
need for prior or subsequent accounting) by an instrument in writing executed
by the Preferred Guarantee Trustee and delivered to the Guarantor, which
resignation shall not take effect until a Successor Preferred Guarantee
Trustee has been appointed and has accepted such appointment by instrument in
writing executed by such Successor Preferred Guarantee Trustee and delivered
to the Guarantor and the resigning Preferred Guarantee Trustee.
(d) If no Successor Preferred Guarantee Trustee shall have been
appointed and accepted appointment as provided in this Section 4.2 within 60
days after delivery of an instrument of resignation or removal, the Preferred
Guarantee Trustee resigning or being removed may petition any court of
competent jurisdiction for appointment of a Successor Preferred Guarantee
Trustee. Such court may thereupon, after prescribing such notice, if any, as
it may deem proper, appoint a Successor Preferred Guarantee Trustee.
(e) No Preferred Guarantee Trustee shall be liable for the acts or
omissions to act of any Successor Preferred Guarantee Trustee.
(f) Upon termination of this Preferred Securities Guarantee or removal
or resignation of the Preferred Guarantee Trustee pursuant to this Section
4.2, the Guarantor shall pay to the Preferred Guarantee Trustee all amounts
owed to the Preferred Guarantee Trustee by the Guarantor to the date of such
termination, removal or resignation.
ARTICLE V
PREFERRED SECURITIES GUARANTEE
SECTION 5.1. PREFERRED SECURITIES GUARANTEE
The Guarantor fully and unconditionally agrees to pay in full to the
Holders the Guarantee Payments (without duplication of amounts theretofore
paid by the Issuer), as and when due, regardless of any defense, right of
set-off or counterclaim that the Issuer may have or assert. The Guarantor's
obligation to make a Guarantee Payment may be satisfied by direct payment of
the required amounts by the Guarantor to the Holders or by causing the Issuer
to pay such amounts to the Holders.
SECTION 5.2. WAIVER OF NOTICE AND DEMAND
The Guarantor hereby waives notice of acceptance of this Preferred
Securities Guarantee and of any liability to which it applies or may apply,
presentment, demand for payment, any right to require a proceeding first
against the Issuer or any other Person before proceeding against the
Guarantor, protest, notice of nonpayment, notice of dishonor, notice of
redemption and all other notices and demands.
SECTION 5.3. OBLIGATIONS NOT AFFECTED
The obligations, covenants, agreements and duties of the Guarantor under
this Preferred Securities Guarantee shall in no way be affected or impaired
by reason of the happening from time to time of any of the following:
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(a) the release or waiver, by operation of law or otherwise, of the
performance or observance by the Issuer of any express or implied agreement,
covenant, term or condition relating to the Preferred Securities to be
performed or observed by the Issuer;
(b) the extension of time for the payment by the Issuer of all or any
portion of the Distributions, Redemption Price, Liquidation Distribution or
any other sums payable under the terms of the Preferred Securities or the
extension of time for the performance of any other obligation under, arising
out of, or in connection with, the Preferred Securities (other than an
extension of time for payment of Distributions, Redemption Price, Liquidation
Distribution or other sum payable that results from the extension of any
interest payment period on the Debentures);
(c) any failure, omission, delay or lack of diligence on the part of
the Holders to enforce, assert or exercise any right, privilege, power or
remedy conferred on the Holders pursuant to the terms of the Preferred
Securities, or any action on the part of the Issuer granting indulgence or
extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution, sale of any
collateral, receivership, insolvency, bankruptcy, assignment for the benefit
of creditors, reorganization, arrangement, composition or readjustment of
debt of, or other similar proceedings affecting, the Issuer or any of the
assets of the Issuer;
(e) any invalidity of, or defect or deficiency in, the Preferred
Securities;
(f) the settlement or compromise of any obligation guaranteed hereby or
hereby incurred; or
(g) any other circumstance whatsoever that might otherwise constitute a
legal or equitable discharge or defense of a guarantor, it being the intent
of this Section 5.3 that the obligations of the Guarantor hereunder shall be
full and unconditional under any and all circumstances.
There shall be no obligation of the Holders to give notice to, or obtain
consent of, the Guarantor with respect to the happening of any of the
foregoing.
SECTION 5.4. RIGHTS OF HOLDERS
(a) The Holders of a Majority in liquidation amount of the Preferred
Securities have the right to direct the time, method and place of conducting
of any proceeding for any remedy available to the Preferred Guarantor Trustee
in respect of this Preferred Securities Guarantee or exercising any trust or
power conferred upon the Preferred Guarantee Trustee under this Preferred
Securities Guarantee.
