Exhibit 4(o)
================================================================================
TRUST PREFERRED SECURITIES GUARANTEE AGREEMENT
HAWAIIAN ELECTRIC INDUSTRIES CAPITAL TRUST I
DATED AS OF JANUARY [ ], 1997
================================================================================
TABLE OF CONTENTS
Page
----
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation......................... 2
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application....................... 7
SECTION 2.2 Lists of Holders of Securities......................... 7
SECTION 2.3 Reports by the Trust Guarantee Trustee................. 8
SECTION 2.4 Periodic Reports to the Trust Guarantee Trustee........ 8
SECTION 2.5 Evidence of Compliance with Conditions Precedent....... 8
SECTION 2.6 Events of Default; Waiver.............................. 8
SECTION 2.7 Event of Default; Notice............................... 9
SECTION 2.8 Conflicting Interests.................................. 9
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
THE TRUST GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Trust Guarantee Trustee....... 9
SECTION 3.2 Certain Rights of the Trust Guarantee Trustee.......... 12
SECTION 3.3 Not Responsible for Recitals or Issuance of the Trust
Preferred Securities Guarantee......................... 15
ARTICLE IV
THE TRUST GUARANTEE TRUSTEE
SECTION 4.1 The Trust Guarantee Trustee; Eligibility............... 15
SECTION 4.2 Appointment, Removal and Resignation of the Trust
Guarantee Trustee...................................... 16
SECTION 4.3 Successor to the Trust Guarantee Trustee by Merger,
Consolidation or Succession to Business................ 17
ARTICLE V
THE TRUST PREFERRED SECURITIES GUARANTEE
SECTION 5.1 Guarantee.............................................. 17
SECTION 5.2 Waiver of Notice and Demand............................ 17
SECTION 5.3 Obligations Not Affected............................... 17
SECTION 5.4 Rights of Holders...................................... 19
SECTION 5.5 Guarantee of Payment................................... 19
SECTION 5.6 Subrogation............................................ 19
SECTION 5.7 Independent Obligations................................ 20
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions............................. 20
SECTION 6.2 Ranking................................................ 11
ARTICLE VII
TERMINATION
SECTION 7.1 Termination............................................ 22
ARTICLE VIII
EXCULPATION AND INDEMNIFICATION
SECTION 8.1 Exculpation............................................ 22
SECTION 8.2 Indemnification........................................ 23
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns................................. 23
SECTION 9.2 Amendments............................................. 23
SECTION 9.3 Merger of the Guarantor................................ 24
SECTION 9.4 Notices................................................ 24
SECTION 9.5 Benefit................................................ 25
SECTION 9.6 Governing Law.......................................... 25
CROSS-REFERENCE TABLE*
SECTION OF SECTION OF
TRUST INDENTURE ACT GUARANTEE
OF 1939, AS AMENDED AGREEMENT
------------------- ----------
310(a)...................................................... 4.1(a)
310(b)...................................................... 4.1(c), 2.8
310(c)...................................................... Inapplicable
311(a)...................................................... 2.2(b)
311(b)...................................................... 2.2(b)
311(c)...................................................... Inapplicable
312(a)...................................................... 2.2(a)
312(b)...................................................... 2.2(b)
313......................................................... 2.3
314(a)...................................................... 2.4
314(b)...................................................... Inapplicable
314(c)...................................................... 2.5
314(d)...................................................... Inapplicable
314(e)...................................................... 1.1, 2.5, 3.2
314(f)...................................................... 2.1, 3.2
315(a)...................................................... 3.1(d)
315(b)...................................................... 2.7
315(c)...................................................... 3.1
315(d)...................................................... 3.1(d)
316(a)...................................................... 1.1, 2.6, 5.4
316(b)...................................................... 5.3
316(c)...................................................... 9.2
317(a)...................................................... Inapplicable
318(a)...................................................... Inapplicable
318(a)...................................................... 2.1(b)
318(b)...................................................... 2.1
318(c)...................................................... 2.1(a)
--------
* This Cross-Reference Table does not constitute part of this Trust Preference
Securities Guarantee Agreement and shall not affect the interpretation of any
of its terms or provisions.
Trust Preferred Securities Guarantee Agreement
This TRUST PREFERRED SECURITIES GUARANTEE AGREEMENT (this "Trust
Preferred Securities Guarantee"), dated as of February __, 1997, is executed and
delivered by Hawaiian Electric Industries, Inc., a Hawaii corporation (the
"Guarantor" or the "Company"), and The Bank of New York, a New York banking
corporation, as trustee (the "Trust Guarantee Trustee"), for the benefit of the
Holders (as defined herein) from time to time of the Trust Preferred Securities
(as defined herein) of Hawaiian Electric Industries Capital Trust I, a Delaware
statutory business trust (the "Trust").
WHEREAS, pursuant to an Amended and Restated Trust Agreement (the
"Trust Agreement"), dated as of February __, 1997, among the trustees of the
Trust named therein, Hawaiian Electric Industries, Inc., as sponsor, and the
holders from time to time of undivided beneficial interests in the assets of the
Trust, the Trust is issuing on the date hereof 4,000,000 Trust Originated
Preferred Securities, having an aggregate liquidation amount of $100,000,000,
designated the % Trust Originated Preferred Securities (the "Trust
Preferred Securities");
WHEREAS, as incentive for the Holders to purchase the Trust Preferred
Securities, the Guarantor desires irrevocably and unconditionally to agree, to
the extent set forth in this Trust Preferred Securities Guarantee, to pay to the
Holders of the Trust Preferred Securities the Guarantee Payments (as defined
herein) and to make certain other payments on the terms and conditions set forth
herein and;
WHEREAS, the Guarantor is also executing and delivering a guarantee
agreement (the "Trust Common Securities Guarantee") in substantially identical
terms to this Trust Preferred Securities Guarantee for the benefit of the
holders of the Trust Common Securities (as defined herein), except that if the
Company is in default on any of its obligations under this Trust Preferred
Securities Guarantee or the Partnership Guarantee or an Investment Event of
Default (as defined herein) has occurred and is continuing and the Company is in
default on any of its obligations with respect thereto under an applicable
Investment Guarantee, the rights of holders of the Trust Common Securities to
receive Guarantee Payments under the
1
Trust Common Securities Guarantee are subordinated to the rights of Holders of
Trust Preferred Securities to receive Guarantee Payments under this Trust
Preferred Securities Guarantee.
