EXHIBIT 4.15
======================================================
PREFERRED SECURITIES GUARANTEE AGREEMENT
CCC Capital II
Dated as of [ ], 199_
======================================================
TABLE OF CONTENTS
-----------------
Page
----
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation . . . . . . 1
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application . . . . . 5
SECTION 2.2 Lists of Holders of Securities . . . . . . 5
SECTION 2.3 Reports by the Preferred Guarantee Trustee 5
SECTION 2.4 Periodic Reports to Preferred Guarantee Trust-
ee . . . . . . . . . . . . . . . . . . . . 5
SECTION 2.5 Evidence of Compliance with Conditions Xxxxx-
xxxx . . . . . . . . . . . . . . . . . . . 6
SECTION 2.6 Events of Default; Waiver . . . . . . . . 6
SECTION 2.7 Event of Default; Notice . . . . . . . . . 6
SECTION 2.8 Conflicting Interests . . . . . . . . . . 6
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
PREFERRED GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Preferred Guarantee
Trustee . . . . . . . . . . . . . . . . . 7
SECTION 3.2 Certain Rights of Preferred Guarantee Trustee
8
SECTION 3.3. Not Responsible for Recitals or Issuance of
Guarantee . . . . . . . . . . . . . . . . 10
ARTICLE IV
PREFERRED GUARANTEE TRUSTEE
SECTION 4.1 Preferred Guarantee Trustee; Eligibility . 11
SECTION 4.2 Appointment, Removal and Resignation of Pre-
ferred Guarantee Trustees . . . . . . . . 11
ARTICLE V
GUARANTEE
Page
----
SECTION 5.1 Guarantee . . . . . . . . . . . . . . . . 12
SECTION 5.2 Waiver of Notice and Demand . . . . . . . 13
SECTION 5.3 Obligations Not Affected . . . . . . . . . 12
SECTION 5.4 Rights of Holders . . . . . . . . . . . . 13
SECTION 5.5 Guarantee of Payment . . . . . . . . . . . 14
SECTION 5.6 Subrogation . . . . . . . . . . . . . . . 14
SECTION 5.7 Independent Obligations . . . . . . . . . 14
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions . . . . . . . . 15
SECTION 6.2 Ranking . . . . . . . . . . . . . . . . . 15
ARTICLE VII
TERMINATION
SECTION 7.1 Termination . . . . . . . . . . . . . . . 15
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1 Exculpation . . . . . . . . . . . . . . . 16
SECTION 8.2 Indemnification . . . . . . . . . . . . . 16
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns . . . . . . . . . . 17
SECTION 9.2 Amendments . . . . . . . . . . . . . . . . 17
SECTION 9.3 Notices . . . . . . . . . . . . . . . . . 17
SECTION 9.4 Benefit . . . . . . . . . . . . . . . . . 18
SECTION 9.5 Governing Law . . . . . . . . . . . . . . 18
ii
PREFERRED SECURITIES GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT (the "Preferred Securities
Guarantee"), dated as of __________, 199_, is executed and
delivered by Travelers Group Inc., a Delaware corporation (the
"Guarantor"), and The Chase Manhattan Bank, as trustee (the
"Preferred Guarantee Trustee"), for the benefit of the Holders
(as defined herein) from time to time of the Preferred Securities
(as defined herein) of CCC Capital II, a Delaware statutory
business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Declara-
tion of Trust (the "Declaration"), dated as of __________, 199_,
among the trustees of the Issuer named therein, the Guarantor, as
sponsor, and the holders from time to time of undivided benefi-
cial interests in the assets of the Issuer, the Issuer is issuing
on the date hereof __________ preferred securities, having an
aggregate liquidation amount of $___________ (plus up to an
additional preferred securities, having an
---------------
aggregate liquidation amount of $ if the over-
----------------
allotment option granted to the underwriters pursuant to the
Underwriting Agreement (as hereinafter defined) is exercised),
designated the ____% Trust Preferred Securities (the "Preferred
Securities");
WHEREAS, as incentive for the Holders to purchase the
Preferred Securities, the Guarantor desires irrevocably and
unconditionally to agree, to the extent set forth in this Pre-
ferred Securities Guarantee, to pay to the Holders the Guarantee
Payments (as defined herein) and to make certain other payments
on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the purchase by
each Holder of Preferred Securities, which purchase the Guarantor
hereby agrees shall benefit the Guarantor, the Guarantor executes
and delivers this Preferred Securities Guarantee for the benefit
of the Holders.