(b) If the Preferred Guarantee Trustee fails to enforce such Preferred
Securities Guarantee, any Holder of Preferred Securities may institute a
legal proceeding directly against the Guarantor to enforce the Preferred
Guarantee Trustee's rights under this Preferred Securities Guarantee,
without first instituting a legal proceeding against the Issuer, the Preferred
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Guarantee Trustee or any other person or entity. The Guarantor waives any
right or remedy to require that any action be brought first against the
Issuer or any other person or entity before proceeding directly against the
Guarantor.
SECTION 5.5 GUARANTEE OF PAYMENT
This Preferred Securities Guarantee creates a guarantee of payment and
not of collection.
SECTION 5.6 SUBROGATION
The Guarantor shall be subrogated to all (if any) rights of the Holders
of Preferred Securities against the Issuer in respect of any amounts paid to
such Holders by the Guarantor under this Preferred Securities Guarantee;
PROVIDED, HOWEVER, that the Guarantor shall not (except to the extent
required by mandatory provisions of law) be entitled to enforce or exercise
any right that it may acquire by way of subrogation or any indemnity,
reimbursement or other agreement, in all cases as a result of payment under
this Preferred Securities Guarantee, if, at the time of any such payment, any
amounts are due and unpaid under this Preferred Securities Guarantee. If any
amount shall be paid to the Guarantor in violation of the preceding sentence,
the Guarantor agrees to hold such amount in trust for the Holders and to pay
over such amount to the Holders.
SECTION 5.7 INDEPENDENT OBLIGATIONS
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Issuer with respect to the Preferred
Securities, and that the Guarantor shall be liable as principal and as debtor
hereunder to make Guarantee Payments pursuant to the terms of this Preferred
Securities Guarantee notwithstanding the occurrence of any event referred to
in subsections (a) through (g), inclusive, of Section 5.3 hereof.
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 LIMITATION OF TRANSACTIONS
So long as any Preferred Securities remain outstanding, if there shall
have occurred an Event of Default or an event of default under the
Declaration, then (a) the Guarantor shall not declare or pay any dividend on,
make any distributions with respect to, or redeem, purchase, acquire or make
a liquidation payment with respect to, any of its capital stock (other than (i)
purchases or acquisitions of shares of capital stock in connection with any
employee benefit plan or program, director benefit plan or program, dividend
reinvestment, stock repurchase, or other similar plans available to
stockholders of the Guarantor, or any option, warrant, right, or exercisable,
exchangeable, or convertible security outstanding as of ____________, (ii) as
a result of a reclassification of the Guarantor's capital stock or the
exchange or conversion of one class or series of the Guarantor's capital
stock for another class or series of the Guarantor's capital stock or the
capital securities of a subsidiary (including a trust such as the Issuer), or
(iii) the purchase of fractional interests in shares of the Guarantor's
capital stock pursuant to the
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conversion or exchange provisions of such capital stock of the Guarantor or
the security being converted or exchanged) or make any guarantee payments
with respect to the foregoing, the Guarantor shall not make any payment of
interest, principal or premium, if any, on or repay, repurchase or redeem any
debt securities (including guarantees) issued by the Guarantor which rank
PARI PASSU with or junior to the Debentures and (c) the Guarantor shall not
make any guarantee payments with respect to the foregoing (other than
pursuant to this Preferred Securities Guarantee).
SECTION 6.2 SUBORDINATION
This Preferred Securities Guarantee will constitute an unsecured
obligation of the Guarantor and will rank (i) subordinate and junior in right
of payment to all other liabilities of the Guarantor, (ii) PARI PASSU with
the most senior preferred or preference stock now or hereafter issued by the
Guarantor and with any guarantee now or hereafter entered into by the
Guarantor in respect of any preferred or preference stock of any Affiliate of
the Guarantor, and (iii) senior to the Guarantor's common stock.
ARTICLE VII
TERMINATION
SECTION 7.1 TERMINATION
This Preferred Securities Guarantee shall terminate upon (i) full
payment of the Redemption Price of all Preferred Securities, (ii) the
distribution of the Guarantor's common stock to all of the Holders in
respect of the conversion of all the Preferred Securities into the Guarantor's
common stock or upon the distribution of the Debentures held by the Issuer to
the Holders of all of the Preferred Securities or (iii) full payment of the
amounts payable in accordance with the Declaration upon liquidation of the
Issuer. Notwithstanding the foregoing, this Preferred Securities Guarantee
will continue to be effective or will be restated, as the case may be, if at
any time any Holder must restore payment of any sums paid under the
Preferred Securities or under this Preferred Securities Guarantee.