NOW, THEREFORE, in consideration of the purchase by each Holder of
Trust Preferred Securities, which purchase the Guarantor hereby agrees shall
benefit the Guarantor, the Guarantor executes and delivers this Trust Preferred
Securities Guarantee for the benefit of the Holders.
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation
In this Trust Preferred Securities Guarantee, unless the context
otherwise requires:
(a) capitalized terms used in this Trust Preferred Securities
Guarantee but not defined in the preamble above have the respective meanings
assigned to them in this Section 1.1;
(b) capitalized terms used in this Trust Preferred Securities
Guarantee but not otherwise defined herein shall have the meanings assigned to
them in the Trust Agreement or the Agreement of Limited Partnership, as the case
may be;
(c) a term defined anywhere in this Trust Preferred Securities
Guarantee has the same meaning throughout;
(d) all references to "this Trust Preferred Securities Guarantee" are
to this Trust Preferred Securities Guarantee as modified, supplemented or
amended from time to time;
(e) all references in this Trust Preferred Securities Guarantee to
Articles and Sections are to Articles and Sections of this Trust Preferred
Securities Guarantee, unless otherwise specified;
(f) a term defined in the Trust Indenture Act has the same meaning
when used in this Trust Preferred Securities Guarantee, unless otherwise defined
in this Trust Preferred
2
Securities Guarantee or unless the context otherwise requires; and
(g) a reference to the singular includes the plural and vice versa.
"Affiliate" means, with respect to any specified Person, any other
Person that directly or indirectly controls or is controlled by, or is under
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.
"Affiliate Investment Instruments" has the meaning set forth in the
Agreement of Limited Partnership.
"Agreement of Limited Partnership" means the Amended and Restated
Agreement of Limited Partnership of the Partnership, dated as of February ____,
1997, among Hycap Management, Inc., a Delaware corporation, as general partner,
Hawaiian Electric Industries Capital Trust I, a Delaware statutory business
trust, as initial limited partner, and such other Persons who become limited
partners as provided therein.
"Business Day" means any day other than a day on which banking
institutions in the City of New York, State of New York are authorized or
required by any applicable law to close.
"Comparable Equity Interest" shall mean any preferred security
hereafter issued by any finance subsidiary of which the Company is the parent
company and the principal purpose of which is to lend the proceeds of the sale
thereof to the Company or to eligible affiliates of the Company.
"Corporate Trust Office" means the principal trust office of the Trust
Guarantee Trustee at which, at any particular time, its corporate trust business
shall be administered, which office at the date hereof is located at 000 Xxxxxxx
Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Corporate Trust
Trustee Administration.
3
"Covered Person" means any Holder or beneficial owner of Trust
Preferred Securities.
"Event of Default" means a default by the Guarantor on any of its
payment or other obligations under this Trust Preferred Securities Guarantee.
"Guarantee Payments" means the following payments or distributions,
without duplication, with respect to the Trust Preferred Securities, to the
extent not paid or made by the Trust: (i) any accumulated and unpaid
Distributions (as defined in the Trust Agreement) that are required to be paid
on such Trust Preferred Securities to the extent the Trust shall have funds
available therefor, (ii) the redemption price, including all accumulated and
unpaid Distributions to the date of redemption (the "Redemption Price") to the
extent the Trust has funds available therefor, with respect to any Trust
Preferred Securities called for redemption by the Trust, and (iii) upon a
voluntary or involuntary dissolution, winding-up or termination of the Trust
(other than in connection with the distribution of Partnership Preferred
Securities to the Holders as provided in the Trust Agreement or the redemption
of all of the Trust Preferred Securities), the lesser of (a) the aggregate of
the liquidation amount and all accumulated and unpaid Distributions on the Trust
Preferred Securities to the date of payment and (b) the amount of assets of the
Trust, after satisfaction of all liabilities, remaining available for
distribution to Holders in liquidation of the Trust (in either case, the
"Liquidation Distribution").
"Holder" shall mean any and each holder, as registered on the books
and records of the Trust of any Trust Preferred Securities; provided, however,
that, in determining whether the holders of the requisite percentage of Trust
Preferred Securities have given any request, notice, consent or waiver
hereunder, "Holder" shall not include the Guarantor or any Affiliate of the
Guarantor.
"Indemnified Person" means the Trust Guarantee Trustee, any Affiliate
of the Trust Guarantee Trustee, or any officers, directors, shareholders,
members, partners, employees, representatives, nominees, custodians or agents of
the Trust Guarantee Trustee.
4
"Investment Affiliate" means the Company or any corporation,
partnership, limited liability company or other entity (other than the
Partnership, the general partner of the Partnership or the Trust) that is
controlled by the Company and is not an investment company by reason of
Section 3(a) or 3(b) of the 1940 Act.
"Investment Event of Default" means an event of default under any
Affiliate Investment Instrument that is a debt instrument or the breach by an
Investment Affiliate of its obligations under any Affiliate Investment
Instrument that is an equity instrument.
"Majority in liquidation amount of the Trust Preferred Securities"
means, except as provided by the Trust Indenture Act, a vote by Holders of Trust
Preferred Securities, voting separately as a class, of more than 50% of the
aggregate liquidation amount (including the stated amount that would be paid on
redemption, liquidation or otherwise, plus accumulated and unpaid Distributions
to the date upon which the voting percentages are determined) of all Trust
Preferred Securities.