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1 Definitions and Interpretation
------------------------------
In this Preferred Securities Guarantee, unless the
context otherwise requires:
(a) Capitalized terms used in this Preferred Securi-
ties Guarantee but not defined in the preamble
above have the respective meanings assigned to
them in this Section 1.1;
(b) a term defined anywhere in this Preferred Securi-
ties Guarantee has the same meaning throughout;
(c) all references to "the Preferred Securities Guar-
xxxxx" or "this Preferred Securities Guarantee"
are to this Preferred Securities Guarantee as
modified, supplemented or amended from time to
time;
(d) all references in this Preferred Securities Guar-
xxxxx to Articles and Sections are to Articles and
Sections of this Preferred Securities Guarantee,
unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the
same meaning when used in this Preferred Securi-
ties Guarantee, unless otherwise defined in this
Preferred Securities Guarantee or unless the con-
text otherwise requires; and
(f) a reference to the singular includes the plural
and vice versa.
"Authorized Officer" of a Person means any Person that
------------------
is authorized to bind such Person.
"Affiliate" has the same meaning as given to that term
---------
in Rule 405 of the Securities Act of 1933, as amended, or any
successor rule thereunder.
"Business Day" means any day other than a Saturday,
------------
Sunday or a day on which banking institutions in the City of New
York, New York are permitted or required by any applicable law to
close.
"Common Securities" means the securities representing
-----------------
common undivided beneficial interests in the assets of the
Issuer.
"Corporate Trust Office" means the office of the
----------------------
Preferred Guarantee Trustee at which the corporate trust business
of the Preferred Guarantee Trustee shall, at any particular time,
be principally administered, which office at the date of execu-
tion of this Agreement is located at 000 Xxxx 00xx Xxxxxx - 00xx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000.
"Covered Person" means any Holder or beneficial owner
--------------
of Preferred Securities.
"Debentures" means the series of junior subordinated
----------
debt securities of the Guarantor designated the ____% Junior
Subordinated Deferrable Interest Debentures due ____________, 20
--
held by the Institutional Trustee (as defined in the Declaration)
of the Issuer.
"Event of Default" means a default by the Guarantor on
----------------
any of its payment or other obligations under this Preferred
Securities Guarantee.
"Guarantee Payments" means the following payments or
------------------
distributions, without duplication, with respect to the Preferred
Securities, to the extent not paid or made by the Issuer:
2
(i) any accrued and unpaid Distributions (as defined in Annex I
to the Declaration) that are required to be paid on the Preferred
Securities, to the extent the Issuer has funds available there-
for, (ii) the redemption price of $25 per Preferred Security,
plus all accrued and unpaid Distributions to the date of redemp-
tion (the "Redemption Price"), to the extent the Issuer has funds
available therefor, with respect to any Preferred Securities
called for redemption by the Issuer and (iii) upon a voluntary or
involuntary dissolution, winding-up or termination of the Issuer
(other than in connection with the distribution of Debentures to
the Holders in exchange for Preferred Securities as provided in
the Declaration or the redemption of all of the Preferred Securi-
ties upon the maturity or redemption of all of the Debentures as
provided in the Declaration) the lesser of (a) the aggregate of
the liquidation amount of $25 per Preferred Security and all
accrued and unpaid Distributions on the Preferred Securities to
the date of payment, or (b) the amount of assets of the Issuer
remaining for distribution to Holders in liquidation of the
Issuer (in either case, the "Liquidation Distribution").
"Holder" shall mean any holder, as registered on the
------
books and records of the Issuer, of any Preferred Securities;
provided, however, that, in determining whether the holders of
the requisite percentage of Preferred Securities have given any
request, notice, consent or waiver hereunder, "Holder" shall not
include the Guarantor or any Affiliate of the Guarantor.
"Indemnified Person" means the Preferred Guarantee
------------------
Trustee, any Affiliate of the Preferred Guarantee Trustee, or any
officers, directors, shareholders, members, partners, employees,
representatives, nominees, custodians or agents of the Preferred
Guarantee Trustee.
"Indenture" means the Indenture dated as of __________-
---------
__, 199_, among the Guarantor and The Chase Manhattan Bank, as
trustee, and any indenture supplemental thereto pursuant to which
the Debentures are to be issued to the Institutional Trustee of
the Issuer.
"Majority in liquidation amount of the Securities"
------------------------------------------------
means, except as provided by the Trust Indenture Act, a vote by
Holder(s), voting separately as a class, holding Preferred
Securities representing more than 50% of the aggregate liquida-
tion amount (including the stated amount that would be paid on
redemption, liquidation or otherwise, plus accrued and unpaid
Distributions to the date upon which the voting percentages are
determined) of all 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
Preferred Securities Guarantee shall include:
(a) a statement that each officer signing the Office-
rs' Certificate has read the covenant or condition and the
definitions relating thereto;
3
(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.
"Person" means a legal person, including any individu-
------
al, corporation, estate, partnership, joint venture, association,
joint stock company, limited liability company, trust, unincorpo-
rated association, or government or any agency or political
subdivision thereof, or any other entity of whatever nature.
"Preferred Guarantee Trustee" means The Chase Manhattan
---------------------------
Bank, until a Successor Preferred Guarantee Trustee has been
appointed and has accepted such appointment pursuant to the terms
of this Preferred Securities Guarantee and thereafter means each
such Successor Preferred Guarantee Trustee.
