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Exhibit 4.4
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FORM OF
AMENDED AND RESTATED TRUST AGREEMENT
CLEVELAND ELECTRIC FINANCING TRUST I
DATED AS OF _____________, 2001
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Certain Sections of this Amended and Restated Trust Agreement relating to
Section 310 through 315 of the
Trust Indenture Act of 1939:
Amended and
Restated
Trust Indenture Trust Agreement
Act Section Section
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Section 310(b) .................................................... 8.08
Section 311(b) .................................................... 8.13
Section 313(a) .................................................... 8.14(a)
Section 314(a)(4) .................................................... 8.15
(c) .................................................... 8.16
(c)(1) .................................................... 8.16
Section 315(a) .................................................... 8.01(a)
(c) .................................................... 8.01(a)
(d)(2) .................................................... 8.01(a)
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Note: This reconciliation and tie shall not, for any purpose, be deemed to be
a part of the Amended and Restated Trust Agreement.
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TABLE OF CONTENTS
Page
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ARTICLE I
DEFINED TERMS
Section 1.01 Definitions....................................................................................1
ARTICLE II
ESTABLISHMENT OF THE TRUST
Section 2.01 Name..........................................................................................10
Section 2.02 Office of the Delaware Trustee; Principal Place of Business...................................10
Section 2.03 Initial Contribution of Trust Property; Organizational Expenses...............................10
Section 2.04 Issuance of the Preferred Securities..........................................................10
Section 2.05 Issuance of the Common Securities; Subscription and Purchase of Debentures....................11
Section 2.06 Declaration of Trust..........................................................................11
Section 2.07 Authorization to Enter into Certain Transactions..............................................12
Section 2.08 Assets of Trust...............................................................................15
Section 2.09 Title to Trust Property.......................................................................15
Section 2.10 Mergers.......................................................................................15
ARTICLE III
PAYMENT ACCOUNT
Section 3.01 Payment Account...............................................................................17
ARTICLE IV
DISTRIBUTIONS; REDEMPTION
Section 4.01 Distributions.................................................................................17
Section 4.02 Redemption....................................................................................18
Section 4.03 Subordination of Common Securities............................................................20
Section 4.04 Payment Procedures............................................................................21
Section 4.05 Tax Returns and Reports.......................................................................21
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ARTICLE V
TRUST SECURITIES CERTIFICATES
Section 5.01 Initial Ownership.............................................................................21
Section 5.02 The Trust Securities Certificates.............................................................21
Section 5.03 Delivery of Trust Securities Certificates.....................................................22
Section 5.04 Registration of Transfer and Exchange of Preferred Securities Certificates....................22
Section 5.05 Mutilated, Destroyed, Lost or Stolen Trust Securities Certificates............................23
Section 5.06 Persons Deemed Securityholders................................................................23
Section 5.07 Access to List of Securityholders' Names and Addresses........................................23
Section 5.08 Maintenance of Office or Agency...............................................................24
Section 5.09 Appointment of Paying Agent...................................................................24
Section 5.10 Ownership of Common Securities by Depositor...................................................24
Section 5.11 Book-entry Preferred Securities Certificates; Common Securities Certificate...................25
Section 5.12 Notices to Clearing Agency....................................................................26
Section 5.13 Definitive Preferred Securities Certificates..................................................26
Section 5.14 Rights of Securityholders.....................................................................26
ARTICLE VI
ACTS OF SECURITYHOLDERS; MEETINGS; VOTING
Section 6.01 Limitations on Voting Rights..................................................................27
Section 6.02 Notice of Meetings............................................................................28
Section 6.03 Meetings of Preferred Securityholders.........................................................29
Section 6.04 Voting Rights.................................................................................29
Section 6.05 Proxies, Etc..................................................................................29
Section 6.06 Securityholder Action by Written Consent......................................................30
Section 6.07 Record Date for Voting and Other Purposes.....................................................30
Section 6.08 Acts of Securityholders.......................................................................30
Section 6.09 Inspection of Records.........................................................................31
ARTICLE VII
REPRESENTATIONS AND WARRANTIES OF THE
PROPERTY TRUSTEE AND THE DELAWARE TRUSTEE
Section 7.01 Property Trustee..............................................................................31
Section 7.02 Delaware Trustee..............................................................................32
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ARTICLE VIII
THE TRUSTEES
Section 8.01 Certain Duties and Responsibilities...........................................................32
Section 8.02 Notice of Defaults............................................................................34
Section 8.03 Certain Rights of Property Trustee............................................................34
Section 8.04 Not Responsible For Recitals or Issuance of Securities........................................36
Section 8.05 May Hold Securities...........................................................................36
Section 8.06 Compensation; Fees; Indemnity.................................................................36
Section 8.07 Corporate Property Trustee Required; Eligibility Trustees.....................................37
Section 8.08 Conflicting Interests.........................................................................38
Section 8.09 Co-trustees and Separate Trustee..............................................................38
Section 8.10 Resignation and Removal; Appointment of Successor; Special Administrative Trustee.............39
Section 8.11 Acceptance of Appointment by Successor........................................................41
Section 8.12 Merger, Conversion, Consolidation Succession to Business......................................42
Section 8.13 Preferential Collection of Claims Against Depositor or Trust..................................42
Section 8.14 Reports by Property Trustee...................................................................42
Section 8.15 Reports to the Property Trustee...............................................................43
Section 8.16 Evidence of Compliance with Conditions Precedent..............................................43
Section 8.17 Number of Trustees............................................................................43
Section 8.18 Delegation of Power...........................................................................44
Section 8.19 Fiduciary Duty................................................................................44
ARTICLE IX
DISSOLUTION AND LIQUIDATION
Section 9.01 Dissolution upon Expiration Date..............................................................45
Section 9.02 Early Dissolution.............................................................................45
Section 9.03 Dissolution...................................................................................45
Section 9.04 Liquidation...................................................................................46
ARTICLE X
MISCELLANEOUS PROVISIONS
Section 10.01 Guarantee by the Depositor....................................................................47
Section 10.02 Limitation of Rights of Securityholders.......................................................47
Section 10.03 Amendment.....................................................................................48
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Section 10.04 Separability..................................................................................49
Section 10.05 Governing Law.................................................................................49
Section 10.06 Successors....................................................................................49
Section 10.07 Headings......................................................................................49
Section 10.08 Notice and Demand.............................................................................49
Section 10.09 Agreement not to Petition.....................................................................50
Section 10.10 Trust Indenture Act; Conflict with Trust Indenture Act........................................50
Section 10.11 Counterparts..................................................................................51
EXHIBIT A CERTIFICATE OF TRUST OF CLEVELAND ELECTRIC FINANCING TRUST
EXHIBIT B CERTIFICATE DEPOSITORY AGREEMENT
EXHIBIT C CERTIFICATE EVIDENCING COMMON SECURITIES OF CLEVELAND ELECTRIC FINANCING TRUST I
EXHIBIT D AGREEMENT AS TO EXPENSES AND LIABILITIES
EXHIBIT E ASSIGNMENT
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AMENDED AND RESTATED TRUST AGREEMENT, (this "Trust Agreement") dated as
of _____________, 2001, among (i) The Cleveland Electric Illuminating Company,
an Ohio corporation (the "Depositor" or "Cleveland Electric"), (ii) The Bank of
New York, a banking corporation duly organized and existing under the laws of
New York, as trustee (the "Property Trustee" and, in its individual capacity and
not in its capacity as Property Trustee, the "Bank"), (iii) The Bank of New York
(Delaware), a banking corporation duly organized under the laws of Delaware, as
Delaware trustee (the "Delaware Trustee"), (iv), Xxxxxx Xxxxx and Xxxxx Xxxxxx,
individuals, as trustees, each of whose address is c/o Cleveland Electric
Illuminating Company, 00 Xxxxx Xxxx Xxxxxx, Xxxxx, Xxxx (each an "Administrative
Trustee" and together the "Administrative Trustees") (the Property Trustee, the
Delaware Trustee and the Administrative Trustees referred to collectively as the
"Trustees"), and (v) the several Holders, as hereinafter defined,
W I T N E S S E T H:
WHEREAS, the Depositor, the Property Trustee, the Delaware Trustee and
the Administrative Trustees have heretofore duly declared and established a
business trust pursuant to the Delaware Business Trust Act by the entering into
of that certain Trust Agreement, dated as of June 7, 2001 (the "Original Trust
Agreement"), and by the execution by the Property Trustee, the Delaware Trustee
and the Administrative Trustees and filing with the Secretary of State of the
State of Delaware of the Certificate of Trust, dated June 7, 2001, copies of
which are attached as Exhibit A; and
WHEREAS, the parties hereto desire to amend and restate the Original
Trust Agreement in its entirety as set forth herein to provide for, among other
things, (i) the acquisition by the Trust from the Depositor of all of the right,
title and interest in the Debentures, (ii) the issuance of the Common Securities
by the Trust to the Depositor, and (iii) the issuance and sale of the Preferred
Securities by the Trust pursuant to the Underwriting Agreement;
NOW, THEREFORE, in consideration of the agreements and obligations set
forth herein and for other good and valuable consideration, the sufficiency of
which is hereby acknowledged, each party, for the benefit of the other parties
and for the benefit of the Securityholders, hereby amends and restates the
Original Trust Agreement in its entirety and agrees as follows:
ARTICLE I
DEFINED TERMS
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Section 1.01 DEFINITIONS. For all purposes of this Trust Agreement,
except as otherwise expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as the singular;
(b) all other terms used herein that are defined in the
Trust Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
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(c) unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the case may be,
of this Trust Agreement; and
(d) the words "herein," "hereof" and "hereunder" and other
words of similar import refer to this Trust Agreement as a whole and not to any
particular Article, Section or other subdivision.
"ACT" has the meaning specified in Section 6.08.
"ADDITIONAL AMOUNT" means, with respect to Trust Securities of a given
Liquidation Amount and/or a given period, the amount of Additional Interest (as
defined in the Subordinated Indenture) paid by the Depositor on a Like Amount of
Debentures for such period.
"ADMINISTRATIVE TRUSTEE" means each of the individuals identified as an
"Administrative Trustee" in the preamble to this Trust Agreement solely in their
capacities as Administrative Trustees of the Trust and not in their individual
capacities, or such trustee's successor in interest in such capacity, or any
successor trustee or any Special Administrative Trustee appointed as herein
provided.
"AFFILIATE" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control," when used with respect to any specified Person, means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"APPOINTMENT EVENT" has the meaning specified in Section 6.01(d).
"BANK" has the meaning specified in the preamble to this Trust
Agreement.
"BANKRUPTCY EVENT" means, with respect to any Person:
(i) the entry of a decree or order by a court having
jurisdiction in the premises judging such Person a bankrupt or
insolvent, or approving as properly filed a petition seeking
reorganization, arrangement, adjudication or composition of or in
respect of such Person under Federal bankruptcy law or any other
applicable Federal or State law, or appointing a receiver, liquidator,
assignee, trustee, sequestrator or other similar official of such
Person or of all or substantially all of its property, or ordering the
winding up or liquidation of its affairs, and the continuance of any
such decree or order unstated and in effect for a period of 60
consecutive days; or
(ii) the institution by such Person of proceedings to be
adjudicated a bankrupt or insolvent, or of the consent by it to the
institution of bankruptcy or insolvency proceedings against it, or the
filing by it of a petition or answer or consent seeking reorganization
or relief under Federal bankruptcy law or any other applicable Federal
or State law, or the consent by it to the filing of such petition or to
the appointment of a receiver, liquidator, assignee, trustee,
sequestrator or similar official of such Person or of all or
substantially all of its property, or the making by it of an
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assignment for the benefit of creditors, or the admission by it in
writing of its inability to pay its debts generally as they become due,
or the taking of action by such Person in furtherance of any such
action.
"BANKRUPTCY LAWS" has the meaning specified in Section 10.09.
"BOARD RESOLUTION" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Depositor to have been duly adopted
by the Depositor's Board of Directors or a duly authorized committee thereof and
to be in full force and effect on the date of such certification, and delivered
to the Trustees.
"BOOK ENTRY PREFERRED SECURITIES CERTIFICATES" means a beneficial
interest in the Preferred Securities Certificates, ownership and transfers of
which shall be made through book entries by a Clearing Agency as described in
Section 5.11.
"BUSINESS DAY" means a day other than (x) a Saturday or a Sunday, (y) a
day on which banks in New York, New York are authorized or obligated by law or
executive order to remain closed or (z) a day on which the principal corporate
trust office of the Property Trustee or the Debenture Trustee is closed for
business.
"CERTIFICATE DEPOSITORY AGREEMENT" means the agreement among the Trust
and The Depository Trust Company, as the initial Clearing Agency, dated as of
the Closing Date, relating to the Trust Securities Certificates, substantially
in the form attached as Exhibit B, as the same may be amended and supplemented
from time to time.
"CLEARING AGENCY" means an organization registered as a "clearing
agency" pursuant to Section 17A of the Securities Exchange Act of 1934. The
Depository Trust Company will be the initial Clearing Agency.
"CLEARING AGENCY PARTICIPANT" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time a Clearing
Agency effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
"CLOSING DATE" means the Time of Delivery as defined in the
Underwriting Agreement, which date is also the date of execution and delivery of
this Trust Agreement.
"CODE" means the Internal Revenue Code of 1986, as amended.
"COMMISSION" means the Securities and Exchange Commission, as from time
to time constituted, created under the Securities Exchange Act of 1934, or, if
at any time after the execution of this instrument such Commission is not
existing and performing the duties now assigned to it under the Trust Indenture
Act, then the body performing such duties at such time.
"COMMON SECURITY" means an undivided beneficial interest in the assets
of the Trust, having a Liquidation Amount of $25 and having the rights provided
therefor in this Trust Agreement, including the right to receive Distributions
and a Liquidation Distribution as provided herein.
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"COMMON SECURITIES CERTIFICATE" means a certificate evidencing
ownership of Common Securities, substantially in the form attached as Exhibit C.
"CORPORATE TRUST OFFICE" means the principal corporate office of the
Property Trustee located in New York, New York.
"COVERED PERSON" means: (a) any officer, director, shareholder,
partner, member, representative, employee or agent of the Trust or the Trust's
Affiliates; and (b) any Holder of Trust Securities.
"DEBENTURE EVENT OF DEFAULT" means an "EVENT OF DEFAULT" as defined in
the Subordinated Indenture.
"DEBENTURE ISSUER" means The Cleveland Electric Illuminating Company,
an Ohio corporation, in its capacity as issuer of the Debentures.
"DEBENTURE REDEMPTION DATE" means a "Redemption Date" as defined in the
Subordinated Indenture.
"DEBENTURE TRUSTEE" means The Bank of New York, a banking corporation
duly organized and existing under the laws of New York, as trustee under the
Subordinated Indenture.
"DEBENTURES" means the $_____________ aggregate principal amount (or
$______aggregate principal amount if the underwriters exercise their
over-allotment option granted pursuant to the Underwriting Agreement) of the
Debenture Issuer's ___% Junior Subordinated Debentures, Series [ ], Due 2031,
issued pursuant to the Subordinated Indenture.
"DEFINITIVE PREFERRED SECURITIES CERTIFICATES" means either or both (as
the context requires) of (i) Preferred Securities Certificates issued in
certificated, fully registered form as provided in Section 5.11(a) and (ii)
Preferred Securities Certificates issued in certificated, fully registered form
as provided in Section 5.13.
"DELAWARE BUSINESS TRUST ACT" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. C.ss.3801, et seq., as it may be amended from time to
time.
"DELAWARE TRUSTEE" means the banking corporation identified as the
"Delaware Trustee" in the preamble to this Trust Agreement solely in its
capacity as Delaware Trustee of the Trust and not in its individual capacity, or
its successor in interest in such capacity, or any successor trustee appointed
as herein provided.
"DEPOSITOR" has the meaning specified in the preamble to this Trust
Agreement and includes The Cleveland Electric Illuminating Company, an Ohio
Corporation, or any successor entity in a merger, consolidation or amalgamation,
in its capacity as Holder of the Common Securities.
"DISTRIBUTION DATE" has the meaning specified in Section 4.01(a).
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"DISTRIBUTIONS" means amounts payable in respect of the Trust
Securities as provided in Section 4.01.
"EVENT OF DEFAULT" means any one of the following events (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(i) the occurrence of a Debenture Event of Default; or
(ii) default by the Trust in the payment of any
Distribution when it becomes due and payable, and continuation of such
default for a period of 30 days; or
(iii) default by the Trust in the payment of any
Redemption Price of any Trust Security when it becomes due and
payable; or
(iv) default in the performance, or breach, in any
material respect, of any covenant or warranty of the Trustees in this
Trust Agreement (other than a covenant or warranty a default in whose
performance or breach is dealt with in clause (ii) or (iii), above) and
continuation of such default or breach for a period of 60 days after
there has been given, by registered or certified mail, to the
defaulting Trustee or Trustees by the Holders of at least 10% in
Liquidation Amount of the Outstanding Preferred Securities a written
notice specifying such default or breach and requiring it to be
remedied and stating that such notice is a "Notice of Default"
hereunder; or
(v) the occurrence of a Bankruptcy Event with respect to
the Trust.
"EXPENSE AGREEMENT" means the Agreement as to Expenses and Liabilities,
dated as of _____________, 2001, between Cleveland Electric and the Trust,
substantially in the form attached as Exhibit D, as amended from time to time.
"EXTENSION PERIOD" has the meaning specified in the Subordinated
Indenture.
"GLOBAL CERTIFICATE" has the meaning specified in Section 5.11.
"GUARANTEE" means the Guarantee Agreement, dated as of _____________,
2001, executed and delivered by the Depositor and The Bank of New York, a New
York banking corporation, as trustee, contemporaneously with the execution and
delivery of this Trust Agreement, for the benefit of the Preferred
Securityholders, as amended from time to time.
"INDEMNIFIED PERSON" means any Trustee, any Affiliate of any Trustee,
or any officers, directors, shareholders, members, partners, employees,
representatives or agents of any Trustee, or any employee or agent of the Trust
or its Affiliates.
"INVESTMENT COMPANY EVENT" means the receipt by the Administrative
Trustees of an Opinion of Counsel experienced in practice under the Investment
Company Act of 1940, as amended (the "1940 Act"), to the effect that as a result
of the occurrence of a change in law or regulation by any legislative body,
court, governmental agency or regulatory authority (a
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"Change in 1940 Act Law"), the Trust is or will be considered an "investment
company" which is required to be registered under the 1940 Act, which Change in
1940 Act Law becomes effective on or after the date of the issuance of the
Preferred Securities.
"LIEN" means any lien, pledge, charge, encumbrance, mortgage, deed of
trust, adverse ownership interest, hypothecation, assignment, security interest
or preference, priority or other security agreement or preferential arrangement
of any kind or nature whatsoever.
"LIKE AMOUNT" means (i) Trust Securities having a Liquidation Amount
equal to the principal amount of Debentures to be contemporaneously redeemed in
accordance with the Subordinated Indenture and the proceeds of which will be
used to pay the Redemption Price of such Trust Securities, or (ii) Debentures
having a principal amount equal to the Liquidation Amount of the Trust
Securities of the Holder to whom such Debentures are distributed, as the case
may be.
"LIQUIDATION AMOUNT" means the stated amount of $25 per Trust Security.
"LIQUIDATION DATE" means the date on which Debentures are to be
distributed to Holders of Trust Securities in connection with a dissolution and
liquidation of the Trust pursuant to Section 9.04(a).
"LIQUIDATION DISTRIBUTION" has the meaning specified in Section
9.04(d).
"OFFICERS' CERTIFICATE" means a certificate signed by the Chairman of
the Board, a Vice Chairman of the Board, the President, a Vice President or the
Comptroller, and by the Treasurer, an Assistant Treasurer, the Secretary or an
Assistant Secretary, of the Depositor, and delivered to the appropriate Trustee.
One of the officers signing an Officers' Certificate given pursuant to Section
8.16 shall be the principal executive, financial or accounting officer of the
Depositor. Any Officers' Certificate delivered with respect to compliance with a
condition or covenant provided for in this Trust Agreement shall include:
(a) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the definitions relating
thereto;
(b) a brief statement of the nature and scope of the
examination or investigation undertaken by each officer upon which the
statements or opinions of such officer contained in such Officers' Certificate
are based;
(c) a statement that, in each such officer's opinion, such
officer has made such examination or investigation as 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.
"OPINION OF COUNSEL" means a written opinion of counsel, who may be
counsel for the Trust, any of the Trustees or the Depositor, but not an employee
of the Trust or any of the Trustees, and who shall be reasonably acceptable to
the Trustees.
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"OPTION CLOSING DATE" has the meaning specified in the Underwriting
Agreement.