"Officers' Certificate" means, with respect to any Person, a
certificate signed by two Authorized Officers of such Person. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Trust Preferred Securities Guarantee shall include:
(a) a statement that each officer signing the Officers' Certificate
has read the covenant or condition and the definition relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Officers' Certificate;
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such officer
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(d) a statement as to whether, in the opinion of each such officer,
such condition or covenant has been complied with.
5
"Partnership" means HEI Preferred Funding, LP.
"Partnership Preferred Securities" means those securities representing
limited partner interests in the Partnership.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever
nature.
"Responsible Officer" means, with respect to the Trust Guarantee
Trustee, any officer within the Corporate Trust Office of the Trust Guarantee
Trustee, including any vice president, any assistant vice president, any
assistant secretary, any assistant treasurer or other officer of the Trust
Guarantee Trustee customarily performing functions similar to those performed by
any of the above designated officers and also means, with respect to a
particular corporate trust matter, any other officer to whom such matter is
referred because of that officer's knowledge of and familiarity with the
particular subject.
"Successor Trust Guarantee Trustee" means a successor Trust Guarantee
Trustee possessing the qualifications to act as Trust Guarantee Trustee under
Section 4.1.
"Trust Common Securities" means the securities representing common
undivided beneficial interests in the assets of the Trust.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended.
"Trust Guarantee Trustee" means The Bank of New York, a New York
banking corporation, until a Successor Trust Guarantee Trustee has been
appointed and has accepted such appointment pursuant to the terms of this Trust
Preferred Securities Guarantee and thereafter means each such Successor Trust
Guarantee Trustee.
"Trust Securities" means the Trust Common Securities together with the
Trust Preferred Securities.
6
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application
(a) This Trust Preferred Securities Guarantee is subject to the
provisions of the Trust Indenture Act that are required to be part of this Trust
Preferred Securities Guarantee and shall, to the extent applicable, be governed
by such provisions.
(b) If and to the extent that any provision of this Trust Preferred
Securities Guarantee limits, qualifies or conflicts with the duties imposed by
Section 310 to 317, inclusive, of the Trust Indenture Act, the duties imposed by
the Trust Indenture Act shall control.
SECTION 2.2 Lists of Holders of Securities
(a) The Trust Guarantee Trustee shall preserve in as current a form as
is reasonably practicable the most recent list available to it of the names and
addresses of Holders of Trust Preferred Securities. If the Trust Guarantee
Trustee is not the Registrar, the Guarantor shall furnish (or cause to be
furnished) to the Trust Guarantee Trustee semi-annually on or before the last
day of June and December in each year, and at such other times as the Trust
Guarantee Trustee may request in writing, a list, in such form and as of such
date as the Trust Guarantee Trustee may reasonably require, containing all the
information in the possession or control of the Registrar, the Guarantor or any
of its Paying Agents other than the Trust Guarantee Trustee as to the names and
addresses of Holders of Trust Preferred Securities. If there are unregistered
securities outstanding, even if the Trust Guarantee Trustee is the Registrar,
the Company shall furnish to the Trust Guarantee Trustee such a list containing
such information with respect to Holders of such unregistered securities only.
(b) The Trust Guarantee Trustee shall comply with its obligations
under Sections 311(a), 311(b) and Section 312(b) of the Trust Indenture Act.
7
SECTION 2.3 Reports by the Trust Guarantee Trustee
Within 60 days after May 15 of each year, the Trust Guarantee Trustee
shall provide to the Holders of the Trust Preferred Securities such reports as
are required by Section 313 of the Trust Indenture Act, if any, in the form and
in the manner provided by Section 313 of the Trust Indenture Act. The Trust
Guarantee Trustee shall also comply with the requirements of Section 313(d) of
the Trust Indenture Act.
SECTION 2.4 Periodic Reports to the Trust Guarantee Trustee
The Guarantor shall provide to the Trust Guarantee Trustee such
documents, reports and information as required by Section 314 (if any) and the
compliance certificate required by Section 314 of the Trust Indenture Act in the
form, in the manner and at the times required by Section 314 of the Trust
Indenture Act. Delivery of such reports, information and documents to the Trust
Guarantee Trustee is for informational purposes only and the Trust Guarantee
Trustee's receipt of such shall not constitute constructive notice of
any information contained therein or determinable from information contained
therein.
SECTION 2.5 Evidence of Compliance with Conditions Precedent
The Guarantor shall provide to the Trust Guarantee Trustee such
evidence of compliance with any conditions precedent, if any, provided for in
this Trust Preferred Securities Guarantee that relate to any of the matters set
forth in Section 314(c) of the Trust Indenture Act. Any certificate or opinion
required to be given by an officer pursuant to Section 314(c)(1) may be given in
the form of an Officers' Certificate.
SECTION 2.6 Events of Default; Waiver
The Holders of a Majority in liquidation amount of Trust Preferred
Securities may, by vote, on behalf of the Holders of all of the Trust Preferred
Securities, waive any past Event of Default and its consequences. Upon such
waiver, any such Event of Default shall cease to exist, and any Event of Default
arising therefrom shall be deemed to have been cured, for every purpose of this
Trust Preferred Securities Guarantee, but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon.
8
SECTION 2.7 Event of Default; Notice
(a) The Trust Guarantee Trustee shall, within 90 days after the
occurrence of an Event of Default, transmit by mail, first class postage
prepaid, to the Holders of the Trust Preferred Securities, notices of all Events
of Default actually known to a Responsible Officer of the Trust Guarantee
Trustee, unless such defaults have been cured before the giving of such notice;
provided, however, that the Trust Guarantee Trustee shall be protected in
withholding such notice if and so long as a Responsible Officer of the Trust
Guarantee Trustee in good faith determines that the withholding of such notice
is in the interests of the Holders of the Trust Preferred Securities.
