EXHIBIT 4.16
FORM OF
AMENDED AND RESTATED
TRUST AGREEMENT
AMONG
MONTPELIER RE HOLDINGS LTD.,
AS DEPOSITOR,
THE BANK OF NEW YORK,
AS PROPERTY TRUSTEE
THE BANK OF NEW YORK (DELAWARE),
AS DELAWARE TRUSTEE,
AND
THE ADMINISTRATIVE TRUSTEES NAMED HEREIN
DATED AS OF _________________, 200__
MRH CAPITAL TRUST II
TABLE OF CONTENTS
PAGE
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ARTICLE I. DEFINED TERMS................................................................... 1
Section 1.1. Definitions..................................................................... 1
ARTICLE II. ESTABLISHMENT OF THE TRUST...................................................... 9
Section 2.1. Name............................................................................ 9
Section 2.2. Office of the Delaware Trustee; Principal Place of Business..................... 9
Section 2.3. Initial Contribution of Trust Property; Organizational Expenses................. 9
Section 2.4. Issuance of the Preferred Securities............................................ 9
Section 2.5. Issuance of the Common Securities; Subscription and Purchase of Debentures...... 10
Section 2.6. Declaration of Trust............................................................ 11
Section 2.7. Authorization to Enter into Certain Transactions................................ 11
Section 2.8. Assets of Trust................................................................. 15
Section 2.9. Title to Trust Property......................................................... 15
Section 2.10. Not Responsible for Recitals or Issuance of Securities.......................... 15
ARTICLE III. PAYMENT ACCOUNT................................................................. 15
Section 3.1. Payment Account................................................................. 15
ARTICLE IV. CERTAIN TERMS OF THE TRUST SECURITIES........................................... 16
Section 4.1. Distributions................................................................... 16
Section 4.2. Redemption...................................................................... 17
Section 4.3. Subordination of Common Securities.............................................. 19
Section 4.4. Payment Procedures.............................................................. 20
Section 4.5. Tax Returns and Reports......................................................... 20
Section 4.6. Payment of Taxes, Duties, Etc. of the Trust..................................... 21
Section 4.7. Payments Under Indenture........................................................ 21
Section 4.8. CUSIP Numbers................................................................... 21
ARTICLE V. TRUST SECURITIES CERTIFICATES................................................... 21
Section 5.1. Initial Ownership............................................................... 21
Section 5.2. The Trust Securities Certificates............................................... 21
Section 5.3. Execution and Delivery of Trust Securities Certificates......................... 22
Section 5.4. Registration of Transfer and Exchange of Preferred Securities Certificates...... 22
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Section 5.5. Mutilated, Destroyed, Lost or Stolen Trust Securities Certificates.............. 22
Section 5.6. Persons Deemed Securityholders.................................................. 23
Section 5.7. Access to List of Securityholders' Names and Addresses.......................... 23
Section 5.8. Maintenance of Office or Agency................................................. 24
Section 5.9. Appointment of Paying Agent..................................................... 24
Section 5.10. Ownership of Common Securities by Depositor..................................... 24
Section 5.11. Book-Entry Preferred Securities Certificates; Common Securities Certificate..... 25
Section 5.12. Notices to Clearing Agency...................................................... 26
Section 5.13. Definitive Preferred Securities Certificates.................................... 26
Section 5.14. Rights of Securityholders....................................................... 27
Section 5.15. Rights and Immunities of the Registrar.......................................... 29
Section 5.16. Rights and Immunities of the Paying Agent....................................... 29
Section 5.17. No Obligation for Clearing Agency............................................... 29
ARTICLE VI. ACTS OF SECURITYHOLDERS; MEETINGS; VOTING....................................... 30
Section 6.1. Limitations on Voting Rights.................................................... 30
Section 6.2. Notice of Meetings.............................................................. 31
Section 6.3. Meetings of Preferred Securityholders........................................... 31
Section 6.4. Voting Rights................................................................... 31
Section 6.5. Proxies, Etc.................................................................... 31
Section 6.6. Securityholder Action by Written Consent........................................ 32
Section 6.7. Record Date for Voting and Other Purposes....................................... 32
Section 6.8. Acts of Securityholders......................................................... 32
Section 6.9. Inspection of Records........................................................... 33
ARTICLE VII. REPRESENTATIONS AND WARRANTIES.................................................. 33
Section 7.1. Representations and Warranties of the Property Trustee and the Delaware Trustee. 33
Section 7.2. Representations And Warranties of Depositor..................................... 34
ARTICLE VIII. THE TRUSTEES.................................................................... 36
Section 8.1. Certain Duties and Responsibilities............................................. 36
Section 8.2. Certain Notices................................................................. 37
Section 8.3. Certain Rights of Property Trustee.............................................. 37
Section 8.4. Not Responsible for Recitals or Issuance of Securities.......................... 40
Section 8.5. May Hold Securities............................................................. 40
Section 8.6. Compensation; Indemnity; Fees................................................... 40
Section 8.7. Corporate Property Trustee Required; Eligibility Of Trustees.................... 41
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Section 8.8. Conflicting Interests........................................................... 41
Section 8.9. Co-Trustees and Separate Trustee................................................ 42
Section 8.10. Resignation and Removal; Appointment of Successor............................... 43
Section 8.11. Acceptance of Appointment by Successor.......................................... 44
Section 8.12. Merger, Conversion, Consolidation or Succession to Business..................... 45
Section 8.13. Preferential Collection of Claims Against Depositor, Debenture Issuer or Trust.. 46
Section 8.14. Reports by Property Trustee..................................................... 46
Section 8.15. Reports to the Property Trustee................................................. 46
Section 8.16. Evidence of Compliance with Conditions Precedent................................ 46
Section 8.17. Number of Trustees.............................................................. 47
Section 8.18. Delegation of Power............................................................. 47
ARTICLE IX. DISSOLUTION, LIQUIDATION, TERMINATION AND MERGER................................ 47
Section 9.1. Dissolution Upon Expiration Date................................................ 47
Section 9.2. Early Dissolution............................................................... 48
Section 9.3. Termination..................................................................... 48
Section 9.4. Liquidation..................................................................... 48
Section 9.5. Mergers, Consolidations, Amalgamations or Replacements of the Trust............. 50
ARTICLE X. MISCELLANEOUS PROVISIONS........................................................ 51
Section 10.1. Limitation of Rights of Securityholders......................................... 51
Section 10.2. Amendment....................................................................... 51
Section 10.3. Separability.................................................................... 52
Section 10.4. Governing Law................................................................... 52
Section 10.5. Payments Due on Non-Business Day................................................ 52
Section 10.6. Successors...................................................................... 52
Section 10.7. Headings........................................................................ 53
Section 10.8. Reports, Notices and Demands.................................................... 53
Section 10.9. Agreement Not to Petition....................................................... 53
Section 10.10. Trust Indenture Act; Conflict with Trust Indenture Act.......................... 54
Section 10.11. Acceptance of Terms of Trust Agreement, Guarantee and Indenture................. 54
EXHIBITS
Exhibit A Certificate of Trust of MRH Capital Trust II
Exhibit B Letter to [ ] Pertaining To the Trust Originated Preferred Securities
Exhibit C Certificate Evidencing Common Securities of MRH Capital Trust II
Exhibit D Agreement as to Expenses and Liabilities
Exhibit E Certificate Evidencing Preferred Securities of MRH Capital Trust II
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MRH CAPITAL TRUST II
CERTAIN SECTIONS OF THIS TRUST AGREEMENT RELATING
TO SECTIONS 310 THROUGH 318 OF
THE TRUST INDENTURE ACT OF 1939:
TRUST INDENTURE ACT TRUST AGREEMENT SECTION
ss.ss.310(a)(1)..............................................................8.7
(a)(2).......................................................................8.7
(a)(3).......................................................................8.9
(a)(4)................................................................2.7(a)(ii)
(b)..........................................................................8.8
ss.ss.311(a)................................................................8.13
(b).........................................................................8.13
ss.ss.312(a).................................................................5.7
(b)..........................................................................5.7
(c)..........................................................................5.7
ss.ss.313(a).............................................................8.14(a)
(a)(4)...................................................................8.14(b)
(b)......................................................................8.14(b)
(c).........................................................................10.8
(d)......................................................................8.14(c)
ss.ss.314(a)................................................................8.15
(b)...............................................................Not Applicable
(c)(1)......................................................................8.16
(c)(2)......................................................................8.16
(c)(3)............................................................Not Applicable
(d)...............................................................Not Applicable
(e)....................................................................1.1, 8.16
ss.ss.315(a)......................................................8.1(a), 8.3(a)
(b)....................................................................8.2, 10.8
(c).......................................................................8.1(a)
(d).....................................................................8.1, 8.3
(e)...............................................................Not Applicable
ss.ss.316(a)......................................................Not Applicable
(a)(1)(A).........................................................Not Applicable
(a)(1)(B).........................................................Not Applicable
(a)(2)............................................................Not Applicable
(b)...............................................................Not Applicable
(c)..........................................................................6.7
ss.ss.317(a)(1)...................................................Not Applicable
(a)(2)............................................................Not Applicable
(b)..........................................................................5.9
ss.ss.318(a)...............................................................10.10
Note: This reconciliation and tie sheet shall not, for any purpose be deemed to
be a part of the Trust Agreement.
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AMENDED AND RESTATED TRUST AGREEMENT, dated as of __________, 200__,
among (i) MONTPELIER RE HOLDINGS LTD., a company incorporated and organized
under the laws of Bermuda (including any successors or assigns, the
"Depositor"), (ii) The Bank of New York, a New York banking corporation, as
property trustee (the "Property Trustee" and, in its individual capacity and not
in its capacity as Property Trustee, the "Bank"), (iii) The Bank of New York
(Delaware), a Delaware banking corporation, as Delaware trustee (in such
capacity, the "Delaware Trustee,"), (iv) [ ], an individual, and [ ],
an individual, each of whose address is c/o Montpelier Re Holdings Ltd.,
Mintflower Place, 8 Par-La-Ville Road, Xxxxxxxx XX 08, Bermuda (each an
"Administrative Trustee" and collectively, the "Administrative Trustees") (the
Property Trustee, the Delaware Trustee and the Administrative Trustees are
referred to collectively as the "Trustees") and (v) the several Holders, as
hereinafter defined.
W I T N E S S E T H
WHEREAS, Montpelier Re Holdings Ltd., as original sponsor of the Trust
and the Trustees have heretofore duly declared and established a statutory trust
pursuant to the Delaware Statutory Trust Act by the entering into of that
certain Trust Agreement, dated as of January 27, 2004 (the "Initial Trust
Agreement"), and by the execution by the Trustees and filing with the Secretary
of State of the State of Delaware of the Certificate of Trust, filed on January
28, 2004 (the "Certificate of Trust"), attached as Exhibit A;
WHEREAS, the Depositor and the Trustees desire to amend and restate the
Original Trust Agreement in its entirety as set forth herein to provide for,
among other things, (i) the issuance of the Common Securities by the Trust to
the Depositor, (ii) the issuance and sale of the Preferred Securities by the
Trust pursuant to the Underwriting Agreement and (iii) the acquisition by the
Trust from the Debenture Issuer of all of the right, title and interest in the
Debentures;
NOW THEREFORE, in consideration of the agreements and obligations set
forth herein and for other good and valuable consideration, the sufficiency of
which is hereby acknowledged, each party, for the benefit of the other parties
and for the benefit of the Securityholders, hereby amends and restates the
Original Trust Agreement in its entirety and agrees as follows:
ARTICLE I.
DEFINED TERMS
SECTION 1.1. DEFINITIONS.
For all purposes of this Trust Agreement, except as otherwise expressly
provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as the singular;
(b) all other terms used herein that are defined in the
Trust Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(c) unless the context otherwise requires, any reference to
an "Article" or a "Section" refers to an Article or a Section, as the case may
be, of this Trust Agreement; and
(d) the words "herein," "hereof" and "hereunder" and other
words of similar import refer to this Trust Agreement as a whole and not to any
particular Article, Section or other subdivision.
"Act" has the meaning specified in Section 6.8.
"Additional Amounts" means, with respect to Trust Securities of a given
Liquidation Amount, for a given period, the amount of any Additional Interest
and any Additional Amounts (as defined in the Indenture) paid by the Debenture
Issuer on a Like Amount of Debentures for such period.
"Additional Interest" has the meaning specified in Section 1.1 of the
Indenture.
"Additional Sums" has the meaning specified in Section 10.9 of the
Indenture.
"Administrative Trustee" means each of [ ] and [ ], solely in
such Person's capacity as an Administrative Trustee of the Trust and not in such
Person's individual capacity, or such Administrative Trustee's successor in
interest in such capacity, or any successor trustee appointed as herein
provided.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Authorized Officer" means, when used with respect to the Depositor, the
directors of the board of directors and the officers of the Depositor.
"Bank" has the meaning specified in the preamble to this Trust
Agreement.
"Bankruptcy Event" means, with respect to any Person: (a) the entry of a
decree or order by a court having jurisdiction in the premises judging such
Person bankrupt or insolvent, or approving as properly filed a petition seeking
reorganization, arrangement, adjudication or composition of, or in respect of,
such Person under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law, or appointing a receiver, liquidator,
assignee, trustee, sequestrator (or other similar official) of such Person or of
any substantial part of its property or ordering the winding up or liquidation
of its affairs, and the continuance of any such decree or order unstayed and in
effect for a period of sixty (60) consecutive days; or (b) the institution by
such Person of proceedings to be adjudicated bankrupt or insolvent, or the
consent by it to the institution of bankruptcy or insolvency proceedings against
it, or the filing by it of a petition or answer or consent seeking
reorganization or relief under any applicable Federal or State bankruptcy,
insolvency, reorganization or other similar law, or the consent by it to the
filing of any such petition or to the appointment of a receiver, liquidator,
assignee, trustee,
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sequestrator (or similar official) of such Person or of any substantial part of
its property, or the making by it of an assignment for the benefit of creditors,
or the admission by it in writing of its inability to pay its debts generally as
they become due and its willingness to be adjudicated a bankrupt, or the taking
of corporate action by such Person in furtherance of any such action.
"Bankruptcy Law" has the meaning specified in Section 10.9.
"Board Resolution" means a copy of a resolution certified by the
Secretary or any Assistant Secretary of the Depositor to have been duly adopted
by the Depositor's Board of Directors, or such committee of the Board of
Directors or officers of the Depositor to which authority to act on behalf of
the Board of Directors has been delegated, and to be in full force and effect on
the date of such certification, and delivered to the appropriate Trustee or
Trustees.
"Book-Entry Preferred Securities Certificates" means a beneficial
interest in the Preferred Securities Certificates, ownership and transfers of
which shall be made through book entries by a Clearing Agency as described in
Section 5.11.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and
Friday which is not (a) a day on which banking institutions in The City of New
York are authorized or required by law or executive order to remain closed or
(b) a day on which the Property Trustee's Corporate Trust Office or the
Corporate Trust Office of the Debenture Trustee is closed for business.
"Certificate Depository Agreement" means the agreement among the Trust,
the Depositor and [ ], as the initial Clearing Agency, dated as of the
Closing Date, relating to the Trust Securities Certificates, substantially in
the form attached as Exhibit B, as the same may be amended and supplemented from
time to time.
"Certificate of Trust" has the meaning specified in the recitals to this
Trust Agreement.
"Clearing Agency" means an organization registered as a "clearing
agency" pursuant to Section 17A of the Securities Exchange Act of 1934, as
amended. [ ] will be the initial Clearing Agency.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time a Clearing
Agency effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
"Closing Time" has the meaning specified in the Underwriting Agreement,
which date is also the date of execution and delivery of this Trust Agreement.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission, as from time
to time constituted, created under the Securities Exchange Act of 1934, as
amended, or, if at any time after the date on which this Trust Agreement was
originally executed such Commission is not existing and performing the duties
now assigned to it under the Trust Indenture Act on such date of original
execution, then the body performing such duties at such time.
3
"Common Security" means an undivided beneficial interest in the assets
of the Trust, having a Liquidation Amount of $[ ] and having the rights
provided therefor in this Trust Agreement, including the right to receive
Distributions and a Liquidation Distribution as provided herein.
"Common Securities Certificate" means a certificate evidencing ownership
of Common Securities, substantially in the form attached as Exhibit C.
"Corporate Trust Office" means the principal office of the Property
Trustee at which at any particular time its corporate trust business shall be
administered, which office, on the date of original execution of this Trust
Agreement, is located at 000 Xxxxxxx Xxxxxx, XX.0X, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Corporate Trust Administration or at any other time at such address
as the Property Trustee may designate from time to time by notice to the parties
hereto.
"Date of Delivery" has the meaning specified in the Underwriting
Agreement.
"Debenture Event of Default" means an "Event of Default" as defined in
the Indenture.
"Debenture Issuer" means Montpelier Re Holdings Ltd., a company
incorporated and organized under the laws of Bermuda, in its capacity as the
issuer of the Debentures under the Indenture, and its successors.
"Debenture Redemption Date" means, with respect to any Debentures to be
redeemed under the Indenture, the date fixed for redemption under the Indenture.
"Debenture Trustee" means The Bank of New York, a New York banking
corporation, solely in its capacity as trustee and not in its individual
capacity under the Indenture, or any successor trustee appointed as therein
provided.
"Debentures" means the aggregate principal amount of the Debenture
Issuer's [ ]% Junior Subordinated Deferrable Interest Debentures due
[ ], issued pursuant to the Indenture.
"Definitive Preferred Securities Certificates" means either or both (as
the context requires) of (a) Preferred Securities Certificates issued as
Book-Entry Preferred Securities Certificates as provided in Section 5.11(a) and
Section 5.11(b) and (b) Preferred Securities Certificates issued in
certificated, fully registered form as provided in Section 5.13.
"Delaware Statutory Trust Act" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. C. Section 3801, et seq., as it may be amended from time
to time.
"Delaware Trustee" means the corporation identified as the "Delaware
Trustee" in the first paragraph of this Trust Agreement solely in its capacity
as Delaware Trustee of the Trust and not in its individual capacity, or its
successor in interest in such capacity, or any successor trustee appointed as
herein provided.
"Depositor" has the meaning specified in the preamble to this Trust
Agreement.
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"Distribution Date" has the meaning specified in Section 4.1(a).
"Distributions" means amounts payable in respect of the Trust Securities
as provided in Section 4.1.
"Early Termination Event" has the meaning specified in Section 9.2.
"Event of Default" means any one of the following events (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body): (a) the occurrence of a Debenture Event of
Default; or (b) default by the Property Trustee in the payment of any
Distribution when it becomes due and payable, and continuation of such default
for a period of 30 days; or (c) default by the Property Trustee in the payment
of any Redemption Price of any Trust Security when it becomes due and payable;
or (d) default in the performance, or breach, in any material respect, of any
covenant or warranty of the Trustees in this Trust Agreement (other than a
covenant or warranty a default in the performance or breach of which is dealt
with in clause (b) or (c) above) and continuation of such default or breach for
a period of 60 days after there has been given, by registered or certified mail,
to the defaulting Trustee or Trustees by the Holders of at least 25% in
aggregate liquidation preference of the Outstanding Preferred Securities a
written notice specifying such default or breach and requiring it to be remedied
and stating that such notice is a "Notice of Default" hereunder; or (e) the
occurrence of a Bankruptcy Event with respect to the Property Trustee and the
failure by the Depositor to appoint a successor Property Trustee within 60 days
thereof.
"Expense Agreement" means the Agreement as to Expenses and Liabilities
between the Depositor and the Trust, substantially in the form attached as
Exhibit D, as amended from time to time.
"Expiration Date" has the meaning specified in Section 9.1.
"Guarantee" means the Guarantee Agreement executed and delivered by the
Preferred Securities Guarantor and Bankers Trust Company, as trustee,
contemporaneously with the execution and delivery of this Trust Agreement, for
the benefit of the Holders of the Preferred Securities, as amended from time to
time.
"Indenture" means the Junior Subordinated Indenture, dated as of [ ],
200__, among the Debenture Issuer and the Debenture Trustee, as trustee, as
amended or supplemented from time to time.
"Investment Company Act" means the Investment Company Act of 1940, as
amended.
"Lien" means any lien, pledge, charge, encumbrance, mortgage, deed of
trust, adverse ownership interest, hypothecation, assignment, security interest
or preference, priority or other security agreement or preferential arrangement
of any kind or nature whatsoever.
"Like Amount" means (a) with respect to a redemption of Trust
Securities, Trust Securities having a Liquidation Amount equal to the principal
amount of Debentures to be
5
contemporaneously redeemed in accordance with the Indenture the proceeds of
which will be used to pay the Redemption Price of such Trust Securities, and (b)
with respect to a distribution of Debentures to Holders of Trust Securities in
connection with a dissolution or liquidation of the Trust, Debentures having a
principal amount equal to the Liquidation Amount of the Trust Securities of the
Holder to whom such Debentures are distributed.
"Liquidation Amount" means the stated amount of $[ ] per Trust
Security.
"Liquidation Date" means the date on which Debentures are to be
distributed to Holders of Trust Securities in connection with a dissolution and
liquidation of the Trust pursuant to Section 9.4(a).
"Liquidation Distribution" has the meaning specified in Section 9.4(e).