"Responsible Officer" means, with respect to the
-------------------
Preferred Guarantee Trustee, any officer within the Corporate
Trust Office of the Preferred Guarantee Trustee, including any
vice-president, any assistant vice-president, any assistant
secretary, the treasurer, any assistant treasurer or other
officer of the Corporate Trust Office of the Preferred Guarantee
Trustee customarily performing functions similar to those per-
formed by any of the above designated officers and also means,
with respect to a particular corporate trust matter, any other
officer to whom such matter is referred because of that officer's
knowledge of and familiarity with the particular subject.
"Successor Preferred Guarantee Trustee" means a succes-
-------------------------------------
sor Preferred Guarantee Trustee possessing the qualifications to
act as Preferred Guarantee Trustee under Section 4.1.
"Trust Indenture Act" means the Trust Indenture Act of
-------------------
1939, as amended.
"Underwriting Agreement" has the meaning set forth in
----------------------
the Indenture.
4
ARTICLE II
TRUST INDENTURE ACT
SECTION 1 Trust Indenture Act; Application
--------------------------------
(a) This Preferred Securities Guarantee is subject to
the provisions of the Trust Indenture Act that are required to be
part of this Preferred Securities Guarantee and shall, to the
extent applicable, be governed by such provisions; and
(b) if and to the extent that any provision of this
Preferred Securities Guarantee limits, qualifies or conflicts
with the duties imposed by Section 310 to 317, inclusive, of the
Trust Indenture Act, such imposed duties shall control.
SECTION 2 Lists of Holders of Securities
------------------------------
(a) The Guarantor shall provide the Preferred Guaran-
tee Trustee with a list, in such form as the Preferred Guarantee
Trustee may reasonably require, of the names and addresses of the
Holders ("List of Holders") as of such date, (i) within one
Business Day after January 1 and June 30 of each year, and (ii)
at any other time within 30 days of receipt by the Guarantor of a
written request for a List of Holders as of a date no more than
14 days before such List of Holders is given to the Preferred
Guarantee Trustee provided, that the Guarantor shall not be
obligated to provide such List of Holders at any time the List of
Holders does not differ from the most recent List of Holders
given to the Preferred Guarantee Trustee by the Guarantor. The
Preferred Guarantee Trustee may destroy any List of Holders
previously given to it on receipt of a new List of Holders.
(b) The Preferred Guarantee Trustee shall comply with
its obligations under Sections 311(a), 311(b) and 312(b) of the
Trust Indenture Act.
SECTION 3 Reports by the Preferred Guarantee Trustee
------------------------------------------
Within 60 days after April 15 of each year, the Pre-
ferred Guarantee Trustee shall provide to the Holders such
reports as are required by Section 313 of the Trust Indenture
Act, if any, in the form and in the manner provided by Section
313 of the Trust Indenture Act. The Preferred Guarantee Trustee
shall also comply with the requirements of Section 313(d) of the
Trust Indenture Act.
SECTION 4 Periodic Reports to Preferred Guarantee Trustee
-----------------------------------------------
The Guarantor shall provide to the Preferred 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.
5
SECTION 5 Evidence of Compliance with Conditions Precedent
------------------------------------------------
The Guarantor shall provide to the Preferred Guarantee
Trustee such evidence of compliance with any conditions xxxxx-
xxxx, if any, provided for in this Preferred Securities Guarantee
that relate to any of the matters set forth in Section 314(c) of
the Trust Indenture Act. Any certificate or opinion required to
be given by an officer pursuant to Section 314(c)(1) may be given
in the form of an Officers' Certificate.
SECTION 6 Events of Default; Waiver
-------------------------
The Holders of a Majority in liquidation amount of
Preferred Securities may, by vote, on behalf of the Holders of
all of the Preferred Securities, waive any past Event of Default
and its consequences. Upon such waiver, any such Event of
Default shall cease to exist, and any Event of Default arising
therefrom shall be deemed to have been cured, for every purpose
of this Preferred Securities Guarantee, but no such waiver shall
extend to any subsequent or other default or Event of Default or
impair any right consequent thereon.
SECTION 7 Event of Default; Notice
------------------------
(a) The Preferred Guarantee Trustee shall, within 90
days after the occurrence of an Event of Default, transmit by
mail, first class postage prepaid, to the Holders, notices of all
Events of Default actually known to a Responsible Officer of the
Preferred Guarantee Trustee, unless such defaults have been cured
before the giving of such notice, provided, that, the Preferred
Guarantee Trustee shall be protected in withholding such notice
if and so long as a Responsible Officer of the Preferred Guaran-
tee Trustee in good faith determines that the withholding of such
notice is in the interests of the Holders.
(b) The Preferred Guarantee Trustee shall not be
deemed to have knowledge of any Event of Default unless the
Preferred Guarantee Trustee shall have received written notice,
or of which a Responsible Officer of the Preferred Guarantee
Trustee charged with the administration of the Declaration shall
have obtained actual knowledge.