(b) The Trust Guarantee Trustee shall not be deemed to have knowledge
of any Event of Default unless the Trust Guarantee Trustee shall have received
written notice, or of which a Responsible Officer of the Trust Guarantee Trustee
charged with the administration of the Trust Agreement shall have obtained
actual knowledge.
SECTION 2.8 Conflicting Interests
The Trust Agreement shall be deemed to be specifically described in
this Trust Preferred Securities Guarantee for the purposes of clause (i) of the
first proviso contained in Section 310(b) of the Trust Indenture Act.
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
THE TRUST GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Trust Guarantee Trustee
(a) This Trust Preferred Securities Guarantee shall be held by the
Trust Guarantee Trustee for the benefit of the Holders of the Trust Preferred
Securities, and the Trust Guarantee Trustee shall not transfer this Trust
Preferred Securities Guarantee to any Person except a Holder of Trust Preferred
Securities exercising his or her rights pursuant to Section 5.4(b) or to a
Successor Trust Guarantee Trustee on acceptance by such Successor Trust
Guarantee Trustee of its appointment to act as Successor Trust Guarantee
Trustee. The right, title and interest of the Trust Guarantee Trustee shall
9
automatically vest in any Successor Trust Guarantee Trustee, and such vesting
and cessation of title shall be effective whether or not conveyancing documents
have been executed and delivered pursuant to the appointment of such Successor
Trust Guarantee Trustee.
(b) If an Event of Default actually known to a Responsible Officer of
the Trust Guarantee Trustee has occurred and is continuing, the Trust Guarantee
Trustee shall enforce this Trust Preferred Securities Guarantee for the benefit
of the Holders of the Trust Preferred Securities.
(c) The Trust Guarantee Trustee, during the period before the
occurrence of any Event of Default and during the period after the curing or
waiver of all Events of Default that may have occurred, shall undertake to
perform only such duties as are specifically set forth in this Trust Preferred
Securities Guarantee, and no implied covenants shall be read into this Trust
Preferred Securities Guarantee against the Trust Guarantee Trustee. In case an
Event of Default has occurred (that has not been cured or waived pursuant to
Section 2.6) and is actually known to a Responsible Officer of the Trust
Guarantee Trustee, the Trust Guarantee Trustee shall exercise such of the rights
and powers vested in it by this Trust Preferred Securities Guarantee, and use
the same degree of care and skill in its exercise thereof, as a prudent person
would exercise or use under the circumstances in the conduct of his or her own
affairs.
(d) No provision of this Trust Preferred Securities Guarantee shall be
construed to relieve the Trust Guarantee Trustee from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) During the period prior to the occurrence of any Event of
Default and during the period after the curing or waiving of any Events of
Default that may occur:
(A) the duties and obligations of the Trust Guarantee Trustee
shall be determined solely by the express provisions of this Trust
Preferred Securities Guarantee, and the Trust Guarantee Trustee shall
not be liable except for the performance of such duties and
obligations as are specifically set forth in this
10
Trust Securities Guarantee, and no implied covenants or obligations
shall be read into this Trust Securities Guarantee against the Trust
Guarantee Trustee; and
(B) in the absence of bad faith on the part of the Trust
Guarantee Trustee, the Trust Guarantee 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
Trust Guarantee Trustee and conforming to the requirements of this
Trust Preferred Securities Guarantee; but in the case of any such
certificates or opinions that by any provision hereof are specifically
required to be furnished to the Trust Guarantee Trustee, the Trust
Guarantee Trustee shall be under a duty to examine the same to
determine whether or not they conform to the requirements of this
Trust Preferred Securities Guarantee;
(ii) The Trust Guarantee Trustee shall not be liable for any error
of judgment made in good faith by a Responsible Officer of the Trust
Guarantee Trustee, unless it shall be proved that the Trust Guarantee
Trustee was negligent in ascertaining the pertinent facts upon which such
judgment was made;
(iii) The Trust Guarantee Trustee shall not be liable with respect
to any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of Trust Preferred Securities
relating to the time, method and place of conducting any proceeding for any
remedy available to the Trust Guarantee Trustee, or exercising any trust or
power conferred upon the Trust Guarantee Trustee under this Trust Preferred
Securities Guarantee; and
(iv) No provision of this Trust Preferred Securities Guarantee shall
require the Trust Guarantee Trustee to expend or risk its own funds or
otherwise incur personal financial liability in the performance of any of
its duties or in the exercise of any of its rights or powers, if the Trust
Guarantee Trustee shall have reasonable grounds for believing that the
repayment of such funds or
11
liability is not reasonably assured to it under the terms of this Trust
Preferred Securities Guarantee or indemnity, reasonably satisfactory to the
Trust Guarantee Trustee, against such risk or liability is not reasonably
assured to it.
SECTION 3.2 Certain Rights of the Trust Guarantee Trustee
(a) Subject to the provisions of Section 3.1:
(i) The Trust Guarantee Trustee may conclusively rely, and shall be
fully protected in acting or refraining from acting upon, any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document believed by it to be genuine and to
have been signed, sent or presented by the proper party or parties.
(ii) Any direction or act of the Guarantor contemplated by this
Trust Preferred Securities Guarantee shall be sufficiently evidenced by an
Officers' Certificate.
(iii) Whenever, in the administration of this Trust Preferred
Securities Guarantee, the Trust Guarantee Trustee shall deem it desirable
that a matter be proved or established before taking, suffering or omitting
any action hereunder, the Trust Guarantee Trustee (unless other evidence is
herein specifically prescribed) may, in the absence of bad faith on its
part, request and conclusively rely upon an Officers' Certificate which,
upon receipt of such request, shall be promptly delivered by the Guarantor.