"Officers' Certificate" means a certificate signed by two Authorized
Officers, at least one of which is a principal executive, principal financial or
principal accounting officer, that complies with the requirements of Section
314(e) of the Trust Indenture Act and is delivered to the appropriate Trustee or
Trustees.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Trust or the Depositor, as the case may be, or other counsel,
that, if required by the Trust Indenture Act, complies with the requirements of
Section 314(e) of the Trust Indenture Act.
"Original Trust Agreement" has the meaning specified in the recitals to
this Trust Agreement.
"Outstanding," when used with respect to Preferred Securities, means, as
of the date of determination, all Preferred Securities theretofore executed and
delivered under this Trust Agreement, except:
(a) Preferred Securities theretofore cancelled by the
Property Trustee or delivered to the Property Trustee for cancellation;
(b) Preferred Securities for whose payment or redemption
money in the necessary amount has been theretofore deposited with the Property
Trustee or any Paying Agent for the Holders of such Preferred Securities;
provided that, if such Preferred Securities are to be redeemed, notice of such
redemption has been duly given pursuant to this Trust Agreement; and
(c) Preferred Securities which have been paid or in exchange
for or in lieu of which other Preferred Securities have been executed and
delivered pursuant to Section 5.4, Section 5.5, Section 5.11, Section 5.13,
unless there shall have been presented to the Property Trustee proof
satisfactory to it that such Preferred Security is held by a bona fide purchaser
in whose hand such Preferred Security is a valid obligation of the Trust;
provided, however, that in determining whether the Holders of the requisite
Liquidation Amount of the Outstanding Preferred Securities have given any
request, demand, authorization, direction, notice, consent or waiver hereunder
or are present at a meeting of Securityholders for quorum purposes, Preferred
Securities owned by the Depositor, any Trustee or any Affiliate of the Depositor
or any Trustee, shall be disregarded and deemed not to be Outstanding, except
that (a) in determining whether
6
any Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Preferred Securities
that such Trustee knows to be so owned shall be so disregarded and (b) the
foregoing shall not apply at any time when all of the outstanding Preferred
Securities are owned by the Depositor, one or more of the Trustees and/or any
such Affiliate. Preferred Securities so owned which have been pledged in good
faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Administrative Trustees the pledgee's right so to act with
respect to such Preferred Securities and that the pledgee is not the Depositor
or any Affiliate of the Depositor.
"Owner" means each Person who is the beneficial owner of a Book-Entry
Preferred Securities Certificate as reflected in the records of the Clearing
Agency or, if a Clearing Agency Participant is not the Owner, then as reflected
in the records of a Person maintaining an account with such Clearing Agency
(directly or indirectly, in accordance with the rules of such Clearing Agency).
"Paying Agent" means any paying agent or co-paying agent appointed
pursuant to Section 5.9 and shall initially be the Bank.
"Payment Account" means a segregated non-interest-bearing corporate
trust account maintained by the Property Trustee with the Paying Agent in its
trust department for the benefit of the Securityholders in which all amounts
paid in respect of the Debentures will be held and from which the Property
Trustee shall make payments to the Securityholders in accordance with Section
4.1 and Section 4.2.
"Person" means any individual, company, corporation, partnership, joint
venture, trust, limited liability company or corporation, unincorporated
organization or government or any agency or political subdivision thereof.
"Preferred Security" means an undivided beneficial interest in the
assets of the Trust, having a Liquidation Amount of $[ ] and having the rights
provided therefor in this Trust Agreement, including the right to receive
Distributions and a Liquidation Distribution as provided herein.
"Preferred Securities Certificate" means a certificate evidencing
ownership of Preferred Securities, substantially in the form attached as Exhibit
E.
"Preferred Securities Guarantor" means Montpelier Re Holdings Ltd., a
company incorporated and organized under the laws of Bermuda, in its capacity as
guarantor under the Guarantee, and its successors.
"Property Trustee" means the commercial bank or trust company identified
as the "Property Trustee" in the preamble to this Trust Agreement solely in its
capacity as Property Trustee of the Trust and not in its individual capacity, or
its successor in interest in such capacity, or any successor property trustee
appointed as herein provided.
"Redemption Date" means, with respect to any Trust Security to be
redeemed, the date fixed for such redemption by or pursuant to this Trust
Agreement; provided that each Debenture
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Redemption Date and the stated maturity of the Debentures shall be a Redemption
Date for a Like Amount of Trust Securities.
"Redemption Price" means, with respect to any Trust Security, the
Liquidation Amount of such Trust Security plus accumulated and unpaid
Distributions to the Redemption Date, plus the related amount of the premium, if
any, and any Additional Amounts paid by the Debenture Issuer upon the concurrent
redemption of a Like Amount of Debentures, allocated on a pro rata basis (based
on Liquidation Amounts) among the Trust Securities.
"Relevant Trustee" shall have the meaning specified in Section 8.10.
"Responsible Officer" means, with respect to the Property Trustee, any
officer within the Corporate Trust Office of the Property Trustee, including any
vice president, assistant vice president or other officer of the Corporate Trust
Office of the Property 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.
"Securities Register" and "Securities Registrar" have the respective
meanings specified in Section 5.4.
"Securityholder" or "Holder" means a Person in whose name a Trust
Security or Securities is registered in the Securities Register; any such Person
being a beneficial owner within the meaning of the Delaware Statutory Trust Act;
provided, however, that in determining whether the Holders of the requisite
amount of Preferred Securities have voted on any matter provided for in this
Trust Agreement, then for purposes of any such determination, so long as
Definitive Preferred Securities Certificates have not been issued, the term
Securityholders or Holders as used herein shall refer to the Owners.
"Time of Delivery" means, collectively, the Closing Time and each Date
of Delivery.
"Trust" means the Delaware statutory trust created by the Original Trust
Agreement and the Certificate of Trust and continued hereby and identified on
the cover page to this Trust Agreement.
"Trust Agreement" means this Amended and Restated Trust Agreement, as
the same may be modified, amended or supplemented in accordance with the
applicable provisions hereof, including all exhibits hereto, including, for all
purposes of this Trust Agreement and any such modification, amendment or
supplement, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this Trust Agreement and any such modification, amendment or
supplement, respectively.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in force
on the date as of which this instrument was executed; provided, however, that in
the event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
8
"Trust Property" means (a) the Debentures, (b) any cash on deposit in,
or owing to, the Payment Account and (c) all proceeds and rights in respect of
the foregoing and any other property and assets for the time being held or
deemed to be held by the Property Trustee pursuant to the trusts of this Trust
Agreement.
"Trust Security" means any one of the Common Securities or the Preferred
Securities.
"Trust Securities Certificate" means any one of the Common Securities
Certificates or the Preferred Securities Certificates.
"Trustees" means, collectively, the Property Trustee, the Delaware
Trustee and the Administrative Trustees.
"Underwriting Agreement" means the Underwriting Agreement, dated as of
[ ], 200__, among the Trust, the Depositor, the Debenture Issuer
and the Underwriters named therein.
ARTICLE II.
ESTABLISHMENT OF THE TRUST
SECTION 2.1. NAME.
The Trust continued hereby shall be known as "MRH Capital Trust II," as
such name may be modified from time to time by the Administrative Trustees
following written notice to the Holders of Trust Securities and the other
Trustees, in which name the Trustees may conduct the business of the Trust, make
and execute contracts and other instruments on behalf of the Trust and xxx and
be sued.
SECTION 2.2. OFFICE OF THE DELAWARE TRUSTEE; PRINCIPAL PLACE OF
BUSINESS.
The address of the initial Delaware Trustee in the State of Delaware is
[ ], or such other address in the State of Delaware as the Delaware Trustee
may designate by written notice to the Depositor. The principal executive office
of the Trust is c/o Montpelier Re Holdings Ltd., Xxxxxxxxxx Xxxxx, 0
Xxx-Xx-Xxxxx Xxxx, Xxxxxxxx XX 00, Xxxxxxx.
SECTION 2.3. INITIAL CONTRIBUTION OF TRUST PROPERTY; ORGANIZATIONAL
EXPENSES.
The Trustees acknowledge receipt in trust from the Depositor in
connection with the Original Trust Agreement of the sum of $10, which
constituted the initial Trust Property. The Depositor shall pay organizational
expenses of the Trust as they arise or shall, upon request of any Trustee,
promptly reimburse such Trustee for any such expenses paid by such Trustee. The
Depositor shall make no claim upon the Trust Property for the payment of such
expenses.
SECTION 2.4. ISSUANCE OF THE PREFERRED SECURITIES.
9
The Depositor, on behalf of the Trust and as Trust sponsor under the
Original Trust Agreement, has executed and delivered the Underwriting Agreement.
At the Closing Time, an Administrative Trustee, on behalf of the Trust, shall
execute in accordance with Section 5.2 and deliver to the Underwriters named in
the Underwriting Agreement Preferred Securities Certificates, registered in the
name of the nominee of the initial Clearing Agency, in an aggregate amount of
[ ] Preferred Securities having an aggregate Liquidation Amount of
$[ ], against receipt of such aggregate purchase price of such Preferred
Securities of $[ ], which amount such Administrative Trustee shall
promptly deliver to the Property Trustee. On each Date of Delivery, an
Administrative Trustee, on behalf of the Trust, shall execute in accordance with
Section 5.2 and deliver to the Underwriters named in the Underwriting Agreement
Preferred Securities Certificates, registered in the name of the nominee of the
initial Clearing Agency, in an aggregate amount of up to [ ] Preferred
Securities (less such number of Preferred Securities evidenced by Preferred
Securities Certificates executed and delivered on any prior Dates of Delivery)
having an aggregate Liquidation Amount of up to $[ ] (less the aggregate
Liquidation Amount of any Preferred Securities evidenced by Preferred Securities
Certificates executed and delivered on any prior Dates of Delivery), against
receipt of such aggregate purchase price of such Preferred Securities of
$[ ] (less the aggregate Liquidation Amount of any Preferred Securities
evidenced by Preferred Securities Certificates executed and delivered on any
prior Dates of Delivery), which amount such Administrative Trustee shall
promptly deliver to the Property Trustee.
SECTION 2.5. ISSUANCE OF THE COMMON SECURITIES; SUBSCRIPTION AND
PURCHASE OF DEBENTURES.
(a) At the Closing Time, an Administrative Trustee, on
behalf of the Trust, shall execute in accordance with Section 5.2 and deliver to
the Depositor Common Securities Certificates, registered in the name of the
Depositor, in an aggregate amount of [ ] Common Securities having an
aggregate Liquidation Amount of $[ ], against payment by the Depositor of
such amount, which amount such Administrative Trustee shall promptly deliver to
the Property Trustee. Contemporaneously therewith, an Administrative Trustee, on
behalf of the Trust, shall subscribe to and purchase from the Debenture Issuer
Debentures, registered in the name of the Property Trustee in accordance with
Section 2.9 and having an aggregate principal amount equal to $[ ], and, in
satisfaction of the purchase price for such Debentures, the Property Trustee, on
behalf of the Trust, shall deliver to the Debenture Issuer the sum of $[ ].
On each Date of Delivery, an Administrative Trustee, on behalf of the Trust,
shall execute in accordance with Section 5.2 and deliver to the Depositor Common
Securities Certificates, registered in the name of the Depositor, in an
aggregate amount of up to [ ] Common Securities (less such number of Common
Securities evidenced by Common Securities Certificates executed and delivered on
any prior Dates of Delivery) having an aggregate Liquidation Amount of up to
$[ ] (less the aggregate Liquidation Amount of any Common Securities
evidenced by Common Securities Certificates executed and delivered on any prior
Dates of Delivery), against payment by the Depositor of such amount, which
amount such Administrative Trustee shall promptly deliver to the Property
Trustee.
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(b) At the Closing Time and on each Date of Delivery, an
Administrative Trustee, on behalf of the Trust, shall subscribe to and purchase
from the Debenture Issuer Debentures, registered in the name of the Property
Trustee in accordance with Section 2.9 and having an aggregate principal amount
equal to the aggregate Liquidation Amount of the Preferred Securities and Common
Securities issued and sold on such date, and, in satisfaction of the purchase
price for such Debentures, the Property Trustee, on behalf of the Trust, shall
deliver to the Debenture Issuer the amount received on such date from one of the
Administrative Trustees pursuant to the last sentence of Section 2.4.
SECTION 2.6. DECLARATION OF TRUST.
The exclusive purposes and functions of the Trust are (a) to issue and
sell Trust Securities and use the proceeds from such sale to acquire the
Debentures, and (b) to engage in those activities necessary, convenient or
incidental thereto. The Depositor hereby appoints the Trustees as trustees of
the Trust, to have all the rights, powers and duties to the extent set forth
herein, and the Trustees hereby accept such appointment. The Property Trustee
hereby declares that it will hold the Trust Property upon and subject to the
conditions set forth herein for the benefit of the Securityholders. The
Administrative Trustees shall have all rights, powers and duties set forth
herein and in accordance with applicable law with respect to accomplishing the
purposes of the Trust. The Delaware Trustee shall be one of the Trustees of the
Trust for the sole and limited purpose of fulfilling the requirements of Section
3807(a) of the Delaware Statutory Trust Act.
SECTION 2.7. AUTHORIZATION TO ENTER INTO CERTAIN TRANSACTIONS.
(a) The Trustees shall conduct the affairs of the Trust in
accordance with the terms of this Trust Agreement. Subject to the limitations
set forth in paragraph (b) of this Section and Article VIII, and in accordance
with the following provisions (i) and (ii), the Administrative Trustees shall
have the authority to enter into all transactions and agreements determined by
the Trustees to be appropriate in exercising the authority, express or implied,
otherwise granted to the Trustees under this Trust Agreement, and to perform all
acts in furtherance thereof, including without limitation, the following:
(i) As among the Trustees, each of the
Administrative Trustees, acting singly or
together, shall have the power and authority to
act on behalf of the Trust with respect to the
following matters:
(A) the issuance and sale of the Trust
Securities;
(B) to cause the Trust to enter into, and to
execute, deliver and perform on behalf
of the Trust, the Expense Agreement and
the Certificate Depository Agreement and
such other agreements as may be
necessary or desirable in connection
with the purposes and function of the
Trust;
(C) to assist in the registration of the
Preferred Securities under the
Securities Act of 1933, as amended, and
under state
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securities or blue sky laws, and the
qualification of this Trust Agreement
as a trust indenture under the Trust
Indenture Act;
(D) to assist in the listing of the
Preferred Securities upon such
securities exchange or exchanges as
shall be determined by the Depositor and
the registration of the Preferred
Securities under the Securities Exchange
Act of 1934, as amended, and the
preparation and filing of all periodic
and other reports and other documents
pursuant to the foregoing;
(E) the sending of notices (other than
notices of default) and other
information regarding the Trust
Securities and the Debentures to the
Securityholders in accordance with this
Trust Agreement;
(F) the appointment of a Paying Agent,
authenticating agent and Securities
Registrar in accordance with this Trust
Agreement;
(G) the establishment of a record date for
any of the purposes contemplated by
Section 6.7 hereof;
(H) to the extent provided in this Trust
Agreement, the winding up of the affairs
of and liquidation of the Trust and the
preparation, execution and filing of the
certificate of cancellation with the
Secretary of State of the State of
Delaware;
(I) unless otherwise determined by the
Depositor, the Property Trustee or the
Administrative Trustees, or as otherwise
required by the Delaware Statutory Trust
Act or the Trust Indenture Act, to
execute on behalf of the Trust (either
acting alone or together with any or all
of the Administrative Trustees) any
documents that the Administrative
Trustees have the power to execute
pursuant to this Trust Agreement; and
(J) the taking of any action incidental to
the foregoing as the Trustees may from
time to time determine is necessary or
advisable to give effect to the terms of
this Trust Agreement for the benefit of
the Securityholders (without
consideration of the effect of any such
action on any particular
Securityholder).
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(ii) As among the Trustees, the Property Trustee
shall have the power, duty and authority to act
on behalf of the Trust with respect to the
following matters:
(A) the establishment of the Payment
Account;
(B) the receipt of the Debentures;
(C) the collection of interest, principal
and any other payments made in respect
of the Debentures in the Payment
Account;
(D) the distribution of amounts owed to the
Securityholders in respect of the Trust
Securities provided that the Property
Trustee and the Paying Agent are the
same person;
(E) the exercise of all of the rights,
powers and privileges of a holder of the
Debentures;
(F) the sending of notices of default and
other information regarding the Trust
Securities and the Debentures to the
Securityholders in accordance with this
Trust Agreement;
(G) the distribution of the Trust Property
in accordance with the terms of this
Trust Agreement;
(H) to the extent provided in this Trust
Agreement, the winding up of the affairs
of and liquidation of the Trust and the
preparation, execution and filing of the
certificate of cancellation with the
Secretary of State of the State of
Delaware;
(I) after an Event of Default, the taking of
any action incidental to the foregoing
as the Property Trustee may from time to
time determine is necessary or advisable
to give effect to the terms of this
Trust Agreement and to protect and
conserve the Trust Property for the
benefit of the Securityholders (without
consideration of the effect of any such
action on any particular
Securityholder); and
(J) engaging in such ministerial activities
as shall be necessary, appropriate,
convenient or incidental to effect the
repayment of the Preferred Securities
and the Common Securities to the extent
the Debentures mature or are redeemed.
Except as otherwise provided in this Section 2.7(a)(ii), the Property
Trustee shall have none of the duties, liabilities, powers or the authority of
the Administrative Trustees set forth in Section 2.7(a)(i).
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(b) So long as this Trust Agreement remains in effect, the
Trust (or the Trustees acting on behalf of the Trust) shall not undertake any
business, activities or transaction except as expressly provided herein or
contemplated hereby. In particular, the Trustees shall not cause the Trust to
(i) acquire any investments or engage in any activities not authorized by this
Trust Agreement, (ii) sell, assign, transfer, exchange, mortgage, pledge,
set-off or otherwise dispose of any of the Trust Property or interests therein,
including to Securityholders, except as expressly provided herein, (iii) take
any action that would cause the Trust to fail or cease to qualify as a "grantor
trust" for United States Federal income tax purposes, (iv) incur any
indebtedness for borrowed money or issue any other debt or (v) take or consent
to any action that would result in the placement of a Lien on any of the Trust
Property. The Administrative Trustees shall defend all claims and demands of all
Persons at any time claiming any Lien on any of the Trust Property adverse to
the interest of the Trust or the Securityholders in their capacity as
Securityholders.
(c) In connection with the issue and sale of the Preferred
Securities, the Depositor shall have the right and responsibility to assist the
Trust with respect to, or effect on behalf of the Trust, the following (and any
actions taken by the Depositor in furtherance of the following prior to the date
of this Trust Agreement are hereby ratified and confirmed in all respects):
(i) the preparation and filing by the Trust with the
Commission and the execution on behalf of the
Trust of a registration statement on the
appropriate form in relation to the Preferred
Securities, including any amendments thereto;
(ii) the determination of the States in which to take
appropriate action to qualify or register for
sale all or part of the Preferred Securities and
the determination of any and all such acts,
other than actions which must be taken by or on
behalf of the Trust, and the advice to the
Trustees of actions they must take on behalf of
the Trust, and the preparation for execution and
filing of any documents to be executed and filed
by the Trust or on behalf of the Trust, as the
Depositor deems necessary or advisable in order
to comply with the applicable laws of any such
States;
(iii) the preparation for filing by the Trust and
execution on behalf of the Trust of an
application to the New York Stock Exchange or
any other national stock exchange or the Nasdaq
National Market for listing upon notice of
issuance of any Preferred Securities;
(iv) the preparation for filing by the Trust with the
Commission and the execution on behalf of the
Trust of a registration statement on Form 8-A
relating to the registration of the Preferred
Securities under Section 12(b) or 12(g) of the
Exchange Act, including any amendments thereto;
14
(v) the negotiation of the terms of, and the
execution and delivery of, the Underwriting
Agreement providing for the sale of the
Preferred Securities; and
(vi) the taking of any other actions deemed by the
Depositor to be necessary or desirable to carry
out any of the foregoing activities.
(d) Notwithstanding anything herein to the contrary, the
Administrative Trustees are authorized and directed to conduct the affairs of
the Trust and to operate the Trust so that the Trust will not be deemed to be an
"investment company" required to be registered under the Investment Company Act
or classified as anything other than a grantor trust for United States Federal
income tax purposes and so that the Debentures will be treated as indebtedness
of the Debenture Issuer for United States Federal income tax purposes. In this
connection, the Depositor and the Administrative Trustees are authorized to take
any action, not inconsistent with applicable law, the Certificate of Trust or
this Trust Agreement, that each of the Depositor and the Administrative Trustees
determines in their discretion to be necessary or desirable for such purposes,
as long as such action does not adversely affect in any material respect the
interests of the Holders of the Preferred Securities.
SECTION 2.8. ASSETS OF TRUST.
The assets of the Trust shall consist of the Trust Property.
SECTION 2.9. TITLE TO TRUST PROPERTY.
Legal title to all Trust Property shall be vested at all times in the
Property Trustee (in its capacity as such) and shall be held and administered by
the Property Trustee for the benefit of the Trust and the Securityholders in
accordance with this Trust Agreement.
SECTION 2.10. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.
The recitals contained in this Trust Agreement and the Securities shall
be taken as the statements of the Depositor, and the Trustees do not assume any
responsibility for their correctness. Neither the Administrators nor the
Trustees make any representations as to the value or condition of the property
of the Trust or any part thereof. Neither the Administrative Trustees nor the
Trustees make any representations as to the validity or sufficiency of this
Declaration or the Securities.