SECTION 2.8 Conflicting Interests
---------------------
The Declaration shall be deemed to be specifically
described in this Preferred Securities Guarantee for the purposes
of clause (i) of the first proviso contained in Section 310(b) of
the Trust Indenture Act.
6
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
PREFERRED GUARANTEE TRUSTEE
SECTION 1 Powers and Duties of the Preferred Guarantee Trustee
----------------------------------------------------
(a) This Preferred Securities Guarantee shall be held
by the Preferred Guarantee Trustee for the benefit of the Hold-
ers, and the Preferred Guarantee Trustee shall not transfer its
right, title and interest in this Preferred Securities Guarantee
to any Person except a Holder exercising his or her rights
pursuant to Section 5.4(b) or to a Successor Preferred Guarantee
Trustee on acceptance by such Successor Preferred Guarantee
Trustee of its appointment to act as Successor Preferred Guaran-
tee Trustee. The right, title and interest of the Preferred
Guarantee Trustee shall automatically vest in any Successor
Preferred 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 Preferred Guarantee Trustee.
(b) If an Event of Default actually known to a Respon-
sible Officer of the Preferred Guarantee Trustee has occurred and
is continuing, the Preferred Guarantee Trustee shall enforce this
Preferred Securities Guarantee for the benefit of the Holders of
the Preferred Securities.
(c) The Preferred Guarantee Trustee, before the
occurrence of any Event of Default and after the curing of all
Events of Default that may have occurred, shall undertake to
perform only such duties as are specifically set forth in this
Preferred Securities Guarantee, and no implied covenants shall be
read into this Preferred Securities Guarantee against the Pre-
ferred Guarantee Trustee. In case an Event of Default has
occurred (that has not been cured or waived pursuant to Section
2.6) and is actually known to a Responsible Officer of the
Preferred Guarantee Trustee, the Preferred Guarantee Trustee
shall exercise such of the rights and powers vested in it by this
Preferred Securities Guarantee, and use the same degree of care
and skill in its exercise thereof, as a prudent person would
exercise or use under the circumstances in the conduct of his or
her own affairs.
(d) No provision of this Preferred Securities Guaran-
tee shall be construed to relieve the Preferred Guarantee Trustee
from liability for its own negligent action, its own negligent
failure to act, or its own willful misconduct, except that:
(i) prior to the occurrence of any Event of Default
and after the curing or waiving of all such Events of De-
fault that may have occurred:
(A) the duties and obligations of the Preferred
Guarantee Trustee shall be determined solely by the
express provisions of this Preferred Securities Guaran-
tee, and the Preferred Guarantee Trustee shall not be
liable except for the
7
performance of such duties and obligations as are
specifically set forth in this Preferred Securities
Guarantee, and no implied covenants or obligations
shall be read into this Preferred Securities Guarantee
against the Preferred Guarantee Trustee; and
(B) in the absence of bad faith on the part of
the Preferred Guarantee Trustee, the Preferred Guaran-
tee 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 Preferred Guarantee Trustee and con-
forming to the requirements of this Preferred Securi-
ties Guarantee; but in the case of any such certifi-
xxxxx or opinions that by any provision hereof are
specifically required to be furnished to the Preferred
Guarantee Trustee, the Preferred Guarantee Trustee
shall be under a duty to examine the same to determine
whether or not they conform to the requirements of this
Preferred Securities Guarantee;
(ii) the Preferred Guarantee Trustee shall not be
liable for any error of judgment made in good faith by a
Responsible Officer of the Preferred Guarantee Trustee,
unless it shall be proved that the Preferred Guarantee
Trustee was negligent in ascertaining the pertinent facts
upon which such judgment was made;
(iii) the Preferred Guarantee Trustee shall not be
liable with respect to any action taken or omitted to be
taken by it in good faith in accordance with the direction
of the Holders of not less than a Majority in liquidation
amount of the Preferred Securities relating to the time,
method and place of conducting any proceeding for any remedy
available to the Preferred Guarantee Trustee, or exercising
any trust or power conferred upon the Preferred Guarantee
Trustee under this Preferred Securities Guarantee; and
(iv) no provision of this Preferred Securities Guaran-
tee shall require the Preferred Guarantee Trustee to expend
or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the
exercise of any of its rights or powers, if the Preferred
Guarantee Trustee shall have reasonable grounds for believ-
ing that the repayment of such funds or liability is not
reasonably assured to it under the terms of this Preferred
Securities Guarantee or indemnity, reasonably satisfactory
to the Preferred Guarantee Trustee, against such risk or
liability is not reasonably assured to it.
SECTION 2 Certain Rights of Preferred Guarantee Trustee
---------------------------------------------
(a) Subject to the provisions of Section 3.1:
(i) The Preferred Guarantee Trustee may conclusively
rely, and shall be fully protected in acting or refraining
from acting upon, any resolution, certificate, statement,
8
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 Preferred Securities Guarantee shall be sufficiently
evidenced by an Officers' Certificate.