(iv) The Trust Guarantee Trustee shall have no duty to see to any
recording, filing or registration of any instrument (or any rerecording,
refiling or registration thereof).
(v) The Trust Guarantee Trustee may, at the expense of the Sponsor,
consult with counsel of its selection, and the advice or opinion of such
counsel with respect to legal matters shall be full and complete
authorization and protection in respect of any action taken, suffered or
12
omitted by it hereunder in good faith and in accordance with such advice or
opinion. Such counsel may be counsel to the Guarantor or any of its
Affiliates and may include any of its employees. The Trust Guarantee
Trustee shall have the right at any time to seek instructions concerning
the administration of this Trust Preferred Securities Guarantee from any
court of competent jurisdiction.
(vi) The Trust Guarantee Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Trust Preferred
Securities Guarantee at the request or direction of any Holder, unless such
Holder shall have provided to the Trust Guarantee Trustee such security and
indemnity, reasonably satisfactory to the Trust Guarantee Trustee, against
the costs, expenses (including attorneys' fees and expenses and the
expenses of the Trust Guarantee Trustee's agents, nominees or custodians)
and liabilities that might be incurred by it in complying with such request
or direction, including such reasonable advances as may be requested by the
Trust Guarantee Trustee; provided that, nothing contained in this Section
3.2(a)(vi) shall be taken to relieve the Trust Guarantee Trustee, upon the
occurrence of an Event of Default, of its obligation to exercise the rights
and powers vested in it by this Trust Preferred Securities Guarantee.
(vii) The Trust Guarantee Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Trust Guarantee Trustee,
in its discretion, may make such further inquiry or investigation into such
facts or matters as it may see fit.
(viii) The Trust Guarantee Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by or
through agents, nominees, custodians or attorneys, and the Trust Guarantee
Trustee shall not be responsible for any misconduct or negligence on the
part of any agent or attorney appointed with due care by it hereunder.
13
(ix) Any action taken by the Trust Guarantee Trustee or its agents
hereunder shall bind the Holders of the Trust Preferred Securities, and the
signature of the Trust Guarantee Trustee or its agents alone shall be
sufficient and effective to perform any such action. No third party shall
be required to inquire as to the authority of the Trust Guarantee Trustee
to so act or as to its compliance with any of the terms and provisions of
this Trust Preferred Securities Guarantee, both of which shall be
conclusively evidenced by the Trust Guarantee Trustee or its agent taking
such action.
(x) Whenever in the administration of this Trust Preferred
Securities Guarantee the Trust Guarantee Trustee shall deem it desirable to
receive instructions with respect to enforcing any remedy or right or
taking any other action hereunder, the Trust Guarantee Trustee (i) may
request instructions from the Holders of a Majority in liquidation amount
of the Trust Preferred Securities, (ii) may refrain from enforcing such
remedy or right or taking such other action until such instructions are
received, and (iii) shall be protected in conclusively relying on or acting
in accordance with such instructions.
(xi) The Trust Guarantee Trustee shall not be liable for any action
taken, suffered, or omitted to be taken by it in good faith and reasonably
believed by it to be authorized or within the discretion or rights or
powers conferred upon it by this Trust Preferred Securities Guarantee.
(b) No provision of this Trust Preferred Securities Guarantee shall be
deemed to impose any duty or obligation on the Trust Guarantee Trustee to
perform any act or acts or exercise any right, power, duty or obligation
conferred or imposed on it in any jurisdiction in which it shall be illegal, or
in which the Trust Guarantee Trustee shall be unqualified or incompetent in
accordance with applicable law, to perform any such act or acts or to exercise
any such right, power, duty or obligation. No permissive power or authority
available to the Trust Guarantee Trustee shall be construed to be a duty.
14
SECTION 3.3 Not Responsible for Recitals or Issuance of the Trust Preferred
Securities Guarantee
The recitals contained in this Trust Preferred Securities Guarantee shall
be taken as the statements of the Guarantor, and the Trust Guarantee Trustee
does not assume any responsibility for their correctness. The Trust Guarantee
Trustee makes no representation as to the validity or sufficiency of this Trust
Preferred Securities Guarantee.
ARTICLE IV
THE TRUST GUARANTEE TRUSTEE
SECTION 4.1 The Trust Guarantee Trustee; Eligibility
(a) There shall at all times be a Trust Guarantee Trustee which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business under the laws of
the United States of America or any State or Territory thereof or of the
District of Columbia, or a corporation or Person permitted by the
Securities and Exchange Commission to act as an institutional trustee under
the Trust Indenture Act, authorized under such laws to exercise corporate
trust powers, having a combined capital and surplus of at least 50 million
U.S. dollars ($50,000,000), and subject to supervision or examination by
Federal, State, Territorial or District of Columbia authority. If such
corporation publishes reports of condition at least annually, pursuant to
law or to the requirements of the supervising or examining authority
referred to above, then, for the purposes of this Section 4.1(a)(ii), the
combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of
condition so published.
(b) If at any time the Trust Guarantee Trustee shall cease to be eligible
to so act under Section 4.1(a), the Trust Guarantee Trustee shall immediately
resign in the manner and with the effect set out in Section 4.2(c).
15
(c) If the Trust Guarantee Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture Act, the
Trust Guarantee Trustee and Guarantor shall in all respects comply with the
provisions of Section 310(b) of the Trust Indenture Act.
SECTION 4.2 Appointment, Removal and Resignation of the Trust Guarantee Trustee
(a) Subject to Section 4.2(b), the Trust Guarantee Trustee may be appointed
or removed without cause at any time by the Guarantor except during an Event of
Default.