ARTICLE III.
PAYMENT ACCOUNT
SECTION 3.1. PAYMENT ACCOUNT.
(a) On or prior to the Closing Date, the Property Trustee
shall establish the Payment Account. The Property Trustee and any agent of the
Property Trustee shall have exclusive control and sole right of withdrawal with
respect to the Payment Account for the purpose of making deposits in and
withdrawals from the Payment Account in accordance with
15
this Trust Agreement. All monies and other property deposited or held from time
to time in the Payment Account shall be held by the Property Trustee in the
Payment Account for the exclusive benefit of the Securityholders and for
distribution as herein provided, including (and subject to) any priority of
payments provided for herein.
(b) The Property Trustee shall deposit in the Payment
Account, promptly upon receipt, all payments of principal of or interest on, and
any other payments or proceeds with respect to, the Debentures. Amounts held in
the Payment Account shall not be invested by the Property Trustee pending
distribution thereof.
ARTICLE IV.
CERTAIN TERMS OF THE TRUST SECURITIES
SECTION 4.1. DISTRIBUTIONS.
(a) Distributions on the Trust Securities shall be
cumulative, and will accumulate whether or not there are funds of the Trust
available for the payment of Distributions. Distributions shall accrue from
[ ], 200_, and shall be payable quarterly in arrears on [ ],
[ ], [ ] and [ ] of each year, commencing on
[ ], 200_, except as otherwise described below. The Debenture Issuer
has the right under the Indenture, at any time and from time to time, to defer
payments of interest for such period or periods as may be specified with respect
to the Debentures (each, an "Extension Period"), on the terms and conditions
specified in the Indenture. As a consequence of such deferral, Distributions
will also be deferred. Despite such deferral, quarterly Distributions will
continue to accumulate at the rate set forth in paragraph (b) of this Section
4.1, together with additional distributions thereon (to the extent permitted by
applicable law) at the rate at which Additional Interest is then accruing on the
Debentures, compounded quarterly during any such Extension Period. If any date
on which a Distribution is otherwise payable on the Trust Securities is not a
Business Day, then the payment of such Distribution shall be made on the next
succeeding day that is a Business Day (and without any additional distributions
or other payment in respect of any such delay), except that, if such Business
Day is in the next succeeding calendar year, payment of such Distribution shall
be made on the immediately preceding Business Day, in each case with the same
force and effect as if made on the date such payment was originally payable
(each date on which distributions are payable in accordance with this Section
4.1(a), a "Distribution Date").
(b) The Trust Securities represent undivided beneficial
interests in the Trust Property, and, as a practical matter, the Distributions
on the Trust Securities shall be payable at a rate of [ ]% per annum of the
Liquidation Amount of the Trust Securities. The term "Distributions" as used
herein includes such cash distributions and any accumulated or additional
distributions that are payable hereunder unless otherwise stated. The amount of
Distributions payable for any full or partial period shall be computed on the
basis of a 360-day year of twelve 30-day months. The amount of Distributions
payable for any period shall include Additional Amounts, if any.
(c) Distributions on the Trust Securities shall be made by
the Property Trustee at the written direction of the Debenture Issuer from the
Payment Account and shall be payable
16
on each Distribution Date only to the extent that the Trust has funds then on
hand and available in the Payment Account for the payment of such Distributions.
(d) Distributions on the Trust Securities with respect to a
Distribution Date shall be payable to the Holders thereof as they appear on the
Securities Register at the close of business on the relevant record date, which,
as long as the Preferred Securities remain in book-entry only form, shall be the
date fifteen (15) Business Days immediately preceding such Distribution Date.
The relevant record dates for the Common Securities shall be the same record
dates as for the Preferred Securities. If the Preferred Securities shall not
continue to remain in book-entry only form or are not in book-entry only form at
issuance, the relevant record dates for the Preferred Securities shall be the
date fifteen (15) days prior to the relevant Distribution Date, which
Distribution Dates shall correspond to the interest payment dates on the
Debentures. Distributions payable on any Trust Securities that are not
punctually paid on any Distribution Date, as a result of the Debenture Issuer
having failed to make an interest payment under the Debentures, will cease to be
payable to the Person in whose name such Trust Securities are registered on the
relevant record date, and such defaulted Distribution will instead be payable to
the Person in whose name such Trust Securities are registered on the special
record date or other specified date for determining Debentureholders entitled to
such defaulted interest established in accordance with the Indenture.
(e) In the event that there is any money or other property
held by or for the Trust that is not accounted for hereunder, such property
shall be distributed pro rata among the Holders of the Trust Securities. A
reference herein to any payment, distribution or treatment as being "pro rata"
shall mean pro rata to each Holder of Trust Securities according to the
aggregate Liquidation Amount of the Trust Securities held by the relevant Holder
in relation to the aggregate Liquidation Amount of all Trust Securities
outstanding unless, in relation to a payment, a Debenture Event of Default has
occurred and is continuing, in which case any funds available to make such
payment shall be paid first to each Holder of the Preferred Securities pro rata
according to the aggregate Liquidation Amount of Preferred Securities held by
the relevant Holder relative to the aggregate Liquidation Amount of all
Preferred Securities outstanding, and only after satisfaction of all amounts
owed to the Holders of the Preferred Securities, to each Holder of Common
Securities pro rata according to the aggregate Liquidation Amount of Common
Securities held by the relevant Holder relative to the aggregate Liquidation
Amount of all Common Securities outstanding.
SECTION 4.2. REDEMPTION.
(a) On each Debenture Redemption Date and on the stated
maturity of the Debentures, the Trust will be required to redeem a Like Amount
of Trust Securities at a price per Trust Security equal to the Redemption Price.
(b) Notice of redemption shall be given by the Property
Trustee at the expense of the Debenture Issuer by first-class mail, postage
prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption
Date to each Holder of Trust Securities to be redeemed, at such Holder's address
appearing in the Security Register. All notices of redemption shall state:
(i) the Redemption Date;
17
(ii) the Redemption Price;
(iii) the CUSIP number;
(iv) if less than all the Outstanding Trust
Securities are to be redeemed, the
identification and the total Liquidation Amount
of the particular Trust Securities to be
redeemed; and
(v) that on the Redemption Date the Redemption Price
will become due and payable upon each such Trust
Security to be redeemed and that distributions
thereon will cease to accrue on and after said
date.
(c) The Trust Securities redeemed on each Redemption Date
shall be redeemed at the Redemption Price with the proceeds from the
contemporaneous redemption of Debentures. Redemptions of the Trust Securities
shall be made and the Redemption Price shall be payable on each Redemption Date
only to the extent that the Trust has funds then on hand and available in the
Payment Account for the payment of such Redemption Price.
(d) If the Property Trustee gives a notice of redemption
(which notice shall be irrevocable) in respect of any Preferred Securities,
then, by 12:00 noon, New York City time, on the Redemption Date, subject to
Section 4.2(c), the Property Trustee will, so long as the Preferred Securities
are in book-entry only form, irrevocably deposit with the Clearing Agency for
the Preferred Securities funds sufficient to pay the applicable Redemption Price
and will give such Clearing Agency irrevocable instructions and authority to pay
the Redemption Price to the relevant Persons' accounts at such Clearing Agency
on the applicable Redemption Date. If the Preferred Securities are no longer in
book-entry only form, and in the case of the Common Securities, the Property
Trustee, subject to Section 4.2(c), will irrevocably deposit with the Paying
Agent funds sufficient to pay the applicable Redemption Price and will give the
Paying Agent irrevocable instructions and authority to pay the Redemption Price
to the Holders thereof upon surrender of their Trust Securities Certificates.
Notwithstanding the foregoing, Distributions payable on or prior to the
Redemption Date for any Trust Securities called for redemption shall be payable
to the Holders of such Trust Securities as they appear on the Securities
Register for the Trust Securities on the relevant record dates for the related
Distribution Dates. If notice of redemption shall have been given and funds
deposited as required, then immediately prior to the close of business on the
date of such deposit, all rights of Securityholders holding Trust Securities so
called for redemption will cease, except the right of such Securityholders to
receive the Redemption Price and any Distributions payable on or prior to the
Redemption Date, but without interest, and such Securities will cease to be
outstanding. In the event that any date on which any Redemption Price is payable
is not a Business Day, then payment of the Redemption Price payable on such date
will be made on the next succeeding day that is a Business Day (and without any
interest or other payment in respect of any such delay), except that, if such
Business Day falls in the next calendar year, such payment will be made on the
immediately preceding Business Day, in each case, with the same force and effect
as if made on such date. In the event that payment of the Redemption Price in
respect of any Trust Securities called for redemption is improperly withheld or
refused and not paid either by the Trust or by the Preferred Securities
Guarantor pursuant to the Guarantee, Distributions on such
18
Trust Securities will continue to accrue, at the then applicable rate, from the
Redemption Date originally established by the Trust for such Trust Securities to
the date such Redemption Price is actually paid, in which case the actual
payment date will be the date fixed for redemption for purposes of calculating
the Redemption Price. The notice if mailed in the manner herein provided shall
be conclusively presumed to have been duly given, whether or not the Holder
receives such notice. In any case, failure to give such notice by mail or any
defect in the notice to the Holder of Trust Securities to be redeemed as a whole
or in part shall not affect the validity of the proceedings for the redemption
of any other Trust Security.
(e) Payment of the Redemption Price on the Trust Securities
shall be made to the recordholders thereof as they appear on the Securities
Register for the Trust Securities on the relevant record date, which shall be
fifteen (15) Business Days prior to the relevant Redemption Date; provided,
however, that in the event that the Preferred Securities do not remain in
book-entry only form, the relevant record date shall be the date fifteen (15)
days prior to the relevant Redemption Date.
(f) Subject to Section 4.3(a), if less than all the
Outstanding Trust Securities are to be redeemed on a Redemption Date, then the
aggregate Liquidation Amount of Trust Securities to be redeemed shall be
allocated on a pro rata basis (based on Liquidation Amounts) among the Common
Securities and the Preferred Securities. The particular Preferred Securities to
be redeemed shall be selected on a pro rata basis (based upon Liquidation
Amounts) not more than sixty (60) days prior to the Redemption Date by the
Property Trustee from the Outstanding Preferred Securities not previously called
for redemption, by such method (including, without limitation, by lot) as the
Property Trustee shall deem fair and appropriate and which may provide for the
selection for redemption of portions (equal to $[ ] or an integral multiple of
$[ ] in excess thereof) of the Liquidation Amount of Preferred Securities of a
denomination larger than $[ ]. The Property Trustee shall promptly notify the
Security Registrar in writing of the Preferred Securities selected for
redemption and, in the case of any Preferred Securities selected for partial
redemption, the Liquidation Amount thereof to be redeemed. For all purposes of
this Trust Agreement, unless the context otherwise requires, all provisions
relating to the redemption of Preferred Securities shall relate, in the case of
any Preferred Securities redeemed or to be redeemed only in part, to the portion
of the Liquidation Amount of Preferred Securities that has been or is to be
redeemed.
(g) Any determination made by the Property Trustee pursuant
to this Section 4.2 shall be conclusive and binding upon the Debenture Issuer
and the Holders of the Trust Securities in the absence of manifest error and the
Trustee shall have no liability with respect to such determination.
SECTION 4.3. SUBORDINATION OF COMMON SECURITIES.
(a) Payment of Distributions (including Additional Amounts,
if applicable) on, and the Redemption Price of, the Trust Securities, as
applicable, shall be made, subject to Section 4.2(f), pro rata among the Common
Securities and the Preferred Securities based on the Liquidation Amount of the
Trust Securities; provided, however, that if on any Distribution Date or
Redemption Date any Event of Default resulting from a Debenture Event of Default
shall have occurred and be continuing, no payment of any Distribution (including
Additional Amounts, if
19
applicable) on, or Redemption Price of, any Common Security, and no other
payment on account of the redemption, liquidation or other acquisition of Common
Securities, shall be made unless payment in full in cash of all accumulated and
unpaid Distributions (including Additional Amounts, if applicable) on all
Outstanding Preferred Securities for all Distribution periods terminating on or
prior thereto, or in the case of payment of the Redemption Price the full amount
of such Redemption Price on all Outstanding Preferred Securities, shall have
been made or provided for, and all funds immediately available to the Property
Trustee shall first be applied to the payment in full in cash of all
Distributions (including Additional Amounts, if applicable) on, or the
Redemption Price of, Preferred Securities then due and payable.
(b) In the case of the occurrence of any Event of Default
resulting from any Debenture Event of Default, the Holder of Common Securities
will be deemed to have waived any right to act with respect to any such Event of
Default under this Trust Agreement until the effect of all such Events of
Default with respect to the Preferred Securities have been cured, waived or
otherwise eliminated. Until any such Event of Default under this Trust Agreement
with respect to the Preferred Securities has been so cured, waived or otherwise
eliminated, the Property Trustee shall act solely on behalf of the Holders of
the Preferred Securities and not the Holder of the Common Securities, and only
the Holders of the Preferred Securities will have the right to direct the
Property Trustee to act on their behalf.
SECTION 4.4. PAYMENT PROCEDURES.
Payments of Distributions (including Additional Amounts, if applicable)
in respect of the Preferred Securities shall be made by check mailed to the
address of the Person entitled thereto as such address shall appear on the
Securities Register or, if the Preferred Securities are held by a Clearing
Agency, such Distributions shall be made to the Clearing Agency in immediately
available funds, which shall credit the relevant Persons' accounts at such
Clearing Agency on the applicable distribution dates. Payments in respect of the
Common Securities shall be made in such manner as shall be mutually agreed
between the Property Trustee and the Common Securityholder.
SECTION 4.5. TAX RETURNS AND REPORTS.
The Administrative Trustees shall prepare (or cause to be prepared), at
the Depositor's expense, and file all United States Federal, state and local tax
and information returns and reports required to be filed by or in respect of the
Trust. In this regard, the Administrative Trustees shall
(a) prepare and file (or cause to be prepared and filed) the
appropriate Internal Revenue Service form required to be filed in respect of the
Trust in each taxable year of the Trust and
(b) prepare and furnish (or cause to be prepared and
furnished) to each Securityholder the appropriate Internal Revenue Service form
required to be provided on such form. The Administrative Trustees shall provide
the Depositor and the Property Trustee with a copy of all such returns and
reports promptly after such filing or furnishing. The Trustees shall comply with
United States Federal withholding and backup withholding tax laws and
20
information reporting requirements with respect to any payments to
Securityholders under the Trust Securities.
SECTION 4.6. PAYMENT OF TAXES, DUTIES, ETC. OF THE TRUST.
Upon receipt under the Debentures of Additional Sums, the Property
Trustee shall promptly pay any taxes, duties or governmental charges of
whatsoever nature (other than withholding taxes) imposed on the Trust by the
United States or any other taxing authority.
SECTION 4.7. PAYMENTS UNDER INDENTURE.
Any amount payable hereunder to any Holder of Preferred Securities shall
be reduced by the amount of any corresponding payment such Holder (and any Owner
with respect thereto) has directly received pursuant to Section 5.8 of the
Indenture.
SECTION 4.8. CUSIP NUMBERS.
The Company in issuing the Securities may use "CUSIP," "CINS" and "ISIN"
numbers (if then generally in use), and the Trustee shall use CUSIP, CINS or
ISIN numbers, as the case may be, in notices of redemption or exchange as a
convenience to Holders and no representation shall be made as to the correctness
of such numbers either as printed on the Securities or as contained in any
notice of redemption or exchange. The Company shall promptly notify the Trustees
of any change in the CUSIP numbers.
ARTICLE V.
TRUST SECURITIES CERTIFICATES
SECTION 5.1. INITIAL OWNERSHIP.
Upon the formation of the Trust and the contribution by the Depositor
pursuant to Section 2.3 and until the issuance of the Trust Securities, and at
any time during which no Trust Securities are outstanding, the Depositor shall
be the sole beneficial owner of the Trust.
SECTION 5.2. THE TRUST SECURITIES CERTIFICATES.
The Preferred Securities Certificates shall be issued in minimum
denominations of $[ ] Liquidation Amount and integral multiples of $[ ] in
excess thereof, and the Common Securities Certificates shall be issued in
denominations of $[ ] Liquidation Amount and integral multiples of $[ ] in
excess thereof. The Trust Securities Certificates shall be executed on behalf of
the Trust by manual signature of at least one Administrative Trustee. Trust
Securities Certificates bearing the manual signatures of individuals who were,
at the time when such signatures shall have been affixed, authorized to sign on
behalf of the Trust, shall be validly issued and entitled to the benefits of
this Trust Agreement, notwithstanding that such individuals or any of them shall
have ceased to be so authorized prior to the delivery of such Trust Securities
Certificates or did not hold such offices at the date of delivery of such Trust
Securities Certificates. A transferee of a Trust Securities Certificate shall
become a Securityholder, and shall be entitled to the rights and subject to the
obligations of a Securityholder hereunder, upon
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due registration of such Trust Securities Certificate in such transferee's name
pursuant to Section 5.4, Section 5.11 and Section 5.13.
SECTION 5.3. EXECUTION AND DELIVERY OF TRUST SECURITIES CERTIFICATES.
At each Time of Delivery, the Administrative Trustees shall cause Trust
Securities Certificates, in an aggregate Liquidation Amount as provided in
Section 2.4 and Section 2.5, to be executed on behalf of the Trust and delivered
to or upon the written order of the Depositor, signed by its Chairman of the
Board, a Vice Chairman, its President, a Vice President or its Treasurer and
attested by its Secretary or one of its Assistant Secretaries, without further
corporate action by the Depositor, in authorized denominations.
SECTION 5.4. REGISTRATION OF TRANSFER AND EXCHANGE OF PREFERRED
SECURITIES CERTIFICATES.
The Depositor shall keep or cause to be kept, at the office or agency
maintained pursuant to Section 5.8, a register or registers for the purpose of
registering Trust Securities Certificates and transfers and exchanges of
Preferred Securities Certificates (the "Securities Register"). The registrar
designated by the Depositor (the "Securities Registrar"), subject to such
reasonable regulations as it may prescribe, shall provide for the registration
of Preferred Securities Certificates and Common Securities Certificates (subject
to Section 5.10 in the case of the Common Securities Certificates) and
registration of transfers and exchanges of Preferred Securities Certificates as
herein provided. The Bank shall be the initial Securities Registrar. Upon
surrender for registration of transfer of any Preferred Securities Certificate
at the office or agency maintained pursuant to Section 5.8, the Administrative
Trustees or any one of them shall execute and deliver, in the name of the
designated transferee or transferees, one or more new Preferred Securities
Certificates in authorized denominations of a like aggregate Liquidation Amount
dated the date of execution by such Administrative Trustee or Trustees. The
Securities Registrar shall not be required to register the transfer of any
Preferred Securities after such Preferred Securities have been called for
redemption. At the option of a Holder, Preferred Securities Certificates may be
exchanged for other Preferred Securities Certificates in authorized
denominations of the same class and of a like aggregate Liquidation Amount upon
surrender of the Preferred Securities Certificates to be exchanged at the office
or agency maintained pursuant to Section 5.8. Every Preferred Securities
Certificate presented or surrendered for registration of transfer or exchange
shall be duly endorsed or accompanied by a written instrument of transfer in
form satisfactory to an Administrative Trustee and the Securities Registrar duly
executed by the Holder or his attorney duly authorized in writing. Each
Preferred Securities Certificate surrendered for registration of transfer or
exchange shall be cancelled and subsequently disposed of by the Securities
Registrar in accordance with customary practice. Registration of transfers or
exchanges of Preferred Securities Certificates shall be effected without service
charge by or on behalf of the Trust, but the Securities Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any such transfer or exchange.
SECTION 5.5. MUTILATED, DESTROYED, LOST OR STOLEN TRUST SECURITIES
CERTIFICATES.
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If (a) any mutilated Trust Securities Certificate shall be surrendered
to the Securities Registrar, or if the Securities Registrar shall receive
evidence to its satisfaction of the destruction, loss or theft of any Trust
Securities Certificate and (b) there shall be delivered to the Securities
Registrar and the Administrative Trustees such security or indemnity as may be
required by them to save each of them harmless, then in the absence of notice
that such Trust Securities Certificate shall have been acquired by a bona fide
purchaser, the Administrative Trustees, or any one of them, on behalf of the
Trust shall execute and make available for delivery, in exchange for or in lieu
of any such mutilated, destroyed, lost or stolen Trust Securities Certificate, a
new Trust Securities Certificate of like class, tenor and denomination. In
connection with the issuance of any new Trust Securities Certificate under this
Section, the Administrative Trustees or the Securities Registrar may require the
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection therewith and any expenses they incur in replacing
the Trust Securities. Any duplicate Trust Securities Certificate issued pursuant
to this Section shall constitute conclusive evidence of an undivided beneficial
interest in the assets of the Trust, as if originally issued, whether or not the
lost, stolen or destroyed Trust Securities Certificate shall be found at any
time.
SECTION 5.6. PERSONS DEEMED SECURITYHOLDERS.