"ORIGINAL TRUST AGREEMENT" has the meaning specified in the recitals to
this Trust Agreement.
"OUTSTANDING," when used with respect to Preferred Securities, means,
as of the date of determination, all Preferred Securities theretofore delivered
under this Trust Agreement, except:
(i) Preferred Securities theretofore cancelled by the
Administrative Trustees or delivered to the Administrative Trustees for
cancellation;
(ii) Preferred Securities for whose payment or redemption
money in the necessary amount has been theretofore deposited with the
Property Trustee or any Paying Agent for the Holders of such Preferred
Securities; provided that, if such Preferred Securities are to be
redeemed, notice of such redemption has been duly given pursuant to
this Trust Agreement; and
(iii) Preferred Securities which have been exchanged for
or in lieu of which other Preferred Securities have been delivered
pursuant to Section 5.05 of this Trust Agreement;
provided, however, that in determining whether the Holders of the requisite
Liquidation Amount of the Outstanding Preferred Securities have given any
request, demand, authorization, direction, notice, consent or waiver hereunder,
Preferred Securities owned by the Depositor, any Trustee or any Affiliate of the
Depositor or any Trustee shall be disregarded and deemed not to be Outstanding,
except that (a) in determining whether any Trustee shall be protected in relying
upon any such request, demand, authorization, direction, notice, consent or
waiver, only Preferred Securities which such Trustee knows to be so owned shall
be so disregarded and (b) the foregoing shall not apply at any time when all of
the Outstanding Preferred Securities are owned by the Depositor, one or more of
the Trustees and/or any such Affiliate. Preferred Securities so owned which have
been pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Administrative Trustees the pledgee's
right so to act with respect to such Preferred Securities and that the pledgee
is not the Depositor or any Affiliate of the Depositor.
"OWNER" means each Person who is the beneficial owner of a Book Entry
Preferred Securities Certificate as reflected in the records of the Clearing
Agency or, if a Clearing Agency Participant is not the Owner, then as reflected
in the records of a Person maintaining an account with such Clearing Agency
(directly or indirectly, in accordance with the rules of such Clearing Agency).
"PAYING AGENT" means any paying agent or co-paying agent appointed
pursuant to Section 5.09 and shall initially be The Bank of New York.
"PAYMENT ACCOUNT" means a segregated non-interest-bearing corporate
trust account maintained by the Property Trustee in its trust department for the
benefit of the Securityholders in which all amounts paid in respect of the
Debentures will be held and from which the Property Trustee shall make payments
to the Securityholders in accordance with Sections 4.01 and 4.02.
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"PERSON" means any individual, corporation, company, limited liability
company, association, joint stock company, partnership, joint venture, trust,
business trust, unincorporated organization or government or any agency or
political subdivision thereof.
"PREFERRED SECURITY" means an undivided beneficial interest in assets
of the Trust, having a Liquidation Amount of $25 and having rights provided
therefor in this Trust Agreement, including the right to receive Distributions
and a Liquidation Distribution as provided herein.
"PREFERRED SECURITIES CERTIFICATE" means a certificate evidencing
ownership of Preferred Securities, substantially in the form attached as Exhibit
E.
"PROPERTY TRUSTEE" means the commercial bank or trust company
identified as the "Property Trustee" in the preamble to this Trust Agreement
solely in its capacity as Property Trustee of the Trust and not in its
individual capacity, or its successor in interest in such capacity, or any
successor trustee appointed as herein provided.
"REDEMPTION DATE" means, with respect to any Trust Security to be
redeemed, the date fixed for such redemption by or pursuant to this Trust
Agreement; provided that each Debenture Redemption Date shall be a Redemption
Date for a Like Amount of Trust Securities.
"REDEMPTION PRICE" means, with respect to any date fixed for redemption
of any Trust Security, the Liquidation Amount of such Trust Security, plus
accumulated and unpaid Distributions to such date.
"RELEVANT TRUSTEE" shall have the meaning specified in Section 8.10.
"RESPONSIBLE OFFICER", when used with respect to the Property Trustee,
means any Vice President or any trust officer of the Property Trustee, which in
each case is assigned by the Property Trustee to its Corporate Trust Office (or
any successor department), and also means, with respect to a particular
corporate trust matter, any other trust officer to whom such matter is referred
because of his knowledge of and familiarity with the particular subject.
"SECURITIES REGISTER" and "TRANSFER AGENT AND REGISTRAR" have the
respective meanings specified in Section 5.04.
"SECURITYHOLDER" or "HOLDER" means a Person in whose name a Trust
Security or Securities is registered in the Securities Register; any such Person
shall be deemed to be a beneficial owner within the meaning of the Delaware
Business Trust Act.
"SPECIAL ADMINISTRATIVE TRUSTEE" shall have the meaning specified in
Section 8.10.
"SPECIAL EVENT" means a Tax Event or an Investment Company Event.
"STATED MATURITY" has the meaning specified in the Subordinated
Indenture.
"SUBORDINATED INDENTURE" means the Indenture, dated as of
_____________, 2001, between the Debenture Issuer and the Debenture Trustee, as
trustee, as amended or supplemented from time to time.
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"TAX EVENT" means the receipt by the Administrative Trustees of an
Opinion of Counsel from nationally recognized independent counsel experienced in
such matters to the effect that, as a result of (a) any amendment to, or change
(including any announced prospective change) in, the laws or treaties (or any
regulations thereunder) of the United States or any political subdivision or
taxing authority thereof or therein, (b) any amendment to or change in an
interpretation or application of such laws or regulations by any legislative
body, court, governmental agency or regulatory authority (including the
enactment of any legislation and the publication of any judicial decision or
regulatory determination on or after the date of the issuance of the Preferred
Securities), (c) any interpretation or pronouncement of any such body, court,
agency or authority, that provides for a position with respect to such laws or
regulations that differs from the theretofore generally accepted position, or
(d) any action taken by any governmental agency or regulatory authority, which
amendment or change is enacted, promulgated or effective, or which
interpretation or pronouncement is issued or announced, or which action is
taken, in each case on or after the date of the issuance of the Preferred
Securities, there is more than an insubstantial risk that (i) the Trust is, or
will be, subject to United States federal income tax with respect to income
accrued or received on the Debentures, (ii) interest payable on the Debentures
is not, or will not be, fully deductible by Cleveland Electric for United States
federal income tax purposes or (iii) the Trust is, or will be, subject to more
than a de minimus amount of other taxes, duties or other governmental charges.
"TRUST" means the Delaware business trust created and continued hereby
and identified on the cover page to this Trust Agreement.
"TRUST AGREEMENT" means this Amended and Restated Trust Agreement, as
the same may be modified, amended or supplemented in accordance with the
applicable provisions hereof, including all exhibits hereto, including, for all
purposes of this Trust Agreement and any such modification, amendment or
supplement, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this Trust Agreement and any such modification, amendment or
supplement, respectively.
"TRUST INDENTURE ACT" means the Trust Indenture Act of 1939 as in force
at the date as of which this instrument was executed; provided, however, that in
the event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
"TRUST PROPERTY" means (i) the Debentures, (ii) any cash on deposit in,
or owing to, the Payment Account and (iii) all proceeds and rights in respect of
the foregoing and any other property and assets for the time being held by the
Property Trustee pursuant to the trusts of this Trust Agreement.
"TRUST SECURITY" means any one of the Common Securities or the
Preferred Securities.
"TRUST SECURITIES CERTIFICATE" means any one of the Common Securities
Certificates or the Preferred Securities Certificates.
"UNDERWRITING AGREEMENT" means the Underwriting Agreement, dated as of
_____________, 2001, among the Trust, Cleveland Electric and the underwriters
named therein.
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ARTICLE II
ESTABLISHMENT OF THE TRUST
--------------------------
Section 2.01 NAME. The Trust created and continued hereby shall be
known as Cleveland Electric Financing Trust I. Such name may be modified from
time to time by the Administrative Trustees following written notice to the
Holders of Trust Securities, in which name the Trustees may conduct the business
of the Trust, make and execute contracts and other instruments on behalf of the
Trust and xxx and be sued.
Section 2.02 OFFICE OF THE DELAWARE TRUSTEE; PRINCIPAL PLACE OF
BUSINESS. The office of the Delaware Trustee in the State of Delaware is Xxxxx
Xxxx Center, Xxxxx 000, Xxxxxx, Xxxxxxxx 00000, or at such other address in
Delaware as the Delaware Trustee may designate by written notice to the
Securityholders and the Depositor. The principal place of business of the Trust
is c/o The Cleveland Electric Illuminating Company, 00 Xxxxx Xxxx Xxxxxx, Xxxxx,
Xxxx 00000.
Section 2.03 INITIAL CONTRIBUTION OF TRUST PROPERTY; ORGANIZATIONAL
EXPENSES. The Property Trustee acknowledges receipt in trust from the Depositor
in connection with the Original Trust Agreement of the sum of $10, which
constituted the initial Trust Property. The Depositor shall pay organizational
expenses of the Trust as they arise or shall, upon request of any Trustee,
promptly reimburse such Trustee for any such expenses paid by such Trustee. The
Depositor shall make no claim upon the Trust Property for the payment of such
expenses.
Section 2.04 ISSUANCE OF THE PREFERRED SECURITIES. On _____________,
2001, the Depositor, on behalf of the Trust and pursuant to the Original Trust
Agreement, executed and delivered the Underwriting Agreement. Contemporaneously
with the execution and delivery of this Trust Agreement, the Administrative
Trustees or any one of them, on behalf of the Trust, shall execute and deliver
to the underwriters named therein Preferred Securities Certificates, registered
in the name of the nominee of the initial Clearing Agency, in an aggregate
amount of _____________ Preferred Securities having an aggregate Liquidation
Amount of $_____________ against receipt of the aggregate purchase price of such
Preferred Securities of $_____________ ($_____ per Preferred Security) which
amount the Administrative Trustees shall promptly deliver to or to the order of
the Property Trustee. In the event and to the extent the over-allotment option
granted by the Trust and the Depositor pursuant to the Underwriting Agreement is
exercised by such underwriters, on the Option Closing Date, the Administrative
Trustees or any one of them, on behalf of the Trust, shall execute and deliver
to the underwriters named therein Preferred Securities Certificates, registered
in the name of the nominee of the initial Clearing Agency, in an aggregate
amount up to ______ Preferred Securities having an aggregate Liquidation Amount
of up to $_______ against receipt of the aggregate purchase price of such
Preferred Securities of up to $______ ($_____ per Preferred Security), which
amount the Administrative Trustees shall promptly deliver to or to the order of
the Property Trustee.
Section 2.05 ISSUANCE OF THE COMMON SECURITIES; SUBSCRIPTION AND
PURCHASE OF DEBENTURES. Contemporaneously with the execution and delivery of
this Trust Agreement, (a) the Administrative Trustees or any one of them, on
behalf of the Trust, shall execute and deliver to the Depositor Common
Securities Certificates, registered in the name of the Depositor, in an
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aggregate amount of _____________ Common Securities having an aggregate
Liquidation Amount of $_____________, and in payment of the purchase price for
such Common Securities, the Depositor shall deliver to the Trust the sum of
$_____________; and (b) the Administrative Trustees, on behalf of the Trust,
shall subscribe to and purchase from the Depositor Debentures, registered in the
name of the Property Trustee on behalf of the Holders of the Trust Securities
and having an aggregate principal amount equal to $_____________, and, in
payment of the purchase price for such Debentures the Property Trustee, on
behalf of the Trust, shall deliver to the Depositor the sum of $_____________.
In the event and to the extent the over-allotment option granted by the Trust
and the Depositor pursuant to the Underwriting Agreement is exercised by such
underwriters, on the Option Closing Date, (a) the Administrative Trustees or any
one of them, on behalf of the Trust, shall execute and deliver to the Depositor
Common Securities Certificates, registered in the name of the Depositor, in an
aggregate amount of up to _______ Common Securities having an aggregate
Liquidation Amount of up to $_______ against payment by the Depositor of such
amount; and (b) the Administrative Trustees or any one of them, on behalf of the
Trust, shall subscribe to and purchase from the Depositor additional Debentures,
registered in the name of the Property Trustee on behalf of the Holders of the
Trust Securities and having an aggregate principal amount of up to $______, and,
in payment of the purchase price for such additional Debentures the Property
Trustee, on behalf of the Trust, shall deliver to the Depositor an amount equal
to the aggregate principal amount of the additional Debentures being purchased.
Section 2.06 DECLARATION OF TRUST. The exclusive purposes and functions
of the Trust are (a) to issue and sell Trust Securities and use the proceeds
from such sale to acquire the Debentures, and (b) to engage in those activities
necessary, convenient or incidental thereto. The Depositor hereby appoints the
Trustees as trustees of the Trust, to have all the rights, powers and duties to
the extent set forth herein. The Property Trustee hereby declares that it will
hold the Trust Property in trust upon and subject to the conditions set forth
herein for the benefit of the Securityholders. The Trustees shall have all
rights, powers and duties set forth herein and in accordance with applicable law
with respect to accomplishing the purposes of the Trust. The Delaware Trustee
shall be one of the Trustees of the Trust for the sole and limited purpose of
fulfilling the requirements of Section 3807 of the Delaware Business Trust Act,
and, notwithstanding the foregoing or any other provision of this Trust
Agreement, the Delaware Trustee shall not be entitled to exercise any powers,
nor shall the Delaware Trustee have any of the duties and responsibilities, of
the Property Trustee or the Administrative Trustees set forth herein.
Section 2.07 AUTHORIZATION TO ENTER INTO CERTAIN TRANSACTIONS. (a) The
Trustees shall conduct the affairs of the Trust in accordance with the terms of
this Trust Agreement. Subject to the limitations set forth in paragraph (b) of
this Section and Article VIII of this Trust Agreement, and in accordance with
the following provisions (ii) and (iii), the Trustees shall have the authority
to enter into all transactions and agreements determined by the Trustees to be
appropriate in exercising the authority, express or implied, otherwise granted
to the Trustees under this Trust Agreement, and to perform all acts in
furtherance thereof, including without limitation, the following:
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(i) As among the Trustees, the Administrative Trustees,
acting singly or collectively, shall have the power, duty and authority
to act on behalf of the Trust with respect to the following matters:
(A) the issuance and sale of the Trust
Securities;
(B) to cause the Trust to enter into, and to
execute, deliver and perform on behalf of the Trust, the
Expense Agreement and the Certificate Depository Agreement and
such other agreements as may be necessary or desirable in
connection with the consummation hereof;
(C) assisting in the registration of the
Preferred Securities under the Securities Act of 1933, and
under state securities or blue sky laws, and the qualification
of this Trust Agreement as a trust indenture under the Trust
Indenture Act;
(D) assisting in the listing of the
Preferred Securities upon such securities exchange or
exchanges as shall be determined by the Depositor and the
registration of the Preferred Securities under the Securities
Exchange Act of 1934, and the preparation and filing of all
periodic and other reports and other documents pursuant to the
foregoing;
(E) the sending of notices (other than
notices of default) and other information regarding the Trust
Securities and the Debentures to the Securityholders in
accordance with this Trust Agreement;
(F) the appointment of a Paying Agent,
authenticating agent and Transfer Agent and Registrar in
accordance with this Trust Agreement;
(G) registering transfers of the Trust
Securities in accordance with this Trust Agreement in their
capacity as initial Transfer Agent and Registrar;
(H) to the extent provided in this Trust
Agreement, the winding up of the affairs of and liquidation of
the Trust and the preparation, execution and filing of the
certificate of cancellation with the Secretary of State of the
State of Delaware;
(I) unless otherwise determined by the
Depositor or the Property Trustee, or as otherwise required by
the Delaware Business Trust Act or the Trust Indenture Act, to
execute and deliver on behalf of the Trust (either acting
alone or together with any or all of the Administrative
Trustees) any documents that the Administrative Trustees have
the power to execute and deliver pursuant to this Trust
Agreement; and
(J) the taking of any action incidental to
the foregoing as the Administrative Trustees may from time to
time determine is necessary or advisable to protect and
conserve the Trust Property for the benefit of the
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Securityholders (without consideration of the effect of any
such action on any particular Securityholder).
The Administrative Trustee shall give notice to the Securityholders of any
Extension Period or any extension on the Stated Maturity in accordance with this
Trust Agreement.
(ii) As among the Trustees, the Property Trustee shall
have the power, duty and authority to act on behalf of the Trust with
respect to the following ministerial matters:
(A) the establishment of the Payment
Account;
(B) the receipt of the Debentures;
(C) the deposit of interest, principal and
any other payments made in respect of the Debentures in the
Payment Account;
(D) the distribution of amounts owed to the
Securityholders in respect of the Trust Securities in
accordance with the terms of this Trust Agreement;
(E) the sending of notices of default and
other information regarding the Trust Securities and the
Debentures to the Securityholders in accordance with the terms
of this Trust Agreement;
(F) the distribution of the Trust Property
in accordance with the terms of this Trust Agreement;
(G) to cause the Trust to enter into, and to
execute, deliver and perform on behalf of the Trust, the
Certificate Depository Agreement;
(H) as provided in this Trust Agreement, the
winding up of the affairs of and liquidation of the Trust and
the execution of the certificate of cancellation to be
prepared and filed by the Administrative Trustees with the
Secretary of State of the State of Delaware; and
(I) the taking of any ministerial action
incidental to the foregoing as the Property Trustee may from
time to time determine is necessary or advisable to protect
and conserve the Trust Property for the benefit of the
Securityholders (without consideration of the effect of any
such action on any particular Securityholder).
Subject to this Section 2.07(a)(ii), the Property Trustee shall have none of the
duties, powers or authority of the Administrative Trustees set forth in Sections
2.07(a)(i) and 2.07(d) or the Depositor set forth in Sections 2.07(c) and
2.07(d). The Property Trustee shall have the power and authority to exercise all
of the rights, powers and privileges of a holder of Debentures under the
Subordinated Indenture and, if an Event of Default occurs and is continuing, the
Property Trustee may, for the benefit of Holders of the Trust Securities, in its
discretion, proceed to
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protect and enforce its rights as holder of the Debentures subject to the rights
of the Holders pursuant to the terms of such Trust Securities.
(b) So long as this Trust Agreement remains in effect, the
Trust (or the Trustees acting on behalf of the Trust) shall not undertake any
business, activities or transaction except as expressly provided herein or
contemplated hereby. In particular, the Trustees shall not (i) acquire any
investments or engage in any activities not authorized by this Trust Agreement,
(ii) sell, assign, transfer, exchange, pledge, set-off or otherwise dispose of
any of the Trust Property or interests therein, including to Securityholders,
except as expressly provided herein, (iii) take any action that would cause the
Trust to be treated as an association taxable as a corporation for United States
Federal income tax purposes, (iv) incur any indebtedness for borrowed money or
(v) take or consent to any action that would result in the placement of a Lien
on any of the Trust Property. The Trustees shall defend all claims and demands
of all Persons at any time claiming any Lien on any of the Trust Property
adverse to the interest of the Trust or the Securityholders in their capacity as
Securityholders.
(c) In connection with the issue and sale of the Preferred
Securities, the Depositor shall have the right and responsibility to assist the
Trust with respect to, or effect on behalf of the Trust, the following (and any
actions taken by the Depositor in furtherance of the following prior to the date
of this Trust Agreement are hereby ratified and confirmed in all respects):
(i) to prepare for filing, execute and file with the
Commission on behalf of the Trust a registration statement on Form S-2
in relation to the Preferred Securities and the Debentures, including
any amendments thereto;
(ii) to determine the states in which to take appropriate
action to qualify or register for sale all or part of the Preferred
Securities and to do any and all such acts, other than actions which
must be taken by or on behalf of the Trust, and advise the Trustees of
actions they must take on behalf of the Trust, and prepare for
execution and filing any documents to be executed and filed by the
Trust or on behalf of the Trust, as the Depositor deems necessary or
advisable in order to comply with the applicable laws of any such
states;
(iii) to prepare for filing, execute and file with the New
York Stock Exchange or any other national stock exchange or the Nasdaq
National Market on behalf of the Trust an application for listing upon
notice of issuance of any Preferred Securities;
(iv) to prepare for filing, execute and file with the
Commission on behalf of the Trust a registration statement on Form 8-A
relating to the registration of the Preferred Securities under Section
12(b) or 12(g) of the Securities Exchange Act of 1934, including any
amendments thereto;
(v) to negotiate the terms of, and execute and deliver,
the Underwriting Agreement providing for the sale of the Preferred
Securities; and
(vi) any other actions necessary or desirable to carry out
any of the foregoing activities.