(b) The Trust Guarantee Trustee shall not be removed in accordance with
Section 4.2(a) until a Successor Trust Guarantee Trustee has been appointed and
has accepted such appointment by written instrument executed by such Successor
Trust Guarantee Trustee and delivered to the Guarantor.
(c) The Trust Guarantee Trustee appointed to office shall hold office until
a Successor Trust Guarantee Trustee shall have been appointed or until its
removal or resignation. The Trust Guarantee Trustee may resign from office
(without need for prior or subsequent accounting) by an instrument in writing
executed by the Trust Guarantee Trustee and delivered to the Guarantor, which
resignation shall not take effect until a Successor Trust Guarantee Trustee has
been appointed and has accepted such appointment by instrument in writing
executed by such Successor Trust Guarantee Trustee and delivered to the
Guarantor and the resigning Trust Guarantee Trustee.
(d) If no Successor Trust Guarantee Trustee shall have been appointed and
accepted appointment as provided in this Section 4.2 within 60 days after
delivery of an instrument of removal or resignation, the Trust Guarantee Trustee
resigning or being removed may petition any court of competent jurisdiction for
appointment of a Successor Trust Guarantee Trustee. Such court may thereupon,
after prescribing such notice, if any, as it may deem proper, appoint a
Successor Trust Guarantee Trustee.
(e) No Trust Guarantee Trustee shall be liable for the acts or omissions to
act of any Successor Trust Guarantee Trustee.
16
(f) Upon termination of this Trust Preferred Securities Guarantee or
removal or resignation of the Trust Guarantee Trustee pursuant to this Section
4.2, and before the appointment of any Successor Trust Guarantee Trustee the
Guarantor shall pay to the Trust Guarantee Trustee all amounts to which it is
entitled to the date of such termination, removal or resignation.
SECTION 4.3 Successor to the Trust Guarantee Trustee by Merger, Consolidation
or Succession to Business.
Any corporation into which the Trust Guarantee Trustee may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Trustee shall be a
party, or any corporation succeeding to the corporate trust business of the
Trust Guarantee Trustee, shall be the successor of the Trust Guarantee Trustee
hereunder, provided such corporation shall be qualified and eligible under the
provisions of Section 4.1(a), without the execution or filing of any paper or
any further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding.
ARTICLE V
THE TRUST PREFERRED SECURITIES GUARANTEE
SECTION 5.1 Guarantee
The Guarantor irrevocably and unconditionally agrees to pay in full to the
Holders the Guarantee Payments (without duplication of amounts theretofore paid
by the Trust), if, as and when due, regardless of any defense, right of setoff
or counterclaim that the Trust may have or assert. The Guarantor's obligation
to make a Guarantee Payment may be satisfied by direct payment of the required
amounts by the Guarantor to the Holders or by causing the Trust to pay such
amounts to the Holders.
SECTION 5.2 Waiver of Notice and Demand
The Guarantor hereby waives notice of acceptance of this Trust Preferred
Securities Guarantee and of any liability to which it applies or may apply,
presentment, demand for payment, any right to require a proceeding first against
the Trust or any other Person before proceeding against the Guarantor, protest,
notice of nonpayment, notice of dishonor, notice of redemption and all other
notices and demands.
SECTION 5.3 Obligations Not Affected
The obligations, covenants, agreements and duties of the Guarantor under
this Trust Preferred Securities Guarantee shall in no way be affected or
impaired by reason of the happening from time to time of any of the following:
(a) the release or waiver, by operation of law or otherwise, of the
performance or observance by the Trust of any express or implied agreement,
covenant, term or condition
17
relating to the Trust Preferred Securities to be performed or observed by the
Trust;
(b) the extension of time for the payment by the Trust of all or any
portion of the Distributions, Redemption Price, Liquidation Distribution or any
other sums payable under the terms of the Trust Preferred Securities or the
extension of time for the performance of any other obligation under, arising out
of, or in connection with, the Trust Preferred Securities (other than an
extension of time for payment of Distributions, Redemption Price, Liquidation
Distribution or other sum payable that results from the extension of any
interest payment period on the Partnership Preferred Securities or any extension
of the maturity date of the Partnership Preferred Securities permitted by the
Agreement of Limited Partnership);
(c) any failure, omission, delay or lack of diligence on the part of the
Holders to enforce, assert or exercise any right, privilege, power or remedy
conferred on the Holders pursuant to the terms of the Trust Preferred
Securities, or any action on the part of the Trust granting indulgence or
extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution, sale of any
collateral, receivership, insolvency, bankruptcy, assignment for the benefit of
creditors, reorganization, arrangement, composition or readjustment of debt of,
or other similar proceedings affecting, the Trust or any of the assets of the
Trust;
(e) any invalidity of, or defect or deficiency in, the Trust Preferred
Securities;
(f) the settlement or compromise of any obligation guaranteed hereby or
hereby incurred; or
(g) any other circumstance whatsoever that might otherwise constitute a
legal or equitable discharge or defense of a guarantor, it being the intent of
this Section 5.3 that the obligations of the Guarantor hereunder shall be
absolute and unconditional under any and all circumstances.
There shall be no obligation of the Holders to give notice to, or obtain
consent of, the Guarantor with respect to the happening of any of the foregoing.
18
SECTION 5.4 Rights of Holders
(a) The Holders of a Majority in liquidation amount of the Trust Preferred
Securities have the right to direct the time, method and place of conducting of
any proceeding for any remedy available to the Trust Guarantee Trustee in
respect of this Trust Preferred Securities Guarantee or exercising any trust or
power conferred upon the Trust Guarantee Trustee under this Trust Preferred
Securities Guarantee.