Prior to due presentation of a Trust Securities Certificate for
registration of transfer, the Administrative Trustees or the Securities
Registrar shall treat the Person in whose name any Trust Securities Certificate
shall be registered in the Securities Register as the owner of such Trust
Securities Certificate for the purpose of receiving distributions and for all
other purposes whatsoever, and, accordingly, shall not be bound to recognize any
equitable or other claim to or interest in such Trust Securities Certificate and
neither the Trustees nor the Securities Registrar shall be bound by any notice
to the contrary.
SECTION 5.7. ACCESS TO LIST OF SECURITYHOLDERS' NAMES AND ADDRESSES.
The Administrative Trustees shall furnish or cause to be furnished (x)
to the Depositor, within fifteen (15) days after receipt by any Administrative
Trustee of a request therefor from the Depositor in writing and (y) to the
Property Trustee, promptly after receipt by any Administrative Trustee of a
request therefor from the Property Trustee in writing in order to enable the
Property Trustee to discharge its obligations under this Trust Agreement, a
list, in such form as the Depositor or the Property Trustee may reasonably
require, of the names and addresses of the Securityholders as of a recent date.
If Holders of Trust Securities Certificates evidencing ownership at such time
and for the previous six months of not less than 25% of the Outstanding
aggregate Liquidation Amount apply in writing to any Administrative Trustee, and
such application states that the applicants desire to communicate with other
Securityholders with respect to their rights under this Trust Agreement or under
the Trust Securities Certificates and such application is accompanied by a copy
of the communication that such applicants propose to transmit, then the
Administrative Trustees shall, within five (5) Business Days after the receipt
of such application, afford such applicants access during normal business hours
to the current list of Securityholders. Each Holder, by receiving and holding a
Trust Securities Certificate, and each Owner shall be deemed to have agreed not
to hold the Depositor, the Property Trustee or the
23
Administrative Trustees accountable by reason of the disclosure of its name and
address, regardless of the source from which such information was derived.
SECTION 5.8. MAINTENANCE OF OFFICE OR AGENCY.
The Trust shall maintain in [ ], an office or offices or agency
or agencies where Preferred Securities Certificates may be surrendered for
registration of transfer or exchange and where notices and demands to or upon
the Trustees in respect of the Trust Securities and the Trust Agreement may be
served. The Administrative Trustees initially designate the Corporate Trust
Office of [ ] as the principal corporate trust office for such purposes.
The Administrative Trustees shall give prompt written notice to the Depositor
and to the Securityholders of any change in the location of the Securities
Register or any such office or agency.
SECTION 5.9. APPOINTMENT OF PAYING AGENT.
The Paying Agent shall make distributions to Securityholders from the
Payment Account and shall report the amounts of such distributions in writing to
the Property Trustee and the Administrative Trustees. Any Paying Agent shall
have the revocable power to withdraw funds from the Payment Account for the
purpose of making the distributions referred to above. The Administrative
Trustees may revoke such power and remove the Paying Agent if such Trustees
determine in their sole discretion that the Paying Agent shall have failed to
perform its obligations under this Trust Agreement in any material respect. The
Paying Agent shall initially be the Bank, and any co-paying agent chosen by the
Bank, and acceptable to the Administrative Trustees and the Depositor. Any
Person acting as Paying Agent shall be permitted to resign as Paying Agent upon
thirty (30) days' written notice to the Administrative Trustees, the Property
Trustee and the Depositor. In the event that the Bank shall no longer be the
Paying Agent or a successor Paying Agent shall resign or its authority to act be
revoked, the Administrative Trustees shall appoint a successor (which shall be a
bank or trust company that is acceptable to the Property Trustee and the
Depositor) to act as Paying Agent. The Administrative Trustees shall cause such
successor Paying Agent or any additional Paying Agent appointed by the
Administrative Trustees to execute and deliver to the Trustees an instrument in
which such successor Paying Agent or additional Paying Agent shall agree with
the Trustees that as Paying Agent, such successor Paying Agent or additional
Paying Agent will hold all sums, if any, held by it for payment to the
Securityholders in trust for the benefit of the Securityholders entitled thereto
until such sums shall be paid to such Securityholders. At the written request of
the Administrative Trustees, the Paying Agent shall return all unclaimed funds
to the Property Trustee and upon removal of a Paying Agent such Paying Agent
shall also return all funds in its possession to the Property Trustee, at which
time the Paying Agent (if other than the Trust or an Affiliate of the Trust)
shall have no further liability for the money. The provisions of Section 8.1,
Section 8.3 and Section 8.6 herein shall apply to the Paying Agent appointed
hereunder and, to the extent applicable, to any other paying agent appointed
hereunder. Any reference in this Agreement to the Paying Agent shall include any
co-paying agent unless the context requires otherwise.
SECTION 5.10. OWNERSHIP OF COMMON SECURITIES BY DEPOSITOR.
24
At each Time of Delivery, the Depositor shall acquire and retain
beneficial and record ownership of all of the Common Securities then issued by
the Trust, in an amount equal to at least [ ]% of the total capital of the
Trust, at the same time as the Preferred Securities are issued and sold. The
aggregate Liquidation Amount of the Common Securities at any time shall not be
less than [ ]% of the total capital of the Trust. To the fullest extent
permitted by law, other than a transfer in connection with a consolidation or
merger of the Depositor into another corporation, or any conveyance, transfer or
lease by the Depositor of its properties and assets substantially as an entirety
to any Person, pursuant to Section 8.1 of the Indenture, any attempted transfer
of the Common Securities shall be void. The Administrative Trustees shall cause
each Common Securities Certificate issued to the Depositor to contain a legend
stating "THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT AS PROVIDED IN THE TRUST
AGREEMENT (AS DEFINED BELOW)". Each Common Securities Certificate issued to the
Depositor shall be issued pursuant to Section 5.11(b) of this Trust Agreement.
SECTION 5.11. BOOK-ENTRY PREFERRED SECURITIES CERTIFICATES; COMMON
SECURITIES CERTIFICATE.
(a) The Preferred Securities Certificates, upon original
issuance, will be issued in the form of a typewritten Preferred Securities
Certificate or Certificates representing Book-Entry Preferred Securities
Certificates, to be delivered to [ ], the initial Clearing Agency, by,
or on behalf of, the Trust. Such Preferred Securities Certificate or
Certificates shall initially be registered on the Securities Register in the
name of [ ], the nominee of the initial Clearing Agency, and no beneficial
owner will receive a Definitive Preferred Securities Certificate representing
such beneficial owner's interest in such Preferred Securities, except as
provided in Section 5.13. Except for Definitive Preferred Securities
Certificates as specified herein, unless and until Definitive Preferred
Securities Certificates have been issued to beneficial owners pursuant to
Section 5.13:
(i) the provisions of this Section 5.11(a) shall be
in full force and effect;
(ii) the Securities Registrar and the Trustees shall
be entitled to deal with the Clearing Agency for
all purposes of this Trust Agreement relating to
the Book-Entry Preferred Securities Certificates
(including the payment of the Liquidation Amount
of and Distributions on the Book-Entry Preferred
Securities and the giving of instructions or
directions to Owners of Book-Entry Preferred
Securities) as the sole Holder of Book-Entry
Preferred Securities and shall have no
obligations to the Owners thereof;
(iii) to the extent that the provisions of this
Section 5.11 conflict with any other provisions
of this Trust Agreement, the provisions of this
Section 5.11 shall control; and
(iv) the rights of the Owners of the Book-Entry
Preferred Securities Certificates shall be
exercised only through the Clearing Agency and
shall be limited to those established by law and
agreements
25
between such Owners and the Clearing Agency
and/or the Clearing Agency Participants;
provided, that solely for the purposes of
determining whether the Holders of the requisite
amount of Preferred Securities have voted on any
matter provided for in this Trust Agreement, so
long as Definitive Preferred Security
Certificates have not been issued, the Trustees
may conclusively rely on, and shall be protected
in relying on, any written instrument (including
a proxy) delivered to the Trustees by the
Clearing Agency setting forth the Owners' votes
or assigning the right to vote on any matter to
any other Persons either in whole or in part.
Pursuant to the Certificate Depository
Agreement, unless and until Definitive Preferred
Securities Certificates are issued pursuant to
Section 5.13, the initial Clearing Agency will
make book-entry transfers among the Clearing
Agency Participants and receive and transmit
payments on the Preferred Securities to such
Clearing Agency Participants.
(b) A single Common Securities Certificate representing the
Common Securities shall be issued to the Depositor in the form of a definitive
Common Securities Certificate.
SECTION 5.12. NOTICES TO CLEARING AGENCY.
(a) To the extent that a notice or other communication to
the Owners is required under this Trust Agreement, unless and until Definitive
Preferred Securities Certificates shall have been issued to Owners pursuant to
Section 5.13, the Trustees shall give all such notices and communications
specified herein to be given to Owners to the Clearing Agency, and shall have no
obligations to the Owners.
SECTION 5.13. DEFINITIVE PREFERRED SECURITIES CERTIFICATES.
If (a) the Depositor advises the Trustees in writing that the Clearing
Agency is no longer willing or able to act as clearing agency with respect to
the Preferred Securities Certificates, and the Depositor fails to appoint a
qualified successor within ninety (90) days, (b) the Depositor at its option
advises the Trustees in writing that it elects to terminate the book-entry
system through the Clearing Agency or (c) after the occurrence of a Debenture
Event of Default, Owners of Preferred Securities Certificates representing
beneficial interests aggregating at least a majority of the Liquidation Amount
of the Outstanding Preferred Securities advise the Property Trustee in writing
that the continuation of a book-entry system through the Clearing Agency is no
longer in the best interest of the Owners of Preferred Securities Certificates,
then the Property Trustee shall notify the Clearing Agency and the Clearing
Agency shall notify all Owners of Preferred Securities Certificates and the
other Trustees of the occurrence of any such event and of the availability of
the Definitive Preferred Securities Certificates to Owners of such class or
classes, as applicable, requesting the same. Upon surrender to the Property
Trustee of the typewritten Preferred Securities Certificate or Certificates
representing the Book-Entry Preferred Securities Certificates by the Clearing
Agency, accompanied by registration instructions, the Administrative Trustees,
or any one of them, shall execute the Definitive Preferred Securities
26
Certificates in accordance with the instructions of the Clearing Agency. Neither
the Securities Registrar nor the Trustees shall be liable for any delay in
delivery of such instructions and may conclusively rely on, and shall be fully
protected in relying on, such instructions. Upon the issuance of Definitive
Preferred Securities Certificates, the Trustees shall recognize the Holders of
the Definitive Preferred Securities Certificates as Securityholders. The
Definitive Preferred Securities Certificates shall be printed, lithographed or
engraved or may be produced in any other manner as is reasonably acceptable to
the Administrative Trustees, as evidenced by the execution thereof by the
Administrative Trustees or any one of them.
SECTION 5.14. RIGHTS OF SECURITYHOLDERS.
(a) The legal title to the Trust Property is vested
exclusively in the Property Trustee (in its capacity as such) in accordance with
Section 2.9, and the Securityholders shall not have any right or title therein
other than the undivided beneficial interest in the assets of the Trust
conferred by their Trust Securities and they shall have no right to call for any
partition or division of property, profits or rights of the Trust except as
described below. The Trust Securities shall be personal property giving only the
rights specifically set forth therein and in this Trust Agreement. The Trust
Securities shall have no preemptive or similar rights and when issued and
delivered to Securityholders against payment of the purchase price therefor will
be fully paid and nonassessable by the Trust. The Holders of the Trust
Securities, in their capacities as such, shall be entitled to the same
limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the State
of Delaware.
(b) For so long as any Preferred Securities remain
Outstanding, if, upon a Debenture Event of Default, the Debenture Trustee fails
or the holders of not less than 25% in principal amount of the outstanding
Debentures fail to declare the principal of all of the Debentures to be
immediately due and payable, the Holders of at least 25% in Liquidation Amount
of the Preferred Securities then Outstanding shall have such right by a notice
in writing to the Debenture Issuer, the Debenture Trustee and the Property
Trustee; and upon any such declaration such principal amount of and the accrued
interest on all of the Debentures shall become immediately due and payable,
provided that the payment of principal, interest, and any other amounts payable
with respect to such Debentures shall remain subordinated to the extent provided
in the Indenture.
At any time after such a declaration of acceleration with respect to the
Debentures has been made and before a judgment or decree for payment of the
money due has been obtained by the Debenture Trustee as in the Indenture
provided, the Holders of a majority in Liquidation Amount of the Preferred
Securities then Outstanding, by written notice to the Debenture Issuer, the
Debenture Trustee and the Property Trustee, may rescind and annul such
declaration and its consequences if:
(i) the Debenture Issuer has paid or deposited with
the Debenture Trustee a sum sufficient to pay
27
(A) all overdue installments of interest
(including any Additional Interest) on,
and any other Additional Amounts with
respect to, all of the Debentures,
(B) the principal of and premium on any
Debentures which have become due
otherwise than by such declaration of
acceleration and interest thereon and
any Additional Amounts with respect
thereto at the rate or rates borne by or
provided for in the Debentures,
(C) to the extent the payment of such
interest or Additional Amounts is
lawful, interest upon overdue
installments of any interest and
Additional Amounts at the rate or rates
borne by or provided for in the
Debentures, and
(D) all sums paid or advanced by the
Debenture Trustee under the Indenture
and the reasonable compensation,
expenses, disbursements and advances of
the Debenture Trustee, its agents and
counsel and all other amounts due the
Debenture Trustee under the Indenture;
and
(ii) all Events of Default with respect to the
Debentures, other than the non-payment of the
principal of, any premium and interest on, and
any Additional Amounts with respect to the
Debentures which have become due solely by such
acceleration, have been cured or waived as
provided in Section 5.13 of the Indenture.
No such rescission shall affect any subsequent default or impair any
right consequent thereon.
The Holders of not less than a majority in Liquidation Amount of the
Preferred Securities then Outstanding may, on behalf of the Holders of all the
Preferred Securities, waive any past default under the Indenture, except a
default (i) in the payment of principal of, any premium or interest (including
any Additional Interest) on, or any other Additional Amounts with respect to,
the Debentures or (ii) in respect of a covenant or provision which under the
Indenture cannot be modified or amended without the consent of the holder of
each outstanding Debenture.
Upon receipt by the Property Trustee of written notice declaring such an
acceleration, or rescission and annulment thereof, by Holders of the Preferred
Securities all or part of which are represented by Book-Entry Preferred
Securities Certificates, a record date shall be established for determining
Holders of Outstanding Preferred Securities entitled to join in such notice,
which record date shall be at the close of business on the day the Property
Trustee receives such notice. The Holders on such record date, or their duly
designated proxies, and only such Persons, shall be entitled to join in such
notice, whether or not such Holders remain Holders after such record date;
provided, that, unless such declaration of acceleration, or rescission and
annulment, as the case may be, shall have become effective by virtue of the
requisite percentage having joined in such notice prior to the day which is
ninety (90) days after such record date, such notice of
28
declaration of acceleration, or rescission and annulment, as the case may be,
shall automatically and without further action by any Holder be cancelled and of
no further effect. Nothing in this paragraph shall prevent a Holder, or a proxy
of a Holder, from giving, after expiration of such 90-day period, a new written
notice of declaration of acceleration, or rescission and annulment thereof, as
the case may be, that is identical to a written notice which has been cancelled
pursuant to the proviso to the preceding sentence, in which event a new record
date shall be established pursuant to the provisions of this Section 5.14(b).
(c) For so long as any Preferred Securities remain
Outstanding, to the fullest extent permitted by law and subject to the terms of
this Trust Agreement and the Indenture, any Holder of Preferred Securities shall
have the right, upon a Debenture Event of Default specified in Section 5.1(1) or
Section 5.1(2) of the Indenture, to institute directly a proceeding against the
Debenture Issuer, pursuant to Section 5.8 of the Indenture, for enforcement of
payment to such Holder of the principal of, and any premium and (subject to the
provisions of the Indenture) interest (including any Additional Interest) on,
and any other Additional Amounts with respect to, such Debentures having a
principal amount equal to the Liquidation Amount of the Preferred Securities of
such Holder (a "Direct Action"). In connection with any such Direct Action, the
rights of the Holders of Common Securities will be subrogated to the rights of
any Holder of Preferred Securities to the extent of any payment made by the
Debenture Issuer to such Holder of Preferred Securities as a result of such
Direct Action. Except as set forth in Section 5.14(b) and Section 5.14(c), or as
otherwise contemplated by the Indenture, the Holders of Preferred Securities
shall have no right to exercise directly any right or remedy available to the
holders of, or in respect of, the Debentures.
SECTION 5.15. RIGHTS AND IMMUNITIES OF THE REGISTRAR.
The Registrar shall be entitled to all of the rights, protections,
immunities and indemnities afforded to the Property Trustee hereunder.
SECTION 5.16. RIGHTS AND IMMUNITIES OF THE PAYING AGENT.
The Paying Agent shall be entitled to all of the rights, protections,
immunities and indemnities afforded to the Property Trustee hereunder.
SECTION 5.17. NO OBLIGATION FOR CLEARING AGENCY.
The Property Trustee shall have no responsibility or obligation to any
beneficial owners of a Preferred Securities Certificate or Owner, a Clearing
Agency Participant or other Person with respect to the accuracy of the records
of the Clearing Agency or its nominee or of any Clearing Agency Participant
thereof, with respect to any ownership interest in the Preferred Securities
Certificates or with respect to the delivery to any Clearing Agency Participant,
Owner or other Person (other than the Clearing Agency) of any notice (including
any notice of redemption) or the payment of any amount, under or with respect to
such Preferred Securities Certificates. The Property Trustee may conclusively
rely and shall be fully protected in relying upon information furnished by the
Clearing Agency or any agent thereof with respect to its Participants and
beneficial owners.
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ARTICLE VI.
ACTS OF SECURITYHOLDERS; MEETINGS; VOTING
SECTION 6.1. LIMITATIONS ON VOTING RIGHTS.
(a) Except as provided in this Section, in Section 5.14,
Section 8.10 and Section 10.2 and in the Indenture and as otherwise required by
law, no Holder of Preferred Securities shall have any right to vote or in any
manner otherwise control the administration, operation and management of the
Trust or the obligations of the parties hereto, nor shall anything herein set
forth, or contained in the terms of the Trust Securities Certificates, be
construed so as to constitute the Securityholders from time to time as partners
or members of an association.
(b) So long as any Debentures are held by the Property
Trustee, the Trustees shall not
(i) direct the time, method and place of conducting
any proceeding for any remedy available to the
Debenture Trustee, or executing any trust or
power conferred on the Debenture Trustee with
respect to such Debentures,
(ii) waive any past default which is waivable under
Section 5.13 of the Indenture,
(iii) exercise any right to rescind or annul a
declaration that the principal of all the
Debentures shall be due and payable, or
(iv) consent to any amendment, modification or
termination of the Indenture or the Debentures,
where such consent shall be required,
without, in each case, obtaining the prior approval of the Holders of at least
a majority in Liquidation Amount of all Outstanding Preferred Securities;
provided, however, that where a consent under the Indenture would require the
consent of each holder of Debentures affected thereby, no such consent shall be
given by the Property Trustee without the prior written consent of each Holder
of Preferred Securities. The Trustees shall not revoke any action previously
authorized or approved by a vote of the Holders of Preferred Securities, except
by a subsequent vote of the Holders of Preferred Securities. The Property
Trustee shall notify all Holders of the Preferred Securities of any notice of
default received from the Debenture Trustee with respect to the Debentures. In
addition to obtaining the foregoing approvals of the Holders of the Preferred
Securities, prior to taking any of the foregoing actions, the Trustees shall, at
the expense of the Depositor, be provided with an Opinion of Counsel rendered by
counsel experienced in such matters to the effect that the Trust will not be
classified as an association taxable as a corporation for United States Federal
income tax purposes on account of such action.
(c) If any proposed amendment to the Trust Agreement
provides for, or the Trustees otherwise propose to effect,
(i) any action that would adversely affect in any
material respect the powers, preferences or
special rights of the Preferred Securities,
30
whether by way of amendment to the Trust
Agreement or otherwise, or
(ii) the dissolution, winding-up or termination of
the Trust, other than pursuant to the terms of
this Trust Agreement,
then the Holders of Outstanding Preferred Securities as a class will be entitled
to vote on such amendment or proposal and such amendment or proposal shall not
be effective except with the approval of the Holders of at least a majority in
Liquidation Amount of the Outstanding Preferred Securities. No amendment to this
Trust Agreement may be made if, as a result of such amendment, the Trust would
be classified as an association taxable as a corporation for United States
Federal income tax purposes.
SECTION 6.2. NOTICE OF MEETINGS.
Notice of all meetings of the Preferred Securityholders, stating the
time, place and purpose of the meeting, shall be given by the Property Trustee
pursuant to Section 10.8 to each Preferred Securityholder of record, at his
registered address, at least fifteen (15) days and not more than ninety (90)
days before the meeting. At any such meeting, any business properly before the
meeting may be so considered whether or not stated in the notice of the meeting.
Any adjourned meeting may be held as adjourned without further notice.
SECTION 6.3. MEETINGS OF PREFERRED SECURITYHOLDERS.