(iii) Whenever, in the administration of this
Preferred Securities Guarantee, the Preferred Guarantee
Trustee shall deem it desirable that a matter be proved or
established before taking, suffering or omitting any action
hereunder, the Preferred Guarantee Trustee (unless other
evidence is herein specifically prescribed) may, in the
absence of bad faith on its part, request and conclusively
rely upon an Officers' Certificate which, upon receipt of
such request, shall be promptly delivered by the Guarantor.
(iv) The Preferred Guarantee Trustee shall have no duty
to see to any recording, filing or registration of any
instrument (or any rerecording, refiling or registration
thereof).
(v) The Preferred Guarantee Trustee may consult with
counsel, and the written advice or opinion of such counsel
with respect to legal matters shall be full and complete
authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in
accordance with such advice or opinion. Such counsel may be
counsel to the Guarantor or any of its Affiliates and may
include any of its employees. The Preferred Guarantee
Trustee shall have the right at any time to seek instruc-
tions concerning the administration of this Preferred Secu-
rities Guarantee from any court of competent jurisdiction.
(vi) The Preferred Guarantee Trustee shall be under no
obligation to exercise any of the rights or powers vested in
it by this Preferred Securities Guarantee at the request or
direction of any Holder, unless such Holder shall have
provided to the Preferred Guarantee Trustee such security
and indemnity, reasonably satisfactory to the Preferred
Guarantee Trustee, against the costs, expenses (including
attorneys' fees and expenses and the expenses of the Pre-
ferred Guarantee Trustee's agents, nominees or custodians)
and liabilities that might be incurred by it in complying
with such request or direction, including such reasonable
advances as may be requested by the Preferred Guarantee
Trustee; provided that, nothing contained in this Section
3.2(a)(vi) shall be taken to relieve the Preferred Guarantee
Trustee, upon the occurrence of an Event of Default, of its
obligation to exercise the rights and powers vested in it by
this Preferred Securities Guarantee.
(vii) The Preferred Guarantee Trustee shall not be
bound to make any investigation into the facts or matters
stated in any resolution, certificate, statement, instru-
ment, opinion, report, notice, request, direction, consent,
order, bond, debenture,
9
note, other evidence of indebtedness or other paper or
document, but the Preferred Guarantee Trustee, in its dis-
cretion, may make such further inquiry or investigation into
such facts or matters as it may see fit.
(viii) The Preferred Guarantee Trustee may execute
any of the trusts or powers hereunder or perform any duties
hereunder either directly or by or through agents, nominees,
custodians or attorneys, and the Preferred Guarantee Trustee
shall not be responsible for any misconduct or negligence on
the part of any agent or attorney appointed with due care by
it hereunder.
(ix) Any action taken by the Preferred Guarantee Trust-
ee or its agents hereunder shall bind the Holders of the
Preferred Securities, and the signature of the Preferred
Guarantee Trustee or its agents alone shall be sufficient
and effective to perform any such action. No third party
shall be required to inquire as to the authority of the
Preferred Guarantee Trustee to so act or as to its compli-
ance with any of the terms and provisions of this Preferred
Securities Guarantee, both of which shall be conclusively
evidenced by the Preferred Guarantee Trustee's or its agen-
t's taking such action.
(x) Whenever in the administration of this Preferred
Securities Guarantee the Preferred Guarantee Trustee shall
deem it desirable to receive instructions with respect to
enforcing any remedy or right or taking any other action
hereunder, the Preferred Guarantee Trustee (i) may request
instructions from the Holders of a Majority in liquidation
amount of the Preferred Securities, (ii) may refrain from
enforcing such remedy or right or taking such other action
until such instructions are received, and (iii) shall be
protected in conclusively relying on or acting in accordance
with such instructions.
(b) No provision of this Preferred Securities Guaran-
tee shall be deemed to impose any duty or obligation on the
Preferred Guarantee Trustee to perform any act or acts or exer-
cise any right, power, duty or obligation conferred or imposed on
it in any jurisdiction in which it shall be illegal, or in which
the Preferred Guarantee Trustee shall be unqualified or incompe-
tent in accordance with applicable law, to perform any such act
or acts or to exercise any such right, power, duty or obligation.
No permissive power or authority available to the Preferred
Guarantee Trustee shall be construed to be a duty.
SECTION 3.3. Not Responsible for Recitals or Issuance of
--------------------------------------------
Guarantee
---------
The recitals contained in this Guarantee shall be taken
as the statements of the Guarantor, and the Preferred Guarantee
Trustee does not assume any responsibility for their correctness.
The Preferred Guarantee Trustee makes no representation as to the
validity or sufficiency of this Preferred Securities Guarantee.