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(d) Notwithstanding anything herein to the contrary, the
Administrative Trustees are authorized and directed to conduct the affairs of
the Trust and to operate the Trust so that the Trust will not be deemed to be an
"investment company" required to be registered under the Investment Company Act
of 1940, as amended, or treated as an association taxable as a corporation for
United States Federal income tax purposes and so that the Debentures will be
treated as indebtedness of the Depositor for United States Federal income tax
purposes. In this connection, the Depositor and the Administrative Trustees are
authorized to take any action, not inconsistent with applicable law, the
Certificate of Trust or this Trust Agreement, that each of the Depositor and the
Administrative Trustees determines in its discretion to be necessary or
desirable for such purposes, as long as such action does not adversely affect
the interests of the Holders of the Preferred Securities.
Section 2.08 ASSETS OF TRUST. The assets of the Trust shall consist of
the Trust Property.
Section 2.09 TITLE TO TRUST PROPERTY. Legal title to all Trust Property
shall be vested at all times in the Property Trustee (in its capacity as such)
and shall be held and administered by the Property Trustee for the benefit of
the Securityholders and the Trust in accordance with this Trust Agreement.
Section 2.10 MERGERS. (a) The Trust may not consolidate, amalgamate,
merge with or into, or be replaced by, or convey, transfer or lease its
properties and assets substantially as an entirety to any Person, except as
provided by (b) and (c) of this Section 2.10 or by Section 9.04.
(b) The Trust may, with the consent of the Administrative Trustees or,
if there are more than two, a majority of the Administrative Trustees and
without the consent of the Holders of the Securities, the Delaware Trustee or
the Property Trustee, consolidate, amalgamate, merge with or into, or be
replaced by a trust organized as such under the laws of any State; provided
that:
(i) such successor entity (the "Successor Entity") either:
(A) expressly assumes all of the obligations
of the Trust under the Securities; or
(B) substitutes for the Securities other
securities having substantially the same terms as the
Preferred Securities (the "Successor Securities") so long as
the Successor Securities rank the same as the Preferred
Securities rank with respect to Distributions and payments
upon liquidation, redemption and otherwise;
(ii) the Debenture Issuer expressly acknowledges a
trustee of the Successor Entity that possesses the same powers and
duties as the Property Trustee as the Holder of the Debentures;
(iii) the Preferred Securities or any Successor Securities
are listed, or any Successor Securities will be listed upon
notification of issuance, on any national securities exchange or with
any other organization on which the Preferred Securities are then
listed or quoted;
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(iv) such merger, consolidation, amalgamation or
replacement does not cause the Preferred Securities (including any
Successor Securities) to be downgraded by any nationally recognized
statistical rating organization;
(v) such merger, consolidation, amalgamation or
replacement does not adversely affect the rights, preferences and
privileges of the Holders of the Securities (including any Successor
Securities) in any material respect (other than with respect to any
dilution of such Holders' interests in the Successor Entity as a result
of such merger, consolidation, amalgamation or replacement);
(vi) such Successor Entity has a purpose substantially
identical to that of the Trust;
(vii) prior to such merger, consolidation, amalgamation or
replacement, the Trust has received an Opinion of Counsel of nationally
recognized independent counsel to the Trust experienced in such matters
to the effect that:
(A) such merger, consolidation, amalgamation
or replacement does not adversely affect the rights,
preferences and privileges of the Holders of the Securities
(including any Successor Securities) in any material respect
(other than with respect to any dilution of the Holders'
interest in the Successor Entity);
(B) following such merger, consolidation,
amalgamation or replacement, neither the Trust nor the
Successor Entity will be required to register as an Investment
Company;
(C) following such merger, consolidation,
amalgamation or replacement, the Trust (or the Successor
Entity) will not be classified as an association taxable as
corporation for United States federal income tax purposes; and
(viii) the Depositor guarantees the obligations of such
Successor Entity under the Successor Securities at least to the extent
provided by the Preferred Securities Guarantee.
(c) Notwithstanding Section 2.10(b), the Trust shall not,
without the consent of Holders of 100% in Liquidation Amount of the
Securities, consolidate, amalgamate, merge with or into, or be replaced
by any other entity or permit any other entity to consolidate,
amalgamate, merge with or into, or replace it, unless the Trustees
shall have received an Opinion of Counsel from nationally recognized
independent counsel experienced in such matters, to the effect that
such consolidation, amalgamation, merger or replacement would not cause
the Trust or Successor Entity to be classified as an association
taxable as a corporation for United States federal income tax purposes.
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ARTICLE III
PAYMENT ACCOUNT
---------------
Section 3.01 PAYMENT ACCOUNT. (a) On or prior to the Closing Date, the
Property Trustee shall establish the Payment Account. The Property Trustee and
any agent of the Property Trustee shall have exclusive control and sole right of
withdrawal with respect to the Payment Account for the purpose of making
deposits in and withdrawals from the Payment Account in accordance with this
Trust Agreement. All monies and other property deposited or held from time to
time in the Payment Account shall be held by the Property Trustee in the Payment
Account for the exclusive benefit of the Securityholders and for distribution as
herein provided, including (and subject to) any priority of payments provided
for herein.
(b) The Property Trustee shall deposit in the Payment Account,
promptly upon receipt, all payments of principal of or interest on, and any
other payments or proceeds with respect to, the Debentures. Amounts held in the
Payment Account shall not be invested by the Property Trustee pending
distribution thereof.
ARTICLE IV
DISTRIBUTIONS; REDEMPTION
-------------------------
Section 4.01 DISTRIBUTIONS. (a) Distributions on the Trust Securities
shall be cumulative, and will accumulate whether or not there are funds of the
Trust available for the payment of Distributions. Distributions shall accrue
from _____________, 2001, and, except in the event that Cleveland Electric
exercises its right to extend the interest payment period for the Debentures
pursuant to Section 3.01 of the Subordinated Indenture, shall be payable
quarterly in arrears on March 31, June 30, September 30 or December 31 of each
year, commencing on _____________, 2001. If any date on which Distributions are
otherwise payable on the Trust Securities is not a Business Day, then the
payment of such Distribution shall be made on the next succeeding day which is a
Business Day (and without any interest or other payment in respect of any such
delay) except that, if such Business Day is in the next succeeding calendar
year, payment of such Distribution shall be made on the immediately preceding
Business Day, in each case, with the same force and effect as if made on such
date (each date on which distributions are payable in accordance with this
Section 4.01(a), a "Distribution Date").
(b) Distributions payable on the Trust Securities shall be
fixed at a rate of ___% per annum of the Liquidation Amount of the Trust
Securities. Distributions that are in arrears for more than one quarter (whether
due to an extension of the interest payment period for the Debentures under
Section 3.01 of the Subordinated Indenture or otherwise) will accrue interest at
the rate per annum set forth above and the interest so accrued at the end of
each quarter and remaining unpaid will itself bear interest thereafter (at the
rate specified in the Trust Securities to the extent permitted by applicable
law) until paid on the same basis. The term "Distributions" as used herein
includes any such interest payable, unless otherwise stated. The amount of
Distributions payable (and the amount, if any, of interest payable, including
interest on overdue interest) for any full quarterly period shall be computed on
the basis of twelve 30-day months and a 360-day year.
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(c) Distributions on the Trust Securities shall be made and
shall be deemed payable on each Distribution Date only to the extent that the
Trust has funds legally available in the Payment Account for the payment of such
Distributions.
(d) Distributions on the Trust Securities with respect to a
Distribution Date shall be payable to the Holders thereof as they appear on the
Securities Register for the Trust Securities on the relevant record date, which
shall be one Business Day prior to such Distribution Date; provided, however,
that in the event that the Preferred Securities do not remain in book-entry-only
form, the relevant record date shall be the date (whether or not a Business Day)
15 days prior to the relevant Distribution Date.
Section 4.02 REDEMPTION. (a) On each Debenture Redemption Date and at
Maturity (as defined in the Subordinated Indenture), the Trust will be required
to redeem a Like Amount of Trust Securities at the Redemption Price.
(b) Notice of redemption shall be given by the Administrative
Trustees by first-class mail, postage prepaid, mailed not less than 30 nor more
than 60 days prior to the Redemption Date to each Holder of Trust Securities to
be redeemed, at such Holder's address appearing in the Security Register. All
notices of redemption or liquidation shall state:
(i) the Redemption Date;
(ii) the Redemption Price;
(iii) the CUSIP number;
(iv) if less than all the Outstanding Trust Securities
are to be redeemed, the identification and the total Liquidation Amount
of the particular Trust Securities to be redeemed; and
(v) that on the Redemption Date the Redemption Price
will become due and payable upon each such Trust Security to be
redeemed and that Distributions thereon will cease to accrue on and
after said date.
(c) The Trust Securities redeemed on each Redemption Date
shall be redeemed at the Redemption Price with the proceeds from the
contemporaneous redemption of the Debentures. Redemptions of the Trust
Securities shall be made and the Redemption Price shall be deemed payable on
each Redemption Date only to the extent that the Trust has funds immediately
available in the Payment Account for the payment of such Redemption Price.
(d) If the Administrative Trustees give a notice of redemption
in respect of any Preferred Securities, then, by 12:00 noon, New York time, on
the Redemption Date, subject to Section 4.02(c), the Property Trustee will, so
long as the Preferred Securities are in book-entry-only form, irrevocably
deposit with the Clearing Agency for the Preferred Securities funds sufficient
to pay the applicable Redemption Price with respect to the Preferred Securities
and shall give such Clearing Agency irrevocable instructions and authority to
pay the Redemption Price to the holders thereof. If the Preferred Securities are
no longer in book-entry-only form, the Property Trustee, subject to Section
4.02(c), shall irrevocably deposit with the Paying Agent
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funds sufficient to pay the applicable Redemption Price with respect to the
Preferred Securities and will give the Paying Agent irrevocable instructions to
pay the Redemption Price to the holders thereof. Notwithstanding the foregoing,
Distributions payable on or prior to the Redemption Date for any Trust
Securities called for redemption shall be payable to the Holders of such Trust
Securities as they appear on the Securities Register for the Trust Securities on
the relevant record dates for the related Distribution Dates. If notice of
redemption shall have been given and funds deposited as required, then upon the
date of such deposit, all rights of Securityholders holding Trust Securities so
called for redemption will cease, except the right of such Securityholders to
receive the Redemption Price, but without interest, and such Trust Securities
will cease to be outstanding. In the event that any date on which any Redemption
Price is payable is not a Business Day, then payment of the Redemption Price
payable on such date shall be made on the next succeeding day which is a
Business Day (and without any interest or other payment in respect of any such
delay) except that, if such Business Day is in the next succeeding calendar
year, payment of such distribution shall be made on the immediately preceding
Business Day, in each case, with the same force and effect as if made on such
date. In the event that payment of the Redemption Price in respect of any Trust
Securities called for redemption is improperly withheld or refused and not paid
either by the Trust or by the Depositor pursuant to the Guarantee, Distributions
on such Trust Securities will continue to accrue, at the then applicable rate,
from the Redemption Date originally established by the Trust for such Trust
Securities to the date such Redemption Price is actually paid, in which case the
actual payment date will be the date fixed for redemption for purposes of
calculating the Redemption Price.
(e) Payment of the Redemption Price on the Trust Securities
shall be made to the Securityholders thereof as they appear on the Securities
Register for the Trust Securities on the relevant record date, which shall be
one Business Day prior to the relevant Redemption Date; provided, however, that
in the event that the Preferred Securities do not remain in book-entry-only
form, the relevant record date shall be the fifteenth day (whether or not a
Business Day) prior to the Redemption Date.
(f) If less than all the Outstanding Trust Securities are to
be redeemed on a Redemption Date, then the aggregate Liquidation Amount of Trust
Securities to be redeemed shall be allocated pro rata to the Common Securities
and the Preferred Securities based on the relative liquidation amounts of such
classes. The particular Preferred Securities to be redeemed shall be selected
not more than 60 days prior to the Redemption Date by the Property Trustee from
the Outstanding Preferred Securities not previously called for redemption, by
such method as the Property Trustee shall deem fair and appropriate and which
may provide for the selection for a redemption of portions (equal to $25 or
integral multiple thereof) of the Liquidation Amount of Preferred Securities of
a denomination larger than $25. The Property Trustee shall promptly notify the
Security Registrar in writing of the Preferred Securities selected for
redemption and, in the case of any Preferred Securities selected for partial
redemption, the Liquidation Amount thereof to be redeemed. For all purposes of
this Trust Agreement, unless the context otherwise requires, all provisions
relating to the redemption of Preferred Securities shall relate, in the case of
any Preferred Securities redeemed or to be redeemed only in part, to the portion
of the Liquidation Amount of Preferred Securities which has been or is to be
redeemed.
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Section 4.03 SUBORDINATION OF COMMON SECURITIES. (a) Payment of
Distributions (including Additional Amounts, if applicable) on, and the
Redemption Price of, the Trust Securities, as applicable, shall be made pro rata
based on the Liquidation Amount of the Trust Securities; provided, however, that
if on any Distribution Date or Redemption Date a Debenture Event of Default
shall have occurred and be continuing, no payment of any Distribution (including
Additional Amounts, if applicable) on, or Redemption Price of, any Common
Security, and no other payment on account of the redemption, liquidation or
other acquisition of Common Securities, shall be made unless payment in full in
cash of all accumulated and unpaid Distributions (including Additional Amounts,
if applicable) on all Outstanding Preferred Securities for all distribution
periods terminating on or prior thereto, or in the case of payment of the
Redemption Price the full amount of such Redemption Price on all Outstanding
Preferred Securities, shall have been made or provided for, and all funds
immediately available to the Property Trustee shall first be applied to the
payment in full in cash of all Distributions (including Additional Amounts, if
applicable) on, or Redemption Price of, Preferred Securities then due and
payable. The existence of an Event of Default does not entitle the Holders of
Trust Securities to accelerate the maturity thereof.
(b) In the case of the occurrence of any Debenture Event of
Default, the Holder of Common Securities will be deemed to have waived any right
to act with respect to any Event of Default under this Trust Agreement until the
effect of all such Events of Default with respect to the Preferred Securities
have been cured, waived or otherwise eliminated. Until any such Events of
Default under this Trust Agreement with respect to the Preferred Securities have
been so cured, waived or otherwise eliminated, the Property Trustee shall act
solely on behalf of the Holders of the Preferred Securities and not the Holder
of the Common Securities, and only the Holders of the Preferred Securities will
have the right to direct the Property Trustee to act on their behalf.
Section 4.04 PAYMENT PROCEDURES. Payments in respect of the Preferred
Securities shall be made by check mailed to the address of the Person entitled
thereto as such address shall appear on the Securities Register or, if the
Preferred Securities are held by a Clearing Agency, such Distributions shall be
made to the Clearing Agency, which shall credit the relevant Persons' accounts
at such Clearing Agency on the applicable distribution dates. Payments in
respect of the Common Securities shall be made in such manner as shall be
mutually agreed between the Property Trustee and the Common Securityholder.
Section 4.05 TAX RETURNS AND REPORTS. The Administrative Trustees shall
prepare (or cause to be prepared), and file, on behalf of the Trust, all
applicable United States Federal, state and local tax returns and tax
information reports that are required to be filed with respect to the Trust. The
Administrative Trustees shall provide the Depositor and the Property Trustee
with a copy of all such returns, reports and schedules promptly after such
filing or furnishing. The Trustees shall comply with United States Federal
withholding and backup withholding tax laws and information reporting
requirements with respect to any payments to Securityholders under the Trust
Securities.
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ARTICLE V
TRUST SECURITIES CERTIFICATES
-----------------------------
Section 5.01 INITIAL OWNERSHIP. Upon the formation of the Trust and the
contribution by the Depositor pursuant to Section 2.03 and until the issuance of
the Trust Securities, and at any time during which no Trust Securities are
outstanding, the Depositor shall be the sole beneficial owner of the Trust.
Section 5.02 THE TRUST SECURITIES CERTIFICATES. Subject to Section
5.11, the Preferred Securities Certificates shall be issued in minimum
denominations of $1,000 Liquidation Amount and integral multiples of $25 in
excess thereof, and the Common Securities Certificates shall be issued in
denominations of $25 Liquidation Amount and integral multiples thereof. The
Trust Securities Certificates shall be executed on behalf of the Trust by manual
or facsimile signature of at least one Administrative Trustee. Trust Securities
Certificates bearing the signatures of individuals who were, at the time when
such signatures shall have been affixed, authorized to sign on behalf of the
Trust, shall be validly issued and entitled to the benefits of this Trust
Agreement, notwithstanding that such individuals or any of them shall have
ceased to be so authorized prior to the delivery of such Trust Securities
Certificates or did not hold such offices at the date of delivery of such Trust
Securities Certificates. A transferee of a Trust Securities Certificate shall
become a Securityholder, and shall be entitled to the rights and subject to the
obligations of a Securityholder hereunder, upon due registration of such Trust
Securities Certificate in such transferee's name pursuant to Section 5.04.
Section 5.03 DELIVERY OF TRUST SECURITIES CERTIFICATES. On the Closing
Date and the Option Closing Date, the Administrative Trustees shall cause Trust
Securities Certificates, in an aggregate Liquidation Amount as provided in
Sections 2.04 and 2.05, to be executed on behalf of the Trust and delivered to
or upon the written order of the Depositor signed by its chairman of the board,
its president or any vice president, without further corporate action by the
Depositor, in authorized denominations.
Section 5.04 REGISTRATION OF TRANSFER AND EXCHANGE OF PREFERRED
SECURITIES CERTIFICATES. The Transfer Agent and Registrar shall keep or cause to
be kept, at the office or agency maintained pursuant to Section 5.08, a
Securities Register in which, subject to such reasonable regulations as it may
prescribe, the Transfer Agent and Registrar shall provide for the registration
of Preferred Securities Certificates and the Common Securities Certificates
(subject to Section 5.10 in the case of the Common Securities Certificates) and
registration of transfers and exchanges of Preferred Securities Certificates as
herein provided. Until such time as they have appointed a Transfer Agent and
Registrar under Section 2.07(a)(i)(F) hereof, the Administrative Trustees,
acting together, shall be the initial Transfer Agent and Registrar.
Upon surrender for registration of transfer of any Preferred Securities
Certificate at the office or agency maintained pursuant to Section 5.08, the
Administrative Trustees or any one of them on behalf of the Trust shall execute
and deliver, in the name of the designated transferee or transferees, one or
more new Preferred Securities Certificates in authorized denominations of a like
aggregate Liquidation Amount dated the date of execution by the Administrative
Trustee or Trustees. The Transfer Agent and Registrar shall not be required to
register the transfer of or
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exchange (i) Preferred Securities during a period of 15 days immediately
preceding the date on which notice identifying the serial numbers for the
Preferred Securities called for redemption is mailed, or (ii) any Preferred
Securities that have been called for redemption. At the option of a Holder,
Preferred Securities Certificates may be exchanged for other Preferred
Securities Certificates in authorized denominations of the same class and of a
like aggregate Liquidation Amount upon surrender of the Preferred Securities
Certificates to be exchanged at the office or agency maintained pursuant to
Section 5.08.
Every Preferred Securities Certificate presented or surrendered for
registration of transfer or exchange shall be accompanied by a written
instrument of transfer in form satisfactory to the Administrative Trustees and
the Transfer Agent and Registrar duly executed by the Holder or such Holder's
attorney duly authorized in writing. Each Preferred Securities Certificate
surrendered for registration of transfer or exchange shall be cancelled and
subsequently disposed of by the Administrative Trustees in accordance with
customary practice by trustees generally.
No service charge shall be made for any registration of transfer or
exchange of Preferred Securities Certificates, but the Transfer Agent and
Registrar may require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any transfer or
exchange of Preferred Securities Certificates.
Section 5.05 MUTILATED, DESTROYED, LOST OR STOLEN TRUST SECURITIES
CERTIFICATES. If (a) any mutilated Trust Securities Certificate shall be
surrendered to the Transfer Agent and Registrar, or if the Transfer Agent and
Registrar shall receive evidence to its satisfaction of the destruction, loss or
theft of any Trust Securities Certificate and (b) there shall be delivered to
the Transfer Agent and Registrar and the Administrative Trustees such security
or indemnity as may be required by them to save each of them harmless, then in
the absence of notice that such Trust Securities Certificate shall have been
acquired by a bona fide purchaser, the Administrative Trustees or any one of
them on behalf of the Trust shall execute and make available for delivery, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen Trust
Securities Certificate, a new Trust Securities Certificate of like class, tenor
and denomination. In connection with the issuance of any new Trust Securities
Certificate under this Section, the Administrative Trustees or the Transfer
Agent and Registrar may require the payment of a sum sufficient to cover any tax
or other governmental charge that may be imposed in connection therewith. Any
Trust Securities Certificate issued pursuant to this Section shall constitute
conclusive evidence of an undivided beneficial interest in the assets of the
Trust, as if originally issued, whether or not the lost, stolen or destroyed
Trust Securities Certificate shall be found at any time.