No annual meeting of Securityholders is required to be held. The
Administrative Trustees, however, shall call a meeting of Securityholders to
vote on any matter upon the written request of the Preferred Securityholders of
record of 25% of the Preferred Securities (based upon their Liquidation Amount)
and the Administrative Trustees or the Property Trustee may, at any time in
their discretion, call a meeting of Preferred Securityholders to vote on any
matters as to which Preferred Securityholders are entitled to vote. Preferred
Securityholders of record of 50% of the Outstanding Preferred Securities (based
upon their Liquidation Amount), present in person or by proxy, shall constitute
a quorum at any meeting of Securityholders. If a quorum is present at a meeting,
an affirmative vote by the Preferred Securityholders of record present, in
person or by proxy, holding a majority of the Preferred Securities (based upon
their Liquidation Amount) held by the Preferred Securityholders of record
present, either in person or by proxy, at such meeting shall constitute the
action of the Securityholders, unless this Trust Agreement requires a greater
number of affirmative votes.
SECTION 6.4. VOTING RIGHTS.
Securityholders shall be entitled to one vote for each $[ ] of
Liquidation Amount represented by their Trust Securities in respect of any
matter as to which such Securityholders are entitled to vote.
SECTION 6.5. PROXIES, ETC.
At any meeting of Securityholders, any Securityholder entitled to vote
thereat may vote by proxy, provided that no proxy shall be voted at any meeting
unless it shall have been placed
31
on file with the Administrative Trustees, or with such other officer or agent of
the Trust as the Administrative Trustees may direct, for verification prior to
the time at which such vote shall be taken. Pursuant to a resolution of the
Administrative Trustees, proxies may be solicited in the name of the
Administrative Trustees or one or more officers of the Administrative Trustees.
Only Securityholders of record shall be entitled to vote. When Trust Securities
are held jointly by several Persons, any one of them may vote at any meeting in
person or by proxy in respect of such Trust Securities, but if more than one of
them shall be present at such meeting in person or by proxy, and such joint
owners or their proxies so present disagree as to any vote to be cast, such vote
shall not be received in respect of such Trust Securities. A proxy purporting to
be executed by or on behalf of a Securityholder shall be deemed valid unless
challenged at or prior to its exercise, and the burden of proving invalidity
shall rest on the challenger. No proxy shall be valid more than three (3) years
after its date of execution.
SECTION 6.6. SECURITYHOLDER ACTION BY WRITTEN CONSENT.
Any required approval or action which may be given or taken by
Securityholders at a meeting convened for such purpose may be given or taken
without a meeting and without prior notice if Securityholders holding a majority
of all Outstanding Trust Securities (based upon their Liquidation Amount)
entitled to vote in respect of such action (or such larger proportion thereof as
shall be required by any express provision of this Trust Agreement) shall
consent to the action in writing.
SECTION 6.7. RECORD DATE FOR VOTING AND OTHER PURPOSES.
For the purposes of determining the Securityholders who are entitled to
notice of and to vote at any meeting or to act by written consent, or to
participate in any distribution on the Trust Securities in respect of which a
record date is not otherwise provided for in this Trust Agreement, or for the
purpose of any other action, the Administrative Trustees may from time to time
fix a date, not more than ninety (90) days prior to the date of any meeting of
Securityholders or the payment of a distribution or other action, as the case
may be, as a record date for the determination of the identity of the
Securityholders of record for such purposes.
SECTION 6.8. ACTS OF SECURITYHOLDERS.
Any request, demand, authorization, direction, notice, consent, waiver
or other action provided or permitted by this Trust Agreement to be given, made
or taken by Securityholders or Owners may be embodied in and evidenced by one or
more instruments of substantially similar tenor signed by such Securityholders
or Owners in person or by an agent duly appointed in writing; and, except as
otherwise expressly provided herein, such action shall become effective when
such instrument or instruments are delivered to an Administrative Trustee. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Securityholders or
Owners signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Trust Agreement and (subject to Section 8.1) conclusive in favor
of the Trustees, if made in the manner provided in this Section. The fact and
date of the execution by any Person of any such instrument or writing may be
proved by the affidavit of a witness of such execution or by a certificate of a
notary public or other officer
32
authorized by law to take acknowledgments of deeds, certifying that the
individual signing such instrument or writing acknowledged to him the execution
thereof. Where such execution is by a signer acting in a capacity other than his
individual capacity, such certificate or affidavit shall also constitute
sufficient proof of his authority. The fact and date of the execution of any
such instrument or writing, or the authority of the Person executing the same,
may also be proved in any other manner which any Trustee receiving the same
deems sufficient. The ownership of Preferred Securities shall be proved by the
Securities Register. Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Securityholder of any Trust Security shall
bind every future Securityholder of the same Trust Security and the
Securityholder of every Trust Security issued upon the registration of transfer
thereof or in exchange therefor or in lieu thereof in respect of anything done,
omitted or suffered to be done by the Trustees or the Trust in reliance thereon,
whether or not notation of such action is made upon such Trust Security. Without
limiting the foregoing, a Securityholder entitled hereunder to take any action
hereunder with regard to any particular Trust Security may do so with regard to
all or any part of the Liquidation Amount of such Trust Security or by one or
more duly appointed agents each of which may do so pursuant to such appointment
with regard to all or any part of such Liquidation Amount. If any dispute shall
arise between the Securityholders and the Administrative Trustees or among such
Securityholders or Trustees with respect to the authenticity, validity or
binding nature of any request, demand, authorization, direction, consent, waiver
or other Act of such Securityholder or Trustee under this Article VI, then the
determination of such matter by the Property Trustee shall be conclusive with
respect to such matter.
SECTION 6.9. INSPECTION OF RECORDS.
Upon reasonable notice to the Administrative Trustees and the Property
Trustee, the records of the Trust shall be open to inspection by Securityholders
during normal business hours for any purpose reasonably related to such
Securityholder's interest as a Securityholder.
ARTICLE VII.
REPRESENTATIONS AND WARRANTIES
SECTION 7.1. REPRESENTATIONS AND WARRANTIES OF THE PROPERTY TRUSTEE
AND THE DELAWARE TRUSTEE.
The Property Trustee and the Delaware Trustee, each severally on behalf
of and solely as each such representation or warranty applies to itself, hereby
represents and warrants for the benefit of the Depositor and the Securityholders
that:
(a) the Property Trustee is a New York banking corporation
duly organized, validly existing and in good standing under the laws of New
York, and the Delaware Trustee is a banking corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware;
(b) each of the Property Trustee and the Delaware Trustee
has full corporate power, authority and legal right to execute, deliver and
perform its obligations under this Trust Agreement and has taken all necessary
action to authorize the execution, delivery and
33
performance by it of this Trust Agreement, and, in the case of the Delaware
Trustee, satisfies for the Trust Section 3807(a) of the Delaware Statutory Trust
Act;
(c) this Trust Agreement has been duly authorized, executed
and delivered by each of the Property Trustee and the Delaware Trustee and
constitutes the respective valid and legally binding agreement of each of the
Property Trustee and the Delaware Trustee enforceable against it in accordance
with its terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to
or affecting creditors' rights and to general equity principles;
(d) the execution, delivery and performance by each of the
Property Trustee and the Delaware Trustee of this Trust Agreement has been duly
authorized by all necessary corporate or other action on the part of the
Property Trustee or the Delaware Trustee, as the case may be, and does not
require any approval of stockholders of the Property Trustee or the Delaware
Trustee, and such execution, delivery and performance will not (i) violate the
Property Trustee's or the Delaware Trustee's Charter or By-laws, (ii) to its
knowledge without independent investigation violate any provision of, or
constitute, with or without notice or lapse of time, a default under, or result
in the creation or imposition of, any Lien on any properties included in the
Trust Property pursuant to the provisions of, any indenture, mortgage, credit
agreement, license or other agreement or instrument to which the Property
Trustee or the Delaware Trustee, as the case may be, is a party or by which it
is bound, or (iii) violate any law, governmental rule or regulation of the
United States or the State of Delaware, as the case may be, governing the
corporate, banking or trust powers of the Property Trustee or the Delaware
Trustee (as appropriate in context) or any order, judgment or decree applicable
to the Property Trustee or the Delaware Trustee;
(e) neither the authorization, execution or delivery by the
Property Trustee or the Delaware Trustee, as the case may be, of this Trust
Agreement nor the consummation of any of the transactions by the Property
Trustee or the Delaware Trustee, as the case may be, contemplated herein or
therein requires the consent or approval of, the giving of notice to, the
registration with or the taking of any other action with respect to any
governmental authority or agency under any existing Federal law governing the
corporate, banking or trust powers of the Property Trustee or the Delaware
Trustee, as appropriate in context, under the laws of the United States or the
State of Delaware; and
(f) there are no proceedings pending or, to the best of each
of the Property Trustee's and the Delaware Trustee's knowledge, threatened
against or affecting the Property Trustee or the Delaware Trustee in any court
or before any governmental authority, agency or arbitration board or tribunal
which, individually or in the aggregate, would materially and adversely affect
the Trust or would question the right, power and authority of the Property
Trustee or the Delaware Trustee, as the case may be, to enter into or perform
its obligations as one of the Trustees under this Trust Agreement.
SECTION 7.2. REPRESENTATIONS AND WARRANTIES OF DEPOSITOR.
The Depositor hereby represents and warrants for the benefit of the
Property Trustee and the Securityholders that:
34
(a) the Trust Securities Certificates issued at each Time of
Delivery on behalf of the Trust have been duly authorized and will have been,
duly and validly executed, issued and delivered by the Trustees pursuant to the
terms and provisions of, and in accordance with the requirements of, this Trust
Agreement and the Securityholders will be, as of each such date, entitled to the
benefits of this Trust Agreement;
(b) there are no taxes, fees or other governmental charges
payable by the Trust (or the Trustees on behalf of the Trust) under the laws of
the State of Delaware or any political subdivision thereof in connection with
the execution, delivery and performance by the Property Trustee or the Delaware
Trustee, as the case may be, of this Trust Agreement;
(c) the Depositor is a company duly organized, validly
existing and in good standing (meaning solely that it has not failed to make any
filing with any Bermuda government authority or to pay any Bermuda government
fees or tax which would make it liable to be struck off the Register of
companies and thereby cease to exist under the laws of Bermuda);
(d) the Depositor has full corporate power, authority and
legal right to execute, deliver and perform its obligations under this Trust
Agreement and has taken all necessary action to authorize the execution,
delivery and performance by it of this Trust Agreement;
(e) this Trust Agreement has been duly authorized, executed
and delivered by the Depositor and constitutes the valid and legally binding
agreement of the Depositor enforceable against it in accordance with its terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles;
(f) the execution, delivery and performance by each of the
Depositor of this Trust Agreement has been duly authorized by all necessary
company or other action on the part of the Depositor and does not require any
approval of shareholders of the Depositor, and such execution, delivery and
performance will not (i) violate the Depositor's Memorandum of Association or
Amended and Restated Bye-Laws, (ii) violate any provision of, or constitute,
with or without notice or lapse of time, a default under, or result in the
creation or imposition of, any Lien on any properties included in the Trust
Property pursuant to the provisions of, any indenture, mortgage, credit
agreement, license or other agreement or instrument to which the Depositor is a
party or by which it is bound, or (iii) violate any law, governmental rule or
regulation of Bermuda, governing the powers of the Company or any order,
judgment or decree applicable to the Company;
(g) neither the authorization, execution or delivery by the
Depositor of this Trust Agreement nor the consummation of any of the
transactions by the Depositor contemplated herein requires the consent or
approval of, the giving of notice to, the registration with or the taking of any
other action with respect to any governmental authority or agency under any
existing Bermuda law governing the powers of the Company; and
(h) there are no proceedings pending or, to the best of the
Depositor's knowledge, threatened against or affecting the Depositor in any
court or before any
35
governmental authority, agency or arbitration board or tribunal which,
individually or in the aggregate, would materially and adversely affect the
Depositor or would question the right, power and authority of the Depositor to
enter into or perform its obligations under this Trust Agreement.
ARTICLE VIII.
THE TRUSTEES
SECTION 8.1. CERTAIN DUTIES AND RESPONSIBILITIES.
(a) The duties and responsibilities of the Trustees shall be
determined solely by the express provisions of this Trust Agreement (subject to
the Delaware Statutory Trust Act) and, in the case of the Property Trustee,
subject to the Trust Indenture Act. Notwithstanding the foregoing, no provision
of this Trust Agreement shall require the Trustees to expend or risk their own
funds or otherwise incur any liability, financial or otherwise, in the
performance of any of their duties hereunder, or in the exercise of any of their
rights or powers, if they shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it. Whether or not therein expressly so provided,
every provision of this Trust Agreement relating to the conduct or affecting the
liability of or affording protection to the Trustees shall be subject to the
provisions of this Section. To the extent that, at law or in equity, an
Administrative Trustee has duties (including fiduciary duties) and liabilities
relating thereto to the Trust or to the Securityholders, such Administrative
Trustee shall not be liable to the Trust or to any Securityholder for such
Trustee's good faith reliance on the provisions of this Trust Agreement. The
provisions of this Trust Agreement, to the extent that they restrict the duties
and liabilities of the Administrative Trustees otherwise existing at law or in
equity, are agreed by the Depositor and the Securityholders to replace such
other duties and liabilities of the Administrative Trustees.
(b) All payments made by the Property Trustee or a Paying
Agent in respect of the Trust Securities shall be made only from the revenue and
proceeds from the Trust Property and only to the extent that there shall be
sufficient revenue or proceeds from the Trust Property to enable the Property
Trustee or a Paying Agent to make payments in accordance with the terms hereof.
Each Securityholder, by its acceptance of a Trust Security, agrees that it will
look solely to the revenue and proceeds from the Trust Property to the extent
legally available for distribution to it as herein provided and that the
Trustees are not personally liable to it for any amount distributable in respect
of any Trust Security or for any other liability in respect of any Trust
Security. This Section 8.1(b) does not limit the liability of the Trustees
expressly set forth elsewhere in this Trust Agreement and, in the case of the
Property Trustee, in the Trust Indenture Act.
(c) No provision of this Trust Agreement shall be construed
to relieve the Property Trustee from liability for its own bad faith, negligence
or willful misconduct, except that: (i) the Property Trustee undertakes to
perform only those duties specifically set forth in this Agreement, provided
that, it must exercise the same degree of care as a prudent person would
exercise in the conduct of his or her own affairs; (ii) the Property Trustee
shall not be liable for any error of judgment made in good faith by an
authorized officer of the Property Trustee, unless it shall be determined by a
court of competent jurisdiction or other tribunal or arbitration
36
authority that the Property Trustee was negligent in ascertaining the pertinent
facts; (iii) the Property 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 Trust Securities relating to the time, method and place of conducting any
proceeding for any remedy available to the Property Trustee, or exercising any
trust or power conferred upon the Property Trustee under this Trust Agreement;
(iv) the Property Trustee's sole duty with respect to the custody, safe keeping
and physical preservation of the Debentures and the Payment Account shall be to
deal with such Property in a similar manner as the Property Trustee deals with
similar property for its own account, subject to the protections and limitations
on liability afforded to the Property Trustee under this Trust Agreement and the
Trust Indenture Act; (v) the Property Trustee shall not be liable for any
interest on any money received by it except as it may otherwise agree in writing
with the Depositor; and money held by the Property Trustee need not be
segregated from other funds held by it except in relation to the Payment Account
maintained by the Property Trustee pursuant to Section 3.1 and except to the
extent otherwise required by law; and (vi) the Property Trustee shall not be
responsible for monitoring the compliance by the Administrative Trustees or the
Depositor with their respective duties under this Trust Agreement, nor shall the
Property Trustee be liable for the default or misconduct of the Administrative
Trustees or the Depositor.
(d) The Delaware Trustee is appointed to serve as the
trustee of the Trust in the State of Delaware for the sole purpose of satisfying
the requirement of Section 3807(a) of the Delaware Statutory Trust Act that the
Trust have at least one trustee with a principal place of business in Delaware.
It is understood and agreed by the parties hereto that the Delaware Trustee
shall have none of the duties or liabilities of the Property Trustee or the
Administrative Trustees. The duties of the Delaware Trustee shall be limited to
(a) accepting legal process served on the Trust in the State of Delaware and (b)
the execution of any certificates provided to it required to be filed with the
Delaware Secretary of State which the Delaware Trustee is required to execute
under Section 3811 of the Delaware Statutory Trust Act. To the extent that, at
law or in equity, the Delaware Trustee has duties (including fiduciary duties)
and liabilities relating thereto to the Trust or the Beneficiary, it is hereby
understood and agreed by the other parties hereto that such duties and
liabilities are replaced by the duties and liabilities of the Delaware Trustee
expressly set forth in this Agreement. The Delaware Trustee shall be entitled to
all of the same rights, protections, indemnities and immunities as the Property
Trustee.
SECTION 8.2. CERTAIN NOTICES.
Within five (5) Business Days after the occurrence of any Event of
Default actually known to a Responsible Officer of the Property Trustee, the
Property Trustee shall transmit, in the manner and to the extent provided in
Section 10.8, notice of such Event of Default to the Securityholders, the
Administrative Trustees and the Depositor, unless such Event of Default shall
have been cured or waived. Within five (5) Business Days after the receipt of
notice of the Debenture Issuer's exercise of its right to defer the payment of
interest on the Debentures pursuant to the Indenture, the Administrative
Trustees shall transmit, in the manner and to the extent provided in Section
10.8, written notice of such exercise to the Securityholders and the Property
Trustee, unless such exercise shall have been revoked.
SECTION 8.3. CERTAIN RIGHTS OF PROPERTY TRUSTEE.
37
Subject to the provisions of Section 8.1:
(a) the Property Trustee may conclusively rely and shall be
fully protected in acting or refraining from acting in good faith upon any
resolution, Opinion of Counsel, certificate, written representation of a Holder
or transferee, certificate of auditors or any other certificate, statement,
instrument, opinion, report, notice, request, consent, order, appraisal, bond,
debenture, approval, note, other evidence of indebtedness or other paper or
document (whether in original or facsimile form) believed by it to be genuine
and to have been signed or presented by the proper party or parties;
(b) if (i) in performing its duties under this Trust
Agreement the Property Trustee is required to decide between alternative courses
of action or (ii) in construing any of the provisions of this Trust Agreement
the Property Trustee finds the same ambiguous or inconsistent with any other
provisions contained herein or (iii) the Property Trustee is unsure of the
application of any provision of this Trust Agreement, then, except as to any
matter as to which the Preferred Securityholders are entitled to vote under the
terms of this Trust Agreement, the Property Trustee shall deliver a notice to
the Depositor requesting written instructions of the Depositor as to the course
of action to be taken and the Property Trustee shall take such action, or
refrain from taking such action, as the Property Trustee shall be instructed in
writing to take, or to refrain from taking, by the Depositor and the Property
Trustee shall be fully protected in acting in accordance with such instructions;
provided, however, that if the Property Trustee does not receive such
instructions of the Depositor within ten (10) Business Days after it has
delivered such notice, or such reasonably shorter period of time set forth in
such notice (which to the extent practicable shall not be less than two (2)
Business Days), it may, but shall be under no duty to, take or refrain from
taking such action not inconsistent with this Trust Agreement as it shall deem
advisable and in the interests of the Securityholders, in which event the
Property Trustee shall have no liability except for its own bad faith,
negligence or willful misconduct;
(c) any direction or act of the Depositor or the
Administrative Trustees contemplated by this Trust Agreement shall be
sufficiently evidenced by an Officers' Certificate;
(d) whenever in the administration of this Trust Agreement,
the Property Trustee shall deem it necessary or desirable that a matter be
proved or established before undertaking, suffering or omitting any action
hereunder, the Property Trustee (unless other evidence is herein specifically
prescribed) may, in the absence of bad faith on its part, request and rely upon
an Officers' Certificate which, upon receipt of such request, shall be promptly
delivered by the Depositor or the Administrative Trustees, and such Officers'
Certificate shall be full warrant to the Property Trustee for any action taken,
suffered or omitted by it under the provisions of this Agreement upon the faith
thereof;
(e) the Property Trustee shall have no duty to see to any
recording, filing or registration of any instrument (including any financing or
continuation statement or any filing under tax or securities laws) or any
rerecording, refiling or reregistration thereof;
(f) the Property Trustee may consult with counsel (which
counsel may be counsel to the Depositor or any of its Affiliates, and may
include any of its employees) and the advice or any opinion of such counsel
shall be full and complete authorization and protection in
38
respect of any action taken, suffered or omitted by it hereunder in good faith
and in reliance thereon and in accordance with such advice; the Property Trustee
shall have the right at any time to seek instructions concerning the
administration of this Trust Agreement from any court of competent jurisdiction;
(g) the Property Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Trust Agreement at the
request or direction of any of the Securityholders pursuant to this Trust
Agreement, unless such Securityholders shall have offered to the Property
Trustee reasonable security or reasonable indemnity against the costs, expenses
and liabilities which might be incurred by it in compliance with such request or
direction;
(h) the Property Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, entitlement, request, consent,
order, approval, bond, debenture, note or other evidence of indebtedness or
other paper or document, unless requested in writing to do so by one or more
Securityholders, but the Property Trustee may make such further inquiry or
investigation into such facts or matters as it may see fit;
(i) the Property Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by or
through its agents, custodians, nominees or attorneys, provided that the
Property Trustee shall be responsible for its own negligence or recklessness
with respect to selection of any agent or attorney appointed by it hereunder;
(j) whenever in the administration of this Trust Agreement
the Property Trustee shall deem it desirable to receive instructions with
respect to enforcing any remedy or right or taking any other action hereunder,
the Property Trustee (i) may request instructions from the Holders of the Trust
Securities which instructions may only be given by the Holders of the same
proportion in Liquidation Amount of the Trust Securities as would be entitled to
direct the Property Trustee under the terms of the Trust Securities in respect
of such remedy, right or action, (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 acting in accordance with such instructions;
(k) except as otherwise expressly provided by this Trust
Agreement, the Property Trustee shall not be under any obligation to take any
action that is discretionary under the provisions of this Trust Agreement;
(l) The Property Trustee shall not be liable except for the
performance of such duties and obligations as are specifically set forth in this
Agreement and as specifically directed by the Depositor, the Administrative
Trustees or Securityholders, and no implied covenants or obligations shall be
read into this Trust Agreement against the Property Trustee;
(m) The Property Trustee shall have no obligation to invest
and reinvest any cash held by it in the absence of timely and specific written
investment direction from the Depositor or an Administrative Trustee. In no
event shall the Property Trustee be liable for the selection of investments or
for investment losses incurred thereon. The Property Trustee shall have no
liability in respect of losses incurred as a result of the liquidation of any
investments
39
prior to its stated maturity or the failure of [ ] to provide timely
written investment direction;
(n) In the absence of bad faith on the part of the Property
Trustee, the Property Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Property Trustee which conform to the
requirements of this Trust Agreement; and
(o) Neither the Property Trustee nor any of its officers,
directors, employees or agents shall be liable for any action taken or omitted
under the Trust Agreement or in connection therewith except to the extent caused
by the Property Trustee's negligence, bad faith or willful misconduct, as
determined by the final judgment of a court of competent jurisdiction, no longer
subject to appeal or review. The parties each (for itself and any person or
entity claiming through it) hereby releases, waives, discharges, exculpates and
covenants not to xxx the Property Trustee for any action taken or omitted under
this Trust Agreement except to the extent caused by the Property Trustee's
negligence, bad faith or willful misconduct.