10
ARTICLE IV
PREFERRED GUARANTEE TRUSTEE
SECTION 1 Preferred Guarantee Trustee; Eligibility
----------------------------------------
(a) There shall at all times be a Preferred Guarantee
Trustee which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business
under the laws of the United States of America or any State
or Territory thereof or of the District of Columbia, or a
corporation or Person permitted by the Securities and Ex-
change 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 ($50,000,00-
0), and subject to supervision or examination by Federal,
State, Territorial or District of Columbia authority. If
such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of the
supervising or examining authority referred to above, then,
for the purposes of this Section 4.1(a)(ii), the combined
capital and surplus of such corporation shall be deemed to
be its combined capital and surplus as set forth in its most
recent report of condition so published.
(b) If at any time the Preferred Guarantee Trustee
shall cease to be eligible to so act under Section 4.1(a), the
Preferred Guarantee Trustee shall immediately resign in the
manner and with the effect set out in Section 4.2(c).
(c) If the Preferred Guarantee Trustee has or shall
acquire any "conflicting interest" within the meaning of Section
310(b) of the Trust Indenture Act, the Preferred Guarantee
Trustee and Guarantor shall in all respects comply with the
provisions of Section 310(b) of the Trust Indenture Act.
SECTION 2 Appointment, Removal and Resignation of Preferred
-------------------------------------------------
Guarantee Trustees
------------------
(a) Subject to Section 4.2(b), the Preferred Guarantee
Trustee may be appointed or removed without cause at any time by
the Guarantor.
(b) The Preferred Guarantee Trustee shall not be
removed in accordance with Section 4.2(a) until a Successor
Preferred Guarantee Trustee has been appointed and has accepted
such appointment by written instrument executed by such Successor
Preferred Guarantee Trustee and delivered to the Guarantor.
(c) The Preferred Guarantee Trustee appointed to
office shall hold office until a Successor Preferred Guarantee
Trustee shall have been appointed or until its removal or resig-
nation. The Preferred Guarantee Trustee may resign from office
(without need for prior or
11
subsequent accounting) by an instrument in writing executed by
the Preferred Guarantee Trustee and delivered to the Guarantor,
which resignation shall not take effect until a Successor Pre-
ferred Guarantee Trustee has been appointed and has accepted such
appointment by instrument in writing executed by such Successor
Preferred Guarantee Trustee and delivered to the Guarantor and
the resigning Preferred Guarantee Trustee.
(d) If no Successor Preferred Guarantee Trustee shall
have been appointed and accepted appointment as provided in this
Section 4.2 within 60 days after delivery to the Guarantor of an
instrument of resignation, the resigning Preferred Guarantee
Trustee may petition any court of competent jurisdiction for
appointment of a Successor Preferred Guarantee Trustee. Such
court may thereupon, after prescribing such notice, if any, as it
may deem proper, appoint a Successor Preferred Guarantee Trustee.
(e) No Preferred Guarantee Trustee shall be liable for
the acts or omissions to act of any Successor Preferred Guarantee
Trustee.
(f) Upon termination of this Preferred Securities
Guarantee or removal or resignation of the Preferred Guarantee
Trustee pursuant to this Section 4.2, the Guarantor shall pay to
the Preferred Guarantee Trustee all amounts accrued and owing to
such Preferred Guarantee Trustee to the date of such termination,
removal or resignation.
ARTICLE V
GUARANTEE
SECTION 1 Guarantee
---------
The Guarantor irrevocably and unconditionally agrees to
pay in full to the Holders the Guarantee Payments, as and when
due, regardless of any defense, right of set-off or counterclaim
that the Issuer may have or assert. The Guarantor's obligation
to make a Guarantee Payment may be satisfied by direct payment of
the required amounts by the Guarantor to the Holders or by
causing the Issuer to pay such amounts to the Holders.
SECTION 2 Waiver of Notice and Demand
---------------------------
The Guarantor hereby waives notice of acceptance of
this Preferred Securities Guarantee and of any liability to which
it applies or may apply, presentment, demand for payment, any
right to require a proceeding first against the Issuer or any
other Person before proceeding against the Guarantor, protest,
notice of nonpayment, notice of dishonor, notice of redemption
and all other notices and demands.
12
SECTION 3 Obligations Not Affected
------------------------
The obligations, covenants, agreements and duties of
the Guarantor under this Preferred Securities Guarantee shall in
no way be affected or impaired by reason of the happening from
time to time of any of the following:
(a) the release or waiver, by operation of law or
otherwise, of the performance or observance by the Issuer of any
express or implied agreement, covenant, term or condition relat-
ing to the Preferred Securities to be performed or observed by
the Issuer;
(b) the extension of time for the payment by the
Issuer of all or any portion of the Distributions, Redemption
Price, Liquidation Distribution or any other sums payable under
the terms of the Preferred Securities or the extension of time
for the performance of any other obligation under, arising out
of, or in connection with, the Preferred Securities;
(c) any failure, omission, delay or lack of diligence
on the part of the Holders to enforce, assert or exercise any
right, privilege, power or remedy conferred on the Holders
pursuant to the terms of the Preferred Securities, or any action
on the part of the Issuer granting indulgence or extension of any
kind;
(d) the voluntary or involuntary liquidation, dissolu-
tion, sale of any collateral, receivership, insolvency, bankrupt-
cy, assignment for the benefit of creditors, reorganization,
arrangement, composition or readjustment of debt of, or other
similar proceedings affecting, the Issuer or any of the assets of
the Issuer;
(e) any invalidity of, or defect or deficiency in, the
Preferred Securities;
(f) the settlement or compromise of any obligation
guaranteed hereby or hereby incurred; or
(g) any other circumstance whatsoever that might
otherwise constitute a legal or equitable discharge or defense of
a guarantor, it being the intent of this Section 5.3 that the
obligations of the Guarantor hereunder shall be 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.