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1 EXCULPATION
(a) No Indemnified Person shall be liable, responsible or accountable
in damages or otherwise to the Guarantor or any Covered Person for any loss,
damage, liability, expense or claim incurred by reason of any act or omission
performed or omitted by such Indemnified Person in good faith in accordance
with this Preferred Securities Guarantee and in a manner that such
Indemnified Person reasonably believed to be within the scope of the
authority conferred on such Indemnified Person by this Preferred Securities
Guarantee or by law, except that an Indemnified Person shall be liable for
any such loss, damage or claim incurred by reason of such Indemnified
Person's negligence or willful misconduct with respect to such acts or
omissions.
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(b) An Indemnified Person shall be fully protected in relying in good
faith upon the records of the Guarantor and upon such information, opinions,
reports or statements presented to the Guarantor by any Person as to matters
the Indemnified Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reasonable
care by or on behalf of the Guarantor, including information, opinions,
reports or statements as to the value and amount of the assets, liabilities,
profits, losses, or any other facts pertinent to the existence and amount of
assets from which Distribution to Holders might properly be paid.
SECTION 8.2. INDEMNIFICATION
The Guarantor agrees to indemnify each Indemnified Person for, and to
hold each Indemnified Person harmless against, any loss, liability or expense
incurred without negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of the trust or trusts
hereunder, including the costs and expenses (including reasonable legal fees
and expenses) of defending itself against, or investigating, any claim or
liability in connection with the exercise or performance of any of its powers
or duties hereunder. The obligation to indemnify as set forth in this Section
8.2 shall survive the termination of this Preferred Securities Guarantee.
When the Preferred Guarantee Trust incurs expenses or renders services
in connection with an Event of Default with respect to the Preferred
Securities specified in Section 6.01(e) or 6.01(f) of the Indenture of the
Guarantor, the expenses (including the reasonable charges and expenses of its
counsel) and the compensation for services are intended to constitute
expenses of administration under any applicable federal or state bankruptcy,
insolvency or other similar law.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1. SUCCESSORS AND ASSIGNS
All guarantees and agreements contained in this Preferred Securities
Guarantee shall bind the successors, assigns, receivers, trustees and
representatives of the Guarantor and shall inure to the benefit of the
Holders of the Preferred Securities then outstanding.
SECTION 9.2. AMENDMENTS
Except with respect to any changes that do not adversely affect the
rights of Holders (in which case no consent of Holders will be required),
this Preferred Securities Guarantee may be amended only with the prior
approval of the Holders of at least a Majority in liquidation amount
(including the stated amount that would be paid on redemption, liquidation or
otherwise, plus accumulated and unpaid Distributions to the date upon which
the voting percentages are determined) of the Preferred Securities. The
provisions of Section 12.2 of the Declaration with respect to meetings of
Holders apply to the giving of such approval.
SECTION 9.3. NOTICES
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All notices provided for in this Preferred Securities Guarantee shall be
in writing, duly signed by the party giving such notice, and shall be
delivered by hand, telecopied or mailed by first class mail, as follows:
(a) If given to the Preferred Guarantee Trustee, at the Preferred
Guarantee Trustee's mailing address set forth below (or such other address as
the Preferred Guarantee Trustee may give notice of to the Holders of the
Preferred Securities):
The Bank of New York
000 Xxxxxxx Xxxxxx (21 West)
Xxx Xxxx, Xxx Xxxx 00000
Attn: Corporate Trust Trustee Administration
Fax No.:
-----------------------------
(b) If given to the Guarantor, at the Guarantors's mailing address set
forth below (or such other address as the Guarantor may give notice of to the
Holders of the Preferred Securities):
Unocal Corporation
0000 Xxxxxxxxx Xxxxxx
Xxxxx 0000
Xx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Corporate Secretary
Fax No.: (000) 000-0000
(c) If given to any Holder of Preferred Securities, at the address set
forth on the books and records of the Issuer.
All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid, except that if a notice or other document is refused
delivery or cannot be delivered because of a changed address of which no
notice was given, such notice or other document shall be deemed to have been
delivered on the date of such refusal or inability to deliver.
SECTION 9.4 BENEFIT
This Preferred Securities Guarantee is solely for the benefit of the
Holders of the Preferred Securities and, subject to Section 3.1(a), is not
separately transferable from the Preferred Securities.
SECTION 9.5 GOVERNING LAW
THIS PREFERRED SECURITIES GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK,
WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF.
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THIS PREFERRED SECURITIES GUARANTEE is executed as of the day and year
first above written.
UNOCAL CORPORATION, as Guarantor
By:
-----------------------------
Name:
Title:
THE BANK OF NEW YORK, as Preferred
Guarantee Trustee
By:
-----------------------------
Name:
Title:
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