No provision of this Trust Agreement shall be deemed to impose any duty
or obligation on the Property 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 Property 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 Property Trustee shall be
construed to be a duty.
(p) In no event shall the Property Trustee be responsible or
liable for special, indirect or consequential loss or damage of any kind
whatsoever (including, but not limited to, loss of profit) irrespective of
whether the Property Trustee has been advised of the likelihood of such loss or
damage and regardless of the form of action.
SECTION 8.4. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.
The recitals contained herein and in the Trust Securities Certificates
shall be taken as the statements of the Depositor, and the Trustees do not
assume any responsibility for their correctness. The Trustees shall not be
accountable for the use or application by the Debenture Issuer of the proceeds
of the Debentures.
SECTION 8.5. MAY HOLD SECURITIES.
Any Trustee or any other agent of any Trustee or the Trust, in its
individual or any other capacity, may become the owner or pledgee of Trust
Securities and, except as otherwise provided in the definition of "Outstanding"
in Article I and subject to Section 8.8 and Section 8.13, may otherwise deal
with the Trust with the same rights it would have if it were not a Trustee or
such other agent.
SECTION 8.6. COMPENSATION; INDEMNITY; FEES.
The Depositor agrees:
40
(a) to pay to the Trustees from time to time reasonable
compensation for all services rendered by them hereunder as agreed to in writing
between the Company and the Trustees (which compensation shall not be limited by
any provision of law in regard to the compensation of a trustee of an express
trust);
(b) except as otherwise expressly provided herein, to
reimburse the Trustees upon request for all reasonable expenses, disbursements
and advances incurred or made by the Trustees in accordance with any provision
of this Trust Agreement or arising out of or in connection with the acceptance
or administration of the trust or trusts hereunder (including the reasonable
compensation and the expenses and disbursements of its agents and counsel),
except any such expense, disbursement or advance attributable to its bad faith,
negligence or willful misconduct; and
(c) to indemnify each of the Trustees and their agents,
officers, directors and employees or any predecessor Trustee for, and to hold
them harmless against, any loss, damage, claims, liability, penalty or expense
incurred without bad faith, negligence or willful misconduct on its part,
arising out of or in connection with the acceptance or administration of this
Trust Agreement, including the costs and expenses of defending itself against
any claim or liability in connection with the exercise or performance of any of
its powers or duties hereunder.
The provisions of this Section 8.6 shall survive the termination of
this Trust Agreement or the earlier resignation or removal of any Trustee. No
Trustee may claim any lien or charge on any Trust Property as a result of any
amount due pursuant to this Section 8.6.
SECTION 8.7. CORPORATE PROPERTY TRUSTEE REQUIRED; ELIGIBILITY OF
TRUSTEES.
(a) There shall at all times be a Property Trustee
hereunder. The Property Trustee shall be a Person that is eligible pursuant to
the Trust Indenture Act to act as such and has a combined capital and surplus of
at least $50,000,000. If any such Person publishes reports of condition at least
annually, pursuant to law or to the requirements of its supervising or examining
authority, then for the purposes of this Section, the combined capital and
surplus of such Person shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time
the Property Trustee with respect to the Trust Securities shall cease to be
eligible in accordance with the provisions of this Section, it shall resign
immediately in the manner and with the effect hereinafter specified in this
Article.
(b) There shall at all times be one or more Administrative
Trustees hereunder. Each Administrative Trustee shall be either a natural person
who is at least twenty-one (21) years of age or a legal entity that shall act
through one or more persons authorized to bind that entity.
(c) There shall at all times be a Delaware Trustee. The
Delaware Trustee shall either be (i) a natural person who is at least twenty-one
(21) years of age and a resident of the State of Delaware or (ii) a legal entity
with its principal place of business in the State of Delaware and that otherwise
meets the requirements of applicable Delaware law that shall act through one or
more persons authorized to bind such entity.
SECTION 8.8. CONFLICTING INTERESTS.
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If the Property Trustee has or shall acquire a conflicting interest
within the meaning of the Trust Indenture Act, the Property Trustee shall either
eliminate such interest or resign, to the extent and in the manner provided by,
and subject to the provisions of, the Trust Indenture Act and this Trust
Agreement. Subject to the foregoing, the Depositor and any Trustee may engage in
or possess an interest in other business ventures of any nature or description,
independently or with others, similar or dissimilar to the business of the
Trust, and the Trust and the Holders shall have no rights by virtue of this
Trust Agreement in and to such independent ventures or the income or profits
derived therefrom, and the pursuit of any such venture, even if competitive with
the business of the Trust, shall not be deemed wrongful or improper. Neither the
Depositor, nor any Trustee, shall be obligated to present any particular
investment or other opportunity to the Trust even if such opportunity is of a
character that, if presented to the Trust, could be taken by the Trust, and the
Depositor or any Trustee shall have the right to take for its own account
(individually or as a partner or fiduciary) or to recommend to others any such
particular investment or other opportunity. Any Trustee may engage in any
financial or other transaction with the Depositor or any Affiliate of the
Depositor, or may act as depository for, trustee or agent for, or act on any
committee or body of holders of, securities or other obligations of the
Depositor or its Affiliates.
SECTION 8.9. CO-TRUSTEES AND SEPARATE TRUSTEE.
Unless an Event of Default shall have occurred and be continuing, at any
time or times, for the purpose of meeting the legal requirements of the Trust
Indenture Act or of any jurisdiction in which any part of the Trust Property may
at the time be located, the Depositor and the Administrative Trustees, by agreed
action of the majority of such Trustees, shall have power to appoint, and upon
the written request of the Administrative Trustees, the Depositor shall for such
purpose join with the Administrative Trustees in the execution, delivery, and
performance of all instruments and agreements necessary or proper to appoint,
one or more Persons approved by the Property Trustee either to act as
co-trustee, jointly with the Property Trustee, of all or any part of such Trust
Property, or to the extent required by law to act as separate trustee of any
such property, in either case with such powers as may be provided in the
instrument of appointment, and to vest in such Person or Persons in the capacity
aforesaid, any property, title, right or power deemed necessary or desirable,
subject to the other provisions of this Section. If the Depositor does not join
in such appointment within fifteen (15) days after the receipt by it of a
request so to do, or in case a Debenture Event of Default has occurred and is
continuing, the Property Trustee alone shall have power to make such
appointment. Any co-trustee or separate trustee appointed pursuant to this
Section shall either be (i) a natural person who is at least twenty-one (21)
years of age and a resident of the United States or (ii) a legal entity with its
principal place of business in the United States that shall act through one or
more persons authorized to bind such entity. Should any written instrument from
the Depositor be required by any co-trustee or separate trustee so appointed for
more fully confirming to such co- trustee or separate trustee such property,
title, right, or power, any and all such instruments shall, on request, be
executed, acknowledged and delivered by the Depositor. Every co-trustee or
separate trustee shall, to the extent permitted by law, but to such extent only,
be appointed subject to the following terms, namely:
(a) The Trust Securities shall be executed and delivered and
all rights, powers, duties, and obligations hereunder in respect of the custody
of securities, cash and other
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personal property held by, or required to be deposited or pledged with, the
Trustees specified hereunder, shall be exercised, solely by such Trustees and
not by such co-trustee or separate trustee.
(b) The rights, powers, duties, and obligations hereby
conferred or imposed upon the Property Trustee in respect of any property
covered by such appointment shall be conferred or imposed upon and exercised or
performed by the Property Trustee or by the Property Trustee and such co-trustee
or separate trustee jointly, as shall be provided in the instrument appointing
such co-trustee or separate trustee, except to the extent that under any law of
any jurisdiction in which any particular act is to be performed, the Property
Trustee shall be incompetent or unqualified to perform such act, in which event
such rights, powers, duties and obligations shall be exercised and performed by
such co-trustee or separate trustee.
(c) The Property Trustee at any time, by an instrument in
writing executed by it, with the written concurrence of the Depositor, may
accept the resignation of or remove any co-trustee or separate trustee appointed
under this Section, and, in case a Debenture Event of Default has occurred and
is continuing, the Property Trustee shall have power to accept the resignation
of, or remove, any such co-trustee or separate trustee without the concurrence
of the Depositor. Upon the written request of the Property Trustee, the
Depositor shall join with the Property Trustee in the execution, delivery and
performance of all instruments and agreements necessary or proper to effectuate
such resignation or removal. A successor to any co-trustee or separate trustee
so resigned or removed may be appointed in the manner provided in this Section.
(d) No co-trustee or separate trustee hereunder shall be
personally liable by reason of any act or omission of the Property Trustee or
any other trustee hereunder.
(e) The Property Trustee shall not be liable by reason of
any act or omission of a co-trustee or separate trustee.
(f) Any Act of Holders delivered to the Property Trustee
shall be deemed to have been delivered to each such co-trustee and separate
trustee.
SECTION 8.10. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.
No resignation or removal of any Trustee (the "Relevant Trustee") and no
appointment of a successor Trustee pursuant to this Article shall become
effective until the acceptance of appointment by the successor Trustee in
accordance with the applicable requirements of Section 8.11. Subject to the
immediately preceding sentence, the Relevant Trustee may resign at any time with
respect to the Trust Securities by giving written notice thereof to the
Depositor. If the instrument of acceptance by the successor Trustee required by
Section 8.11 shall not have been delivered to the Relevant Trustee within thirty
(30) days after the giving of such notice of resignation, the Relevant Trustee
may petition, at the expense of the Depositor, any court of competent
jurisdiction for the appointment of a successor Relevant Trustee with respect to
the Trust Securities. Unless a Debenture Event of Default shall have occurred
and be continuing, any Trustee may be removed at any time by Act of the Common
Securityholder. If a Debenture Event of Default shall have occurred and be
continuing, the Property Trustee or the Delaware
43
Trustee, or both of them, may be removed at such time by Act of the Holders of a
majority in Liquidation Amount of the Preferred Securities, delivered to the
Relevant Trustee (in its individual capacity and on behalf of the Trust). In no
event will the Holders of Preferred Securities have the right to vote to
appoint, remove or replace the Administrative Trustees. An Administrative
Trustee may be removed by Act of the Common Securityholder at any time. If any
Trustee shall resign, be removed or become incapable of acting as Trustee, or if
a vacancy shall occur in the office of any Trustee for any cause, at a time when
no Debenture Event of Default shall have occurred and be continuing, the Common
Securityholder, by Act of the Common Securityholder delivered to the retiring
Trustee, shall promptly appoint a successor Trustee or Trustees with respect to
the Trust Securities and the Trust, and the retiring Trustee shall comply with
the applicable requirements of Section 8.11. If the Property Trustee or the
Delaware Trustee shall resign, be removed or become incapable of continuing to
act as the Property Trustee or the Delaware Trustee, as the case may be, at a
time when a Debenture Event of Default shall have occurred and be continuing,
the Preferred Securityholders, by Act of the Securityholders of a majority in
Liquidation Amount of the Preferred Securities then Outstanding delivered to the
retiring Relevant Trustee, shall promptly appoint a successor Relevant Trustee
or Trustees with respect to the Trust Securities and the Trust, and such
successor Trustee shall comply with the applicable requirements of Section 8.11.
If an Administrative Trustee shall resign, be removed or become incapable of
acting as Administrative Trustee, at a time when a Debenture Event of Default
shall have occurred and be continuing, the Common Securityholder by Act of the
Common Securityholder delivered to the Administrative Trustee shall promptly
appoint a successor Administrative Trustee or Administrative Trustees with
respect to the Trust Securities and the Trust, and such successor Administrative
Trustee or Trustees shall comply with the applicable requirements of Section
8.11. If no successor Relevant Trustee with respect to the Trust Securities
shall have been so appointed by the Common Securityholder or the Preferred
Securityholders and accepted appointment in the manner required by Section 8.11,
any Securityholder who has been a Securityholder of Trust Securities for at
least six months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the appointment of a successor
Relevant Trustee with respect to the Trust Securities. The Depositor shall give
notice of each resignation and each removal of the Property Trustee or the
Delaware Trustee and each appointment of a successor Property Trustee or
Delaware Trustee to all Securityholders in the manner provided in Section 10.8.
Each notice shall include the name of the successor Relevant Trustee and the
address of its Corporate Trust Office if it is the Property Trustee.
Notwithstanding the foregoing or any other provision of this Trust Agreement, in
the event any Administrative Trustee or a Delaware Trustee who is a natural
person dies or becomes, in the opinion of the Depositor, incompetent or
incapacitated, the vacancy created by such death, incompetence or incapacity may
be filled by (a) the unanimous act of remaining Administrative Trustees if there
are at least two of them or (b) otherwise by the Depositor (with the successor
in each case being a Person who satisfies the eligibility requirement for
Administrative Trustees set forth in Section 8.7).
SECTION 8.11. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.
In case of the appointment hereunder of a successor Trustee such
successor Trustee so appointed shall execute, acknowledge and deliver to the
Trust and to the retiring Trustee an instrument accepting such appointment, and
thereupon the resignation or removal of the retiring Trustee shall become
effective and such successor Trustee, without any further act, deed or
44
conveyance, shall become vested with all the rights, powers, trusts and duties
of the retiring Trustee; but, on the request of the Depositor or the successor
Trustee, such retiring Trustee shall, upon payment of its charges, execute and
deliver an instrument transferring to such successor Trustee all the rights,
powers and trusts of the retiring Trustee and if the Property Trustee is the
resigning Trustee shall duly assign, transfer and deliver to the successor
Trustee all property and money held by such retiring Property Trustee hereunder.
In case of the appointment hereunder of a successor Relevant Trustee with
respect to the Trust Securities and the Trust, the retiring Relevant Trustee and
each successor Relevant Trustee with respect to the Trust Securities shall
execute and deliver an amendment hereto wherein each successor Relevant Trustee
shall accept such appointment and which
(a) shall contain such provisions as shall be necessary or
desirable to transfer and confirm to, and to vest in, each successor Relevant
Trustee all the rights, powers, trusts and duties of the retiring Relevant
Trustee with respect to the Trust Securities and the Trust and
(b) shall add to or change any of the provisions of this
Trust Agreement as shall be necessary to provide for or facilitate the
administration of the trusts hereunder by more than one Relevant Trustee, it
being understood that nothing herein or in such amendment shall constitute such
Relevant Trustees co-trustees of the same trust and that each such Relevant
Trustee shall be trustee of a trust or trusts hereunder separate and apart from
any trust or trusts hereunder administered by any other such Relevant Trustee
and upon the execution and delivery of such amendment the resignation or removal
of the retiring Relevant Trustee shall become effective to the extent provided
therein and each such successor Relevant Trustee, without any further act, deed
or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Relevant Trustee with respect to the Trust Securities and
the Trust; but, on request of the Trust or any successor Relevant Trustee such
retiring Relevant Trustee shall duly assign, transfer and deliver to such
successor Relevant Trustee all Trust Property, all proceeds thereof and money
held by such retiring Relevant Trustee hereunder with respect to the Trust
Securities and the Trust. Upon request of any such successor Relevant Trustee,
the Trust shall execute any and all instruments for more fully and certainly
vesting in and confirming to such successor Relevant Trustee all such rights,
powers and trusts referred to in the first or second preceding paragraph, as the
case may be. No successor Relevant Trustee shall accept its appointment unless
at the time of such acceptance such successor Relevant Trustee shall be
qualified and eligible under this Article.
SECTION 8.12. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
BUSINESS.
Any corporation into which the Property Trustee or the Delaware Trustee
(or any Administrative Trustee that is not a natural person) may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Relevant Trustee
shall be a party, or any corporation succeeding to all or substantially all of
the business of the Property Trustee or the Delaware Trustee, shall be the
successor of such Relevant Trustee hereunder, provided such corporation shall be
otherwise qualified and eligible under this Article, without the execution or
filing of any paper or any further act on the part of any of the parties hereto.
45
SECTION 8.13. PREFERENTIAL COLLECTION OF CLAIMS AGAINST DEPOSITOR,
DEBENTURE ISSUER OR TRUST.
If and when the Property Trustee or the Delaware Trustee shall be or
become a creditor of the Depositor, the Debenture Issuer or the Trust (or any
other obligor upon the Debentures or the Trust Securities), the Property Trustee
or the Delaware Trustee, as the case may be, shall be subject to and shall take
all actions necessary in order to comply with the provisions of the Trust
Indenture Act regarding the collection of claims against the Depositor,
Debenture Issuer or Trust (or any such other obligor).
SECTION 8.14. REPORTS BY PROPERTY TRUSTEE.
(a) Within sixty (60) days after May 15 of each year
commencing with the first May 15 following the first issuance of Preferred
Securities pursuant to this Trust Agreement, the Property Trustee shall transmit
to all Securityholders in accordance with Section 10.8, and to the Depositor, a
brief report dated as of such May 15 with respect to: (i) its eligibility under
Section 8.7 or, in lieu thereof, if to the best of its knowledge it has
continued to be eligible under said Section, a written statement to such effect;
(ii) a statement that the Property Trustee has complied with all of its
obligations under this Trust Agreement during the twelve-month period (or, in
the case of the initial report, the period since the Closing Time) ending with
such May 15 or, if the Property Trustee has not complied in any material respect
with such obligations, a description of such noncompliance; and (iii) any change
in the property and funds in its possession as Property Trustee since the date
of its last report and any action taken by the Property Trustee in the
performance of its duties hereunder which it has not previously reported and
which in its opinion materially affects the Trust Securities.
(b) In addition the Property Trustee shall transmit to
Securityholders such reports concerning the Property Trustee and its actions
under this Trust Agreement as may be required pursuant to the Trust Indenture
Act at the times and in the manner provided pursuant thereto.
(c) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Property Trustee with each stock
exchange, interdealer quotation system or other self-regulatory organization
upon which the Trust Securities are listed or traded, with the Commission and
with the Depositor.
SECTION 8.15. REPORTS TO THE PROPERTY TRUSTEE.
The Depositor and the Administrative Trustees on behalf of the Trust
shall provide to the Property Trustee such documents, reports and information as
required by Section 314 of the Trust Indenture Act (if any) and the compliance
certificate required by Section 314(a) of the Trust Indenture Act in the form,
in the manner and at the times required by Section 314 of the Trust Indenture
Act.
SECTION 8.16. EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT.
46
Each of the Depositor and the Administrative Trustees on behalf of the
Trust shall provide to the Property Trustee such written evidence of compliance
with any conditions precedent, if any, provided for in this Trust Agreement 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) of the Trust Indenture Act shall be given in the form of an
Officers' Certificate.
SECTION 8.17. NUMBER OF TRUSTEES.
(a) The number of Trustees shall be four, provided that the
Holder of all of the Common Securities by written instrument may increase or
decrease the number of Administrative Trustees. The Property Trustee and the
Delaware Trustee may be the same person if the Property Trustee meets the
applicable requirements.
(b) If a Trustee ceases to hold office for any reason and
the number of Administrative Trustees is not reduced pursuant to Section
8.17(a), or if the number of Trustees is increased pursuant to Section 8.17(a),
a vacancy shall occur. The vacancy shall be filled with a Trustee appointed in
accordance with Section 8.10.
(c) The death, resignation, retirement, removal, bankruptcy,
incompetence or incapacity to perform the duties of a Trustee shall not operate
to annul, dissolve or terminate the Trust. Whenever a vacancy in the number of
Administrative Trustees shall occur, until such vacancy is filled by the
appointment of an Administrative Trustee in accordance with Section 8.10, the
Administrative Trustees in office, regardless of their number (and
notwithstanding any other provision of this Agreement), shall have all the
powers granted to the Administrative Trustees and shall discharge all the duties
imposed upon the Administrative Trustees by this Trust Agreement.