SECTION 4 Rights of Holders
-----------------
(a) The Holders of a Majority in liquidation amount of
the Preferred Securities have the right to direct the time,
method and place of conducting any proceeding for any remedy
13
available to the Preferred Guarantee Trustee in respect of this
Preferred Securities Guarantee or exercising any trust or power
conferred upon the Preferred Guarantee Trustee under this Pre-
ferred Securities Guarantee.
(b) If the Preferred Guarantee Trustee fails to
enforce its rights under this Preferred Securities Guarantee, any
Holder may directly institute a legal proceeding against the
Guarantor to enforce the Preferred Guarantee Trustee's rights
under this Preferred Securities Guarantee, without first insti-
tuting a legal proceeding against the Issuer, the Preferred
Guarantee Trustee or any other Person or entity.
(c) A Holder of Preferred Securities may also directly
institute a legal proceeding against the Guarantor to enforce
such Holder's right to receive payment under this Preferred
Securities Guarantee without first (i) directing the Preferred
Guarantee Trustee to enforce the terms of this Preferred Securi-
ties Guarantee or (ii) instituting a legal proceeding directly
against the Issuer or any other Person or entity.
SECTION 5 Guarantee of Payment
--------------------
This Preferred Securities Guarantee creates a guarantee
of payment and not of collection.
SECTION 6 Subrogation
-----------
The Guarantor shall be subrogated to all (if any)
rights of the Holders of Preferred Securities against the Issuer
in respect of any amounts paid to such Holders by the Guarantor
under this Preferred Securities Guarantee; provided, however,
that the Guarantor shall not (except to the extent required by
mandatory provisions of law) be entitled to enforce or exercise
any right that it may acquire by way of subrogation or any
indemnity, reimbursement or other agreement, in all cases as a
result of payment under this Preferred Securities Guarantee, if,
at the time of any such payment, any amounts are due and unpaid
under this Preferred Securities Guarantee. If any amount shall
be paid to the Guarantor in violation of the preceding sentence,
the Guarantor agrees to hold such amount in trust for the Holders
and to pay over such amount to the Holders.
SECTION 7 Independent Obligations
-----------------------
The Guarantor acknowledges that its obligations hereun-
der are independent of the obligations of the Issuer with respect
to the Preferred Securities, and that the Guarantor shall be
liable as principal and as debtor hereunder to make Guarantee
Payments pursuant to the terms of this Preferred Securities
Guarantee notwithstanding the occurrence of any event referred to
in subsections (a) through (g), inclusive, of Section 5.3 hereof.
14
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 1 Limitation of Transactions
--------------------------
So long as any Preferred Securities remain outstanding,
if there shall have occurred any event that would constitute an
Event of Default or an event of default under the Declaration,
then (a) the Guarantor shall not declare or pay any dividend on,
make any distributions with respect to, or redeem, purchase,
acquire or make a liquidation payment with respect to, any of its
capital stock or make any guarantee payment with respect thereto
(other than (i) repurchases, redemptions or other acquisitions of
shares of capital stock of the Guarantor in connection with any
employment contract, benefit plan or other similar arrangement
with or for the benefit of employees, officers, directors or
consultants, (ii) as a result of an exchange or conversion of any
class or series of the Guarantor's capital stock for any other
class or series of the Guarantor's capital stock, or (iii) the
purchase of fractional interests in shares of the Guarantor's
capital stock pursuant to the conversion or exchange provisions
of such capital stock or the security being converted or ex-
changed) and (b) the Guarantor shall not make any payment of
interest on, or principal of (or premium, if any, on), or repay,
repurchase or redeem, any debt securities issued by the Guarantor
which rank pari passu with or junior to the Debentures; provided,
however, the Guarantor may declare and pay a stock dividend where
the dividend stock is the same stock as that on which the divi-
dend is being paid.
SECTION 2 Ranking
-------
This Preferred Securities Guarantee will constitute an
unsecured obligation of the Guarantor and will rank (i) subordi-
nate and junior in right of payment to all other liabilities of
the Guarantor, (ii) pari passu with the most senior preferred or
preference stock now or hereafter issued by the Guarantor and
with any guarantee now or hereafter entered into by the Guarantor
in respect of any preferred or preference stock of any Affiliate
of the Guarantor, and (iii) senior to the Guarantor's common
stock.
