Exhibit 4(o)
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TRUST PREFERRED SECURITIES GUARANTEE AGREEMENT
HAWAIIAN ELECTRIC INDUSTRIES CAPITAL TRUST I
DATED AS OF FEBRUARY 1, 1997
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TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation............................. 2
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application........................... 6
SECTION 2.2 Lists of Holders of Securities............................. 6
SECTION 2.3 Reports by the Trust Guarantee Trustee..................... 7
SECTION 2.4 Periodic Reports to the Trust Guarantee
Trustee.................................................... 7
SECTION 2.5 Evidence of Compliance with Conditions
Precedent.................................................. 7
SECTION 2.6 Events of Default; Waiver.................................. 7
SECTION 2.7 Event of Default; Notice................................... 8
SECTION 2.8 Conflicting Interests...................................... 8
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
THE TRUST GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Trust Guarantee Trustee........... 8
SECTION 3.2 Certain Rights of the Trust Guarantee Trustee.............. 10
SECTION 3.3 Not Responsible for Recitals or Issuance of the
Trust Guarantee............................................ 13
ARTICLE IV
THE TRUST GUARANTEE TRUSTEE
SECTION 4.1 The Trust Guarantee Trustee; Eligibility................... 13
SECTION 4.2 Appointment, Removal and Resignation of
the Trust Guarantee Trustee................................ 14
SECTION 4.3 Successor to the Trust Guarantee Trustee
by Merger, Consolidation or Succession
to Business................................................ 15
ARTICLE V
THE TRUST GUARANTEE
SECTION 5.1 Guarantee.................................................. 15
SECTION 5.2 Waiver of Notice and Demand................................ 15
SECTION 5.3 Obligations Not Affected................................... 16
(i)
SECTION 5.4 Rights of Holders.......................................... 17
SECTION 5.5 Guarantee of Payment....................................... 17
SECTION 5.6 Subrogation................................................ 17
SECTION 5.7 Independent Obligations.................................... 18
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions................................. 18
SECTION 6.2 Ranking.................................................... 19
ARTICLE VII
TERMINATION
SECTION 7.1 Termination................................................ 19
ARTICLE VIII
EXCULPATION AND INDEMNIFICATION
SECTION 8.1 Exculpation................................................ 20
SECTION 8.2 Indemnification............................................ 20
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns..................................... 21
SECTION 9.2 Amendments and Assignment.................................. 21
SECTION 9.3 Merger of the Guarantor.................................... 21
SECTION 9.4 Notices.................................................... 22
SECTION 9.5 Benefit.................................................... 23
SECTION 9.6 Governing Law.............................................. 23
(ii)
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
317(b)..................................................................... 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 Preferred
Securities Guarantee Agreement and shall not affect the interpretation of
any of its terms or provisions.
(iii)
TRUST PREFERRED SECURITIES GUARANTEE AGREEMENT
This TRUST PREFERRED SECURITIES GUARANTEE AGREEMENT (this "Trust
Guarantee"), dated as of February 1, 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 1, 1997, among the trustees of the Trust named
therein, Hawaiian Electric Industries, Inc., as Sponsor and Depositor, 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 8.36% 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 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 Guarantee for the benefit of the holder of the Trust Common
Securities (as defined herein), except that if the Company is in default on any
of its obligations under this Trust 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 the holder of the Trust
Common Securities to receive Guarantee Payments under the Trust Common
Securities Guarantee are subordinated to the rights of Holders of Trust
Preferred Securities to receive Guarantee Payments under this Trust 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 both directly and indirectly, the Guarantor executes and delivers
this Trust Guarantee for the benefit of the Holders.
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation
In this Trust Guarantee, unless the context otherwise requires:
(a) capitalized terms used in this Trust 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 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 Guarantee has the same meaning
throughout;
(d) all references to "this Trust Guarantee" are to this Trust Guarantee as
modified, supplemented or amended from time to time;
(e) all references in this Trust Guarantee to Articles and Sections are to
Articles and Sections of this Trust Guarantee, unless otherwise specified;
(f) a term defined in the Trust Indenture Act has the same meaning when
used in this Trust Guarantee, unless otherwise defined in this Trust 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,
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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 Section 1.1
of 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 1, 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.
"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 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
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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 remaining available, after
satisfaction of all obligations of the Trust, 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.
"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 on which the voting percentages are determined) of all Trust
Preferred Securities then outstanding.
"Officer's Certificate" means, with respect to any Person, a certificate
signed by an Authorized Officer of such Person. Any Officer's Certificate
delivered with respect to compliance
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with a condition or covenant provided for in this Trust Guarantee shall include:
(a) a statement that the officer signing the Officer's 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 the officer in rendering the Officer's Certificate;
(c) a statement that 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 such officer, such
condition or covenant has been complied with.
"Partnership" means HEI Preferred Funding, LP, a Delaware limited
partnership.
"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.
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"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 Guarantee and
thereafter means each such Successor Trust Guarantee Trustee.
"Trust Securities" means the Trust Common Securities together with the
Trust Preferred Securities.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application
(a) This Trust Guarantee is subject to the provisions of the Trust
Indenture Act that are required to be part of this Trust Guarantee and shall, to
the extent applicable, be governed by such provisions.