SECTION 8.18. DELEGATION OF POWER.
(a) Any Administrative Trustee may, by power of attorney
consistent with applicable law, delegate to any other natural person over the
age of twenty-one (21) his or her power for the purpose of executing any
documents contemplated in Section 2.7(a), including any registration statement
or amendment thereto filed with the Commission, or making any other governmental
filing; and
(b) The Administrative Trustees shall have power to delegate
from time to time to such of their number or to the Depositor the doing of such
things and the execution of such instruments either in the name of the Trust or
the names of the Administrative Trustees or otherwise as the Administrative
Trustees may deem expedient, to the extent such delegation is not prohibited by
applicable law or contrary to the provisions of the Trust, as set forth herein.
ARTICLE IX.
DISSOLUTION, LIQUIDATION, TERMINATION AND MERGER
SECTION 9.1. DISSOLUTION UPON EXPIRATION DATE.
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Unless earlier dissolved, the Trust shall automatically dissolve on
December 31, 2054 (the "Expiration Date").
SECTION 9.2. EARLY DISSOLUTION.
The first to occur of any of the following events is an "Early
Termination Event", upon the occurrence of which the Trust shall be dissolved:
(a) the occurrence of a Bankruptcy Event in respect of, or
the dissolution or liquidation of, the Debenture Issuer;
(b) the written direction to the Property Trustee from the
Depositor at any time (which direction is optional and wholly within the
discretion of the Depositor) to dissolve the Trust and distribute a Like Amount
of Debentures to Securityholders in exchange for the Trust Securities;
(c) the redemption of all of the Trust Securities in
connection with the redemption of all the Debentures; and
(d) the entry of an order for dissolution of the Trust by a
court of competent jurisdiction.
SECTION 9.3. TERMINATION.
The respective obligations and responsibilities of the Trustees and the
Trust shall terminate upon the latest to occur of the following:
(a) the distribution by the Property Trustee to
Securityholders upon the liquidation of the Trust pursuant to Section 9.4, or
upon the redemption of all of the Trust Securities pursuant to Section 4.2, of
all amounts required to be distributed hereunder upon the final payment of the
Trust Securities;
(b) the payment of any expenses owed by the Trust; and
(c) the discharge of all administrative duties of the
Administrative Trustees, including the performance of any tax reporting
obligations with respect to the Trust or the Securityholders.
SECTION 9.4. LIQUIDATION.
(a) If an Early Termination Event specified in clause
Section 9.2(a), Section 9.2(b), or Section 9.2(d) of Section 9.2 occurs or upon
the Expiration Date, the Trust shall be liquidated by the Trustees as
expeditiously as the Trustees determine to be possible by distributing, after
satisfaction of liabilities to creditors of the Trust as provided by applicable
law, to each Securityholder a Like Amount of Debentures, subject to Section
9.4(e).
(b) Notice of liquidation shall be given by the Property
Trustee, at the Depositor's expense, by first-class mail, postage prepaid mailed
not later than thirty (30) nor
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more than sixty (60) days prior to the Liquidation Date to each Holder of Trust
Securities at such Holder's address appearing in the Securities Register. All
notices of liquidation shall: (i) state the Liquidation Date; (ii) state that
from and after the Liquidation Date, the Trust Securities will no longer be
deemed to be Outstanding and any Trust Securities Certificates not surrendered
for exchange will be deemed to represent a Like Amount of Debentures; and (iii)
provide such information with respect to the mechanics by which Holders may
exchange Trust Securities Certificates for Debentures, or if Section 9.4(e)
applies, receive a Liquidation Distribution, as the Administrative Trustees or
the Property Trustee shall deem appropriate.
(c) Except where Section 9.2(c) or Section 9.4(e) applies,
in order to effect the liquidation of the Trust and distribution of the
Debentures to Securityholders, the Property Trustee shall establish a record
date for such distribution (which shall be not more than forty-five (45) days
prior to the Liquidation Date) and, either itself acting as exchange agent or
through the appointment of a separate exchange agent, shall establish such
procedures as it shall deem appropriate to effect the distribution of Debentures
in exchange for the Outstanding Trust Securities Certificates.
(d) Except where Section 9.2(c) or Section 9.4(e) applies,
on and after the Liquidation Date, (i) the Trust Securities will no longer be
deemed to be Outstanding, (ii) certificates representing a Like Amount of
Debentures will be issued to the Holders of Trust Securities Certificates, upon
surrender of such certificates to the Administrative Trustees or their agent for
exchange, (iii) the Depositor shall cause the Debenture Issuer to use its
reasonable efforts to have the Debentures listed or traded on the such stock
exchange, interdealer quotation system and/or other self-regulatory organization
as the Preferred Securities are then listed or traded, (iv) any Trust Securities
Certificates not so surrendered for exchange will be deemed to represent a Like
Amount of Debentures, accruing interest at the rate provided for in the
Debentures from the last Distribution Date on which a Distribution was made on
such Trust Securities Certificates until such certificates are so surrendered
(and until such certificates are so surrendered, no payments of interest or
principal will be made to Holders of Trust Securities Certificates with respect
to such Debentures) and (v) all rights of Securityholders holding Trust
Securities will cease, except the right of such Securityholders to receive
Debentures upon surrender of Trust Securities Certificates.
(e) In the event that, notwithstanding the other provisions
of this Section 9.4, whether because of an order for dissolution entered by a
court of competent jurisdiction or otherwise, distribution of the Debentures in
the manner provided herein is determined by the Property Trustee not to be
practical, the Trust Property shall be liquidated, and the Trust shall be
wound-up and terminated by the Property Trustee in such manner as the Property
Trustee determines; provided, however, that any such determination shall be
conclusive and binding on any such Securityholder and any Person claiming under,
by or through such holder and provided further that the Property Trustee shall
not be liable to any Securityholder or other Person for such determination. In
such event, Securityholders will be entitled to receive out of the assets of the
Trust available for distribution to Securityholders, after satisfaction of
liabilities to creditors of the Trust as provided by applicable law, an amount
equal to the Liquidation Amount per Trust Security plus accumulated and unpaid
Distributions thereon to the date of payment (such amount being the "Liquidation
Distribution"). If, upon any such winding up, the Liquidation Distribution can
be paid only in part because the Trust has insufficient assets available to pay
in
49
full the aggregate Liquidation Distribution, then, subject to the next
succeeding sentence, the amounts payable by the Trust on the Trust Securities
shall be paid on a pro rata basis (based upon Liquidation Amounts). The Holder
of the Common Securities will be entitled to receive Liquidation Distributions
upon any such dissolution pro rata (determined as aforesaid) with Holders of
Preferred Securities, except that, if a Debenture Event of Default has occurred
and is continuing, the Preferred Securities shall have a priority over the
Common Securities.
SECTION 9.5. MERGERS, CONSOLIDATIONS, AMALGAMATIONS OR REPLACEMENTS
OF THE TRUST.
The Trust may not merge with or into, convert into, consolidate,
amalgamate, or be replaced by, or convey, transfer or lease its properties and
assets substantially as an entirety to any corporation or other entity, except
pursuant to this Section 9.5 or Section 9.4. The Trust may, at the request of
the Depositor, with the consent of only the Administrative Trustees and without
the consent of the Holders of the Preferred Securities, merge with or into,
convert into, consolidate, amalgamate, or be replaced by or convey, transfer or
lease its properties and assets substantially as an entirety to a trust
organized as such under the laws of any State; provided, that (i) such successor
entity either (a) expressly assumes all of the obligations of the Trust with
respect to the Preferred Securities or (b) substitutes for the Preferred
Securities other securities having substantially the same terms as the Preferred
Securities (the "Successor Securities") so long as the Successor Securities rank
the same as the Preferred Securities rank in priority with respect to
distributions and payments upon liquidation, redemption and otherwise, (ii) the
Depositor expressly appoints a trustee of such successor entity possessing the
same powers and duties as the Property Trustee as the holder of the Debentures,
(iii) the Successor Securities are listed or traded, or any Successor Securities
will be listed upon notification of issuance, on any national securities
exchange or other organization on which the Preferred Securities are then listed
or traded, if any, (iv) such merger, conversion, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not cause the Preferred
Securities (including any Successor Securities) to be downgraded by any
nationally recognized statistical rating organization, (v) such merger,
conversion, consolidation, amalgamation, replacement, conveyance, transfer or
lease does not adversely affect the rights, preferences and privileges of the
Holders of the Preferred Securities (including any Successor Securities) in any
material respect, (vi) such successor entity has a purpose substantially
identical to that of the Trust, (vii) prior to such merger, conversion,
consolidation, amalgamation, replacement, conveyance, transfer or lease, the
Depositor has received an Opinion of Counsel rendered by independent counsel
experienced in such matters to the effect that (a) such merger, conversion,
consolidation, amalgamation, replacement, conveyance, transfer or lease does not
adversely affect the rights, preferences and privileges of the Holders of the
Preferred Securities (including any Successor Securities) in any material
respect, and (b) following such merger, conversion, consolidation, amalgamation,
replacement, conveyance, transfer or lease, neither the Trust nor such successor
entity will be required to register as an investment company under the
Investment Company Act and (viii) the Depositor (or any permitted successor or
assignee) owns all of the common securities of such successor entity and
guarantees the obligations of such successor entity under the Successor
Securities at least to the extent provided by the Guarantee. Notwithstanding the
foregoing, the Trust shall not, except with the consent of holders of 100% in
Liquidation Amount of the Preferred Securities, consolidate, amalgamate, merge
with or into, convert into, or be replaced by or convey, transfer or lease its
properties and assets substantially as an entirety to any other
50
entity or permit any other entity to consolidate, amalgamate, merge with or
into, convert into, or replace it if such consolidation, amalgamation, merger,
conversion, replacement, conveyance, transfer or lease would cause the Trust or
the successor entity to be classified as other than a grantor trust for United
States Federal income tax purposes.
ARTICLE X.
MISCELLANEOUS PROVISIONS
SECTION 10.1. LIMITATION OF RIGHTS OF SECURITYHOLDERS.
The death or incapacity of any person having an interest, beneficial or
otherwise, in Trust Securities shall not operate to terminate this Trust
Agreement, nor entitle the legal representatives or heirs of such person or any
Securityholder for such person, to claim an accounting, take any action or bring
any proceeding in any court for a partition or winding up of the arrangements
contemplated hereby, nor otherwise affect the rights, obligations and
liabilities of the parties hereto or any of them.
SECTION 10.2. AMENDMENT.
(a) This Trust Agreement may be amended from time to time by
the Trustees and the Depositor, without the consent of any Securityholders, (i)
to cure any ambiguity, correct or supplement any provision herein which may be
inconsistent with any other provision herein, or to make any other provisions
with respect to matters or questions arising under this Trust Agreement, which
shall not be inconsistent with the other provisions of this Trust Agreement, or
(ii) to modify, eliminate or add to any provisions of this Trust Agreement to
such extent as shall be necessary to ensure that the Trust will be classified
for United States Federal income tax purposes as a grantor trust at all times
that any Trust Securities are outstanding or to ensure that the Trust will not
be required to register as an investment company under the Investment Company;
provided, however, that in the case of clause (i), such action shall not
adversely affect in any material respect the interests of any Securityholder (to
be evidenced by an Opinion of Counsel). Any such amendments of this Trust
Agreement shall become effective when notice thereof is given to the
Securityholders.
(b) Except as provided in Section 10.2(c) hereof, any
provision of this Trust Agreement may be amended by the Trustees and the
Depositor with (i) the consent of Trust Securityholders representing not less
than a majority (based upon Liquidation Amounts) of the Trust Securities then
Outstanding and (ii) receipt by the Trustees of an Opinion of Counsel to the
effect that such amendment or the exercise of any power granted to the Trustees
in accordance with such amendment will not affect the Trust's status as a
grantor trust for United States Federal income tax purposes or the Trust's
exemption from status of an investment company under the Investment Company Act.
(c) In addition to and notwithstanding any other provision
in this Trust Agreement, without the consent of each affected Securityholder,
this Trust Agreement may not be amended to (i) change the amount or timing of
any Distribution on the Trust Securities or otherwise adversely affect the
amount of any Distribution required to be made in respect of the Trust
Securities as of a specified date or (ii) restrict the right of a Securityholder
to institute suit
51
for the enforcement of any such payment on or after such date. Notwithstanding
any other provision herein, without the unanimous consent of the
Securityholders, this paragraph (c) of this Section 10.2 may not be amended.
(d) Notwithstanding any other provisions of this Trust
Agreement, no Trustee shall enter into or consent to any amendment to this Trust
Agreement which would cause the Trust to fail or cease to qualify for the
exemption from status of an investment company under the Investment Company Act
or fail or cease to be classified as a grantor trust for United States Federal
income tax purposes.
(e) Notwithstanding anything in this Trust Agreement to the
contrary, this Trust Agreement may not be amended in a manner which imposes any
additional obligation on the Depositor, the Property Trustee or the Delaware
Trustee without the consent of the Depositor, the Property Trustee or the
Delaware Trustee, as the case may be.
(f) In the event that any amendment to this Trust Agreement
is made, the Administrative Trustees shall promptly provide to the Depositor a
copy of such amendment.
(g) Neither the Property Trustee nor the Delaware Trustee
shall be required to enter into any amendment to this Trust Agreement which
affects its own rights, duties or immunities under this Trust Agreement. The
Property Trustee shall be entitled to receive an Opinion of Counsel and an
Officers' Certificate stating that any amendment to this Trust Agreement is in
compliance with this Trust Agreement.
SECTION 10.3. SEPARABILITY.
In case any provision in this Trust Agreement or in the Trust Securities
Certificates shall be invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.
SECTION 10.4. GOVERNING LAW.
This Trust Agreement and the rights and obligations of each of the
Securityholders, the Trust and the Trustees with respect to this Trust Agreement
and the Trust Securities shall be construed in accordance with and governed by
the laws of the State of Delaware.
SECTION 10.5. PAYMENTS DUE ON NON-BUSINESS DAY.
If the date fixed for any payment on any Trust Security shall be a day
that is not a Business Day, then such payment need not be made on such date but
may be made on the next succeeding day that is a Business Day (except as
otherwise provided in Section 4.1(a) and Section 4.2(d)), with the same force
and effect as though made on the date fixed for such payment, and no interest
shall accrue thereon for the period after such date.
SECTION 10.6. SUCCESSORS.
This Trust Agreement shall be binding upon and shall inure to the
benefit of any successor to the Depositor, the Trust or the Relevant Trustee,
including any successor by
52
operation of law. Except in connection with a consolidation, merger or sale
involving the Depositor that is permitted under Article Eight of the Indenture
and pursuant to which the assignee agrees in writing to perform the Depositor's
obligations hereunder, the Depositor shall not assign its obligations hereunder.
SECTION 10.7. HEADINGS.
The Article and Section headings are for convenience only and shall not
affect the construction of this Trust Agreement.
SECTION 10.8. REPORTS, NOTICES AND DEMANDS.
Any report, notice, demand or other communication which by any provision
of this Trust Agreement is required or permitted to be given or served to or
upon any Securityholder or the Depositor may be given or served in writing by
deposit thereof, first-class postage prepaid, in the United States mail, hand
delivery or facsimile transmission, in each case, addressed, (a) in the case of
a Preferred Securityholder, to such Preferred Securityholder as such
Securityholder's name and address may appear on the Securities Register; and (b)
in the case of the Common Securityholder or the Depositor, to Montpelier Re
Holdings Ltd., [executive office of Trust address], Attention: [ ],
facsimile no.: [ ]. Such notice, demand or other communication to or
upon a Securityholder shall be deemed to have been sufficiently given or made,
for all purposes, upon hand delivery, mailing or transmission. Any notice,
demand or other communication which by any provision of this Trust Agreement is
required or permitted to be given or served to or upon the Trust, the Property
Trustee or the Administrative Trustees shall be given in writing addressed
(until another address is published by the Trust) as follows: (a) with respect
to the Property Trustee, to 000 Xxxxxxx Xxxxxx, XX.0X, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Corporate Trust Administration; (b) with respect to the Delaware
Trustee, to Xxxxx Xxxx Xxxxxx, Xxxxx 000, Xxxxxx, XX 00000, Attention: Corporate
Trust Administration; and (c) with respect to the Administrative Trustees, to
them at [ ], marked "Attention: Administrative Trustees of MRH Capital
Trust II." Such notice, demand or other communication to or upon the Trust or
the Property Trustee shall be deemed to have been sufficiently given or made
only upon actual receipt of the writing by the Trust or a Responsible Officer of
the Property Trustee.
SECTION 10.9. AGREEMENT NOT TO PETITION.
Each of the Trustees and the Depositor agree for the benefit of the
Securityholders that, until at least one year and one day after the Trust has
been dissolved in accordance with Article IX, they shall not file, or join in
the filing of, a petition against the Trust under any bankruptcy, insolvency,
reorganization or other similar law (including, without limitation, the United
States Bankruptcy Code) (collectively, "Bankruptcy Laws") or otherwise join in
the commencement of any proceeding against the Trust under any Bankruptcy Law.
In the event the Depositor takes action in violation of this Section 10.9, the
Property Trustee agrees, for the benefit of Securityholders, that at the expense
of the Depositor, it shall file an answer with the bankruptcy court or otherwise
properly contest the filing of such petition by the Depositor against the Trust
or the commencement of such action and raise the defense that the Depositor has
agreed in writing not to take such action and should be stopped and precluded
therefrom and such other
53
defenses, if any, as counsel for the Trustee or the Trust may assert. The
provisions of this Section 10.9 shall survive the termination of this Trust
Agreement.
SECTION 10.10. TRUST INDENTURE ACT; CONFLICT WITH TRUST INDENTURE ACT.
(a) This Trust Agreement is subject to the provisions of the
Trust Indenture Act that are required to be part of this Trust Agreement and
shall, to the extent applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is
a trustee for the purposes of the Trust Indenture Act.
(c) If any provision hereof limits, qualifies or conflicts
with another provision hereof which is required to be included in this Trust
Agreement by any of the provisions of the Trust Indenture Act, such required
provision shall control. If any provision of this Trust Agreement modifies or
excludes any provision of the Trust Indenture Act which may be so modified or
excluded, the latter provision shall be deemed to apply to this Trust Agreement
as so modified or excluded, as the case may be.
(d) The application of the Trust Indenture Act to this Trust
Agreement shall not affect the nature of the Trust Securities as equity
securities representing undivided beneficial interests in the assets of the
Trust.
SECTION 10.11. ACCEPTANCE OF TERMS OF TRUST AGREEMENT, GUARANTEE AND
INDENTURE.
THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST THEREIN
BY OR ON BEHALF OF A SECURITYHOLDER OR ANY BENEFICIAL OWNER, WITHOUT ANY
SIGNATURE OR FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL
ACCEPTANCE BY THE SECURITYHOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN
SUCH TRUST SECURITY OF ALL THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT AND
AGREEMENT TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND
THE INDENTURE, AND SHALL CONSTITUTE THE AGREEMENT OF THE TRUST, SUCH
SECURITYHOLDER AND SUCH OTHERS THAT THE TERMS AND PROVISIONS OF THIS TRUST
AGREEMENT SHALL BE BINDING, OPERATIVE AND EFFECTIVE AS BETWEEN THE TRUST AND
SUCH SECURITYHOLDER AND SUCH OTHERS.
MONTPELIER RE HOLDINGS LTD.,
as Depositor
By:
-----------------------------------
Name:
Title:
00
XXX XXXX XX XXX XXXX
as Property Trustee
By:
-----------------------------------
Name:
Title:
THE BANK OF NEW YORK
(DELAWARE),
as Delaware Trustee
By:
-----------------------------------
-----------------------------------
[ ],
as Administrative Trustee
-----------------------------------
[ ],
as Administrative Trustee
55
EXHIBIT A
CERTIFICATE OF TRUST
OF
MRH CAPITAL TRUST II
This Certificate of Trust of MRH Capital Trust II (the "Trust"), dated
as of January 27, 2004 is being duly executed and filed by the undersigned, as
trustees, to form a statutory trust under the Delaware Statutory Trust Act (12
Del. C. ss. 3801, et seq.).
1. Name. The name of the statutory trust formed hereby is MRH Capital
Trust II.
2. Delaware Trustee. The name and business address of the trustee of the
Trust with a principal place of business in the State of Delaware is The Bank of
New York (Delaware), Xxxxx Xxxx Xxxxxx, Xxxxx 000, Xxxxxx, XX 00000.
3. Counterparts. This Certificate of Trust may be executed in one or
more counterparts, all of which together shall constitute one and the same
instrument.
4. Effective Date. This Certificate of Trust shall be effective upon
filing with the Secretary of the State of the State of Delaware.
A-1
IN WITNESS WHEREOF, the undersigned, being the trustees of the Trust,
have executed this Certificate of Trust as of the date first-above written.
The Bank of New York,
as Property Trustee
By:
----------------------------------------
Name:
Title:
The Bank of New York (Delaware),
as Delaware Trustee
By:
----------------------------------------
Name:
Title:
Administrative Trustee
-------------------------------------------
Xxxxxx X. X. Xxxxxx, not in his individual
capacity but solely as trustee of the Trust
Administrative Trustee
-------------------------------------------
Xxxx XxXxxxxxxx, not in his individual
capacity but solely as trustee of the Trust
A-2
EXHIBIT B
[
]
Attention: [ ]
General Counsel's Officer
Re: MRH Capital Trust II [ ]% Trust Originated Preferred Securities
Ladies and Gentlemen:
The purpose of this letter is to set forth certain matters relating to
the issuance and deposit with [ ] of the MRH Capital Trust II [ ]%
Trust Originated Preferred Securities (the "Preferred Securities"), of MRH
Capital Trust II, a Delaware statutory trust (the "Issuer"), governed by an
Amended and Restated Trust Agreement among Montpelier Re Holdings Ltd.
("Montpelier") and [ ], as Property Trustee, [ ], as Delaware
Trustee, and the Administrative Trustees named therein. The payment of
distributions on the Preferred Securities, and payments due upon liquidation of
Issuer or redemption of the Preferred Securities, to the extent the Issuer has
funds available for the payment thereof are guaranteed by Montpelier Re Holdings
Ltd., a company incorporated and organized under the laws of Bermuda, set forth
in a Guarantee Agreement dated [ ], 200__ by Montpelier with respect to
the Preferred Securities. Montpelier and the Issuer propose to sell the
Preferred Securities to certain Underwriters (the "Underwriters") pursuant to an
Underwriting Agreement dated [ ], 200__ by and among the Underwriters, the
Issuer and Montpelier dated [ ], 200__, and the Underwriters wish to take
delivery of the Preferred Securities through [ ]. [ ] is acting as
transfer agent, registrar and paying agent with respect to the Preferred
Securities (the "Transfer Agent and Registrar").
To induce [ ] to accept the Preferred Securities as eligible for
deposit at [ ], and to act in accordance with [ ]'s rules with respect to
the Preferred Securities, the Issuer, the Transfer Agent and Registrar and
[ ] agree among each other as follows:
(1) Prior to the closing of the sale of the Preferred Securities to
the Underwriters, which is expected to occur on or about [ ], 200__, there
shall be deposited with [ ] one or more global certificates (individually
and collectively, the "Global Certificate") registered in the name of
[ ]'s Preferred Securities nominee, [ ], representing an aggregate
of Preferred Securities and bearing the following legend:
Unless this certificate is presented by an authorized representative of
[ ], to the Issuer or its agent for registration of transfer, exchange, or
payment, and any certificate issued is registered in the name of [ ] or in
such other name as is requested by an authorized representative of [ ]
(and any payment is made to [ ] or to such other entity as is requested by
an authorized representative of [ ]), ANY TRANSFER, PLEDGE, OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
B-1
PERSON IS WRONGFUL inasmuch as the registered owner hereof, [ ], has an
interest herein.
(2) The Amended and Restated Trust Agreement of the Issuer provides
for the voting by holders of the Preferred Securities under certain limited
circumstances. The Issuer shall establish a record date for such purposes and
shall, to the extent possible, give [ ] notice of such record date not
less than fifteen (15) calendar days in advance of such record date.
(3) In the event of a stock split, conversion, recapitalization,
reorganization or any other similar transaction resulting in the cancellation of
all or any part of the Preferred Securities outstanding, the Issuer or the
Transfer Agent and Registrar shall send [ ] a notice of such event at
least five (5) business days prior to the effective date of such event.
(4) In the event of distribution on, or an offering or issuance of
rights with respect to, the Preferred Securities outstanding, the Issuer or the
Transfer Agent and Registrar shall send [ ] a notice specifying: (a) the
amount of and conditions, if any, applicable to the payment of any such
distribution or any such offering or issuance of rights; (b) any applicable
expiration or deadline date, or any date by which any action on the part of the
holders of Preferred Securities is required; and (c) the date any required
notice is to be mailed by or on behalf of the Issuer to holders of Preferred
Securities or published by or on behalf of the Issuer (whether by mail or
publication, the "Publication Date"). Such notice shall be sent to [ ] by
a secure means (e.g., legible telecopy, registered or certified mail, overnight
delivery) in a timely manner designed to assure that such notice is in
[ ]'s possession no later than the close of business on the business day
before the Publication Date. The Issuer or the Transfer Agent and Registrar
will forward such notice either in a separate secure transmission for each CUSIP
number or in a secure transmission of multiple CUSIP numbers (if applicable)
that includes a manifest or list of each CUSIP number submitted in that
transmission. (The party sending such notice shall have a method to verify
subsequently the use of such means and the timeliness of such notice.) The
Publication Date shall be not less than thirty (30) calendar days nor more than
sixty (60) calendar days prior to the payment of any such distribution or any
such offering or issuance of rights with respect to the Preferred Securities.
After establishing the amount of payment to be made on the Preferred Securities,
the Issuer or the Transfer Agent and Registrar will notify [ ] of such
payment five (5) business days prior to payment date. Notices to [ ] by
telecopy shall be sent to [ ]. Such notices by mail or by any other means
shall be sent to:
[
]
The Issuer or the Transfer Agent and Registrar shall confirm
[ ]'s receipt of such telecopy by telephoning
[ ] at [ ].
B-2
(5) In the event of a redemption by the Issuer of the Preferred
Securities, notice specifying the terms of the redemption and the Publication
Date of such notice shall be sent by the Issuer or the Transfer Agent and
Registrar to [ ] not less than thirty (30) calendar days prior to such
event by a secure means in the manner set forth in paragraph 4. Such redemption
notice shall be sent to [ ] at [ ], and receipt of such notice shall
be confirmed by telephoning [ ]. Notice by mail or by any other means
shall be sent to:
[
]
(6) In the event of any invitation to tender the Preferred
Securities, notice specifying the terms of the tender and the Publication Date
of such notice shall be sent by the Issuer or the Transfer Agent and Registrar
to [ ] by a secure means and in a timely manner as described in
paragraph 4. Notices to [ ] pursuant to this paragraph and notices of
other corporate actions (including mandatory tenders, exchanges and capital
changes) shall be sent, unless notification to another department is expressly
provided for herein, by telecopy to [ ] at [ ] and receipt of such
notice shall be confirmed by telephoning [ ], or by mail or any other
means to:
[
]
(7) All notices and payment advices sent to [ ] shall contain the
CUSIP number or numbers of the Preferred Securities and the accompanying
designation of the Preferred Securities, which, as of the date of this letter,
is MRH Capital Trust II [ ]% Trust Originated Preferred Securities.
(8) Distribution payments or other cash payments with respect to the
Preferred Securities evidenced by the Global Certificate shall be received by
[ ], as nominee of [ ], or its registered assigns in next day funds
on each payment date (or in accordance with existing arrangements between the
Issuer or the Transfer Agent and Registrar and [ ]). Such payments shall
be made payable to the order of [ ], and shall be addressed as follows:
[
]
B-3
(9) [ ] may be prior written notice direct the Issuer and the
Transfer Agent and Registrar to use any other telecopy number or address of
[ ] as the number or address to which notices or payments may be sent.
(10) In the event of a conversion, redemption, or any other similar
transaction (e.g., tender made and accepted in response to the Issuer's or the
Transfer Agent and Registrar's invitation) necessitating a reduction in the
aggregate number of Preferred Securities outstanding evidenced by Global
Certificates, [ ], in its discretion: (a) may request the Issuer or the
Transfer Agent and Registrar to issue and countersign a new Global Certificate;
or (b) may make an appropriate notation on the Global Certificate indicating the
date and amount of such reduction.
(11) [ ] may discontinue its services as a securities
depositary with respect to the Preferred Securities at any time by giving at
least ninety (90) days' prior written notice to the Issuer and the Transfer
Agent and Registrar (at which time [ ] will confirm with the Issuer or the
Transfer Agent and Registrar the aggregate number of Preferred Securities
deposited with it) and discharging its responsibilities with respect thereto
under applicable law. Under such circumstances, the Issuer may determine to make
alternative arrangements for book-entry settlement for the Preferred Securities,
make available one or more separate global certificates evidencing Preferred
Securities to any Participant having Preferred Securities credited to its
[ ] account, or issue definitive Preferred Securities to the beneficial
holders thereof, and in any such case, [ ] agrees to cooperate fully with
the Issuer and the Transfer Agent and Registrar, and to return the Global
Certificate, and the Transfer Agent and Registrar, and to return the Global
Certificate, duly endorsed for transfer as directed by the Issuer or the
Transfer Agent and Registrar, together with any other documents of transfer
reasonably requested by the Issuer of the Transfer Agent and Registrar.
(12) In the event that the Issuer determines that beneficial owners
of Preferred Securities shall be able to obtain definitive Preferred Securities,
the Issuer or the Transfer Agent and Registrar shall notify [ ] of the
availability of certificates. In such event, the Issuer or the Transfer Agent
and Registrar shall issue, transfer and exchange certificates in appropriate
amounts, as required by [ ] and others, and [ ] agrees to cooperate
fully with the Issuer and the Transfer Agent and Registrar and to return the
Global Certificate, duly endorsed for transfer as directed by the Issuer or the
Transfer Agent and Registrar, together with any other documents of transfer
reasonably requested by the Issuer or the Transfer Agent and Registrar.
[THE REST OF THIS PAGE LEFT INTENTIONALLY BLANK]
B-4
(13) This letter may be executed in any number of counterparts, each
of which when so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument. Nothing
herein shall be deemed to require the Transfer Agent and Registrar to advance
funds on behalf of MRH Capital Trust II.
Very truly yours,
MRH CAPITAL TRUST II
(As Issuer)
By:
-----------------------------------------------
Administrative Trustee
By:
-----------------------------------------------
Name:
Title:
-----------------------------------------------
(As Transfer Agent, Paying Agent and Registrar)
By:
--------------------------------------------
Name:
Title:
Received and Accepted:
[ ]
By:
--------------------------------------------
Authorized Officer
[ ], as Property Trustee
B-5
EXHIBIT C
THIS CERTIFICATE IS NOT TRANSFERABLE
EXCEPT AS PROVIDED IN THE
TRUST AGREEMENT (AS DEFINED BELOW)
CERTIFICATE NUMBER NUMBER OF COMMON SECURITIES
C-_______________ ___________________________
CERTIFICATE EVIDENCING COMMON SECURITIES
OF
MRH CAPITAL TRUST II
[ ]% Common Securities
(liquidation amount $[ ] per Common Security)
MRH Capital Trust II, a statutory trust formed under the laws of the
State of Delaware (the "Trust"), hereby certifies that Montpelier Re Holdings
Ltd. (the "Holder") is the registered owner of [ ] ([ ]) common
securities of the Trust representing undivided beneficial interests in the
assets of the Trust and designated the [ ]% Common Securities (liquidation
amount $[ ] per Common Security) (the "Common Securities"). In accordance
with Section 5.10 of the Trust Agreement (as defined below) the Common
Securities are not transferable and any attempted transfer hereof shall be void.
The designations, and any attempted transfer hereof shall be void. The
designations, rights, privileges, restrictions, preferences and other terms and
provisions of the Common Securities are set forth in, and this certificate and
the Common Securities represented hereby are issued and shall in all respects be
subject to the terms and provisions of, the Amended and Restated Trust Agreement
of the Trust, dated as of [ ], 200__, as the same may be amended from time
to time (the "Trust Agreement"), including the designation of the terms of the
Common Securities as set forth therein. The Trust will furnish a copy of the
Trust Agreement to the Holder without charge upon written request to the Trust
at its principal place of business or registered office.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.
C-1
IN WITNESS WHEREOF, one of the Administrative Trustees of the Trust has
executed this certificate this [ ] day of [ ], 200__.
MRH CAPITAL TRUST II
By:
-------------------------------
Name: [ ]
Title: Administrative Trustee
C-2
EXHIBIT D
AGREEMENT AS TO EXPENSES AND LIABILITIES
AGREEMENT dated as of [ ], 200__, between Montpelier Re Holdings
Ltd., a company incorporated and organized under the laws of Bermuda ("MRH"),
and MRH Capital Trust II, a Delaware statutory trust (the "Trust").
WHEREAS, the Trust intends to issue its Common Securities (the "Common
Securities") to and receive Debentures from Montpelier, and to issue and sell
[ ]% Trust Originated Preferred Securities (the "Preferred Securities") with
such powers, preferences and special rights and restrictions as are set forth in
the Amended and Restated Trust Agreement of the Trust dated as of [ ],
200__, as the same may be amended from time to time (the "Trust Agreement");
WHEREAS, Montpelier will directly or indirectly own all of the Common
Securities of the Trust and will issue the Debentures;
WHEREAS, Montpelier has agreed to guarantee certain expenses and
limitations of the Trust as provided herein;
NOW, THEREFORE, in consideration of the purchase by each holder of the
Preferred Securities, which purchase Montpelier hereby agrees shall benefit
Montpelier and which purchase Montpelier acknowledges will be made in reliance
upon the execution and delivery of this Agreement, Montpelier and the Trust
hereby agree as follows:
ARTICLE I
SECTION 1.1. GUARANTEE BY MONTPELIER.
Subject to the terms and conditions hereof, Montpelier hereby
irrevocably and unconditionally guarantees to each person or entity to whom the
Trust is now or hereafter becomes indebted or liable (the "Beneficiaries") the
full payment, when and as due, of any and all Obligations (as hereinafter
defined) to such Beneficiaries. As used herein, "Obligations" means any costs,
expenses or liabilities of the Trust, other than obligations of the Trust to pay
to holders of any Preferred Securities or other similar interests in the Trust
the amounts due such holders pursuant to the terms of the Preferred Securities
or such other similar interests, as the case may be. This Agreement is intended
to be for the benefit of, and to be enforceable by, all such Beneficiaries,
whether or not such Beneficiaries have received notice hereof.
SECTION 1.2. TERM OF AGREEMENT.
This Agreement shall terminate and be of no further force and effect
upon the later of (a) the date on which full payment has been made of all
amounts payable to all holders of all the Preferred Securities (whether upon
redemption, liquidation, exchange or otherwise) and (b) the date on which there
are no Beneficiaries remaining; provided, however, that this Agreement shall
continue to be effective or shall be reinstated, as the case may be, if at any
time any holder of Preferred Securities or any Beneficiary must restore payment
of any sums paid under the
D-1
Preferred Securities, under any Obligation, under the Guarantee Agreement dated
the date hereof between Montpelier , in its capacity as guarantor with respect
to the Preferred Securities, and [ ], as guarantee trustee, or under this
Agreement for any reason whatsoever. This Agreement is continuing, irrevocable,
unconditional and absolute.
SECTION 1.3. WAIVER OF NOTICE.
Montpelier hereby waives notice of acceptance of this Agreement and of
any Obligation to which it applies or may apply, and Montpelier hereby waives
presentment, demand for payment, protest, notices of nonpayment, notice of
dishonor, notice of redemption and all other notices and demands.
SECTION 1.4. NO IMPAIRMENT.
The obligations, covenants, agreements and duties of Montpelier under
this Agreement shall in no way be affected or impaired by reason of the
happening from time to time of any of the following:
(a) the extension of time for the payment by the Trust of all or any
portion of the Obligations or for the performance of any other obligation under,
arising out of, or in connection with, the Obligations;
(b) any failure, omission, delay or lack of diligence on the part of the
Beneficiaries to enforce, assert or exercise any right, privilege, power or
remedy conferred on the Beneficiaries with respect to the Obligations or any
action on the part of the Trust granting indulgence or extension of any kind;
(c) 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 Trust or any of the assets of the
Trust.
There shall be no obligation of the Beneficiaries to give notice to, or
obtain the consent of, Montpelier with respect to the happening of any of the
foregoing.
SECTION 1.5. ENFORCEMENT.
A Beneficiary may enforce this Agreement directly against Montpelier and
Montpelier waives any right or remedy to require that any action be brought
against the Trust or any other person or entity before proceeding against
Montpelier .
SECTION 1.6. SUBROGATION.
Montpelier shall be subrogated to all (if any) rights of the Trust in
respect of any amounts paid to the Beneficiaries by Montpelier under this
Agreement; provided, however, that Montpelier shall not (except to the extent
required by mandatory provisions of law) be entitled to enforce or exercise any
rights which it may acquire by way of subrogation or any indemnity,
D-2
reimbursement or other agreement, in all cases as a result of payment under this
Agreement, if, at the time of any such payment, any amounts are due and unpaid
under this Agreement.
ARTICLE II.
SECTION 2.1. BINDING EFFECT.
All guarantees and agreements contained in this Agreement shall bind the
successors, assigns, receivers, trustees and representatives of Montpelier and
shall inure to the benefit of the Beneficiaries.
SECTION 2.2. AMENDMENT.
So long as there remains any Beneficiary or any Preferred Securities are
outstanding, this Agreement shall not be modified or amended in any manner
adverse to such Beneficiary or to the holders of the Preferred Securities.
SECTION 2.3. NOTICES.
Any notice, request or other communication required or permitted to be
given hereunder shall be given in writing by delivering the same against receipt
therefor by facsimile transmission (confirmed by mail), telex or by registered
or certified mail, addressed as follows (and if so given, shall be deemed given
when mailed or upon receipt of an answer-back, if sent by telex):
MRH Capital Trust II
c/o _______________________
______________________________
______________________________
Facsimile: [ ]
Attention: [ ]
Montpelier Re Holdings Ltd.
Mintflower Place
0 Xxx-Xx-Xxxxx Xxxx
Xxxxxxxx XX 00
Xxxxxxx
Xxxxxxxxx: [ ]
Attention: [ ]
SECTION 2.4 GOVERNING LAW.
This Agreement shall be governed by and construed and interpreted in
accordance with the laws of the State of New York.
D-3
THIS AGREEMENT is executed as of the day and year first above written.
MONTPELIER RE HOLDINGS LTD.
By:
-------------------------------
Name:
Title:
[SEAL]
MRH CAPITAL TRUST II
By:
-------------------------------
Name:
Title:
D-4
EXHIBIT E
This Preferred Security is a Global Certificate within the meaning of
the Trust Agreement hereinafter referred to and is registered in the name of
[ ] (the "Depository") or a nominee of the Depository. This Preferred
Security is exchangeable for Preferred Securities registered in the name of a
person other than the Depository or its nominee only in the limited
circumstances described in the Trust Agreement and no transfer of this Preferred
Security (other than a transfer of this Preferred Security as a whole by the
Depository to a nominee of the Depository or by a nominee of the Depository to
the Depository or another nominee of the Depository) may be registered except in
limited circumstances.
Unless this Preferred Security is presented by an authorized
representative of [ ] to MRH Capital Trust II or its agent for
registration of transfer, exchange or payment, and any Preferred Security issued
is registered in the name of [ ] or such other name as requested by an
authorized representative of [ ] and any payment hereon is made to
[ ], ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY
A PERSON IS WRONGFUL inasmuch as the registered owner hereof, [ ], has
an interest herein.
CERTIFICATE NUMBER NUMBER OF PREFERRED SECURITIES
P-______________ ______________________________
CERTIFICATE EVIDENCING PREFERRED SECURITIES
OF
MRH CAPITAL TRUST II
[ ]% Trust Originated Preferred Securities
(liquidation amount $[ ] per Preferred Security)
MRH Capital Trust II, a statutory trust formed under the laws of the
State of Delaware (the "Trust"), hereby certifies that [ ] (the "Holder")
is the registered owner of [ ] ([ ]) preferred securities of the
Trust representing an undivided beneficial interest in the assets of the Trust
and designated the MRH Capital Trust II [ ]% Trust Originated Preferred
Securities (Liquidation Amount $[ ] per Preferred Security) (the
"Preferred Securities"). The Preferred Securities are transferable on the books
and records of the Trust, in person or by a duly authorized attorney, upon
surrender of this certificate duly endorsed and in proper form for transfer as
provided in Section 5.4 of the Trust Agreement (as defined below). The
designations, rights, privileges, restrictions, preferences and other terms and
provisions of the Preferred Securities are set forth in, and this certificate
and the Preferred Securities represented hereby are issued and shall in all
respects be subject to the terms and provisions of the Amended and Restated
Trust Agreement of the Trust, dated as of [ ], 200__, as the same may be
amended from time to time (the "Trust
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Agreement"), including the designation of the terms of Preferred Securities as
set forth therein. The Holder is entitled to the benefits of the Guarantee
Agreement entered into by Montpelier Re Holdings Ltd., a company incorporated
and organized under the laws of Bermuda, and [ ], as guarantee trustee,
dated as of [ ], 200__ (the "Guarantee"), to the extent provided
therein. The Trust will furnish a copy of the Trust Agreement and the Guarantee
to the Holder without charge upon written request to the Trust at its principal
place of business or registered office.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.
IN WITNESS WHEREOF, one of the Administrative Trustees of the Trust has
executed this certificate this [ ]th day of [ ], 200__.
MRH CAPITAL TRUST II
By:
----------------------------------
Name:
Administrative Trustee
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Preferred
Security to:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Insert assignee's social security or tax identification number)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Insert address and zip code of assignee)
and irrevocably appoints _______________________________________________________
________________________________________________________________________________
________________________________________________________________________________
agent to transfer this Preferred Security Certificate on the books of the Trust.
The agent may substitute another to act for him or her.
Date: ----------
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Signature: -----------------------------------
(Sign exactly as your name appears on the other side of this Preferred Security
Certificate)
SIGNATURE(S) GUARANTEED:
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION
(BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATION AND CREDIT UNIONS WITH
MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT TO
S.E.C. RULE 17Ad-15.
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