(b) If the Trust Guarantee Trustee fails to enforce its rights under the
Trust Preferred Securities Guarantee after a Holder of Trust Preferred
Securities has made a written request, such Holder of Trust Preferred Securities
may institute a legal proceeding directly against the Guarantor to enforce the
Trust Guarantee Trustee's rights under this Trust Preferred Securities
Guarantee, without first instituting a legal proceeding against the Trust, the
Trust Guarantee Trustee or any other Person or entity. Notwithstanding the
foregoing, if the Guarantor has failed to make a guarantee payment, a Holder of
Trust Preferred Securities may directly institute a proceeding in such Holder's
own name against the Guarantor for enforcement of the Trust Preferred Securities
Guarantee for such payment. The Guarantor waives any right or remedy to require
that any action be brought first against the Trust or any other Person or entity
before proceeding directly against the Guarantor.
SECTION 5.5 Guarantee of Payment
This Trust Preferred Securities Guarantee creates a guarantee of payment
and not of collection.
SECTION 5.6 Subrogation
The Guarantor shall be subrogated to all (if any) rights of the Holders of
Trust Preferred Securities against the Trust in respect of any amounts paid to
such Holders by the Guarantor under this Trust Preferred Securities Guarantee;
provided, however, that the Guarantor shall not (except to the extent required
by mandatory provisions of law) be entitled to enforce or exercise any right
that it may acquire by way of subrogation or any indemnity, reimbursement or
other agreement, in all cases as a result of payment under this Trust Preferred
19
Securities Guarantee, if, at the time of any such payment, any amounts are due
and unpaid under this Trust Preferred Securities Guarantee. If any amount shall
be paid to the Guarantor in violation of the preceding sentence, the Guarantor
agrees to hold such amount in trust for the Holders and to pay over such amount
to the Holders.
SECTION 5.7 Independent Obligations
The Guarantor acknowledges that its obligations hereunder are independent
of the obligations of the Trust with respect to the Trust Preferred Securities,
and that the Guarantor shall be liable as principal and as debtor hereunder to
make Guarantee Payments pursuant to the terms of this Trust Preferred Securities
Guarantee notwithstanding the occurrence of any event referred to in subsections
(a) through (g), inclusive, of Section 5.3 hereof.
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions
So long as any Trust Preferred Securities remain outstanding, if (a) for
any distribution period, full distributions on a cumulative basis on any Trust
Preferred Securities have not been paid or declared and set apart for payment,
(b) an Investment Event of Default by any Investment Affiliate in respect of any
Affiliate Investment Instrument has occurred and is continuing and the Company
has not performed its obligations with respect thereto under an applicable
Investment Guarantee, or (c) the Company is in default of its obligations under
this Trust Preferred Securities Guarantee, the Trust Common Securities Guarantee
or the Partnership Guarantee, then, during such period (i) the Company shall not
declare or pay any dividends on, make any distributions with respect to, or
redeem, purchase or acquire, or make a liquidation payment with respect to any
of its capital stock (except for dividends or distributions in shares of, or
options, warrants or rights to subscribe for or purchase shares of, its common
stock and exchanges or conversions of common stock of one class for common stock
of another class and other than (x) purchases or acquisitions of shares of its
Common Stock in connection with the satisfaction by the Company of its
20
obligations under any employee benefit plans or any other contractual obligation
of the Company (other than a contractual obligation ranking pari passu with or
junior to an Affiliate Investment Instrument), (y) as a result of a
reclassification of the Company's capital stock or the exchange or conversion of
one class or series of the Company's capital stock for another class or series
of the Company's capital stock or (z) the purchase of fractional interests in
shares of the Company's capital stock pursuant to the conversion or exchange
provisions of such capital stock or the security being converted or exchanged),
(ii) the Company shall not make any payment or cause any payment to be made that
would result in, and shall take such action as shall be necessary to prevent,
the payment of dividends on, any distribution with respect to, any redemption,
purchase or other acquisition of, or any liquidation payment with respect to,
any Comparable Equity Interest, and (iii) the Company shall not make any
guarantee payments with respect to the foregoing (other than pursuant to this
Trust Preferred Securities Guarantee or any other guarantee by the Company with
respect to any Comparable Equity Interest).
SECTION 6.2 Ranking
This Trust Preferred Securities Guarantee will constitute an unsecured
obligation of the Guarantor and will rank (i) subordinate and junior in right of
payment to all other liabilities of the Guarantor, including, without
limitation, the fees, charges, expenses and indemnities due to the Property
Trustee or the Delaware Trustee in respect of the Trust Agreement, to the
Partnership Guarantee Trustee in respect of the Partnership Guarantee, to the
Investment Guarantee Trustee in respect of the Investment Guarantee and to the
Trust Guarantee Trustee in respect of this Trust Guarantee, (ii) pari passu with
(A) the most senior preferred or preference stock now or hereafter issued by the
Guarantor, (B) each Investment Guarantee related to an Affiliate Investment
Instrument, (C) the Partnership Guarantee, (D) any guarantee hereafter entered
into by the Guarantor in respect of any preferred security (similar to the Trust
Preferred Securities or the Partnership Preferred Securities) of the Guarantor
or any Affiliate of the Guarantor, and (E) any other obligation of the Guarantor
expressly stated to rank pari passu with this Trust Guarantee or any of the
foregoing, and (iii) senior to the Guarantor's common stock. Any similar
guarantee given
21
hereafter by the Company with respect to Trust Preferred Securities that is
silent as to seniority will rank pari passu with this Trust Preferred Securities
Agreement.
ARTICLE VII
TERMINATION
SECTION 7.1 Termination
This Trust Preferred Securities Guarantee shall terminate upon (i) full
payment of the Redemption Price of all Trust Preferred Securities, (ii) upon the
distribution of the Partnership Preferred Securities to the Holders of all of
the Trust Preferred Securities or (iii) upon full payment of the amounts payable
in accordance with the Trust Agreement upon liquidation of the Trust.