(b) If and to the extent that any provision of this Trust 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
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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.
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
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 Officer's
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 Guarantee, but no such waiver shall
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extend to any subsequent or other default or Event of Default or impair any
right consequent thereon.
SECTION 2.7 Event of Default; Notice
(a) The 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 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 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 Guarantee to any Person except a
Holder of Trust Preferred Securities exercising its 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
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
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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 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 Guarantee, and no implied
covenants shall be read into this Trust 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 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 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
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 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
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conforming to the requirements of this Trust 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 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
Guarantee; and
(iv) No provision of this Trust 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 liability is not reasonably assured to it under the terms of this
Trust 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.
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(ii) Any direction or act of the Guarantor contemplated by this
Trust Guarantee shall be sufficiently evidenced by an Officer's
Certificate.
(iii) Whenever, in the administration of this Trust 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 Officer's 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
Guarantor, consult with counsel of its selection with respect to this Trust
Guarantee, and the advice or opinion of such counsel with respect to legal
matters shall be full and complete authorization and protection in respect
of any action taken, suffered or omitted by it hereunder in good faith and
in accordance with such advice or opinion. Such counsel may be counsel to
the Guarantor or any of its Affiliates and may include any of its
employees. The Trust Guarantee Trustee shall have the right at any time to
seek instructions concerning the administration of this Trust 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 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 Guarantee.
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(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.
(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 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 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 Guarantee.
(b) No provision of this Trust Guarantee shall be deemed to impose any duty
or obligation on the Trust Guarantee Trustee
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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.
SECTION 3.3 Not Responsible for Recitals or Issuance of the Trust Guarantee
The recitals contained in this Trust 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 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.
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(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).
(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 any period
in which an Event of Default has occurred and is continuing.
(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.
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(f) Upon termination of this Trust 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 all or substantially all of 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 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 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.
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SECTION 5.3 Obligations Not Affected
The obligations, covenants, agreements and duties of the Guarantor under
this Trust 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 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;
(c) any failure, omission, delay or lack of diligence on the part of the
Holders or the Trust Guarantee Trustee to enforce, assert or exercise any right,
privilege, power or remedy conferred on the Holders or the Trust Guarantee
Trustee pursuant to the terms of the Trust Preferred Securities or this Trust
Guarantee, 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.
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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 Guarantee or exercising any trust or power conferred upon
the Trust Guarantee Trustee under this Trust Guarantee.
(b) If the Trust Guarantee Trustee fails to enforce its rights under the
Trust 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 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 Guarantee for such payment. The Guarantor waives any right or remedy
to require that any action be brought first against the Trust, the Trust
Guarantee Trustee or any other Person or entity before proceeding directly
against the Guarantor.
SECTION 5.5 Guarantee of Payment
This Trust Guarantee constitutes 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 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 Guarantee, if,
at the time of any such payment, any amounts are due and unpaid under this Trust
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.
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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 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
is in default of its obligations with respect thereto under an applicable
Investment Guarantee, or (c) the Company is in default of its obligations under
this Trust 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 obligations under any
employee benefit, dividend reinvestment, stock purchase or other stock 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,
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the payment of any 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 Guarantee or any other guarantee by the Company with respect to any
Comparable Equity Interest).
SECTION 6.2 Ranking
This Trust Guarantee will constitute an unsecured obligation of the
Guarantor and will rank (i) subordinate and junior in right of payment to all
other existing 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 any 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) the Trust Common Securities Guarantee, (E) 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 any Affiliate of the Guarantor, and (F) 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;
provided, however, that under the circumstances set forth in Section 2.3 of the
Trust Common Securities Guarantee, the rights of the holder of the Trust Common
Securities shall be subordinated to the rights of the Holders. Any similar
guarantee given hereafter by the Guarantor with respect to securities similar 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 Guarantee shall terminate upon (i) full payment of the
Redemption Price of all Trust Preferred Securities, (ii) the distribution of the
Partnership Preferred Securities to the Holders of all the outstanding Trust
Preferred Securities or (iii) full payment of the amounts payable in accordance
with the Trust Agreement upon liquidation of the Trust.
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Notwithstanding the foregoing, this Trust 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 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 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 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 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
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survive the termination of this Trust 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 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 and Assignment
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 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.
The Guarantor may not assign its rights or delegate its obligations under
this Trust Guarantee without the prior approval of the Holders of at least a
Majority in liquidation amount of the Trust Preferred Securities.
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
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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 Guarantor for purposes of
this provision.
SECTION 9.4 Notices
All notices provided for in this Trust 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
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 with
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.
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SECTION 9.5 Benefit
This Trust 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 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.
THIS TRUST GUARANTEE is executed as of the day and year first above
written.
HAWAIIAN ELECTRIC INDUSTRIES, INC.
Guarantor
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Financial Vice President
By: /s/ Xxxxxxxxx X. Xxx
----------------------------------
Name: Xxxxxxxxx X. Xxx
Title: Treasurer
THE BANK OF NEW YORK,
as Trust Guarantee Trustee
By: /s/ Xxxxxx Xxxxxxx
----------------------------------
Name: Xxxxxx Xxxxxxx
Title: Assistant Vice President
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