Section 5.06 PERSONS DEEMED SECURITYHOLDERS. Prior to due presentation
of a Trust Securities Certificate for registration of transfer, the Trustees or
the Transfer Agent and Registrar shall treat the Person in whose name any Trust
Securities Certificate shall be registered in the Securities Register as the
owner of such Trust Securities Certificate for the purpose of receiving
distributions and for all other purposes whatsoever, and neither the Trustees
nor the Transfer Agent and Registrar shall be bound by any notice to the
contrary.
Section 5.07 ACCESS TO LIST OF SECURITYHOLDERS' NAMES AND ADDRESSES.
The Administrative Trustees shall furnish or cause to be furnished a list (x) to
the Depositor, within
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15 days after receipt by any Administrative Trustee of a request therefor in
such form as such Administrative Trustees may reasonably require, of the names
and addresses of the Securityholders as of the most recent Record Date and (y)
to the Property Trustee, promptly after receipt by any Administrative Trustee of
a request therefor from the Property Trustee in order to enable the Property
Trustee to discharge its obligations under this Trust Agreement. If three or
more Securityholders or one or more Holders of Trust Securities Certificates
evidencing not less than 25% in outstanding Liquidation Amount apply in writing
to any Administrative Trustee, and such application states that the applicants
desire to communicate with other Securityholders with respect to their rights
under this Trust Agreement or under the Trust Securities Certificates and such
application is accompanied by a copy of the communication that such applicants
propose to transmit, then the Administrative Trustees shall, within five
Business Days after the receipt of such application, afford such applicants
access during normal business hours to the current list of Securityholders. Each
Holder, by receiving and holding a Trust Securities Certificate, shall be deemed
to have agreed not to hold either the Depositor or the Trustees accountable by
reason of the disclosure of its name and address, regardless of the source from
which such information was derived.
Section 5.08 MAINTENANCE OF OFFICE OR AGENCY. The Administrative
Trustees shall maintain in the Borough of Manhattan, The City of New York, an
office or offices or agency or agencies where Preferred Securities Certificates
may be surrendered for registration of transfer or exchange and where notices
and demands to or upon the Trustees in respect of the Trust Securities
Certificates may be served. The Administrative Trustees initially designate the
Bank, 000 Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx, Xxx Xxxx, Xxx Xxxx 00000 as their
principal trust office for such purposes. The Administrative Trustees shall give
prompt written notice to the Depositor, the Property Trustee and the
Securityholders of any change in the location of the Securities Register or any
such office or agency.
Section 5.09 APPOINTMENT OF PAYING AGENT. The Paying Agent shall make
distributions to Securityholders from the Payment Account and shall report the
amounts of such distributions to the Property Trustee and the Administrative
Trustees. Any Paying Agent shall have the revocable power to withdraw funds from
the Payment Account for the purpose of making the distributions referred to
above. The Administrative Trustees may revoke such power and remove the Paying
Agent if such Trustees determine in their sole discretion that the Paying Agent
shall have failed to perform its obligations under this Agreement in any
material respect. The Paying Agent shall initially be the Bank, and it may
choose any co-paying agent that is acceptable to the Administrative Trustees and
the Depositor. Any Person acting as a Paying Agent shall be permitted to resign
as Paying Agent upon 30 days' written notice to the Administrative Trustees, the
Property Trustee and the Depositor. In the event that the Bank shall no longer
be the Paying Agent or a successor Paying Agent shall resign or its authority to
act be revoked, the Administrative Trustees shall appoint a successor that is
acceptable to the Property Trustee and the Depositor to act as Paying Agent
(which shall be a bank or trust company). The Administrative Trustees shall
cause such successor Paying Agent or any additional Paying Agent appointed by
the Administrative Trustees to execute and deliver to the Trustees an instrument
in which such successor Paying Agent or additional Paying Agent shall agree with
the Trustees that as Paying Agent, such successor Paying Agent or additional
Paying Agent will hold all sums, if any, held by it for payment to the
Securityholders in trust for the benefit of the Securityholders entitled thereto
until such sums shall be paid to such Securityholders. The Paying Agent shall
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return all unclaimed funds to the Property Trustee and upon removal of a Paying
Agent such Paying Agent shall also return all funds in its possession to the
Property Trustee. The provisions of Sections 8.01, 8.03 and 8.06 shall apply to
the Bank also in its role as Paying Agent, for so long as the Bank shall act as
Paying Agent and, to the extent applicable, to any other paying agent appointed
hereunder. Any reference in this Agreement to the Paying Agent shall include any
co-paying agent unless the context requires otherwise.
Section 5.10 OWNERSHIP OF COMMON SECURITIES BY DEPOSITOR. On the
Closing Date and on each other date provided for in Section 2.05, the Depositor
shall acquire, and thereafter retain, beneficial and record ownership of the
Common Securities. Except in connection with a transaction involving the
Depositor that would be permitted under Article VIII of the Subordinated
Indenture, to the fullest extent permitted by law, any attempted transfer of the
Common Securities shall be void. The Administrative Trustees shall cause each
Common Securities Certificate issued to the Depositor to contain a legend
stating "THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT AS PROVIDED IN THE TRUST
AGREEMENT."
Section 5.11 BOOK-ENTRY PREFERRED SECURITIES CERTIFICATES; COMMON
SECURITIES CERTIFICATE. (a) The Preferred Securities Certificates, upon original
issuance, will be issued in the form of one or more typewritten Global Preferred
Securities Certificate or Certificates representing Book-Entry Preferred
Securities Certificates (each a "Global Certificate"), to be delivered to The
Depository Trust Company, the initial Clearing Agency, by, or on behalf of, the
Trust. Such Preferred Securities Certificate or Certificates shall initially be
registered on the Securities Register in the name of Cede & Co., the nominee of
the initial Clearing Agency, and no Owner will receive a definitive Preferred
Securities Certificate representing such Owner's interest in such Preferred
Securities, except as provided in Section 5.13. Unless and until Definitive
Preferred Securities Certificates have been issued to Owners pursuant to Section
5.13:
(i) the provisions of this Section 5.11(a) shall be in
full force and effect;
(ii) the Transfer Agent and Registrar and the Trustees
shall be entitled to deal with the Clearing Agency for all purposes of
this Trust Agreement relating to the Book-Entry Preferred Securities
Certificates (including the payment of Distributions on the Book-Entry
Preferred Securities and the giving of instructions or directions to
Owners of Book-Entry Preferred Securities) as the sole Holder of
Book-Entry Preferred Securities and shall have no obligations to the
Owners thereof;
(iii) to the extent that the provisions of this Section
5.11 conflict with any other provisions of this Trust Agreement, the
provisions of this Section 5.11 shall control;
(iv) the rights of the Owners of the Book-Entry Preferred
Securities Certificates shall be exercised only through the Clearing
Agency and shall be limited to those established by law and agreements
between such Owners and the Clearing Agency and/or the Clearing Agency
Participants. Pursuant to the Certificate Depository Agreement, unless
and until Definitive Preferred Securities Certificates are issued
pursuant to Section 5.13, the initial Clearing Agency will make
book-entry transfers among the Clearing Agency Participants and receive
and transmit payments on the Preferred Securities to such Clearing
Agency Participants; and
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(v) whenever this Trust Agreement requires or permits
actions to be taken based upon instructions or directions of Holders of
Trust Certificates evidencing a specified percentage of the aggregate
Liquidation Amount, the Clearing Agency shall be deemed to represent
such percentage only to the extent that it has received instructions to
such effect from Owners and/or Clearing Agency Participants owning or
representing, respectively, such required percentage of the beneficial
interest in the applicable class of Trust Certificates and has
delivered such instructions to the Administrative Trustees.
(b) Common Securities Certificates representing the Common
Securities shall be issued to the Depositor in the form of a typewritten or
definitive Common Securities Certificate.
Section 5.12 NOTICES TO CLEARING AGENCY. To the extent a notice or
other communication to the Owners is required under this Trust Agreement, unless
and until Definitive Preferred Securities Certificates shall have been issued to
Owners pursuant to Section 5.13, the Trustees shall give all such notices and
communications specified herein to be given to Owners to the Clearing Agency,
and shall have no obligations to the Owners.
Section 5.13 DEFINITIVE PREFERRED SECURITIES CERTIFICATES. If (i) the
Depositor elects and advises the Trustees in writing that the Clearing Agency is
no longer willing or able to properly discharge its responsibilities with
respect to the Preferred Securities Certificates, and the Depositor is unable to
locate a qualified successor, (ii) the Depositor at its option advises the
Trustees in writing that it elects to terminate the book-entry system through
the Clearing Agency or (iii) after the occurrence of a Debenture Event of
Default, Owners of Preferred Securities Certificates representing beneficial
interests aggregating at least a majority of the Liquidation Amount of Preferred
Securities advise the Clearing Agency in writing that the continuation of a
book-entry system through the Clearing Agency is no longer in the best interest
of the Owners of Preferred Securities Certificates, then the Clearing Agency
shall notify all Owners of Preferred Securities Certificates and the Trustees of
the occurrence of any such event and of the availability of the Definitive
Preferred Securities Certificates to such Owners requesting the same. Upon
surrender to the Administrative Trustees of the typewritten Preferred Securities
Certificate or Certificates representing the Book Entry Preferred Securities
Certificates by the Clearing Agency, accompanied by registration instructions,
the Administrative Trustees, or any one of them, shall execute the Definitive
Preferred Securities Certificates in accordance with the instructions of the
Clearing Agency. Neither the Transfer Agent and Registrar nor the Trustees shall
be liable for any delay in delivery of such instructions and may conclusively
rely on, and shall be protected in relying on, such instructions. Upon the
issuance of Definitive Preferred Securities Certificates, the Trustees shall
recognize the Holders of the Definitive Preferred Securities Certificates as
Securityholders. The Definitive Preferred Securities Certificates shall be
printed, lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to the Administrative Trustees, as evidenced by the
execution thereof by the Administrative Trustees or any one of them.
Section 5.14 RIGHTS OF SECURITYHOLDERS. The legal title to the Trust
Property is vested exclusively in the Property Trustee (in its capacity as such)
in accordance with Section 2.09, and the Securityholders shall not have any
right or title therein other than the undivided beneficial interest in the
assets of the Trust conferred by their Trust Securities, and they shall have no
right
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to call for any partition or division of property, profits or rights of the
Trust except as described below. The Trust Securities shall be personal property
giving only the rights specifically set forth therein and in this Trust
Agreement. The Trust Securities shall have no preemptive or similar rights and
when issued and delivered to Securityholders against payment of the purchase
price therefor will be fully paid and nonassessable by the Trust. Except as
otherwise provided in the Expense Agreement and Section 10.01 hereof, the
Holders of the Trust Securities, in their capacities as such, shall be entitled
to the same limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the State
of Delaware.
ARTICLE VI
ACTS OF SECURITYHOLDERS; MEETINGS; VOTING
-----------------------------------------
Section 6.01 LIMITATIONS ON VOTING RIGHTS. (a) Except as provided in
this Section, in Sections 10.03 and 8.10 hereof, and in the Subordinated
Indenture and the Guarantee, and as otherwise required by law, no Holder of
Preferred Securities shall have any right to vote or in any manner otherwise
control the administration, operation and management of the Trust or the
obligations of the parties hereto, nor shall anything herein set forth, or
contained in the terms of the Trust Securities Certificates, be construed so as
to constitute the Securityholders from time to time as partners or members of an
association.
(b) The Holders of a majority in aggregate Liquidation Amount
of the Outstanding Preferred Securities will have the right to (i) direct the
time, method and place of conducting any proceeding for any remedy available to
the Property Trustee or to direct the exercise of any trust or power conferred
upon the Property Trustee under this Trust Agreement, including the right to
direct the Property Trustee to exercise the remedies available to it as a holder
of the Debentures under the Subordinated Indenture; (ii) on behalf of the
Holders, waive any past Debenture Event of Default that is waivable under the
Subordinated Indenture; or (iii) exercise any right to rescind or annul a
declaration that the principal of all the Debentures shall be due and payable;
provided, however, that where a consent under the Subordinated Indenture
requires the consent of all holders of the Debentures affected thereby, the
Property Trustee may only give such consent at the direction of all Holders of
the Preferred Securities. If the Property Trustee fails to enforce its rights
under the Debentures, to the fullest extent permitted by law, a Holder of
Preferred Securities may, after such holder's written request to the Property
Trustee to enforce such rights, institute a legal proceeding directly against
the Debenture Issuer to enforce the Property Trustee's rights under the
Debentures without first instituting any legal proceeding against the Property
Trustee or any other Person. The Property Trustee shall notify all Holders of
the Preferred Securities of any notice of default received from the Debenture
Trustee with respect to the Debentures. Except with respect to directing the
time, method and place of conducting a proceeding for a remedy under the
Subordinated Indenture, the Property Trustee shall not take any of the actions
described in clauses (i), (ii) or (iii), unless it shall receive an Opinion of
Counsel from nationally recognized independent counsel experienced in such
matters, to the effect that the Issuer will not be classified as an association
taxable as a corporation for United States Federal income tax purposes on
account of such action.
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(c) If any proposed amendment to this Trust Agreement provides
for, or the Trustees otherwise propose to effect, other than pursuant to the
terms of this Trust Agreement, (i) any action that would adversely affect the
powers, preferences or special rights of the Holders of the Preferred
Securities, whether by way of amendment to this Trust Agreement or otherwise, or
(ii) the dissolution, winding-up or termination of the Trust, then the Holders
of Outstanding Preferred Securities will be entitled to vote as a class on such
amendment or proposal and such amendment or proposal shall not be effective
except with the approval of the Holders of at least 66-2/3% in Liquidation
Amount of the Outstanding Preferred Securities. No amendment to this Trust
Agreement may be made if, as a result of such amendment, the Trust would be
classified as an association taxable as a corporation for United States Federal
income tax purposes, and the Trustees shall be entitled to receive and shall be
fully protected in relying upon an Opinion of Counsel from nationally recognized
independent counsel experienced in such matters to such effect.
(d) If (i) the Trust fails to make Distributions in full on
the Preferred Securities for six (6) consecutive quarterly Distribution periods,
or (ii) an Event of Default occurs and is continuing (each of (i) and (ii) being
an "Appointment Event"), then the Holders of the Preferred Securities, acting as
a single class, will be entitled by the vote of a majority in Liquidation Amount
of the Outstanding Preferred Securities to appoint a Special Administrative
Trustee in accordance with Section 8.10 of this Trust Agreement. Any Holder of
Preferred Securities (other than the Depositor, or any entity directly or
indirectly controlling or controlled, by or under direct or indirect common
control with the Depositor) will be entitled to nominate any person to be
appointed as Special Administrative Trustee. For purposes of determining whether
the Trust has failed to make Distributions in full on the Preferred Securities
for six (6) consecutive quarterly Distribution periods, Distributions shall be
deemed to remain in arrears, notwithstanding any payments in respect thereof,
until full cumulative Distributions have been or are contemporaneously are paid
with respect to all quarterly Distribution periods terminating on or prior to
the date of payment of such cumulative Distributions. Not later than 30 days
after such right to appoint a Special Administrative Trustee arises, the
Administrative Trustees will convene a meeting of the Holders of the Preferred
Securities for the purpose of appointing a Special Administrative Trustee. If
the Administrative Trustees fail to convene such meeting within such 30-day
period, the Holders of 10% in Liquidation Amount of the Outstanding Preferred
Securities will be entitled to convene such a meeting in accordance with Section
6.03 of this Trust Agreement. Notwithstanding the appointment of a Special
Administrative Trustee, Cleveland Electric as issuer of the Debentures shall
retain all rights under the Indenture, including the right to extend the
interest payment period on the Debentures.
Section 6.02 NOTICE OF MEETINGS. Notice of all meetings of the
Preferred Securityholders, stating the time, place and purpose of the meeting,
shall be given by the Administrative Trustees pursuant to Section 10.08 to each
Preferred Securityholder of record, at his registered address, at least 15 days
and not more than 90 days before the meeting. At any such meeting, any business
properly before the meeting may be so considered whether or not stated in the
notice of the meeting. Any adjourned meeting may be held as adjourned without
further notice.
Any and all notices to which any Preferred Securityholder hereunder may
be entitled and any and all communications shall be deemed duly served or given
if mailed, postage prepaid,
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addressed to any Preferred Securityholder of record at his last known address as
recorded on the Securities Register.
Section 6.03 MEETINGS OF PREFERRED SECURITYHOLDERS. No annual meeting
of Securityholders is required to be held. The Administrative Trustees, however,
shall call a meeting of Securityholders if directed to do so in writing by the
Holders of at least 25% in Liquidation Amount of the Outstanding Preferred
Securities, and the Administrative Trustees or the Property Trustee may, at any
time in their discretion, call a meeting of Preferred Securityholders to vote on
any matters as to which the Preferred Securityholders are entitled to vote.
Holders of at least 50% in Liquidation Amount of the Preferred
Securities, present in person or by proxy, shall constitute a quorum at any
meeting of Securityholders. If a quorum is present at a meeting, an affirmative
vote by the Holders of the lesser of (i) 66-2/3% in Liquidation Amount of
Preferred Securities present, either in person or by proxy, at such meeting and
(ii) a majority in Liquidation Amount of the Outstanding Preferred Securities
shall constitute the action of the Securityholders, unless this Trust Agreement
requires a greater number of affirmative votes.
Section 6.04 VOTING RIGHTS. Securityholders shall be entitled to one
vote for each $25 of Liquidation Amount represented by their Trust Securities in
respect of any matter as to which such Securityholders are entitled to vote.
Section 6.05 PROXIES, ETC. At any meeting of Securityholders, any
Securityholder entitled to vote thereat may vote by proxy, provided that no
proxy shall be voted at any meeting unless it shall have been placed on file
with the Administrative Trustees, or with such other officer or agent of the
Trust as the Administrative Trustees may direct, for verification prior to the
time at which such vote shall be taken. Pursuant to a resolution of the Property
Trustee, proxies may be solicited in the name of the Property Trustee or one or
more officers of the Property Trustee. Only Securityholders of record shall be
entitled to vote. When Trust Securities are held jointly by several Persons, any
one of them may vote at any meeting in person or by proxy in respect of such
Trust Securities, but if more than one of them shall be present at such meeting
in person or by proxy, and such joint owners or their proxies so present
disagree as to any vote to be cast, such vote shall not be received in respect
of such Trust Securities. A proxy purporting to be executed by or on behalf of a
Securityholder shall be deemed valid unless challenged at or prior to its
exercise, and the burden of proving invalidity shall rest on the challenger.
Section 6.06 SECURITYHOLDER ACTION BY WRITTEN CONSENT. Any action which
may be taken by Securityholders at a meeting may be taken without a meeting and
without prior notice if the Holders of a majority in Liquidation Amount of all
Outstanding Trust Securities entitled to vote in respect of such action (or such
larger proportion thereof as shall be required by any express provision of this
Trust Agreement) shall consent to the action in writing.
Section 6.07 RECORD DATE FOR VOTING AND OTHER PURPOSES. For the
purposes of determining the Securityholders who are entitled to notice of and to
vote at any meeting or by written consent, or to participate in any distribution
on the Trust Securities in respect of which a
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record date is not otherwise provided for in this Trust Agreement, or for the
purpose of any other action, the Administrative Trustees may from time to time
fix a date, not more than 90 days prior to the date of any meeting of
Securityholders or the payment of distribution or other action, as the case may
be, as a record date for the determination of the identity of the
Securityholders of record for such purposes.
Section 6.08 ACTS OF SECURITYHOLDERS. Any request, demand,
authorization, direction, notice, consent, waiver or other action provided or
permitted by this Trust Agreement to be given, made or taken by Securityholders
may be embodied in and evidenced by one or more instruments of substantially
similar tenor signed by such Securityholders in person or by an agent duly
appointed in writing; and, except as otherwise expressly provided herein, such
action shall become effective when such instrument or instruments are delivered
to the Administrative Trustee. Such instrument or instruments (and the action
embodied therein and evidenced thereby) are herein sometimes referred to as the
"Act" of the Securityholders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent shall
be sufficient for any purpose of this Trust Agreement and (subject to Section
8.01) conclusive in favor of the Trustees, if made in the manner provided in
this Section.
The fact and date of the execution by any Person of any such instrument
or writing may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgements of deeds, certifying that the individual signing such
instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which any Trustee receiving the same deems sufficient.
The ownership of Preferred Securities shall be proved by the Securities
Register.
Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the Securityholder of any Trust Security shall bind every future
Securityholder of the same Trust Security and the Securityholder of every Trust
Security issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted or suffered to
be done by the Trustees or the Trust in reliance thereon, whether or not
notation of such action is made upon such Trust Security.
Without limiting the foregoing, a Securityholder entitled hereunder to
take any action hereunder with regard to any particular Trust Security may do so
with regard to all or any part of the Liquidation Amount of such Trust Security
or by one or more duly appointed agents each of which may do so pursuant to such
appointment with regard to all or any part of such liquidation amount.
If any dispute shall arise between the Securityholders of Trust
Securities and the Administrative Trustees or among such Securityholders or
Trustees with respect to the authenticity, validity or binding nature of any
request, demand, authorization, direction, consent, waiver or other Act of such
Securityholder or Trustee under this Article VI, then the
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determination of such matter by the Property Trustee shall be conclusive with
respect to such matter.
Section 6.09 INSPECTION OF RECORDS. Subject to Section 5.07 concerning
access to the list of Securityholders, upon reasonable notice to the
Administrative Trustees and the Property Trustee, the other records of the Trust
shall be open to inspection by Securityholders during normal business hours for
any purpose reasonably related to such Securityholder's interest as a
Securityholder.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES OF THE
PROPERTY TRUSTEE AND THE DELAWARE TRUSTEE
-----------------------------------------
Section 7.01 PROPERTY TRUSTEE. The Property Trustee hereby represents
and warrants for the benefit of the Depositor and the Securityholders that:
(a) the Property Trustee is a banking corporation or trust
company duly organized, validly existing and in good standing under the laws of
the State of New York;
(b) the Property Trustee has full corporate power, authority
and legal right to execute, deliver and perform its obligations under this Trust
Agreement and has taken all necessary action to authorize the execution,
delivery and performance by it of this Trust Agreement;
(c) this Trust Agreement has been duly authorized, executed
and delivered by the Property Trustee and constitutes the valid and legally
binding agreement of the Property Trustee enforceable against it in accordance
with its terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to
or affecting creditors' rights and to general equity principles;
(d) the execution, delivery and performance by the Property
Trustee of this Trust Agreement will not violate, conflict with or constitute a
breach of the Property Trustee's charter or by-laws; and
(e) neither the authorization, execution or delivery by the
Property Trustee of this Trust Agreement nor the consummation of any of the
transactions by the Property Trustee contemplated herein require the consent or
approval of, the giving of notice to, the registration with any Federal or New
York banking authority.
Section 7.02 DELAWARE TRUSTEE. The Delaware Trustee represents and
warrants for the benefit of the Depositor and the Securityholders that:
(a) the Delaware Trustee is a banking corporation or trust
company duly organized, validly existing and in good standing under the laws of
the State of Delaware;
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(b) the Delaware Trustee has full corporate power, authority
and legal right to execute, deliver and perform its obligations under this Trust
Agreement and has taken all necessary action to authorize the execution,
delivery and performance by it of this Trust Agreement;
(c) this Trust Agreement has been duly authorized, executed
and delivered by the Delaware Trustee and constitutes the valid and legally
binding agreement of the Delaware Trustee enforceable against it in accordance
with its terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to
or affecting creditors' rights and to general equity principles;
(d) the execution, delivery and performance by the Delaware
Trustee of this Trust Agreement will not violate the Delaware Trustee's charter
or by-laws; and
(e) neither the authorization, execution or delivery by the
Delaware Trustee of this Trust Agreement nor the consummation of any of the
transactions by the Delaware Trustee contemplated herein require the consent or
approval of, the giving of notice to, the registration with any Federal or
Delaware banking authority.
ARTICLE VIII
THE TRUSTEES
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Section 8.01 CERTAIN DUTIES AND RESPONSIBILITIES. (a) The duties and
responsibilities of the Trustees shall be restricted to those set forth in the
express provisions of this Trust Agreement and, in the case of the Property
Trustee, as provided in the Trust Indenture Act in respect of an indenture
trustee under that Act, and no implied covenants or obligations shall be read
into this Trust Agreement against any of the Trustees. For purposes of Sections
315(a) and 315(c) of the Trust Indenture Act, the term "default" is hereby
defined as an Event of Default which has occurred and is continuing.
Notwithstanding the foregoing, no provision of this Trust Agreement shall
require any of the Trustees to expend or risk its own funds or otherwise incur
any financial liability in the performance of any of its duties hereunder, or in
the exercise of any of its rights or powers, if it shall have reasonable grounds
for believing that repayment of such funds or adequate indemnity against such
risk or liability is not reasonably assured to it. Notwithstanding anything
contained in this Trust Agreement to the contrary, the duties and
responsibilities of the Property Trustee under this Trust Agreement shall be
subject to the protections, exculpations and limitations on liability afforded
to the Property Trustee under this Trust Agreement, the Delaware Business Trust
Act, to the extent applicable, Rule 3a-7 under the Investment Company Act or any
successor rule thereunder, and to an indenture trustee under the Trust Indenture
Act. For the purposes of Section 315(d)(2) of the Trust Indenture Act, the term
"responsible officer" is hereby defined as a Responsible Officer and the
chairman or vice-chairman of the board of directors, the chairman or
vice-chairman of the executive committee of the board of directors, the
president, any vice president, any assistant vice president, the secretary, any
assistant secretary, the treasurer, any assistant treasurer, the cashier, any
assistant cashier, any trust officer or assistant trust officer, the controller
and any assistant controller of the Property Trustee, or any other officer of
the Property Trustee customarily performing functions similar to those performed
by a Responsible Officer or any of the above designated officers and
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also means, with respect to a particular corporate trust matter, any other
officer to whom such matter is referred because of his or her knowledge of and
familiarity with the particular subject. Whether or not therein expressly so
provided, every provision of this Trust Agreement relating to the conduct or
affecting the liability of or affording protection to the Trustees shall be
subject to the provisions of this Section 8.01.
(b) All payments made by the Property Trustee or a Paying
Agent in respect of the Trust Securities shall be made only from the income and
proceeds from the Trust Property and only to the extent that there shall be
sufficient income or proceeds from the Trust Property to enable the Property
Trustee or a Paying Agent to make payments in accordance with the terms hereof.
Each Securityholder, by its acceptance of a Trust Security, agrees that it will
look solely to the income and proceeds from the Trust Property to the extent
legally available for distribution to it as herein provided and that the
Trustees are not personally liable to it for any amount distributable in respect
of any Trust Security or for any other liability in respect of any Trust
Security. This Section 8.01(b) does not limit the liability of the Trustees
expressly set forth elsewhere in this Trust Agreement or, in the case of the
Property Trustee, in the Trust Indenture Act.
(c) All duties and responsibilities of the Property Trustee
contained in this Trust Agreement are subject to the following:
(i) the Property Trustee's sole duty with respect to the
custody, safe keeping and physical preservation of the Trust Property
and the Property Account shall be to deal with such property in a
similar manner as the Property Trustee deals with similar property for
its own account, subject to the protections and limitations on
liability afforded to the Property Trustee under this Trust Agreement,
as an indenture trustee under the Trust Indenture Act, the Delaware
Business Trust Act and, to the extent applicable, Rule 3a-7 under the
Investment Company Act or any successor rule thereunder;
(ii) the Property Trustee shall have no duty or liability
for or with respect to the value, genuineness, existence or sufficiency
of the Trust Property or the payment of any taxes or assessments levied
thereon or in connection therewith;
(iii) the Property Trustee shall not be liable for any
interest on any money received by it except as it may otherwise agree
with the Depositor. Money held by the Property Trustee need not be
segregated from other funds held by it except in relation to the
Payment Account maintained by the Property Trustee pursuant to Section
2.07(a)(ii)(A) and except to the extent otherwise required by law;
(iv) the Property Trustee shall not be responsible for
monitoring the compliance by the Administrative Trustees or the
Depositor with their respective duties under this Trust Agreement, nor
shall the Property Trustee be liable for the default or misconduct of
the Administrative Trustees or the Depositor.
Section 8.02 NOTICE OF DEFAULTS. Within five Business Days after the
occurrence of any Event of Default known to the Property Trustee, the Property
Trustee shall transmit, in the
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manner and to the extent provided in Section 10.08, notice of any default known
to the Property Trustee to the Securityholders, the Administrative Trustees and
the Depositor, unless such default shall have been cured or waived. For the
purpose of this Section, the term "default" means any event which is, or after
notice or lapse of time or both would become, an Event of Default.
Section 8.03 CERTAIN RIGHTS OF PROPERTY TRUSTEE. Subject to the
provisions of Section 8.01 and except as provided by law:
(a) the Property 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 or
presented by the proper party or parties;
(b) any direction or act of the Depositor or the
Administrative Trustees contemplated by this Trust Agreement shall be
sufficiently evidenced by an Officers' Certificate or an instrument signed by
the requisite number of Administrative Trustees, as the case may be; and any
resolution of the Board of Directors mentioned herein may be sufficiently
evidenced by a Board Resolution;
(c) whenever in the administration of this Trust Agreement the
Property Trustee shall deem it desirable that a matter be proved or established
prior to taking, suffering or omitting any action hereunder, the Property
Trustee (unless other evidence be 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 Depositor or the Administrative Trustees;
(d) the Property Trustee may consult with counsel of its
choice and the written advice of such counsel or any Opinion of Counsel 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 reliance thereon;
(e) the Property Trustee shall be under no obligation to
expend or risk its own funds or to exercise any of the rights or powers vested
in it by this Trust Agreement at the request or direction of any of the Holders
pursuant to this Trust Agreement, unless such Holders shall have offered to the
Property Trustee reasonable security or indemnity against the costs, expenses
(including attorneys' fees and expenses) and liabilities which might be incurred
by it in compliance with such request or direction;
(f) the Property Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Property Trustee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it may see fit, and, if
the Property Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records and premises
of the Depositor personally or by agent or attorney;
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(g) the Property Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by or
through agents or attorneys, and the Property 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;
(h) the Property 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 Agreement;
(i) the Property Trustee shall not be charged with knowledge
or deemed to have notice of any default, Event of Default, Appointment Event or
Special Event with respect to the Trust Securities unless either (1) a
Responsible Officer of the Property Trustee shall have actual knowledge of the
default, Event of Default, Appointment Event or Special Event, as the case may
be, or (2) written notice of such default, Event of Default, Appointment Event
or Special Event, as the case may be, shall have been received by a Responsible
Officer of the Property Trustee at the Corporate Trust Office of the Trustee by
the Depositor, the Administrative Trustees or by any Holder of the Trust
Securities, and such notice references the Trust Securities or this Trust
Agreement;
(j) no provision of this Trust Agreement shall be deemed to
impose any duty or obligation on the Property Trustee to perform any act or acts
or exercise any right, power, duty or obligation conferred or imposed on it in
any jurisdiction in which it shall be illegal, or in which the Property Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts or to exercise any such right, power, duty or
obligation; and no permissive or discretionary power or authority available to
the Property Trustee shall be construed to be a duty;
(k) the Property Trustee shall have no duty to see to any
recording, filing or registration of any instrument (including any financing or
continuation statement or any tax or securities) (or any re-recording, refiling
or registration thereof);
(l) the Property Trustee shall have the right at any time to
seek instructions concerning the administration of this Trust Agreement from any
court of competent jurisdiction;
(m) whenever in the administration of this Trust Agreement the
Property Trustee shall deem it desirable to receive instructions with respect to
enforcing any remedy or right or taking any other action hereunder the Property
Trustee (i) may request instructions from the Holders of the Securities, which
instructions may only be given by the Holders of the same Liquidation Amount of
the Trust Securities as would be entitled to direct the Property Trustee under
the terms of this Trust Agreement in respect of such remedies, right or action,
(ii) may refrain from enforcing such remedy or right or taking such other action
until such instructions are received, and (iii) shall be fully protected in
acting in accordance with such instructions; and
(n) the rights, privileges, protections, immunities and
benefits given to the Property Trustee, including, without limitation, its right
to be indemnified, are extended to, and shall be enforceable by, the Property
Trustee in each of its capacities hereunder, and to each agent, custodian and
other Person employed to act hereunder.
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Section 8.04 NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.
The recitals contained herein and in the Trust Securities Certificates shall be
taken as the statements of the Trust, and the Trustees do not assume any
responsibility for their correctness. The Trustees make no representations as to
the value or condition of the property of the Trust or any part thereof, nor as
to the validity or sufficiency of this Trust Agreement or the Trust Securities.
The Trustees shall not be accountable for the use or application by the Trust of
the proceeds of the Trust Securities in accordance with Section 2.05.
Section 8.05 MAY HOLD SECURITIES. Any Trustee or any other agent of any
Trustee or the Trust, in its individual or any other capacity, may become the
owner or pledgee of Trust Securities and except as provided in the definitions
of the term "Outstanding" in Article I, may otherwise deal with the Trust with
the same rights it would have if it were not a Trustee or such other agent.
Section 8.06 COMPENSATION; FEES; INDEMNITY. The Depositor agrees:
(a) to pay to the Trustees from time to time reasonable
compensation for all services rendered by the Trustees hereunder (which
compensation shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust);
(b) except as otherwise expressly provided herein, to
reimburse the Trustees upon request for all reasonable expenses, disbursements
and advances incurred or made by the Trustees in accordance with any provision
of this Trust Agreement (including the reasonable compensation and the expenses
and disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence or bad faith;
and
(c) to indemnify the Trustees for, and to hold the Trustees
harmless from and against, any and all loss, damage, claims, liability or
expense incurred without negligence or bad faith on their part, arising out of
or in connection with the acceptance or administration of this Trust Agreement,
including the costs and expenses of defending themselves against any claim or
liability in connection with the exercise or performance of any of their powers
or duties hereunder.
As security for the performance of the obligations of the Depositor
under this Section, each of the Trustees shall have a lien prior to the Trust
Securities upon all property and funds held or collected by such Trustee as
such, except funds held in trust for the payment of Distributions on the Trust
Securities. "Trustee" for purposes of this Section shall include any predecessor
Trustee; provided, however, that the negligence, willful misconduct or bad faith
of any Trustee hereunder shall not affect the rights of any other Trustee
hereunder.
In addition to the rights provided to each Trustee herein and not by
way of prejudice, when a Trustee incurs expenses or renders services in
connection with an Event of Default resulting from a Bankruptcy Event with
respect to the Trust, the expenses (including the reasonable charges and
expenses of its counsel) and the compensation for the services are intended to
constitute expenses of administration under any applicable Federal or State
bankruptcy, insolvency or other similar law.
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The provisions of this Section 8.06 shall survive the termination of
this Trust Agreement and the payment of the Trust Securities.
Section 8.07 CORPORATE PROPERTY TRUSTEE REQUIRED; ELIGIBILITY TRUSTEES.
(a) There shall at all times be a Property Trustee hereunder with respect to the
Trust Securities. The Property Trustee shall be a Person that has a combined
capital and surplus of at least $50,000,000. If any such Person publishes
reports of condition at least annually, pursuant to law or to the requirements
of its supervising or examining authority, then for the purposes of this
Section, the combined capital and surplus of such Person shall be deemed to be
its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time the Property Trustee with respect to the
Trust Securities shall cease to be eligible in accordance with the provisions of
this Section, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article.
(b) There shall at all times be one or more Administrative
Trustees hereunder with respect to the Trust Securities. Each Administrative
Trustee shall be either a natural person who is at least 21 years of age or a
legal entity that shall act through one or more persons authorized to bind such
entity.
(c) There shall at all times be a Delaware Trustee with
respect to the Trust Securities. The Delaware Trustee shall either be (i) a
natural person who is at least 21 years of age and a resident of the State of
Delaware or (ii) a legal entity with its principal place of business in the
State of Delaware that otherwise meets the requirements of applicable Delaware
law and that shall act through one or more persons authorized to bind such
entity.
Section 8.08 CONFLICTING INTERESTS. If the Property Trustee has or
shall acquire a conflicting interest within the meaning of the Trust Indenture
Act, the Property Trustee shall either eliminate such conflicting interest or
resign, to the extent and in the manner provided by, and subject to the
provisions of, the Trust Indenture Act and this Indenture. The Subordinated
Indenture and the Guarantee shall be deemed to be specifically described in this
Trust Agreement for the purposes of clause (i) of the first proviso contained in
Section 310(b) of the Trust Indenture Act.
Section 8.09 CO-TRUSTEES AND SEPARATE TRUSTEE. Unless an Event of
Default shall have occurred and be continuing, at any time or times, for the
purpose of meeting the legal requirements of the Trust Indenture Act or of any
jurisdiction in which any part of the Trust Property may at the time be located,
the Holder of the Common Securities and the Administrative Trustees shall, by
agreed action of the majority of such Trustees, have power to appoint, and upon
the written request of the Administrative Trustees, the Depositor shall for such
purpose join with the Administrative Trustees in the execution, delivery, and
performance of all instruments and agreements necessary or proper to appoint,
one or more Persons approved by the Property Trustee either to act as
co-trustee, jointly with the Property Trustee, of all or any part of such Trust
Property, or to act as separate trustee of any such property, in either case
with such powers as may be provided in the instrument of appointment, and to
vest in such Person or Persons in the capacity aforesaid, any property, title,
right or power deemed necessary or desirable, subject to the other provisions of
this Section. If the Depositor does not join in such appointment within 15 days
after the receipt by it of a request so to do, or in case an Event of
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Default under the Subordinated Indenture has occurred and is continuing, the
Administrative Trustees alone shall have power to make such appointment. Any
co-trustee or separate trustee appointed pursuant to this Section shall satisfy
the requirements of Section 8.07.
Should any written instrument from the Depositor be required by any
co-trustee or separate trustee so appointed for more fully confirming to such
co-trustee or separate trustee such property, title, right, or power, any and
all such instruments shall, on request, be executed, acknowledged, and delivered
by the Depositor.
Every co-trustee or separate trustee shall, to the extent permitted by
law, but to such extent only, be appointed subject to the following terms,
namely:
(a) The Trust Securities shall be executed and delivered and
all rights, powers, duties, and obligations hereunder in respect of the custody
of securities, cash and other personal property held by, or required to be
deposited or pledged with, the Trustees specified hereunder, shall be exercised,
solely by such Trustees.
(b) The rights, powers, duties, and obligations hereby
conferred or imposed upon the Property Trustee in respect of any property
covered by such appointment shall be conferred or imposed upon and exercised or
performed by the Property Trustee or by the Property Trustee and such co-trustee
or separate trustee jointly, as shall be provided in the instrument appointing
such co-trustee or separate trustee, except to the extent that under any law of
any jurisdiction in which any particular act is to be performed, the Property
Trustee shall be incompetent or unqualified to perform such act, in which event
such rights, powers, duties, and obligations shall be exercised and performed by
such co-trustee or separate trustee.
(c) The Property Trustee at any time, by an instrument in
writing executed by it, with the written concurrence of the Depositor, may
accept the resignation of or remove any co-trustee or separate trustee appointed
under this Section, and, in case an Event of Default under the Subordinated
Indenture has occurred and is continuing, the Property Trustee shall have power
to accept the resignation of, or remove, any such co-trustee or separate trustee
without the concurrence of the Depositor. Upon the written request of the
Property Trustee, the Depositor shall join with the Property Trustee in the
execution, delivery, and performance of all instruments and agreements necessary
or proper to effectuate such resignation or removal. A successor to any
co-trustee or separate trustee so resigned or removed may be appointed in the
manner provided in this Section.
(d) No co-trustee or separate trustee hereunder shall be
personally liable by reason of any act or omission of the Property Trustee, or
any other Trustee hereunder.
(e) The Property Trustee shall not be liable by reason of any
act of a co-trustee or separate trustee.
(f) Any Act of Holders delivered to the Property Trustee shall
be deemed to have been delivered to each such co-trustee or separate trustee.
Section 8.10 RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR; SPECIAL
ADMINISTRATIVE TRUSTEE. No resignation or removal of any Trustee (the "Relevant
Trustee") and
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no appointment of a successor Relevant Trustee pursuant to this Article shall
become effective until the acceptance of appointment by the successor Relevant
Trustee in accordance with the applicable requirements of Section 8.11.
The Relevant Trustee may resign at any time with respect to the Trust
Securities by giving written notice thereof to the Trust. If the instrument of
acceptance by a successor Relevant Trustee required by Section 8.11 shall not
have been delivered to the Relevant Trustee within 30 days after the giving of
such notice of resignation, the resigning Relevant Trustee may petition any
court of competent jurisdiction for the appointment of a successor Relevant
Trustee with respect to the Trust Securities. Unless an Event of Default shall
have occurred and be continuing, the Relevant Trustee may be removed at any time
by Act of the Common Securityholder. If an Event of Default shall have occurred
and be continuing, the Relevant Trustee may be removed at such time by Act of
the Securityholders of a majority in Liquidation Amount of the Outstanding
Preferred Securities delivered to the Relevant Trustee (in its individual
capacity and on behalf of the Trust).
If the Relevant Trustee shall resign, be removed or become incapable of
continuing to act as Relevant Trustee at a time when no Event of Default shall
have occurred and be continuing, the Common Securityholder, by Act of the Common
Securityholder delivered to the retiring Relevant Trustee, shall promptly
appoint a successor Relevant Trustee or Trustees with respect to the Trust
Securities and the Trust, and the retiring Relevant Trustee shall comply with
the applicable requirements of Section 8.11. If the Relevant Trustee shall
resign, be removed or become incapable of continuing to act as the Relevant
Trustee at a time when an Event of Default shall have occurred and be
continuing, the Preferred Securityholders, by Act of the Securityholders of a
majority in Liquidation Amount of the Outstanding Preferred Securities delivered
to the retiring Relevant Trustee, shall promptly appoint a successor Relevant
Trustee or Trustees with respect to the Trust Securities and the Trust, and the
Relevant Trustee shall comply with the applicable requirements of Section 8.11.
If no successor Relevant Trustee with respect to the Trust Securities shall have
been so appointed by the Common Securityholder or the Preferred Securityholders
and accepted appointment in the manner required by Section 8.11, any
Securityholder who has been a Securityholder of Trust Securities for at least
six months may, on behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the appointment of a successor Relevant
Trustee with respect to the Trust Securities.
The Property Trustee on behalf of the Trust and the Relevant Trustee
shall give notice of each resignation and each removal of the Relevant Trustee
with respect to the Trust Securities and the Trust and each appointment of a
successor Trustee with respect to the Trust Securities and the Trust to all
Securityholders in the manner provided in Section 10.08 and shall give notice to
the Depositor. Each notice shall include the name of the successor Relevant
Trustee with respect to the Trust Securities and the Trust and the address of
its Corporate Trust Office. Notwithstanding the foregoing or any other provision
of this Trust Agreement, in the event any Administrative Trustee or a Delaware
Trustee who is a natural person dies or becomes incompetent or incapacitated,
the vacancy created by such death, incompetence or incapacity may be filled by
(i) the unanimous act of remaining Administrative Trustees if there are at least
two of them or (ii) otherwise by the Depositor (with the successor in each case
being an individual who satisfies the eligibility requirement for Administrative
Trustees or Delaware Trustee, as the case may be, set forth in Section 8.07).
Additionally, notwithstanding the
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foregoing or any other provision of this Trust Agreement, in the event the
Depositor reasonably believes that any Administrative Trustee who is a natural
person has become incompetent or incapacitated, the Depositor, by notice to the
remaining Trustees, may terminate the status of such Person as an Administrative
Trustee (in which case the vacancy so created will be filled in accordance with
the preceding sentence).
Notwithstanding the foregoing, if an Appointment Event has occurred and
is continuing, one (1) additional Administrative Trustee (the "Special
Administrative Trustee") may be appointed by vote of the Holders of a majority
in Liquidation Amount of the Outstanding Preferred Securities, voting as a class
at a meeting of the Holders of the Preferred Securities, and such Special
Administrative Trustee may only be removed (otherwise than as set forth in the
next sentence) by vote of the Holders of a majority in Liquidation Amount of the
Outstanding Preferred Securities, voting as a class at a meeting of the Holders
of the Preferred Securities. A Special Administrative Trustee shall only hold
office while an Appointment Event is continuing and shall cease to hold office
immediately after the Appointment Event pursuant to which the Special
Administrative Trustee was appointed and all other Appointment Events cease to
be continuing. Any Special Administrative Trustee may resign from office
(without need for a prior or subsequent accounting) by an instrument in writing
signed by the Special Administrative Trustee and delivered to the Depositor and
the Trust, which resignation shall take effect upon such delivery or upon such
later date as is specified therein; provided, however, that no such resignation
of a Special Administrative Trustee shall be effective until the 60th day
following delivery of the instrument of resignation of the Special
Administrative Trustee to the Depositor and the Trust or such later date
specified in such instrument during which period the Holders of the Preferred
Securities shall have the right to appoint a successor Special Administrative
Trustee as provided in this Section.
Section 8.11 ACCEPTANCE OF APPOINTMENT BY SUCCESSOR. In case of the
appointment hereunder of a successor Relevant Trustee with respect to all Trust
Securities and the Trust, every such successor Relevant Trustee so appointed
shall execute, acknowledge and deliver to the Trust and to the retiring Relevant
Trustee an instrument accepting such appointment, and thereupon the resignation
or removal of the retiring Relevant Trustee shall become effective and such
successor Relevant Trustee, without any further act, deed or conveyance, shall
become vested with all the rights, powers, trusts and duties of the retiring
Relevant Trustee; but, on the request of the Depositor or the successor Relevant
Trustee, such retiring Relevant Trustee shall, upon payment of its charges,
execute and deliver an instrument transferring to such successor Relevant
Trustee all the rights, powers and trusts of the retiring Relevant Trustee and
shall duly assign, transfer and deliver to such successor Relevant Trustee all
property and money held by such retiring Relevant Trustee hereunder, subject,
nevertheless, to the retiring Trustee's prior lien provided for in Section 8.06.
In case of the appointment hereunder of a successor Relevant Trustee
with respect to the Trust Securities and the Trust, the retiring Relevant
Trustee (if required by the Depositor) and each successor Trustee with respect
to the Trust Securities shall execute and deliver an amendment hereto wherein
each successor Relevant Trustee shall accept such appointment and which (1)
shall contain such provisions as shall be necessary or desirable to transfer and
confirm to, and to vest in, each successor Relevant Trustee all the rights,
powers, trusts and duties of the retiring Relevant Trustee with respect to the
Trust Securities and the Trust and (2) shall add to or
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change any of the provisions of this Trust Agreement as shall be necessary to
provide for or facilitate the administration of the trusts hereunder by more
than one Relevant Trustee, it being understood that nothing herein or in such
amendment shall constitute such Relevant Trustees co-trustees of the same trust
and that each such Relevant Trustee shall be trustee of a trust or trusts
hereunder separate and apart from any trust or trusts hereunder administered by
any other such Relevant Trustee and upon the execution and delivery of such
amendment the resignation or removal of the retiring Relevant Trustee shall
become effective to the extent provided therein and each such successor Relevant
Trustee, without any further act, deed or conveyance, shall become vested with
all the rights, powers, trusts and duties of the retiring Relevant Trustee with
respect to the Trust Securities and the Trust; but, on request of the Trust or
any successor Relevant Trustee such retiring Relevant Trustee shall duly assign,
transfer and deliver to such successor Trustee all Trust Property, all proceeds
thereof and money held by such retiring Relevant Trustee hereunder with respect
to the Trust Securities and the Trust.
Upon request of any such successor Relevant Trustee, such retiring
Relevant Trustee shall execute any and all instruments for more fully and
certainly vesting in and confirming to such successor Relevant Trustee all such
rights, powers and trusts referred to in the first or second preceding
paragraph, as the case may be.
No successor Relevant Trustee shall accept its appointment unless at
the time of such acceptance such successor Relevant Trustee shall be qualified
and eligible under this Article.
Section 8.12 MERGER, CONVERSION, CONSOLIDATION SUCCESSION TO BUSINESS.
Any corporation into which the Property Trustee, Delaware Trustee or any
Administrative Trustee which is not a natural person may be merged or converted
or with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which such Relevant Trustee shall be a
party, or any corporation succeeding to all or substantially all the corporate
trust business of such Relevant Trustee, shall be the successor of such Relevant
Trustee hereunder, provided such corporation shall be otherwise qualified and
eligible under this Article, without the execution or filing of any paper or any
further act on the part of any of the parties hereto.
Section 8.13 PREFERENTIAL COLLECTION OF CLAIMS AGAINST DEPOSITOR OR
TRUST. If and when the Property Trustee or the Delaware Trustee shall be or
become a creditor of the Depositor or the Trust (or any other obligor upon the
Debentures or the Trust Securities), the Property Trustee or the Delaware
Trustee, as the case may be, shall be subject to the provisions of the Trust
Indenture Act regarding the collection of claims against the Depositor or Trust
(or any such other obligor). For purposes of Section 311(b) of the Trust
Indenture Act:
(a) the term "cash transaction" means any transaction in which
full payment for goods or securities sold is made within seven days after
delivery of the goods or securities in currency or in checks or other orders
drawn upon banks or bankers and payable upon demand;
(b) the term "self-liquidating paper" means any draft, xxxx of
exchange, acceptance or obligation which is made, drawn, negotiated or incurred
by the Depositor for the purpose of financing the purchase, processing,
manufacturing, shipment, storage or sale of goods, wares or merchandise and
which is secured by documents evidencing title to, possession
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of, or a lien upon, the goods, wares or merchandise or the receivables or
proceeds arising from the sale of the goods, wares or merchandise previously
constituting the security, provided the security is received by the Property
Trustee or Delaware Trustee simultaneously with the creation of the creditor
relationship with the Depositor arising from the making, drawing, negotiating or
incurring of the draft, xxxx of exchange, acceptance or obligation.
Section 8.14 REPORTS BY PROPERTY TRUSTEE. (a) The Property Trustee
shall transmit to Securityholders such reports concerning the Property Trustee
and its actions under this Trust Agreement as may be required pursuant to the
Trust Indenture Act at the times and in the manner provided pursuant thereto.
Such of those reports as are required to be transmitted by the Property Trustee
pursuant to Section 313(a) of the Trust Indenture Act shall be so transmitted
within 60 days after [July 31] of each year, commencing [July 31], _____.
(b) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Property Trustee with each stock
exchange upon which the Trust Securities are listed, with the Commission and
with the Depositor. The Depositor will notify the Property Trustee when any
Trust Securities are listed on any stock exchange or of any delisting thereof.
Section 8.15 REPORTS TO THE PROPERTY TRUSTEE. The Depositor and the
Administrative Trustees on behalf of the Trust shall provide to the Property
Trustee such documents, reports and information (if any) as required by Section
314 and the compliance certificate required by Section 314(a)(4) 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 by the Depositor to the Property Trustee is for informational purposes
only and the Property Trustee's receipt of such shall not constitute
constructive notice of any information contained therein or determinable from
information contained therein, including the Depositor's compliance with any of
its covenants hereunder (as to which the Property Trustee is entitled to rely
exclusively on Officers' Certificates).
Section 8.16 EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT. Each of
the Depositor and the Administrative Trustees on behalf of the Trust shall
provide to the Property Trustee such evidence of compliance with any conditions
precedent, if any, provided for in this Trust Agreement (including any covenants
compliance with which constitutes a condition precedent) that relate to any of
the matters set forth in Section 314(c) of the Trust Indenture Act. Any
certificate or opinion required to be given by an officer pursuant to Section
314(c)(1) of the Trust Indenture Act may be given in the form of an Officers'
Certificate.
Section 8.17 NUMBER OF TRUSTEES. (a) The number of Trustees (exclusive
of any Special Administrative Trustee) shall be four (4), provided that
Depositor, by written instrument may increase or decrease the number of
Administrative Trustees.
(b) If a Trustee ceases to hold office for any reason and the
number of Administrative Trustees is not reduced pursuant to Section 8.17(a), or
if the number of Trustees is increased pursuant to Section 8.17(a), a vacancy
shall occur. The vacancy shall be filled with a Trustee appointed in accordance
with Section 8.10.
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(c) The death, resignation, retirement, removal, bankruptcy,
incompetence or incapacity to perform the duties of a Trustee shall not operate
to dissolve, terminate or annul the Trust. Whenever a vacancy in the number of
Administrative Trustees shall occur, until such vacancy is filled by the
appointment of an Administrative Trustee in accordance with Section 8.10, the
Administrative Trustees in office, regardless of their number (and
notwithstanding any other provision of this Agreement), shall have all the
powers granted to the Administrative Trustees and shall discharge all the duties
imposed upon the Administrative Trustees by this Trust Agreement.
Section 8.18 DELEGATION OF POWER. (a) Any Administrative Trustee may,
by power of attorney consistent with applicable law, delegate to any other
natural person over the age of 21 his or her power for the purpose of executing
any documents contemplated in Section 2.07(a), including any registration
statement or amendment thereto filed with the Commission, or making any other
governmental filing; and
(b) the Administrative Trustees shall have power to delegate
from time to time to such of their number the doing of such things and the
execution of such instruments either in the name of the Trust or the names of
the Administrative Trustees or otherwise as the Administrative Trustees may deem
expedient, to the extent such delegation is not prohibited by applicable law or
contrary to the provisions of the Trust, as set forth herein.
Section 8.19 FIDUCIARY DUTY. (a) To the extent that, at law or in
equity, an Indemnified Person has duties (including fiduciary duties) and
liabilities relating thereto to the Trust or to any other Covered Person, an
Indemnified Person acting under this Trust Agreement shall not be liable to the
Trust or to any other Covered Person for its good faith reliance on the
provisions of this Trust Agreement. The provisions of this Trust Agreement, to
the extent that they restrict the duties and liabilities of an Indemnified
Person otherwise existing at law or in equity (other than the duties imposed on
the Property Trustee under the Trust Indenture Act), are agreed by the parties
hereto to replace such other duties and liabilities of such Indemnified Person;
(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises
between an Indemnified Person and any Covered Person; or
(ii) whenever this Trust Agreement or any other agreement
contemplated herein or therein provides that an Indemnified Person
shall act in a manner that is, or provides terms that are, fair and
reasonable to the Trust or any Holder of Trust Securities,
the Indemnified Person shall resolve such conflict of interest, take such action
or provide such terms, considering in each case the relative interest of each
party (including its own interest) to such conflict, agreement, transaction or
situation and the benefits and burdens relating to such interests, any customary
or accepted industry practices, and any applicable generally accepted accounting
practices or principles. In the absence of bad faith by the Indemnified Person,
the resolution, action or term so made, taken or provided by the Indemnified
Person shall not
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constitute a breach of this Trust Agreement or any other agreement contemplated
herein or of any duty or obligation of the Indemnified Person at law or in
equity or otherwise; and
(c) Whenever in this Trust Agreement an Indemnified Person is
permitted or required to make a decision
(i) in its "discretion" or under a grant of similar
authority, the Indemnified Person shall be entitled to consider such
interests and factors as it desires, including its own interests, and
shall have no duty or obligation to give any consideration to any
interest of or factors affecting the Trust or any other Person; or
(ii) in its "good faith" or under another express
standard, the Indemnified Person shall act under such express standard
and shall not be subject to any other or different standard imposed by
this Trust Agreement or by applicable law.
ARTICLE IX
DISSOLUTION AND LIQUIDATION
---------------------------
Section 9.01 DISSOLUTION UPON EXPIRATION DATE. The Trust shall
automatically dissolve on _____________ (the "Expiration Date"). Following such
dissolution, the Trust Property shall be distributed in accordance with Section
9.04.
Section 9.02 EARLY DISSOLUTION. Upon the first to occur of any of the
following events (such first occurrence, an "Early Termination Event"):
(i) the occurrence of a Bankruptcy Event in respect of, or
the dissolution or liquidation of, the Depositor;
(ii) the election by the Depositor to dissolve the Trust
and, after satisfaction of liabilities to creditors of the Trust,
distribute the Debentures to Holders of the Trust Securities in
liquidation of the Trust;
(iii) the redemption of all of the Preferred Securities in
connection with the redemption of all of the Debentures; and
(iv) an order for judicial dissolution of the Trust having
been entered by a court of competent jurisdiction;
the Trust shall terminate and the Trustees shall take such action as is required
by Section 9.04.
Section 9.03 DISSOLUTION. The respective obligations and
responsibilities of the Trustees and the Trust shall terminate upon the latest
to occur of the following: (i) the distribution by the Property Trustee to
Securityholders upon the liquidation of the Trust pursuant to Section 9.04, or
upon the redemption of all of the Trust Securities pursuant to Section 4.02, of
all amounts required to be distributed hereunder upon the final payment of the
Trust Securities; (ii) the payment of any expenses or other liabilities owed by
the Trust; and (iii) the discharge of
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all administrative duties of the Administrative Trustees, including the
performance of any tax reporting obligations with respect to the Trust or the
Securityholders.
Section 9.04 LIQUIDATION. (a) If an Early Termination Event specified
in Section 9.02 occurs, the Trust shall be liquidated by the Trustees as
expeditiously as the Trustees determine to be appropriate by causing the
Property Trustee to, in the case of subsections (i), (ii) or (iv) of said
Section 9.02, distribute to each Securityholder a Like Amount of Debentures,
subject to Section 9.04(d), and in the case of subsection (iii) of said Section
9.02, redeem the Preferred Securities pursuant to Section 4.02. In the case of
subsections (i), (ii) and (iv) of Section 9.02, notice of liquidation shall be
given by the Administrative Trustees by first-class mail, postage prepaid,
mailed not later than 30 nor more than 60 days prior to the Liquidation Date to
each Holder of Trust Securities at such Holder's address appearing in the
Securities Register. All notices of liquidation shall:
(i) state the Liquidation Date;
(ii) state that from and after the Liquidation Date, the
Trust Securities will no longer be deemed to be outstanding and any
Trust Securities Certificates not surrendered for exchange will be
deemed to represent a Like Amount of Debentures; and
(iii) provide such information with respect to the
mechanics by which Holders may exchange Trust Securities Certificates
for Debentures, or if Section 9.04(d) applies receive a Liquidation
Distribution, as the Administrative Trustee or the Property Trustee
shall deem appropriate.
(b) Except where Section 9.02(iii) or 9.04(d) applies, in
order to effect the liquidation of the Trust and distribution of the Debentures
to Securityholders, the Property Trustee shall establish a record date for such
distribution (which shall be not more than 45 days prior to the Liquidation
Date) and, either itself acting as exchange agent or through the appointment of
a separate exchange agent, shall establish such procedures as it shall deem
appropriate to effect the distribution of Debentures in exchange for the
Outstanding Trust Securities Certificates.
(c) Except where Section 9.02(iii) or 9.04(d) applies, after
the Liquidation Date, (i) the Trust Securities will no longer be deemed to be
Outstanding, (ii) certificates representing a Like Amount of Debentures will be
issued to Holders of Trust Securities Certificates, upon surrender of such
certificates to the Administrative Trustees or their agent for exchange, (iii)
any Trust Securities Certificates not so surrendered for exchange will be deemed
to represent a Like Amount of Debentures, accruing interest at the rate provided
for in the Debentures from the last Distribution Date on which a Distribution
was made on such Trust Certificates until such certificates are so surrendered
(and until such certificates are so surrendered, no payments or interest or
principal will be made to Holders of Trust Securities Certificates with respect
to such Debentures) and (iv) all rights of Securityholders holding Trust
Securities will cease, except the right of such Securityholders to receive
Debentures upon surrender of Trust Securities Certificates.
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(d) In the event that, notwithstanding the other provisions of
this Section 9.04, whether because of an order for dissolution entered by a
court of competent jurisdiction or otherwise, distribution of the Debentures in
the manner provided herein is determined by the Property Trustee not to be
practical, the Trust Property shall be liquidated, and the Trust shall be
wound-up or terminated, by the Property Trustee in such manner as the Property
Trustee determines. In such event, Securityholders will be entitled to receive
out of the assets of the Trust available for distribution to Securityholders,
after satisfaction of liabilities to creditors, an amount equal to the
Liquidation Amount per Trust Security plus accrued and unpaid Distributions
thereon to the date of payment (such amount being the "Liquidation
Distribution"). If, upon any such winding up or termination, the Liquidation
Distribution can be paid only in part because the Trust has insufficient assets
available to pay in full the aggregate Liquidation Distribution, then, subject
to the next succeeding sentence, the amounts payable by the Trust on the Trust
Securities shall be paid on a pro rata basis (based upon Liquidation Amounts).
The Holder of the Common Securities will be entitled to receive Liquidation
Distributions upon any such winding-up or termination pro rata (determined as
aforesaid) with Holders of Preferred Securities, except that, if an Event of
Default has occurred and is continuing, the Preferred Securities shall have a
priority over the Common Securities.
(e) If the Debentures are distributed to the Holders of the
Preferred Securities, the Debenture Issuer will use its best efforts to cause
the Debentures to be listed on the New York Stock Exchange or on such other
exchange, if any, as the Preferred Securities are then listed.
ARTICLE X
MISCELLANEOUS PROVISIONS
------------------------
Section 10.01 GUARANTEE BY THE DEPOSITOR. Subject to the terms and
conditions hereof, the Depositor irrevocably and unconditionally guarantees to
each Person to whom the Trust is now or hereafter becomes indebted or liable
(the "Guarantee Beneficiaries") the full payment, when and as due, of any and
all Obligations (as hereinafter defined) to such Guarantee Beneficiaries. As
used in this Section, "Obligations" means any indebtedness, expenses or
liabilities of the Trust, other than obligations of the Trust to pay to Holders
of the Preferred Securities or other similar interests in the Trust the amounts
due such Holders pursuant to the terms of the Preferred Securities or such other
similar interests, as the case may be. This guarantee is intended to be for the
benefit of, and to be enforceable by, all such Guarantee Beneficiaries, whether
or not such Guarantee Beneficiaries have received notice hereof.
Section 10.02 LIMITATION OF RIGHTS OF SECURITYHOLDERS. The death,
bankruptcy, dissolution, termination or incapacity of any Person having an
interest, beneficial or otherwise, in a Trust Security shall not operate to
terminate this Trust Agreement, nor dissolve, terminate or annul the Trust, nor
entitle the legal representatives or heirs of such Person or any Securityholder
for such Person, to claim an accounting, take any action or bring any proceeding
in any court for a partition or winding up of the arrangements contemplated
hereby, nor otherwise affect the rights, obligations and liabilities of the
parties hereto or any of them.
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Section 10.03 AMENDMENT. (a) This Trust Agreement may be amended from
time to time by the Depositor, without the consent of any Securityholders or any
of the Trustees, (i) to cure any ambiguity, correct or supplement any provision
herein or therein which may be inconsistent with any other provision herein or
therein, or to make any other provisions with respect to matters or questions
arising under this Trust Agreement, which shall not be inconsistent with the
other provisions of this Trust Agreement or (ii) to modify, eliminate or add to
any provisions of this Trust Agreement to such extent as shall be necessary to
ensure that the Trust will not be classified for United States federal income
tax purposes as an association taxable as a corporation at any time that any
Trust Securities are outstanding; provided, however, that, except in the case of
clause (ii), such amendment or action shall not adversely affect in any material
respect the interests of any Securityholder and, in the case of clause (i), any
such amendments of this Trust Agreement shall become effective when notice
thereof is given to the Securityholders.
(b) Except as provided in Section 10.03(c) hereof, any
provision of this Trust Agreement may be amended by the Trustees and the
Depositor with (i) the consent of Trust Securityholders representing not less
than 66-2/3% in Liquidation Amount of the Trust Securities then Outstanding and
(ii) receipt by the Trustees of an Opinion of Counsel from nationally recognized
independent counsel experienced in such matters to the effect that such
amendment or the exercise of any power granted to the Trustees in accordance
with such amendment will not cause the Trust to be classified as an association
taxable as a corporation for United States federal income tax purposes or affect
the Trust's exemption from status of an "investment company" under the
Investment Company Act of 1940, as amended.
(c) In addition to and notwithstanding any other provision in
this Trust Agreement, without the consent of each affected Securityholder, this
Trust Agreement may not be amended to (i) change the amount or timing of any
Distribution on the Trust Securities or otherwise adversely affect the amount of
any Distribution required to be made in respect of the Trust Securities as of a
specified date or (ii) restrict the right of a Securityholder to institute suit
for the enforcement of any such payment on or after such date; notwithstanding
any other provision herein without the unanimous consent of the Securityholders,
paragraph (b) of this Section 10.03 may not be amended.
(d) Notwithstanding any other provisions of this Trust
Agreement, no Trustee shall enter into or consent to any amendment to this Trust
Agreement which would cause the Trust to fail or cease to qualify for the
exemption from status of an "investment company" under the Investment Company
Act of 1940, as amended, afforded by Rule 3a-5 thereunder.
(e) Notwithstanding anything in this Trust Agreement to the
contrary, without the consent of the Depositor or a Trustee, as the case may be,
this Trust Agreement may not be amended in a manner which imposes any additional
obligation on the Depositor or such Trustee, or, in the case of the Trustees,
without the consent of each Trustee whose rights, duties or immunities hereunder
would be affected thereby.
(f) In the event that any amendment to this Trust Agreement is
made, the Administrative Trustees shall promptly provide to the Depositor a copy
of such amendment.
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(g) The Property Trustee and the Delaware Trustee may join in
the execution of or consent to any amendment to the Trust Agreement in which
case they shall be entitled to receive and rely upon an Opinion of Counsel as
conclusive evidence that such amendment to this Trust Agreement is authorized or
permitted by, and conforms to, the terms of this Section 10.03, has been duly
authorized by and lawfully executed and delivered on behalf of the other
requisite parties, and that it is proper for the Property Trustee under the
provisions of this Section 10.03 to accept the additional trusts created thereby
and, if so requested, for the Property Trustee or the Delaware Trustee to join
in the execution thereof or consent thereto.
Section 10.04 SEPARABILITY. In case any provision in this Trust
Agreement or in the Trust Securities Certificates shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
Section 10.05 GOVERNING LAW. THIS TRUST AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF EACH OF THE SECURITYHOLDERS, THE TRUST AND THE TRUSTEES WITH
RESPECT TO THIS TRUST AGREEMENT AND THE TRUST SECURITIES SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF DELAWARE.
Section 10.06 SUCCESSORS. This Trust Agreement shall be binding upon
and shall inure to the benefit of any successor to the Trust or a Relevant
Trustee or both, including any successor by operation of law.
Section 10.07 HEADINGS. The Article and Section headings are for
convenience only and shall not affect the construction of this Trust Agreement.
All references in this Trust Agreement to Articles and Sections are to Articles
and Sections of this Trust Agreement unless otherwise specified.
Section 10.08 NOTICE AND DEMAND. Any notice, demand or other
communication which by any provision of this Trust Agreement is required or
permitted to be given or served to or upon any Securityholder or the Depositor
may be given or served in writing by deposit thereof, postage prepaid, in the
United States mail, hand delivery or facsimile transmission, in each case,
addressed, (i) in the case of a Preferred Securityholder, to such Preferred
Securityholder as such Securityholder's name and address may appear on the
Securities Register and (ii) in the case of the Common Securityholder or the
Depositor, to The Cleveland Electric Illuminating Company, 00 Xxxxx Xxxx Xxxxxx,
Xxxxx, Xxxx 00000, Attention: Treasurer, facsimile no. (000) 000-0000. Such
notice, demand or other communication to or upon a Securityholder shall be
deemed to have been sufficiently given or made, for all purposes, upon hand
delivery, mailing or transmission.
Any notice, demand or other communication which by any provision of
this Trust Agreement is required or permitted to be given or served to or upon
the Trust, the Property Trustee or the Administrative Trustees shall be given in
writing addressed (until another address is published by the Trust) as follows:
(i) with respect to the Property Trustee and the Delaware Trustee, The Bank of
New York, 000 Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx, Xxx Xxxx, XX 00000, Attention:
Corporate Trust Department with a copy to: The Bank of New York (Delaware),
Xxxxx Xxxx Xxxxxx, Xxxxx 000, Xxxxxx, Xxxxxxxx 00000, Attention: Corporate Trust
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Department; and (ii) with respect to the Administrative Trustees, to them at the
address above for notices to the Depositor, marked "Attention: Administrative
Trustees of Cleveland Electric Financing Trust I c/o Treasury Department". Such
notice, demand or other communication to or upon the Trust or the Property
Trustee shall be deemed to have been sufficiently given or made only upon actual
receipt of the writing by the Trust or the Property Trustee.
Section 10.09 AGREEMENT NOT TO PETITION. Each of the Trustees and the
Depositor agree for the benefit of the Securityholders that, until at least one
year and one day after the Trust has been terminated in accordance with Article
IX, they shall not file, or join in the filing of, a petition against the Trust
under any bankruptcy, reorganization, arrangement, insolvency, liquidation or
other similar law (including, without limitation, the United States Bankruptcy
Code) (collectively, "Bankruptcy Laws") or otherwise join in the commencement of
any proceeding against the Trust under any Bankruptcy Law. In the event the
Depositor takes action in violation of this Section 10.09, the Property Trustee
agrees, for the benefit of Securityholders, that it shall file an answer with
the bankruptcy court or otherwise properly contest the filing of such petition
by the Depositor against the Trust or the commencement of such action and raise
the defense that the Depositor has agreed in writing not to take such action and
should be stopped and precluded therefrom and such other defenses, if any, as
counsel for the Property Trustee or the Trust may assert. The provisions of this
Section 10.09 shall survive the termination of this Trust Agreement.
Section 10.10 TRUST INDENTURE ACT; CONFLICT WITH TRUST INDENTURE ACT.
(a) This Trust Agreement is subject to the provisions of the Trust Indenture Act
that are required or deemed to be part of this Trust Agreement and shall, to the
extent applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is a
Trustee for the purposes of the Trust Indenture Act.
(c) If any provision hereof limits, qualifies or conflicts
with another provision hereof which is required to be included in this Trust
Agreement by any of the provisions of the Trust Indenture Act, such required
provision shall control.
(d) THE APPLICATION OF THE TRUST INDENTURE ACT TO THIS TRUST
AGREEMENT SHALL NOT AFFECT THE NATURE OF THE TRUST SECURITIES AS EQUITY
SECURITIES REPRESENTING UNDIVIDED BENEFICIAL INTERESTS IN THE ASSETS OF THE
TRUST. THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST THEREIN BY
OR ON BEHALF OF A SECURITYHOLDER OR ANY OWNER, WITHOUT ANY SIGNATURE OR FURTHER
MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL ACCEPTANCE BY THE
SECURITYHOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN SUCH TRUST
SECURITY OF ALL THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT AND THE
AGREEMENT OF THE TRUST, SUCH SECURITYHOLDER AND SUCH OTHERS THAT THOSE TERMS AND
PROVISIONS SHALL BE BINDING, OPERATIVE AND EFFECTIVE AS BETWEEN THE TRUST AND
SUCH SECURITYHOLDER AND SUCH OTHERS.
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Section 10.11 COUNTERPARTS. This Trust Agreement may contain more than
one counterpart of the signature page and this Trust Agreement may be executed
by the affixing of the signature of each of the Trustees of one of such
counterpart signature pages. All of such counterpart signature pages shall be
read as though one, and they shall have the same force and effect as though all
of the signers had signed a single signature page.
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IN WITNESS WHEREOF, the undersigned have caused these presents to be
executed as of the day and year first above written.
THE CLEVELAND ELECTRIC ILLUMINATING COMPANY
By:
----------------------------------------
Name:
Title:
THE BANK OF NEW YORK,
as Property Trustee
By:
----------------------------------------
Name:
Title:
THE BANK OF NEW YORK (DELAWARE),
as Delaware Trustee
By:
----------------------------------------
Name:
Title:
-----------------------------------------------
__________________ as Administrative Trustee
-----------------------------------------------
__________________ as Administrative Trustee
57
CERTIFICATE OF TRUST
OF
CLEVELAND ELECTRIC FINANCING TRUST I
THIS CERTIFICATE OF TRUST of Cleveland Electric Financing Trust I (the
"Trust"), dated June 7, 2001, is being duly executed and filed by the
undersigned, as trustees, to form a business trust under the Delaware Business
Trust Act (12 Del. C. ss. 3801 et seq.).
1. NAME. The name of the business trust being created hereby is
Cleveland Electric Financing Trust I.
2. DELAWARE TRUSTEE. The name and business address of the trustee of
the Trust with a principal place of business in the State of Delaware is The
Bank of New York (Delaware), Xxxxx Xxxx Xxxxxx, Xxxxx 000, Xxxxxx, Xxxxxxxx
00000.
3. EFFECTIVE DATE. This Certificate of Trust shall be effective as of
its filing with the Secretary of State of the State of Delaware.
IN WITNESS WHEREOF, the undersigned, being the only trustees of the
Trust, have executed this Certificate of Trust as of the date first above
written.
THE BANK OF NEW YORK,
not in its individual capacity but
solely as Property Trustee
By: /s/ Xxxxxxx X. Xxxxxxx
----------------------------------
Xxxxxxx X. Xxxxxxx
Vice President
THE BANK OF NEW YORK (DELAWARE),
not in its individual capacity but
solely as Delaware Trustee
By: /s/ Xxxxxxx Xxxxxxx
----------------------------------
Xxxxxxx Xxxxxxx
Senior Vice President
/s/ Xxxxxx Xxxxx
-----------------------------------------
Xxxxxx Xxxxx,
not in his individual capacity but
solely as Administrative Trustee
/s/ Xxxxx Xxxxxx
-----------------------------------------
Xxxxx Xxxxxx,
not in his individual capacity but
solely as Administrative Trustee
A-1
58
TRUST AGREEMENT, dated as of June 7, 2001, among (i) The Cleveland
Electric Illuminating Company, an Ohio corporation (the "Depositor" or
"Cleveland Electric"), (ii) The Bank of New York, a banking corporation duly
organized and existing under the laws of New York, as trustee (the "Property
Trustee"), (iii) The Bank of New York (Delaware), a banking corporation duly
organized under the laws of Delaware, as Delaware trustee (the "Delaware
Trustee"), and (iv) Xxxxxx Xxxxx, an individual, and Xxxxx Xxxxxx, an
individual, each of whose address is c/o The Cleveland Electric Illuminating
Company, 00 Xxxxx Xxxx Xxxxxx, Xxxxx, Xxxx 00000, as trustees (each an
"Administrative Trustee" and together the "Administrative Trustees") (the
Property Trustee, the Delaware Trustee and the Administrative Trustees referred
to collectively as the "Trustees"). The Depositor and the Trustees hereby agree
as follows:
1. The trust created hereby shall be known as "Cleveland Electric
Financing Trust I" (the "Trust"), in which name the Trustees, or the Depositor
to the extent provided herein, may conduct the business of the Trust, make and
execute contracts, and xxx and be sued.
2. The Depositor hereby assigns, transfers, conveys and sets over to
the Trust the sum of $10. Such amount shall constitute the initial trust estate.
The Trustees hereby declare that they will hold the trust estate in trust for
the Depositor. It is the intention of the parties hereto that the Trust created
hereby constitutes a business trust under Chapter 38 of Title 12 of the Delaware
Code, 12 Del. C. ss. 3801 et seq. (the "Business Trust Act"), and that this
document constitutes the governing instrument of the Trust. The Trustees are
hereby authorized and directed to execute and file a certificate of trust with
the Delaware Secretary of State substantially in the form attached hereto.
3. The Depositor and the Trustees will enter into an amended and
restated Trust Agreement, satisfactory to each such party and substantially in
the form included as Exhibit 4.2 to the 1933 Act Registration Statement referred
to below, to provide for the contemplated operation of the Trust created hereby
and the issuance of the Preferred Securities and the Common Securities referred
to therein. Prior to the execution and delivery of such amended and restated
Trust Agreement, the Trustees shall not have any duty or obligation hereunder or
with respect of the trust estate, except as otherwise required by applicable law
or as may be necessary to obtain prior to such execution and delivery any
licenses, consents or approvals required by applicable law or otherwise.
4. The Depositor and the Trustees hereby authorize and direct the
Depositor, as the Depositor of the Trust, (i) to prepare and file with the
Securities and Exchange Commission (the "Commission") and execute, in each case
on behalf of the Trust, (a) the Registration Statement on Form S-2 (the "1933
Act Registration Statement") and any pre-effective or post-effective amendments
to such Registration Statement, relating to the registration under the
Securities Act of 1933, as amended, of the Preferred Securities of the Trust,
and (b) a Registration Statement on Form 8-A (the "1934 Act Registration
Statement") (including all pre-effective and post-effective amendments thereto)
relating to the registration of the Preferred Securities of the Trust under
Section 12(b) of the Securities Exchange Act of 1934, as amended; (ii) to file
with the New York Stock Exchange and execute on behalf of the Trust a listing
application and all other applications, statements, certificates, agreements and
other instruments as shall be necessary or desirable to cause the Preferred
Securities to be listed on the New York Stock Exchange; (iii) to
A-2
59
file and execute on behalf of the Trust such applications, reports, surety
bonds, irrevocable consents, appointments of attorney for service of process and
other papers and documents as shall be necessary or desirable to register the
Preferred Securities under the securities or "Blue Sky" laws of such
jurisdictions as the Depositor, on behalf of the Trust, may deem necessary or
desirable, (iv) to execute and deliver letters or documents to, or instruments
for filing with a depository relating to the Preferred Securities of the Trust,
and (v) to execute on behalf of the Trust an Underwriting Agreement among the
Trust, the Depositor and the underwriters named therein, substantially in the
form to be included as Exhibit 1(a) of the 1933 Act Registration Statement. In
the event that any filing referred to in clauses (i), (ii) or (iii) above is
required by the rules and regulations of the Commission, the New York Stock
Exchange or state securities or Blue Sky laws, to be executed on behalf of the
Trust by the Trustees, Xxxxxx Xxxxx and Xxxxx Xxxxxx, in their capacities as
Administrative Trustees of the Trust, are hereby authorized and directed to join
in any such filing and to execute on behalf of the Trust any and all of the
foregoing, it being understood that The Bank of New York and The Bank of New
York (Delaware), in their capacities as Property Trustee and Delaware Trustee of
the Trust, respectively, shall not be required to join in any such filing or
execute on behalf of the Trust any such document unless required by the rules
and regulations of the Commission, the New York Stock Exchange or state
securities or Blue Sky laws. In connection with the filings referred to in
clauses (i),(ii) or (iii) above, the Depositor and each Trustee, solely in its
capacity as Trustee of the Trust and not in its individual capacity, hereby
constitutes and appoints Xxxx X. Xxxxxxxx, Xx. and Xxxxx X. Xxxxxx, and each of
them, as his, her or its, as the case may be, true and lawful attorneys-in-fact,
and agents, with full power of substitution and resubstitution, for the
Depositor or such Trustee or in the Depositor's or such Trustee's name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) to the 1933 Act Registration Statement and the 1934
Act Registration Statement, and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Commission, granting unto said
attorneys-in-fact and agents full power and authority to do and perform each and
every act and thing requisite and necessary to be done in connection therewith,
as fully to all intents and purposes as the Depositor or such Trustee might or
could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents or any of them, or their or his or her substitute
or substitutes, shall do or cause to be done by virtue hereof.
5. This Trust Agreement may be executed in one or more counterparts.
6. The number of Trustees initially shall be four (4) and thereafter
the number of Trustees shall be such number as shall be fixed from time to time
by a written instrument signed by the Depositor which may increase or decrease
the number of Trustees; provided, however, that the number of Trustees shall in
no event be less than four (4); and provided, further that to the extent
required by the Business Trust Act, one Trustee shall either be a natural person
who is a resident of the State of Delaware or, if not a natural person, an
entity which has its principal place of business in the State of Delaware.
Subject to the foregoing, the Depositor is entitled to appoint or remove without
cause any Trustee at any time. Any of the Trustees may resign upon thirty days
prior notice to the Depositor.
7. The Trust may be dissolved and terminated before the issuance of the
preferred securities of the Trust at the election of the Depositor.
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8. This Trust Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware (without regard to conflict
of laws principles).
IN WITNESS WHEREOF, the parties hereto have caused this Trust Agreement
to be duly executed as of the day and year first above written.
THE CLEVELAND ELECTRIC ILLUMINATING COMPANY,
as Depositor
By: /s/ Xxxxxx X. Xxxxx
-------------------
Xxxxxx X. Xxxxx
Treasurer
THE BANK OF NEW YORK,
not in its individual capacity but
solely as Property Trustee
By: /s/ Xxxxxxx X. Xxxxxxx
----------------------
Xxxxxxx X. Xxxxxxx
Vice President
THE BANK OF NEW YORK (DELAWARE),
not in its individual capacity but
solely as Delaware Trustee
By: /s/ Xxxxxxx Xxxxxxx
--------------------------------------
Xxxxxxx Xxxxxxx
Senior Vice President
/s/ Xxxxxx Xxxxx
---------------------------------------------
Xxxxxx Xxxxx,
not in his individual capacity but
solely as Administrative Trustee
/s/ Xxxxx Xxxxxx
---------------------------------------------
Xxxxx Xxxxxx,
not in his individual capacity but
solely as Administrative Trustee
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EXHIBIT B
Certificate Depository Agreement
-------------
The Depository Trust Company
00 Xxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000-0000
Attention: General Counsel's Office
Re: Cleveland Electric Financing Trust I
___% Cumulative Trust Preferred Securities
Ladies and Gentlemen:
The purpose of this letter is to set out certain matters relating to
the above-referenced Preferred Securities (CUSIP No. _____________) (the
"Securities") of Cleveland Electric Financing Trust I, a Delaware business trust
(the "Trust" or the "Issuer"). The Securities are guaranteed as to the payment
of distributions and as to payments on liquidation or redemption by The
Cleveland Electric Illuminating Company ("Cleveland Electric"), as described in
the Guarantee Agreement dated _____________, 2001, by Cleveland Electric and The
Bank of New York as guarantee trustee with respect to the Securities. The Trust
is selling the Securities to Underwriters (the "Underwriters") pursuant to an
Underwriting Agreement dated _____________, 2001, and the Underwriters wish to
take delivery of the Securities through The Depository Trust Company ("DTC").
The Bank of New York is acting as transfer agent and registrar with respect to
the Securities (the "Transfer Agent and Registrar" or the "Agent").
To induce DTC to accept the Securities as eligible for deposit at DTC,
and to act in accordance with its rules with respect to the Securities, the
Trust and the Transfer Agent and Registrar agree as follows:
(a) Prior to the closing of the sale of the Securities to the
Underwriters, which is expected to occur on or about _____________, there shall
be deposited with, or held by the Transfer Agent and Registrar as custodian for,
DTC one or more global certificates (the "Global Certificate") registered in the
name of DTC's nominee, Cede & Co., representing an aggregate of _____________
Securities. Each Global Certificate shall bear the following legend:
Unless this certificate is presented by an authorized
representative of The Depository Trust Company, a New York corporation
("DTC"), to Issuer or its agent for registration of transfer, exchange,
or payment, and any certificate issued is registered in the name of
CEDE & Co. or in such other name as is requested by an authorized
representative of DTC (and any payment is made to Cede & Co., or to
such other entity as is requested by an authorized representative of
DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
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(b) The Amended and Restated Trust Agreement of the Trust relating to
the Securities provides for the voting by holders of the Securities under
certain circumstances. The Trust shall establish a record date for such purposes
and shall, to the extent possible, give DTC notice of such record date not less
than fifteen (15) calendar days in advance of such record date.
(c) In the event of a stock split, conversion, recapitalization,
reorganization or any other similar transaction resulting in the cancellation of
all or any part of the Securities outstanding, the Trust or the Transfer Agent
and Registrar shall send DTC a notice of such event five (5) business days prior
to the effective date of such event.
(d) In the event of a cash dividend payment or other distribution, or
an offering or issuance of rights, with respect to the Securities outstanding,
the Trust or the Transfer Agent and Registrar shall send DTC a notice
specifying: (a) the amount of and conditions, if any, applicable to such
payment, distribution or rights offering or issuance; (b) any applicable
expiration or deadline date, or any date by which an action on the part of the
holders of Securities is required; and (c) the date any required notice is to be
mailed to holders of Securities or published (the "Publication Date"). Such
notice shall be sent to DTC by a secure means (e.g., legible telecopy,
registered or certified mail, overnight delivery) in a timely manner designed to
assure that such notice is in DTC's possession no later than the close of
business on the business day before the Publication Date. The Trust or the
Transfer Agent and Registrar will forward such notice either in a separate
secure transmission for each CUSIP number or in a secure transmission of
multiple CUSIP numbers (if applicable) which includes a manifest or list of each
CUSIP number submitted in that transaction. (The party sending such notice shall
have a method to verify subsequently the use of such means and the timeliness of
such notice.) The Publication Date shall be not less than thirty (30) days nor
more than sixty (60) days prior to such cash dividend payment, distribution or
offering or issuance of rights with respect to the Securities. After
establishing the amount of payment to be made on the Securities, the Transfer
Agent and Registrar will notify DTC's Dividend Department of such payment five
(5) business days prior to the payment date.
(e) In the event of a redemption by the Trust of the Securities, notice
to holders of the Securities by the Trust or the Transfer Agent and Registrar
specifying the terms of the redemption and the Publication Date of such notice
shall be sent to DTC not less than thirty (30) days prior to such event by a
secure means in the manner set forth in the preceding paragraph. Such redemption
notice shall be sent to DTC's Call Notification Department at (000) 000-0000 or
(000) 000-0000, and receipt of such notice shall be confirmed by telephoning
(000) 000-0000. Notice by mail or by any other means shall be sent to:
Call Notification Department
The Depository Trust Company
000 Xxxxxxx Xxxxxx
Xxxxxx Xxxx, XX 00000-0000
(f) In the event of any invitation to tender the Securities, notice by
the Trust to holders of the Securities specifying the terms of the tender and
the Publication Date of such notice shall be sent to DTC by a secure means and
in a timely manner as described in Paragraph 4. Notices to DTC pursuant to this
paragraph and notices of other corporate actions (including mandatory
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63
tenders, exchanges and capital changes) shall be sent by telecopy to DTC's
Reorganization Department at (000) 000-0000 and receipt of such notice shall be
confirmed by telephoning (000) 000-0000, or by mail or any other means to:
Manager, Reorganization Department
Reorganization Window
The Depository Trust Company
0 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000-0000
(g) All notices and payment advice sent to DTC shall contain the CUSIP
number of the Securities and the accompanying description of the Securities,
which, as of the date of this letter, is "Cleveland Electric Financing Trust __%
Cumulative Trust Preferred Capital Securities, Series [ ]."
(h) Notices to DTC's Dividend Department by telecopy shall be sent to
(000) 000-0000. Such notices by mail or by any other means shall be sent to:
Manager, Announcements
Dividend Department
The Depository Trust Company
0 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
The Trust or the Transfer Agent and Registrar shall confirm DTC's receipt of
such telecopy by telephoning the Dividend Department at (000) 000-0000.
(i) Payments of dividends or other cash distributions with respect to
the Securities evidenced by the Global Certificate shall be received by Cede &
Co., as nominee of DTC, or its registered assigns in same day funds on each
payment date (or in accordance with existing arrangements between the Trust or
the Transfer Agent and Registrar and DTC). Such payments shall be made payable
to the order of Cede & Co. and shall be addressed as in paragraph 10 below.
(j) Other cash payments shall be received by Cede & Co., as nominee of
DTC, or its registered assigns in next day funds on each payment date (or in
accordance with existing arrangements between the Trust or the Transfer Agent
and Registrar and DTC). Such payments shall be made payable to the order of Cede
& Co., and shall be addressed as follows:
NDFS Redemption Department
The Depository Trust Company
0 Xxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000-0000
(k) DTC may by prior written notice direct the Trust or the Transfer
Agent and Registrar to use any other telecopy number or address of DTC as the
number or address to which notices or payments may be sent.
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64
(l) In the event of a conversion, redemption, or any other similar
transaction (e.g., tender made and accepted in response to the Trust's or the
Transfer Agent and Registrar's invitation) necessitating a reduction in the
aggregate number of Securities outstanding evidenced by the Global Certificate,
DTC, in its discretion: (a) may request the Trust or the Transfer Agent and
Registrar to issue and countersign a new Global Certificate; or (b) may make an
appropriate notation on the Global Certificate indicating the date and amount of
such reduction.
(m) DTC may discontinue its services as a securities depository with
respect to the Global Certificate at any time by giving reasonable notice to the
Trust or the Transfer Agent and Registrar (at which time DTC will confirm with
the Trust or the Transfer Agent and Registrar the aggregate number of Securities
deposited with, or held in custody for, it) and discharging its responsibilities
with respect thereto under applicable law. Under such circumstances, at DTC's
request the Trust and the Transfer Agent and Registrar shall cooperate fully
with DTC by taking prompt appropriate action to make alternative arrangements
for book-entry settlement for the Securities or to make available one or more
separate global certificates evidencing Securities to any participant having
Securities credited to its DTC account, or issue Securities in certificated form
to the beneficial holders thereof, and in any such case, DTC agrees to cooperate
fully with the Trust and the Transfer Agent and Registrar and to return the
Global Certificate, duly endorsed for transfer as directed by the Trust or the
Transfer Agent and Registrar, together with any other documents of transfer
reasonably requested by the Trust or the Transfer Agent and Registrar.
(n) In the event that the Trust determines that beneficial owners of
Securities shall be able to obtain certificated Securities, the Trust or the
Transfer Agent and Registrar shall notify DTC of the availability of
certificates. In such event, the Trust or the Transfer Agent and Registrar shall
issue, transfer and exchange certificates in appropriate amounts, as required by
DTC and others, and DTC agrees to cooperate fully with the Trust and the
Transfer Agent and Registrar and to return the Global Certificate, duly endorsed
for transfer as directed by the Trust or the Transfer Agent and Registrar,
together with any other documents of transfer reasonably requested by the Trust
or the Transfer Agent and Registrar.
(o) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
This letter may be executed in any number of counterparts, each of
which when so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
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65
Nothing herein shall be deemed to require the Transfer Agent and
Registrar to advance funds on behalf of the Trust.
Very truly yours,
CLEVELAND ELECTRIC FINANCING TRUST I
(As Issuer)
By:
-------------------------------------
-------------
Administrative Trustee
By: THE BANK OF NEW YORK
(As Transfer Agent and Registrar)
By:
-------------------------------------
Name:
Title:
RECEIVED AND ACCEPTED:
THE DEPOSITORY TRUST COMPANY
By:
-----------------------------
Authorized Officer
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66
EXHIBIT C
THIS CERTIFICATE IS NOT TRANSFERABLE
EXCEPT AS PROVIDED IN THE TRUST
AGREEMENT (AS DEFINED BELOW)
Certificate No. Number of
Common Securities: _________
Certificate Evidencing Common Securities
of
Cleveland Electric Financing Trust I
Common Securities (liquidation amount $25 per Common Security)
Cleveland Electric Financing Trust I, a statutory business trust
created under the laws of the State of Delaware (the "Trust"), hereby certifies
that The Cleveland Electric Illuminating Company (the "Holder") is the
registered owner of _____________ (_________) common securities of the Trust
representing undivided beneficial interests in the assets of the Trust and
designated the Common Securities (liquidation amount $25 per Common Security)
(the "Common Securities"). Except as provided in Section 5.10 of the Trust
Agreement (as defined below) the Common Securities are not transferable and, to
the fullest extent permitted by law, any attempted transfer hereof shall be
void. The designations, rights, privileges, restrictions, preferences and other
terms and provisions of the Common Securities are set forth in, and this
certificate and the Common Securities represented hereby are issued and shall in
all respects be subject to the terms and provisions of, the Amended and Restated
Trust Agreement of the Trust dated as of _____________, 2001, among The
Cleveland Electric Illuminating Company, an Ohio corporation, The Bank of New
York, a New York banking corporation, as trustee, The Bank of New York
(Delaware), a Delaware banking corporation, as trustee, and Xxxxxx Xxxxx, an
individual, as trustee, and Xxxxx Xxxxxx, an individual, as trustee
(collectively, the "Administrative Trustees of the Trust"), and the holders,
from time to time, of undivided beneficial interests in the assets of the Trust,
as the same may be amended from time to time (the "Trust Agreement"), including
the designation of the terms of the Common Securities as set forth therein. The
Trust will furnish a copy of the Trust Agreement to the Holder without charge
upon written request to the Trust at its principal place of business or
registered office.
Upon receipt and acceptance of this certificate, the Holder is bound by
the Trust Agreement and is entitled to the benefits thereunder.
IN WITNESS WHEREOF, the undersigned Administrative Trustee of the Trust
has executed this certificate this ___ day of _____________, 2001.
Cleveland Electric Financing Trust I
By:
-------------------------------
(as Administrative Trustee)
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EXHIBIT D
AGREEMENT AS TO EXPENSES AND LIABILITIES
AGREEMENT dated as of _____________, 2001, between The Cleveland
Electric Illuminating Company, an Ohio corporation ("Cleveland Electric"), and
Cleveland Electric Financing Trust I, a Delaware business trust (the "Trust").
WHEREAS, the Trust intends to issue its Common Securities (the "Common
Securities") to and receive Debentures from Cleveland Electric and to issue and
sell its ___% Cumulative Trust Preferred Securities, Series [ ], Due 2031 (the
"Preferred Securities") with such powers, preferences and special rights and
restrictions as are set forth in the Amended and Restated Trust Agreement of the
Trust dated as of _____________, 2001 as the same may be amended from time to
time (the "Trust Agreement");
WHEREAS, Cleveland Electric is the issuer of the Debentures;
NOW, THEREFORE, in consideration of the purchase by each holder of the
Preferred Securities, which purchase Cleveland Electric hereby agrees shall
benefit Cleveland Electric and which purchase Cleveland Electric acknowledges
will be made in reliance upon the execution and delivery of this Agreement,
Cleveland Electric (including in its capacity as holder of the Common
Securities) and the Trust hereby agree as follows:
ARTICLE I.
Section 1.01 GUARANTEE BY CLEVELAND ELECTRIC. Subject to the terms and
conditions hereof, Cleveland Electric hereby irrevocably and unconditionally
guarantees to each person or entity to whom the Trust is now or hereafter
becomes indebted or liable (the "Creditors") the full payment, when and as due,
of any and all Obligations (as hereinafter defined) to such Creditors. As used
herein, "Obligations" means any indebtedness, expenses or liabilities of the
Trust, other than obligations of the Trust to pay to holders of any Preferred
Securities or other similar interests in the Trust the amounts due such holders
pursuant to the terms of the Preferred Securities or such other similar
interests, as the case may be. This Agreement is intended to be for the benefit
of, and to be enforceable by, all such Creditors, whether or not such Creditors
have received notice hereof.
Section 1.02 TERM OF AGREEMENT. This Agreement shall terminate and be
of no further force and effect upon the date on which there are no Creditors
remaining; provided, however, that this Agreement shall continue to be effective
or shall be reinstated, as the case may be, if at any time any holder of
Preferred Securities or any Creditor must restore payment of any sums paid under
the Preferred Securities, under any Obligation, under the Guarantee Agreement
dated the date hereof by Cleveland Electric and The Bank of New York, as
guarantee trustee, or under this Agreement for any reason whatsoever. This
Agreement is continuing, irrevocable, unconditional and absolute.
Section 1.03 WAIVER OF NOTICE. Cleveland Electric hereby waives notice
of acceptance of this Agreement and of any Obligation to which it applies or may
apply, and Cleveland Electric hereby waives presentment, demand for payment,
protest, notice of nonpayment, notice of dishonor, notice of redemption and all
other notices and demands.
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Section 1.04 NO IMPAIRMENT. The obligations, covenants, agreements and
duties of Cleveland Electric under this Agreement shall in no way be affected or
impaired by reason of the happening from time to time of any of the following:
(a) the extension of time for the payment by the Trust of all
or any portion of the Obligations or for the performance of any other obligation
under, arising out of, or in connection with, the Obligations;
(b) any failure, omission, delay or lack of diligence on the
part of the Creditors to enforce, assert or exercise any right, privilege, power
or remedy conferred on the Creditors with respect to the Obligations or any
action on the part of the Trust granting indulgence or extension of any kind; or
(c) the voluntary or involuntary liquidation, dissolution,
sale of any collateral, receivership, insolvency, bankruptcy, assignment for the
benefit of creditors, reorganization, arrangement, composition or readjustment
of debt or, or other similar proceedings affecting, the Trust or any of the
assets of the Trust.
There shall be no obligation of the Creditors to give notice to, or
obtain the consent of, Cleveland Electric with respect to the happening of any
of the foregoing.
Section 1.05 ENFORCEMENT. A Creditor may enforce this Agreement
directly against Cleveland Electric, and Cleveland Electric waives any right or
remedy to require that any action be brought against the Trust or any other
person or entity before proceeding against Cleveland Electric.
ARTICLE II.
Section 2.01 BINDING EFFECT. All guarantees and agreements contained in
this Agreement shall bind the successors, assigns, receivers, trustees and
representatives of Cleveland Electric and shall inure to the benefit of the
Creditors.
Section 2.02 AMENDMENT. So long as there remains any Creditor or any
Preferred Securities of any series are outstanding, this Agreement shall not be
modified or amended in any manner adverse to such Creditor or to the holders of
the Preferred Securities but, in any event, without the prior written consent of
the Property Trust (as defined in the Trust Agreement).
Section 2.03 NOTICES. Any notice, request or other communication
required or permitted to be given hereunder shall be given in writing by
delivering the same against receipt therefor by facsimile transmission
(confirmed by mail), telex or by registered or certified mail, addressed as
follows (and if so given, shall be deemed given when mailed or upon receipt of
an answer-back, if sent by telex), to wit:
X-0
00
Xxxxxxxxx Electric Financing Trust I
x/x Xxx Xxxx xx Xxx Xxxx
000 Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx
Xxx Xxxx, XX 00000
Facsimile No.: (000) 000-0000
Attention: Corporate Trust Department
with a copy to:
The Bank of New York (Delaware)
Xxxxx Xxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Facsimile No.: ___________.
Attention: Corporate Trust Department.)
The Cleveland Electric Illuminating Company
00 Xxxxx Xxxx Xxxxxx
Xxxxx, Xxxx
Attention: Treasurer
Facsimile No.: (000) 000-0000.
Section 2.04 THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
THIS AGREEMENT is executed as of the day and year first above written.
THE CLEVELAND ELECTRIC ILLUMINATING COMPANY
By:
-------------------------------------
Name:
Title:
CLEVELAND ELECTRIC FINANCING TRUST I
By:
-------------------------------------
Name:
Title:
(as Administrative Trustees)
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EXHIBIT E
[IF THE PREFERRED SECURITY IS TO BE A GLOBAL CERTIFICATE INSERT -] This
Preferred Security is a Global Certificate within the meaning of the Trust
Agreement hereinafter referred to and is registered in the name of The
Depository Trust Company (the "Depository") or a nominee of the Depository. This
Preferred Security is exchangeable for Preferred Securities registered in the
name of a person other than the Depository or its nominee only in the limited
circumstances described in the Trust Agreement and no transfer of this Preferred
Security (other than a transfer of this Preferred Security as a whole by the
Depository to a nominee of the Depository or by a nominee of the Depository to
the Depository or another nominee of the Depository) may be registered except in
limited circumstances.
Unless this Preferred Security is presented by an authorized
representative of The Depository Trust Company, a New York corporation, to
Cleveland Electric Financing Trust or its agent for registration of transfer,
exchange or payment, and any Preferred Security issued is registered in the name
of Cede & Co. or such other name as requested by an authorized representative of
The Depository Trust Company (and any payment is made to Cede & Co. or to such
other entity as is requested by an authorized representative of The Depository
Trust Company), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede &
Co., has an interest herein.
Certificate No.
Number of Preferred Securities: ____________
CUSIP NO.: _______________
Certificate Evidencing Preferred Securities
of
Cleveland Electric Financing Trust I
___% Cumulative Trust Preferred Securities, Series [ ], Due 2031
(liquidation amount $25 per Preferred Security)
Cleveland Electric Financing Trust I, a statutory business trust
created under the laws of the State of Delaware (the "Trust"), hereby certifies
that ____________ (the "Holder") is the registered owner of _____ (_____)
preferred securities of the Trust representing an undivided beneficial interest
in the assets of the Trust and designated the Cleveland Electric Financing Trust
I ___% Cumulative Trust Preferred Securities, Series [ ], Due 2031 (liquidation
amount $25 per Preferred Security) (the "Preferred Securities"). The Preferred
Securities are transferable on the books and records of the Trust, in person or
by a duly authorized attorney, upon surrender of this certificate duly endorsed
and in proper form for transfer as provided in Section 5.04 of the Trust
Agreement (as defined below). The designations, rights, privileges,
restrictions, preferences and other terms and provisions of the Preferred
Securities are set forth in, and this certificate and the Preferred Securities
represented hereby are issued and shall in all respects be subject to the terms
and provisions of, the Amended and Restated Trust Agreement of the Trust dated
as of _____________, 2001, among The Cleveland Electric Illuminating Company, an
Ohio corporation, The Bank of New York, a New York banking corporation, as
trustee, The Bank of New York (Delaware), a Delaware banking corporation, as
trustee, and
X-0
00
Xxxxxx Xxxxx, an individual, as trustee, and Xxxxx Xxxxxx, an individual, as
trustee (collectively, the "Administrative Trustees of the Trust"), and the
holders, from time to time, of undivided beneficial interests in the assets of
the Trust, as the same may be amended from time to time (the "Trust Agreement")
including the designation of the terms of Preferred Securities as set forth
therein. The holder of this certificate is entitled to the benefits of the
Guarantee Agreement entered into by The Cleveland Electric Illuminating Company,
an Ohio corporation, and The Bank of New York, as guarantee trustee, dated as of
_____________, 2001, as the same may be amended from time to time (the
"Guarantee"), to the extent provided therein. The Trust will furnish a copy of
the Trust Agreement and the Guarantee to the holder of this certificate without
charge upon written request to the Trust at its principal place of business or
registered office.
Upon receipt of this certificate, the holder of this certificate is
bound by the Trust Agreement and is entitled to the benefits thereunder.
IN WITNESS WHEREOF, an Administrative Trustee of the Trust has executed
this certificate this __ day of _______________, 2001.
Cleveland Electric Financing Trust I
By:
-------------------------------
(as Administrative Trustee)
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ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this
Preferred Security to:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Insert assignee's social security or tax identification number)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Insert address and zip code of assignee)
and irrevocably appoints
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
agent to transfer this Preferred Security Certificate on the books of the Trust.
The agent may substitute another to act for him or her.
Date:__________________
Signature:________________________
(Sign exactly as your name appears on the other side of this Preferred Security
Certificate)
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