Notwithstanding the foregoing, this Trust Preferred Securities Guarantee will
continue to be effective or will be reinstated, as the case may be, if at any
time any Holder of Trust Preferred Securities must restore payment of any sums
paid under the Trust Preferred Securities or under this Trust Preferred
Securities Guarantee.
ARTICLE VIII
EXCULPATION AND INDEMNIFICATION
SECTION 8.1 Exculpation
(a) No Indemnified Person shall be liable, responsible or accountable in
damages or otherwise to the Guarantor or any Covered Person for any loss, damage
or claim incurred by reason of any act or omission performed or omitted by such
Indemnified Person in good faith in accordance with this Trust Preferred
Securities Guarantee and in a manner that such Indemnified Person reasonably
believed to be within the scope of the authority conferred on such Indemnified
Person by this Trust Preferred Securities Guarantee or by law, except that an
Indemnified Person shall be liable for any such loss, damage or claim incurred
by reason of such Indemnified Person's gross negligence or willful misconduct
with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying in good faith
upon the records of the Guarantor and upon such information, opinions, reports
or statements
22
presented to the Guarantor by any Person as to matters the Indemnified Person
reasonably believes are within such other Person's professional or expert
competence and who has been selected with reasonable care by or on behalf of the
Guarantor, including information, opinions, reports or statements as to the
value and amount of the assets, liabilities, profits, losses, or any other facts
pertinent to the existence and amount of assets from which Distributions to
Holders of Trust Preferred Securities might properly be paid.
SECTION 8.2 Indemnification
The Guarantor agrees to indemnify each Indemnified Person for, and to hold
each Indemnified Person harmless against, any and all loss, liability, damage,
claim or expense, including taxes (other than taxes based on the income of such
Indemnified Person) incurred without gross negligence or bad faith on its part,
arising out of or in connection with the acceptance or administration of the
trust or trusts hereunder, including the costs and expenses (including
reasonable legal fees and expenses) of defending itself against, or
investigating, any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder. The obligation to
indemnify as set forth in this Section 8.2 shall survive the termination of this
Trust Preferred Securities Guarantee or the earlier resignation or removal of
the Trust Guarantee Trustee.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns
All guarantees and agreements contained in this Trust Preferred Securities
Guarantee shall bind the successors, assigns, receivers, trustees and
representatives of the Guarantor and shall inure to the benefit of the Holders
of the Trust Preferred Securities then outstanding.
SECTION 9.2 Amendments
Except with respect to any changes that do not materially adversely affect
the rights of Holders (in which case no consent of Holders will be required),
this Trust Preferred Securities
23
Guarantee may only be amended with the prior approval of the Holders of at least
a Majority in liquidation amount of the Trust Preferred Securities. The
provisions of Section 13.2 of the Trust Agreement with respect to meetings of
Holders of the Trust Preferred Securities apply to the giving of such approval.
SECTION 9.3 Merger of the Guarantor
The Guarantor covenants that it will not merge or consolidate with any
other corporation or other entity or sell or convey all or substantially all of
its assets to any Person (other than such a sale or conveyance to a Subsidiary
or any successor thereto (such a sale or conveyance being called an "Asset Drop-
Down")), unless (i) either the Guarantor shall be the continuing corporation or
the successor corporation or other entity or the Person which acquires by sale
or conveyance substantially all the assets of the Guarantor shall expressly
assume the obligations of the Guarantor hereunder, according to their tenor, and
the due and punctual performance and observance of all of the covenants hereof
to be performed or observed by the Guarantor, by instrument in form satisfactory
to the Trust Guarantee Trustee, executed and delivered to the Trust Guarantee
Trustee by such corporation or other entity, and (ii) the Guarantor or such
successor corporation or other entity, as the case may be, shall not,
immediately after such merger or consolidation, or such sale or conveyance, be
in default in the performance of any such covenant or condition. In the event
of any Asset Drop-Down after the date hereof, any subsequent sale or conveyance
of assets by a Subsidiary to which assets were transferred in such Asset Drop-
Down will be deemed to be a sale or conveyance of assets by the Company for
purposes of this provision.
SECTION 9.4 Notices
All notices provided for in this Trust Preferred Securities Guarantee shall
be in writing, duly signed by the party giving such notice, and shall be
delivered, telecopied or mailed by first class mail, as follows:
(a) If given to the Trust Guarantee Trustee, at the Trust Guarantee
Trustee's mailing address set forth below:
The Bank of New York
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
00
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Trustee Administration
Telecopy: (000)000-0000
(b) If given to the Guarantor, at the Guarantor's mailing address set forth
below (or such other address as the Guarantor may give notice of to the Holders
of the Trust Preferred Securities):
Hawaiian Electric Industries, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxx 00000
Attention: Treasurer
Telecopy: (000) 000-0000
(c) If given to any Holder of Trust Preferred Securities, at the address
set forth on the books and records of the Trust.
All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid except that if a notice or other document is refused delivery or
cannot be delivered because of a changed address of which no notice was given,
such notice or other document shall be deemed to have been delivered on the date
of such refusal or inability to deliver.
SECTION 9.5 Benefit
This Trust Preferred Securities Guarantee is solely for the benefit of the
Holders of the Trust Preferred Securities and, subject to Section 3.1(a), is not
separately transferable from the Trust Preferred Securities.
SECTION 9.6 Governing Law
THIS TRUST PREFERRED SECURITIES GUARANTEE SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK,
WITHOUT REGARD TO THE CONFLICTS OF LAWS PRINCIPLES THEREOF.
25
THIS TRUST PREFERRED SECURITIES GUARANTEE is executed as
of the day and year first above written.
HAWAIIAN ELECTRIC INDUSTRIES, INC.
as Guarantor
By:___________________________________
Name:
Title:
By:___________________________________
Name:
Title:
THE BANK OF NEW YORK,
as Trust Guarantee Trustee
By:___________________________________
Name:
Title:
26