ARTICLE VII
TERMINATION
SECTION 1 Termination
-----------
This Preferred Securities Guarantee shall terminate
upon (i) full payment of the Redemption Price of all Preferred
Securities, (ii) the distribution of the Debentures to the
Holders of all of the Preferred Securities or (iii) full payment
of the amounts payable in accordance with the Declaration upon
liquidation of the Issuer. Notwithstanding the foregoing, this
Preferred
15
Securities Guarantee will continue to be effective or will be
reinstated, as the case may be, if at any time any Holder must
restore payment of any sums paid under the Preferred Securities
or under this Preferred Securities Guarantee.
ARTICLE VIII
INDEMNIFICATION
SECTION 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 Preferred Securities
Guarantee and in a manner that such Indemnified Person reasonably
believed to be within the scope of the authority conferred on
such Indemnified Person by this Preferred Securities Guarantee or
by law, except that an Indemnified Person shall be liable for any
such loss, damage or claim incurred by reason of such Indemnified
Person's negligence or willful misconduct with respect to such
acts or omissions.
(b) An Indemnified Person shall be fully protected in
relying in good faith upon the records of the Guarantor and upon
such information, opinions, reports or statements presented to
the Guarantor by any Person as to matters the Indemnified Person
reasonably believes are within such other Person's professional
or expert competence and who has been selected with reasonable
care by or on behalf of the Guarantor, including information,
opinions, reports or statements as to the value and amount of the
assets, liabilities, profits, losses, or any other facts perti-
nent to the existence and amount of assets from which Distribu-
tions to Holders might properly be paid.
SECTION 2 Indemnification
---------------
The Guarantor agrees to indemnify each Indemnified
Person for, and to hold each Indemnified Person harmless against,
any loss, liability or expense incurred without negligence or bad
faith on its part, arising out of or in connection with the
acceptance or administration of the trust or trusts hereunder,
including the costs and expenses (including reasonable legal fees
and expenses) of defending itself against, or investigating, any
claim or liability in connection with the exercise or performance
of any of its powers or duties hereunder. The obligation to
indemnify as set forth in this Section 8.2 shall survive the
termination of this Preferred Securities Guarantee.
16
ARTICLE IX
MISCELLANEOUS
SECTION 1 Successors and Assigns
----------------------
All guarantees and agreements contained in this Pre-
ferred Securities Guarantee shall bind the successors, assigns,
receivers, trustees and representatives of the Guarantor and
shall inure to the benefit of the Holders of the Preferred
Securities then outstanding.
SECTION 2 Amendments
----------
Except with respect to any changes that do not adverse-
ly affect the rights of Holders (in which case no consent of
Holders will be required), this Preferred Securities Guarantee
may be amended only with the prior approval of the Holders of not
less than a Majority in aggregate liquidation amount (including
the stated amount that would be paid on redemption, liquidation
or otherwise, plus accrued and unpaid Distributions to the date
upon which the voting percentages are determined) of all the
outstanding Preferred Securities. The provisions of Section 12.2
of the Declaration with respect to meetings of Holders apply to
the giving of such approval.
SECTION 3 Notices
-------
All notices provided for in this Preferred Securities
Guarantee shall be in writing, duly signed by the party giving
such notice, and shall be delivered, telecopied or mailed by
registered or certified mail, as follows:
(a) If given to the Preferred Guarantee Trustee, at
the Preferred Guarantee Trustee's mailing address set forth below
(or such other address as the Preferred Guarantee Trustee may
give notice of to the Holders):
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx - 15th Floor
New York, New York 10001
Attention: Sheik Wiltshire
(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):
Commercial Credit Company
000 Xx. Xxxx Xxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx III, General Counsel
17
(c) If given to any Holder, at the address set forth
on the books and records of the Issuer.
All such notices shall be deemed to have been given
when received in person, telecopied with receipt confirmed, or
mailed by first class mail, postage prepaid except that if a
notice or other document is refused delivery or cannot be deliv-
ered 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 4 Benefit
-------
This Preferred Securities Guarantee is solely for the
benefit of the Holders of the Preferred Securities and, subject
to Section 3.1(a), is not separately transferable from the
Preferred Securities.
SECTION 5 Governing Law
-------------
THIS PREFERRED SECURITIES GUARANTEE SHALL BE GOVERNED
BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK, AND ALL RIGHTS AND REMEDIES SHALL BE
GOVERNED BY SUCH LAWS WITHOUT REGARD FOR THE PRINCIPLES OF ITS
CONFLICTS OF LAWS.
18
THIS PREFERRED SECURITIES GUARANTEE is executed as of
the day and year first above written.
COMMERCIAL CREDIT COMPANY,
as Guarantor
By:
--------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK, as Pre-
ferred Guarantee Trustee
By:
--------------------------------
Name:
Title:
