EXHIBIT 4.14
AMENDED AND RESTATED TRUST AGREEMENT
Among
HARLEYSVILLE GROUP INC., as Depositor,
WILMINGTON TRUST COMPANY, as Property Trustee,
Delaware Trustee and Bank,
and
THE ADMINISTRATIVE TRUSTEES NAMED HEREIN
Dated as of ____________________
HARLEYSVILLE GROUP CAPITAL TRUST __
HARLEYSVILLE GROUP CAPITAL TRUST __
Certain Sections of this Trust Agreement relating to
Sections 310 through 318 of the
Trust Indenture Act of 1939:
Trust Indenture Trust Agreement
Act Section Section
(S) 310 (a)(1)...................................... 8.7
(a)(2)...................................... 8.7
(a)(3)...................................... 8.9
(a)(4)...................................... 2.7(a)(ii)
(a)(5)...................................... 8.7
(b)......................................... 8.8
(c)......................................... Not Applicable
(S) 311 (a)......................................... 8.13
(b)......................................... 8.13
(c)......................................... Not Applicable
(S) 312 ............................................ 5.7
(S) 313 ............................................ 8.14
(S) 314 (a)......................................... 8.15, 2.7(a)(i)(G)
(b)......................................... Not Applicable
(c)......................................... 8.15, 8.16
(d)......................................... Not Applicable
(e)......................................... 8.16
(f)......................................... Not Applicable
(S) 315 (a)......................................... 8.1
(b)......................................... 8.2
(c)......................................... 8.1
(d)......................................... 8.1, 8.3
(e)......................................... Not Applicable
(S) 316 (a)......................................... 8.19
(a)(2)...................................... Not Applicable
(b)......................................... Not Applicable
(c)......................................... 2.7(a)(i)(C), 6.7
(S) 317 ............................................ 2.7, 5.9
(S) 318 ............................................ 10.10
---------------
Note: This reconciliation and tie sheet shall not, for any
purpose, be deemed to be a part of the Trust Agreement and shall not affect the
interpretation of any of its terms and provisions.
TABLE OF CONTENTS
PAGE
ARTICLE 1 DEFINED TERMS...........................................1
Section 1.1 Definitions...................................1
ARTICLE 2 ESTABLISHMENT OF THE TRUST.............................11
Section 2.1 Name.........................................11
Section 2.2 Offices of the Trustees; Principal
Place of Business............................11
Section 2.3 Initial Contribution of Trust Property;
Organizational Expenses......................12
Section 2.4 Issuance of the Preferred Securities.........12
Section 2.5 Subscription and Purchase of
Debentures; Issuance of the
Common Securities............................12
Section 2.6 Declaration of Trust and Appointment
of Trustees..................................12
Section 2.7 Authorization to Enter into
Certain Transactions.........................13
Section 2.8 Assets of Trust..............................18
Section 2.9 Title to Trust Property......................18
ARTICLE 3 PAYMENT ACCOUNT........................................18
Section 3.1 Payment Account..............................19
ARTICLE 4 DISTRIBUTIONS; REDEMPTION..............................19
Section 4.1 Distributions................................19
Section 4.2 Redemption...................................20
Section 4.3 Subordination of Common Securities...........22
Section 4.4 Payment Procedures...........................23
Section 4.5 Tax Returns and Reports......................23
Section 4.6 Payment of Taxes, Duties, Etc.
of the Trust.................................23
Section 4.7 Payments under Indenture.....................23
ARTICLE 5 TRUST SECURITIES CERTIFICATES..........................23
Section 5.1 Initial Ownership............................23
Section 5.2 The Trust Securities Certificates............24
Section 5.3 Authentication and Delivery of
Trust Securities Certificates................24
Section 5.4 Registration of Transfer and
Exchange of Preferred
Securities Certificates......................24
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TABLE OF CONTENTS
(continued)
PAGE
Section 5.5 Mutilated, Destroyed, Lost or
Stolen Trust Securities Certificates.........25
Section 5.6 Persons Deemed Securityholders...............26
Section 5.7 Access to List of Securityholders'
Names and Addresses..........................26
Section 5.8 Maintenance of Office or Agency..............26
Section 5.9 Appointment of Paying Agent..................27
Section 5.10 Ownership of Common Securities by Depositor..27
Section 5.11 Book-Entry Preferred Securities
Certificates; Common
Securities Certificate.......................28
Section 5.12 Notices to Clearing Agency...................28
Section 5.13 Definitive Preferred Securities
Certificates.................................29
Section 5.14 Rights of Securityholders....................29
ARTICLE 6 ACTS OF SECURITYHOLDERS; MEETINGS; VOTING..............30
Section 6.1 Voting Rights................................30
Section 6.2 Notice of Meetings...........................31
Section 6.3 Meetings of Preferred Securityholders........32
Section 6.4 Voting Rights................................32
Section 6.5 Proxies, etc.................................32
Section 6.6 Securityholder Action by Written Consent.....32
Section 6.7 Record Date for Voting and Other Purposes....32
Section 6.8 Acts of Securityholders......................33
Section 6.9 Inspection of Records........................34
ARTICLE 7 REPRESENTATIONS AND WARRANTIES.........................34
Section 7.1 Representations and Warranties
of the Bank, the Property Trustee
and the Delaware Trustee.....................34
Section 7.2 Representations and Warranties
of Depositor.................................36
ARTICLE 8 THE TRUSTEES...........................................36
Section 8.1 Duties, Responsibilities and
Limitation of Liability......................36
Section 8.2 Notices......................................38
Section 8.3 Certain Rights of Property Trustee...........38
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TABLE OF CONTENTS
(continued)
PAGE
Section 8.4 Not Responsible for Recitals or
Issuance of Securities.......................40
Section 8.5 May Hold Securities..........................40
Section 8.6 Compensation; Indemnity; Fees................41
Section 8.7 Corporate Property Trustee Required;
Eligibility of Trustees......................42
Section 8.8 Conflicting Interests........................42
Section 8.9 Co-Trustees and Separate Trustee.............42
Section 8.10 Resignation and Removal;
Appointment of Successor.....................44
Section 8.11 Acceptance of Appointment by Successor.......45
Section 8.12 Merger, Conversion, Consolidation
or Succession to Business....................46
Section 8.13 Preferential Collection of Claims
Against Depositor or Trust...................46
Section 8.14 Reports by Property Trustee..................47
Section 8.15 Reports to the Property Trustee..............47
Section 8.16 Evidence of Compliance with
Conditions Precedent.........................47
Section 8.17 Number of Trustees...........................47
Section 8.18 Delegation of Power..........................48
ARTICLE 9 TERMINATION, LIQUIDATION AND MERGER....................49
Section 9.1 Termination Upon Expiration Date.............49
Section 9.2 Early Termination............................49
Section 9.3 Termination..................................49
Section 9.4 Liquidation..................................50
Section 9.5 Mergers, Consolidations, Amalgamations
or Replacements of the Trust.................51
ARTICLE 10 MISCELLANEOUS PROVISIONS...............................52
Section 10.1 Limitation of Rights and Liability
of Securityholders............................52
Section 10.2 Amendment.....................................52
Section 10.3 Separability..................................54
Section 10.4 Governing Law.................................54
Section 10.5 Payments Due on Non-Business Day; Notice
of Deferral of Distribution...................55
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TABLE OF CONTENTS
(continued)
PAGE
Section 10.6 Successors.....................................55
Section 10.7 Headings.......................................55
Section 10.8 Reports, Notices and Demands...................55
Section 10.9 Agreement Not to Petition......................57
Section 10.10 Limitation of Depositor's Liability............57
Section 10.11 Trust Indenture Act; Conflict with
the Trust Indenture Act........................57
Section 10.12 Acceptance of Terms of Trust Agreement,
Guarantee and Indenture........................58
Section 10.13 Counterparts...................................58
Exhibit A Certificate of Trust
Exhibit B Form of Certificate Depository Agreement
Exhibit C Form of Common Securities Certificate
Exhibit D Form of Expense Agreement
Exhibit E Form of Preferred Securities
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AMENDED AND RESTATED TRUST AGREEMENT
AMENDED AND RESTATED TRUST AGREEMENT, dated as of ________________,
among (i) Harleysville Group Inc., a Delaware corporation (including any
successors or assigns, the "Depositor"), (ii) Wilmington Trust Company, a
Delaware banking corporation, as property trustee and Delaware trustee (in each
such capacity, the "Property Trustee" and "Delaware Trustee," respectively, and,
in its separate corporate capacity and not in its capacity as Property Trustee
or Delaware Trustee, the "Bank"), (iii) ________________, an individual, and
_________________, an individual, (each an "Administrative Trustee" and
collectively the "Administrative Trustees") (the Property Trustee, the Delaware
Trustee and the Administrative Trustees referred to collectively as the
"Trustees") and (iv) the several Holders, as hereinafter defined.
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Depositor, the Property Trustee and the Delaware Trustee
heretofore have duly created a statutory trust pursuant to the Delaware
Statutory Trust Act by the entering into of that certain Trust Agreement, dated
as of April __, 2003 (the "Original Trust Agreement"), and by the execution and
filing by the Delaware Trustee with the Secretary of State of the State of
Delaware of the Certificate of Trust, filed on _________________, 2003, attached
as Exhibit A; and
WHEREAS, the Depositor and the Trustees desire to amend and restate the
Original Trust Agreement in its entirety as set forth herein to appoint the
Administrative Trustees and to provide for the purposes set forth herein;
NOW THEREFORE, in consideration of the agreements and obligations set
forth herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, each party, for the benefit of the
other party and for the benefit of the Securityholders, hereby amends and
restates the Original Trust Agreement in its entirety and agrees as follows:
ARTICLE 1
DEFINED TERMS
Section 1.1 DEFINITIONS.
For all purposes of this Trust Agreement, except as otherwise expressly
provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned
to them in this Article and include the plural as well as the singular;
(b) all other terms used herein that are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
1
(c) unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the case may be,
of this Trust Agreement; and
(d) the words "herein", "hereof" and "hereunder" and other words
of similar import refer to this Trust Agreement as a whole and not to any
particular Article, Section or other subdivision.
"Act" has the meaning specified in Section 6.8.
"Additional 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 Indenture) paid by the Depositor on a Like Amount of Debentures
for such period. For the avoidance of doubt, the Additional Amount does not
include Additional Sums.
"Additional Sums" means such additional amounts that are imposed on the
Trust by the United States, or any other taxing authority, as taxes, duties,
assessments or governmental charges of whatever nature (other than withholding
taxes), and which are paid by the Depositor as additional interest on the
Securities in an amount necessary for the net amounts received and retained by
the Trust after paying such taxes, duties, assessments or other governmental
charges to be equal to the amounts the Trust would have received had no such
taxes, duties, assessments or other governmental charges been imposed.
"Administrative Trustee" has the meaning specified in the preamble to
this Trust Agreement, solely in his or her capacity as Administrative Trustee of
the Trust continued hereunder and not in his or her individual capacity, or such
Administrative Trustee's successor in interest in such capacity, or any
successor trustee appointed as herein provided.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Bank" has the meaning specified in the preamble to this Trust
Agreement.
"Bankruptcy Event" means, with respect to any Person:
(a) the entry by a court having jurisdiction in the premises
of a decree or order (A) for relief in respect of such Person in an
involuntary case or proceeding under any applicable federal or state
bankruptcy, insolvency, reorganization or other similar law or (B)
judging such Person a bankrupt or insolvent, or approving as properly
filed a petition seeking reorganization, arrangement, adjudication or
2
composition of or in respect of such Person under any applicable
Federal or State bankruptcy, insolvency, reorganization or other
similar law, or appointing a receiver, liquidator, assignee, trustee,
sequestrator (or other similar official) of such Person or of any
substantial part of its property or ordering the winding up or
liquidation of its affairs, and the continuance of any such decree or
order unstayed and in effect for a period of 60 consecutive days; or
(b) the institution by such Person of proceedings to be
adjudicated a bankrupt or insolvent, or the consent by it to the
institution of bankruptcy or insolvency proceedings against it, or the
filing by it of a petition or answer or consent seeking reorganization
or relief under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law, or the consent by it to the filing
of any such petition or to the appointment of a receiver, liquidator,
assignee, trustee, sequestrator (or similar official) of such Person or
of any substantial part of its property, or the making by it of an
assignment for the benefit of creditors, or the admission by it in
writing of its inability to pay its debts generally as they become due
and its willingness to be adjudicated a bankrupt, or the taking of
corporate action by such Person in furtherance of any such action.
"Bankruptcy Laws" has the meaning specified in Section 10.9.
"Board Resolution" means a resolution or copy thereof certified by the
Secretary, the Corporate Secretary or an Assistant Secretary of the Depositor to
have been duly adopted by the Depositor's Board of Directors, or such committee
of the Board of Directors or officers of the Company to which authority to act
on behalf of the Board of Directors has been delegated, and to be in full force
and effect on the date of such certification, and delivered to the Trustees.
"Book Entry Preferred Securities Certificates" means certificates
representing Preferred Securities issued in global, fully registered form to the
Clearing Agency as described in Section 5.11.
"Business Day" means a day other than (a) a Saturday or Sunday, (b) a
day on which banking institutions in The City of New York are authorized or
required by law or executive order to remain closed, or (c) a day on which the
Property Trustee's Corporate Trust Office or the Corporate Trust Office of the
Debenture Trustee is closed for business.
"Certificate Depository Agreement" means the agreement among the Trust,
the Depositor and The Depository Trust Company, as the initial Clearing Agency,
dated as of the Closing Date, relating to the Preferred Securities Certificates,
substantially in the form attached as Exhibit B, as the same may be amended or
supplemented from time to time.
3
"Clearing Agency" means The Depository Trust Company or any successor
organization registered as a "clearing agency" pursuant to Section 17A of the
Exchange Act and appointed pursuant to the terms hereof.
"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 pursuant to the rules of such Clearing Agency or an agreement
between the Clearing Agency and such Person in the customary form.
"Closing Date" means the date or dates on which the Preferred
Securities are issued and sold.
"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 Exchange Act 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 $__ and having the rights provided
therefor in this Trust Agreement, including the right to receive Distributions
and a Liquidation Distribution as provided herein.
"Common Securityholder" means Harleysville Group Inc., in its capacity
as purchaser and holder of all of the Common Securities issued by the Trust.
"Common Securities Certificate" means a certificate evidencing
ownership of Common Securities, substantially in the form attached as Exhibit C.
"Corporate Trust Office" means (A) with respect to the Property
Trustee, the office at which its corporate trust business shall be principally
administered located in Wilmington, Delaware, and (B) with respect to the
Debenture Trustee, the office at which its corporate trust business shall be
principally administered located in _________________.
"Debenture Event of Default" means an "Event of Default" as defined in
the Indenture.
"Debenture Redemption Date" means, with respect to any Debentures to be
redeemed under the Indenture, the date fixed for redemption under the Indenture.
"Debenture Trustee" means X.X. Xxxxxx Trust Company, National
Association and any successor thereto, as trustee under the Indenture.
4
"Debentures" means the Depositor's __% Junior Subordinated Deferrable
Interest Debentures due ___, limited in aggregate principal amount to $[ ] (or
up to $[ ], if the Over-Allotment Option is exercised in full) issued to the
Trust pursuant to the Indenture.
"Definitive Preferred Securities Certificates" means either or both (as
the context requires) of (a) Preferred Securities Certificates issued in
certificated, fully registered form as provided in Section 5.11(a) and (b)
Preferred Securities Certificates issued in certificated, fully registered form
as provided in Section 5.13.
"Delaware Statutory Trust Act" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code Section 3801, et seq., as it may be amended from
time to time, or any successor legislation, with a similar purpose and effect.
"Delaware Trustee" means the commercial bank or trust company
identified as the "Delaware Trustee" in the preamble to this Trust Agreement
solely in its capacity as Delaware Trustee of the Trust formed and continued
hereunder and, except as specifically provided to the contrary herein, 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.
"Distribution Date" has the meaning specified in Section 4.1(a).
"Distributions" means amounts payable in respect of the Trust
Securities as provided in Section 4.1.
"Early Termination Event" has the meaning specified in Section 9.2.
"Event of Default" means any one of the following events (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(a) the occurrence of a Debenture Event of Default; or
(b) default by the 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
(c) default by the Trust in the payment of any Redemption Price of any
Trust Security when it becomes due and payable; or
(d) default in the performance or breach in any material respect of any
covenant or warranty of the Trustees in this Trust Agreement (other than a
covenant or warranty a default in whose performance or breach is dealt with in
clause (b) or (c), above) and continuation of such default or breach for a
period of 60 days after there has been given, by registered or certified mail,
5
to the defaulting Trustee or Trustees by the Holders of at least 25% 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
(e) the occurrence of a Bankruptcy Event with respect to the Property
Trustee and the failure of the Depositor to appoint a successor Property Trustee
within 60 days thereafter.
"Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time, or any successor legislation, with a similar purpose and
effect.
"Expense Agreement" means the Agreement as to Expenses and Liabilities
between the Depositor and the Trust, substantially in the form attached as
Exhibit D, as amended or supplemented from time to time.
"Expiration Date" has the meaning specified in Section 9.1.
"Extension Period" has the meaning specified in Section 4.1(b).
"Guarantee" means the Guarantee Agreement executed and delivered by the
Depositor and X.X. Xxxxxx Trust Company, National Association, as trustee,
contemporaneously with the execution and delivery of this Trust Agreement, for
the benefit of the holders of the Preferred Securities, as amended or
supplemented from time to time.
"Indemnified Person" has the meaning specified in Section 8.1(d).
"Indenture" means the Subordinated Indenture, dated as of __________,
as supplemented by a Supplemental Indenture, dated as of ______________ between
the Depositor and the Debenture Trustee, as trustee, as amended or supplemented
from time to time.
"Investment Company Event" means the receipt by the Trust of an opinion
of a nationally recognized independent counsel (an "Investment Company Act
Opinion"), to the effect that, as a result of the occurrence of a change in law
or regulation or a written change in interpretation or application of law or
regulation by any legislative body, court, governmental agency or regulatory
authority (a "Change in 1940 Act Law"), there is more than an insubstantial risk
that the Trust is or will be considered an "investment company" that is required
to be registered under the Investment Company Act, which Change in 1940 Act Law
becomes effective on or after the Closing Date.
"Legal Action" has the meaning specified in Section 2.7(a)(i)(D).
"Lien" means any lien, pledge, charge, encumbrance, mortgage, deed of
trust, adverse ownership interest, hypothecation, assignment, security interest
6
or preference, priority or other security agreement or preferential arrangement
of any kind or nature whatsoever.
"Like Amount" means (a) with respect to a redemption of Trust
Securities, Trust Securities having a Liquidation Amount equal to the principal
amount of Debentures to be contemporaneously redeemed in accordance with the
Indenture the proceeds of which will be used to pay the Redemption Price of such
Trust Securities, and (b) with respect to a distribution of Debentures to
Holders of Trust Securities in connection with a dissolution or liquidation of
the Trust, Debentures having a principal amount equal to the Liquidation Amount
of the Trust Securities of the Holder to whom such Debentures are distributed.
"Liquidation Amount" means the stated amount of $__ per Trust Security.
"Liquidation Date" means each date on which Debentures are to be
distributed to Holders of Trust Securities in connection with a termination and
liquidation of the Trust pursuant to Section 9.4(a).
"Liquidation Distribution" has the meaning specified in Section 9.4(d).
"1940 Act" means the Investment Company Act of 1940, as amended from
time to time, or any successor legislation, with similar purpose and effect.
"Officer's Certificate" means a certificate signed by the Chairman,
Chief Executive Officer, President or a Vice President, and by the Treasurer, an
Associate Treasurer, an Assistant Treasurer, the Controller, the Secretary, the
Corporate Secretary or an Assistant Secretary, of the Person delivering such
certificate. Any Officer's 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 Officer's 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 in rendering the Officer's Certificate;
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such officer
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(d) a statement as to whether, in the opinion of each such officer,
such condition or covenant has been complied with.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Trust, the Property Trustee or the Depositor, but not an
employee of any thereof, and who shall be reasonably acceptable to the Person
receiving such opinion.
7
"Original Trust Agreement" has the meaning specified in the recitals to
this Trust Agreement.
"Outstanding", when used with respect to Preferred Securities, means,
as of the date of determination, all Preferred Securities theretofore executed
and delivered under this Trust Agreement, except:
(a) Preferred Securities theretofore cancelled by the Securities
Registrar or delivered to the Securities Registrar for cancellation;
(b) Preferred Securities for whose payment or redemption money in the
necessary amount has been theretofore deposited with the Property Trustee or any
Paying Agent for the Holders of such Preferred Securities; provided that, if
such Preferred Securities are to be redeemed, notice of such redemption shall
have been duly given pursuant to this Trust Agreement; and
(c) Preferred Securities which have been paid or in exchange for or in
lieu of which other Preferred Securities have been authenticated and delivered
pursuant to 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, approval 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 that such Trustee knows to
be so owned shall be so disregarded and (b) the foregoing shall not apply at any
time when all of the outstanding Preferred Securities are owned by the
Depositor, one or more of the Trustees and/or any Affiliate of any thereof.
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.
"Over-Allotment Option" means the option granted to the underwriters
pursuant to the Underwriting Agreement to purchase up to an additional [ ]
Preferred Securities in order to satisfy over-allotments.
"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).
8
"Paying Agent" means any paying agent or co-paying agent appointed
pursuant to Section 5.9 and shall initially be the Bank.
"Payment Account" means a segregated non-interest-bearing corporate
trust account established pursuant to Section 3.1 and maintained by the Property
Trustee with the Bank in its trust department for the benefit of the
Securityholders in which all amounts paid in respect of the Debentures will be
held and from which the Property Trustee shall make payments to the
Securityholders in accordance with Section 4.1 and 4.2.
"Person" means any individual, corporation, partnership, joint venture,
trust, limited liability company or corporation, unincorporated organization or
government or any agency or political subdivision thereof.
"Preferred Security" means an undivided beneficial interest in the
assets of the Trust, having a Liquidation Amount of $__ and having the rights
provided therefor in this Trust Agreement, including the right to receive
Distributions and a Liquidation Distribution as provided herein.
"Preferred Securityholder" means a Holder of a Preferred Security.
"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 heretofore formed and
continued hereunder and, except as specifically provided to the contrary herein,
not in its individual capacity, or its successor in interest in such capacity,
or any successor property trustee appointed as herein provided. For purposes of
the Trust Indenture Act, the Property Trustee shall be the "indenture trustee."
"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 and the stated maturity
of the Debentures shall be a Redemption Date for a Like Amount of Trust
Securities.
"Redemption Price" means, with respect to any Trust Security, the
Liquidation Amount of such Trust Security, which amount will equal (i) the
redemption price paid by the Depositor to repay or redeem, in whole or in part,
the Debentures held by the Trust, plus an amount equal to accumulated and unpaid
Distributions on such Trust Security through applicable Redemption Date or (ii)
such lesser amount as will be received by the Trust in respect of the Debentures
so repaid or redeemed.
"Relevant Trustee" has the meaning specified in Section 8.10.
9
"Securities Act" means the Securities Act of 1933, as amended from time
to time, or any successor legislation with a similar purpose and effect.
"Securities Register" and "Securities Registrar" have the respective
meanings specified in Section 5.4.
"Securityholder" or "Holder" means a Person in whose name a Trust
Security is or Securities are registered in the Securities Register; any such
Person shall be deemed to be a beneficial owner within the meaning of the
Delaware Statutory Trust Act.
"Successor Securities" has the meaning specified in Section 9.5.
"Special Event" means a Tax Event or an Investment Company Event.
"Tax Event" means the receipt by the Trust of an opinion of independent
tax counsel experienced in such matters ("Tax Event Opinion"), to the effect
that, as a result of (a) any amendment to, change in or announced prospective
change in the laws (or any regulations thereunder) of the United States or any
political subdivision or taxing authority thereof or therein, or (b) any
official administrative written decision, pronouncement or action, or judicial
decision interpreting or applying such laws or regulations, which amendment or
change is effective or which proposed change, pronouncement, decision or action
is announced on or after the Closing Date, there is more than an insubstantial
risk that (i) the Trust is, or will be within 90 days of the date of such
opinion, subject to the United States federal income tax with respect to income
received or accrued on the Debentures, (ii) interest payable to the Trust by the
Depositor on the Debentures is not, or within 90 days of the date of such
opinion will not be, deductible, in whole or in part, by the Depositor for
United States federal income tax purposes, or (iii) the Trust is, or will be
within 90 days of the date of such opinion, subject to a material amount of
other taxes, duties or other governmental charges.
"Trust" means the Delaware statutory trust created pursuant to the
Original Trust Agreement and the filing of the Certificate of Trust with the
Secretary of State of the State of Delaware 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
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Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
"Trust Property" means (a) the Debentures, (b) any cash on deposit in,
or owing to, the Payment Account and (c) all proceeds and rights in respect of
the foregoing and any other property and assets for the time being held or
deemed to be held by the Property Trustee pursuant to this Trust Agreement.
"Trust Security" means any one of the Common Securities or the
Preferred Securities.
"Trust Securities Certificate" means any one of the Common Securities
Certificates or the Preferred Securities Certificates.
"Trustees" means the Persons identified as "Trustees" in the preamble
to this Trust Agreement solely in their capacities as Trustees of the Trust
continued hereunder and, except as specifically provided to the contrary herein,
not in their individual capacities, or any successor in interest in such
capacity, or any successor "Trustee" appointed as herein provided.
"Underwriting Agreement" means the Underwriting Agreement, dated as of
_________, among the Trust, the Depositor and the underwriters named therein.
ARTICLE 2
ESTABLISHMENT OF THE TRUST
Section 2.1 Name.
The Trust heretofore duly created and continued hereby shall be known
as "Harleysville Group Capital Trust __," as such name may be modified from time
to time by the Administrative Trustees following written notice to the Holders
of Trust Securities and the other Trustees, in which name the Trustees may
conduct the business of the Trust, make and execute contracts and other
instruments on behalf of the Trust and xxx and be sued.
Section 2.2 Offices of the Trustees; Principal Place of Business.
The address of the Delaware Trustee and Property Trustee in the State
of Delaware is Xxxxxx Square North, 0000 Xxxxx Xxxxxx Xxxxxx, Xxxxxxxxxx,
Xxxxxxxx 00000-0000, or such other address in the State of Delaware as the
Delaware Trustee and/or the Property Trustee may designate by written notice to
the Securityholders and the Depositor. The address of the Administrative
Trustees is c/o Harleysville Group Inc., 000 Xxxxx Xxxxxx, Xxxxxxxxxxxx,
Xxxxxxxxxxxx 00000-0000. The principal executive office of the Trust is c/o
Wilmington Trust Company, Xxxxxx Square North 0000 Xxxxx Xxxxxx Xxxxxx,
Xxxxxxxxxx, Xxxxxxxx 00000-0000, Attention: Corporate Trust Administration. The
Depositor may change the principal place of business of the Trust at any time by
giving notice thereof to the Trustees.
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Section 2.3 Initial Contribution of Trust Property; Organizational
Expenses.
The Trustees acknowledge receipt in trust from the Depositor in
connection with the Original Trust Agreement of the sum of $10, which
constituted the initial Trust Property. The Depositor shall pay organizational
expenses of the Trust as they arise or shall, upon request of any Trustee,
promptly reimburse such Trustee for any such expenses paid by such Trustee. The
Depositor shall make no claim upon the Trust Property for the payment of such
expenses.
Section 2.4 Issuance of the Preferred Securities.
Contemporaneously with the execution and delivery of this Trust
Agreement, (i) the Depositor and an Administrative Trustee, on behalf of the
Trust, shall execute and deliver the Underwriting Agreement, (ii) an
Administrative Trustee, on behalf of the Trust, shall execute in accordance with
Section 5.2 and, following authentication thereof as provided in subsection
(iii) below, deliver to the Underwriters named therein Preferred Securities
Certificates, registered in the name of Persons entitled thereto, and (iii) the
Property Trustee, on behalf of the Trust, shall authenticate the Preferred
Securities Certificates. The Preferred Securities Certificates shall represent
an aggregate amount of _________ Preferred Securities, having an aggregate
Liquidation Amount of $_____. The Preferred Securities Certificates shall be
delivered against receipt of the aggregate purchase price of such Preferred
Securities of $______, which amount the Administrative Trustees shall promptly
deliver to the Property Trustee.
Section 2.5 Subscription and Purchase of Debentures; Issuance of
the Common Securities.
Contemporaneously with the execution and delivery of this Trust
Agreement, an Administrative Trustee, on behalf of the Trust, shall execute in
accordance with Section 5.2 and, following authentication by the Property
Trustee, deliver to the Depositor Common Securities Certificates, registered in
the name of the Depositor, in an aggregate amount of _____ Common Securities
having an aggregate Liquidation Amount of $___ against payment by the Depositor
of the sum of $____. After execution of the Common Securities Certificates, the
Property Trustee, on behalf of the Trust, shall authenticate such Common
Securities Certificates. Contemporaneously with the delivery of such Common
Securities Certificates, the Administrative Trustees, on behalf of the Trust,
shall subscribe to and purchase Debentures, registered in the name of the Trust
and having an aggregate principal amount equal to $___, and, in satisfaction of
the purchase price for such Debentures, the Property Trustee, on behalf of the
Trust, shall deliver to the Depositor the sum of $___.
Section 2.6 Declaration of Trust and Appointment of Trustees.
(a) The exclusive purposes and functions of the Trust are (i)
to issue and sell Trust Securities and use the proceeds from such sale to
acquire the Debentures, (ii) enter into and perform under the Expense Agreement,
the Certificate Depositary Agreement, and any other agreements related hereto or
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thereto, and (iii) to engage in those activities necessary, convenient or
incidental thereto.
(b) The Depositor hereby appoints the Trustees as trustees of
the Trust, to have all the rights, powers and duties to the extent set forth
herein, and the Trustees hereby accept such appointment.
(i) 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 Trust and the Securityholders.
(ii) 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.
(iii) Except as may be required under the Delaware
Statutory Trust Act, 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. 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 Statutory Trust Act.
(iv) The Delaware Trustee and the Property Trustee,
as the trustees under the Original Trust Agreement, have caused to be filed the
Certificate of Trust of the Trust with the office of the Secretary of State of
the State of Delaware, a copy of which is attached as Exhibit A, and such filing
is hereby confirmed and ratified.
Section 2.7 Authorization to Enter into Certain Transactions.
(a) The Trustees, subject to the limitations set forth herein,
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 in accordance with the following provisions (i) and (ii), 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:
(i) As among the Trustees, the Administrative
Trustees, acting singly or jointly, shall have the power and authority to act on
behalf of the Trust with respect to the following matters:
(A) to acquire the Debentures with the
proceeds of the sale of the Trust Securities; provided, however, the
Administrative Trustees shall cause legal title to all of the Debentures to be
vested in, and the Debentures to be held of record in the name of, the Property
Trustee for the benefit of the Trust and the Holders of the Trust Securities;
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(B) to deliver to the Depositor and the
Property Trustee prompt written notice of the occurrence of any Special Event
and to take any ministerial actions in connection therewith; provided that the
Administrative Trustees shall consult with the Depositor and the Property
Trustee before taking or refraining to take any ministerial action in relation
to a Special Event;
(C) to establish a record date with respect
to all actions to be taken hereunder that require a record date be established,
including for the purposes of Section 316(c) of the Trust Indenture Act and with
respect to Distributions, voting rights, redemptions, and exchanges, and to
issue relevant notices to Holders of the Trust Securities as to such actions and
applicable record dates;
(D) to bring or defend, pay, collect,
compromise, arbitrate, resort to legal action, or otherwise adjust claims or
demands of or against the Trust ("Legal Action"), unless pursuant to Section
2.7(a)(ii)(D), the Property Trustee has the power to bring such Legal Action;
(E) to employ or otherwise engage employees
and agents (who may be designated as officers with titles) and managers,
contractors, advisors, and consultants to conduct only those services that the
Administrative Trustees have authority to conduct directly, and to pay
reasonable compensation for such services;
(F) to cause the Trust to comply with the
Trust's obligations under the Trust Indenture Act;
(G) to give the certificate to the Property
Trustee required by Section 314(a)(4) of the Trust Indenture Act, which
certificate may be executed by any Administrative Trustee;
(H) to take all actions and perform such
duties as may be required of the Administrative Trustees pursuant to the terms
of this Trust Agreement;
(I) to take all action that may be necessary
or appropriate for the preservation and the continuation of the Trust's valid
existence, rights, franchises and privileges as a statutory trust under the laws
of the State of Delaware and of each other jurisdiction in which such existence
is necessary to protect the limited liability of the Holders of the Trust
Securities or to enable the Trust to effect the purposes for which the Trust has
been created;
(J) to take all action necessary to cause
all applicable tax returns and tax information reports that are required to be
filed with respect to the Trust to be duly prepared and filed by the
Administrative Trustees, on behalf of the Trust;
(K) the issuance and sale of the Trust
Securities in accordance with this Article 2;
(L) to cause the Trust to enter into, and to
execute, deliver and perform on behalf of the Trust, the Expense Agreement and
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the Certificate Depository Agreement and such other agreements as may be
necessary or desirable in connection with the purposes and function of the
Trust;
(M) assisting in the registration of the
Preferred Securities under the Securities Act and under state securities or blue
sky laws, and the qualification of this Trust Agreement as a trust indenture
under the Trust Indenture Act;
(N) assisting in the listing of the
Preferred Securities or the Guarantees on such securities exchange or exchanges
as shall be determined by the Depositor and the registration of the Preferred
Securities under the Exchange Act and the preparation and filing of all periodic
and other reports and other documents pursuant to the foregoing;
(O) 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;
(P) the appointment of a Paying Agent,
authenticating agent and Securities Registrar in accordance with this Trust
Agreement;
(Q) registering transfers of the Trust
Securities in accordance with this Trust Agreement, or appointing a replacement
Securities Registrar;
(R) to the extent provided in this Trust
Agreement, to assist in 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;
(S) unless otherwise determined by the
Depositor, the Property Trustee or the Administrative Trustees, or as otherwise
required by the Delaware Statutory Trust Act or the Trust Indenture Act, to
execute on behalf of the Trust (either acting alone or together with any or all
of the Administrative Trustees) any documents that the Administrative Trustees
have the power to execute pursuant to this Trust Agreement; and
(T) the taking of any action incidental to
the foregoing as the Administrative Trustees may from time to time determine is
necessary or advisable to give effect to the terms of this Trust Agreement and
to protect and conserve the Trust Property for the benefit of the
Securityholders (without consideration of the effect of any such action on any
particular Securityholder).
(ii) As among the Trustees, the Property Trustee
shall have the exclusive power, duty and authority to act on behalf of the Trust
with respect to the following matters:
(A) engage in such ministerial activities as
shall be necessary or appropriate to effect promptly the redemption of the Trust
Securities to the extent the Debentures are redeemed or mature;
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(B) upon notice of distribution issued by
the Administrative Trustees in accordance with the terms of this Trust
Agreement, engage in such ministerial activities as shall be necessary or
appropriate to effect promptly the distribution pursuant to the terms of this
Trust Agreement of Debentures to Holders of Trust Securities;
(C) take all actions and perform such duties
as may be specifically required of the Property Trustee pursuant to the terms of
this Trust Agreement;
(D) take any Legal Action which arises out
of or in connection with an Event of Default or the Property Trustee's duties
and obligations under this Trust Agreement, the Delaware Statutory Trust Act or
the Trust Indenture Act;
(E) the establishment and maintenance of the
Payment Account;
(F) the receipt of and holding of legal
title to the Debentures;
(G) the collection of interest, principal
and any other payments made in respect of the Debentures in the Payment Account;
(H) the distribution of amounts received in
the Payment Account and owed to the Securityholders in respect of the Trust
Securities;
(I) subject to the terms hereof, the
exercise of all of the rights, powers and privileges of a holder of the
Debentures and, if an Event of Default occurs and is continuing, to enforce for
the benefit of and subject to the rights of the Securityholders, its rights as
holder of the Debentures under the Indenture;
(J) the sending of notices of default and
other information regarding the Trust Securities and the Debentures to the
Securityholders in accordance with this Trust Agreement;
(K) the distribution of the Trust Property
in accordance with the terms of this Trust Agreement;
(L) 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;
(M) the taking of any action incidental to
the foregoing as the Property Trustee may from time to time determine is
necessary or advisable to give effect to the terms of this Trust Agreement and
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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);
(N) registering transfers of the Trust
Securities in accordance with this Trust Agreement; and
(O) subject to this Section 2.7(a)(ii), the
Property Trustee shall have none of the duties, liabilities, powers or the
authority of the Administrative Trustees set forth in Section 2.7(a)(i).
(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, activity 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, mortgage, pledge, set-off or otherwise
dispose of any of the Trust Property or interests therein, including to
Securityholders, except as expressly provided herein, (iii) take any action that
would cause the Trust to fail or cease to qualify as a "grantor trust" for
United States federal income tax purposes, (iv) incur any indebtedness for
borrowed money or issue any other debt, (v) take or consent to any action that
would result in the placement of a Lien on any of the Trust Property, (vi) issue
any securities other than the Trust Securities, or (vii) have any power to, or
agree to any action by the Depositor that would, vary the Trust Property of the
Trust or the Trust Securities. 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 by the Trust with the
Commission and to execute on behalf of the Trust a registration statement on
Form S-3 or S-4 under the Securities Act in relation to the Preferred Securities
of the Guarantees, 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;
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(iii) to prepare for filing by the Trust and to
execute on behalf of the Trust an application to the New York Stock Exchange or
any other national securities exchange or the Nasdaq National Market for listing
upon notice of issuance of any Preferred Securities or Guarantees;
(iv) to prepare for filing by the Trust with the
Commission and to execute on behalf of the Trust a registration statement on
Form 8-A relating to the registration of the Preferred Securities or the
Guarantees under Section 12(b) or 12(g) of the Exchange Act, including any
amendments thereto;
(v) to negotiate the terms of, and execute, deliver
and perform, the Underwriting Agreement providing for the sale of the Preferred
Securities or the Guarantees;
(vi) to negotiate the terms of an agreement with the
Depository Trust Company relating to the Preferred Securities or the Guarantees
and to execute, deliver and perform the agreement on behalf of the Trust; and
(vii) any other actions necessary or desirable to
carry out any of the foregoing activities.
(d) Notwithstanding anything herein to the contrary, the
Administrative Trustees are authorized and directed to conduct the affairs of
the Trust and to operate the Trust so that the Trust will not be deemed to be an
"investment company" required to be registered under the 1940 Act or taxed as
other than a grantor trust 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 their discretion to
be necessary or desirable for such purposes, as long as such action does not
adversely affect in any material respect the interests of the holders of the
Preferred Securities.
Section 2.8 Assets of Trust.
The assets of the Trust shall consist of the Trust Property.
Section 2.9 Title to Trust Property.
Legal title to all Trust Property shall be vested at all times in the
Property Trustee (in its capacity as such) and shall be held and administered by
the Property Trustee for the benefit of the Securityholders in accordance with
this Trust Agreement. The right, title and interest of the Property Trustee to
the Debentures shall vest automatically in each Person who may thereafter only
be appointed as Property Trustee in accordance with the terms hereof.
ARTICLE 3
PAYMENT ACCOUNT
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Section 3.1 Payment Account.
(a) On or prior to the Closing Date, the Property Trustee
shall establish the Payment Account. The Property Trustee and any agent of the
Property Trustee shall have exclusive control and sole right of withdrawal with
respect to the Payment Account for the purpose of making deposits in and
withdrawals from the Payment Account in accordance with 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 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 4
DISTRIBUTIONS; REDEMPTION
Section 4.1 Distributions.
(a) Distributions on the Trust Securities shall be cumulative,
and will accumulate whether or not there are funds of the Trust available for
the payment of Distributions. Distributions shall accrue from _______, and,
except in the event that the Depositor exercises its right to extend the
interest payment period for the Debentures pursuant to the Indenture, shall be
payable quarterly in arrears on ___, ___, ___ and ____ of each year, commencing
on ___, ___. 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 4.1(a) a "Distribution
Date").
(b) Distributions on the Trust Securities shall be payable at
a rate of __% per annum of the Liquidation Amount of the Trust Securities. The
amount of Distributions payable for any full quarterly period shall be computed
on the basis of a 360-day year of twelve 30-day months. If the interest payment
for the Debentures is extended pursuant to Section 11.02 of the Indenture (an
"Extension Period"), then the rate per annum at which Distributions on the Trust
Securities accumulate shall be increased by an amount such that the aggregate
amount of Distributions that accumulate on all Trust Securities during any such
Extension Period is equal to the aggregate amount of interest (including
interest payable on unpaid interest at the rate of __% of the Liquidation Amount
of the Trust Securities per annum, compounded quarterly) that accrues during any
such Extension Period on the Debentures. The amount of Distributions payable for
any period shall include the Additional Amounts, if any. The amount of
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Distributions for any partial period shall be computed on the basis of the
number of days elapsed in a 360-day year of twelve 30-day months.
(c) Distributions on the Trust Securities shall be made by the
Property Trustee from the Payment Account and shall be payable on each
Distribution Date only to the extent that the Trust has funds then on hand
legally and immediately available in the Payment Account for the payment of such
Distributions.
(d) Distributions (including Additional Amounts, if any), 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 the close of business 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 close of business 15 days prior to the
relevant Distribution Date.
Section 4.2 Redemption.
(a) On each Debenture Redemption Date and on the stated
maturity of the Debentures, the Trust will be required to redeem a Like Amount
of Trust Securities at the Redemption Price.
(b) Notice of redemption shall be given by the Property
Trustee by first-class mail, postage prepaid, mailed not less than 30 nor more
than 60 days prior to the Redemption Date to each Holder of Trust Securities to
be redeemed, at such Holder's address appearing in the Security Register. All
notices of redemption shall state:
(i) the Redemption Date;
(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, except
as provided in Section 4.2(d).
(c) The Trust Securities redeemed on each Redemption Date
shall be redeemed at the Redemption Price with the proceeds from the
contemporaneous redemption of Debentures. Redemptions of the Trust Securities
shall be made and the Redemption Price shall be payable on each Redemption Date
only to the extent that the Trust has funds then on hand legally and immediately
available in the Payment Account for the payment of such Redemption Price.
20
(d) If the Property Trustee gives 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 4.2(c), the Property Trustee will, so long
as the Preferred Securities are in book-entry-only form, irrevocably deposit
with the Clearing Agency for the Preferred Securities funds sufficient to pay
the applicable Redemption Price and will give such Clearing Agency irrevocable
instructions and authority to pay the Redemption Price to the holders thereof.
If the Preferred Securities are no longer in book-entry-only form, the Property
Trustee, subject to Section 4.2(c), will irrevocably deposit with the Paying
Agent funds sufficient to pay the applicable Redemption Price and will give the
Paying Agent irrevocable instructions and authority to pay the Redemption Price
to the holders thereof upon surrender of their Preferred Securities
Certificates. Notwithstanding the foregoing, Distributions payable on or prior
to the Redemption Date for any Trust Securities called for redemption shall be
payable to the Holders of such Trust Securities as they appear on the Securities
Register for the Trust Securities on the relevant record dates for the related
Distribution Dates. If notice of redemption shall have been given and funds
deposited as required, then 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 and any
Distribution payable on or prior to the Redemption Date, but without interest,
and such securities will cease to be outstanding. In the event that any date on
which any Redemption Price is payable is not a Business Day, then payment of the
Redemption Price payable on such date will be made on the next succeeding day
which is a Business Day (and without any interest or other payment in respect of
any such delay), except that, if such Business Day falls in the next calendar
year, such payment will be made on the immediately preceding Business Day, in
each case, with the same force and effect as if made on such date. In the event
that payment of the Redemption Price in respect of any Trust Securities called
for redemption is improperly withheld or refused and not paid either by the
Trust or by the 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 record holders thereof as they appear on the Securities
Register for the Trust Securities on the relevant record date, which shall be
the close of business 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 close of business
on the fifteenth day prior to the Redemption Date.
(f) Subject to Section 4.3(a), if less than all the
Outstanding Trust Securities are to be redeemed on a Redemption Date, then the
aggregate Liquidation Amount of Trust Securities to be redeemed shall be
allocated on a pro rata basis (based on Liquidation Amounts) among the Common
Securities and the Preferred Securities. The particular Preferred Securities to
be redeemed shall be selected on a pro rata basis (based upon Liquidation
Amounts) not more than 60 days prior to the Redemption Date by the Property
Trustee from the Outstanding Preferred Securities not previously called for
21
redemption, by such method as the Property Trustee shall deem fair and
appropriate and which may provide for the selection for redemption of portions
(equal to $___ or an integral multiple of $___ in excess thereof of the
Liquidation Amount of Preferred Securities of a denomination larger than $__);
provided however, that before undertaking redemption of the Preferred Securities
on other than a pro rata basis, the Property Trustee shall have received an
Opinion of Counsel that the status of the Trust as a grantor trust for United
States federal income tax purposes would not be adversely affected. The Property
Trustee shall promptly notify the Securities 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.
(g) Subject to the foregoing provisions of this Section 4.2
and to applicable law (including, without limitation, United States federal
securities laws), the Depositor or its Affiliates may, at any time and from time
to time, purchase Outstanding Preferred Securities by tender, in the open market
or by private agreement.
Section 4.3 Subordination of Common Securities.
(a) Payment of Distributions (including Additional Amounts, if
applicable) on, and the Redemption Price of, the Trust Securities, as
applicable, shall be made subject to Section 4.2(f) pro rata among the Common
Securities and the Preferred Securities based on the Liquidation Amount of the
Trust Securities; provided, however, that if on any Distribution Date or
Redemption Date 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.
(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 such Event of Default under this Trust Agreement
until the effect of all such Events of Default with respect to the Preferred
Securities have been cured, waived or otherwise eliminated. Until any such Event
of Default under this Trust Agreement with respect to the Preferred Securities
has been so cured, waived or otherwise eliminated, the Property Trustee shall
act solely on behalf of the Holders of the Preferred Securities and not the
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Holder of the Common Securities, and only the Holders of the Preferred
Securities will have the right to direct the Property Trustee to act on their
behalf.
Section 4.4 Payment Procedures.
Payments in respect of the Preferred Securities shall be made by check
mailed to the address of the Person entitled thereto as such address shall
appear on the Securities Register or, if the Preferred Securities are held by a
Clearing Agency, such Distributions shall be made to the Clearing Agency in
immediately available funds, which shall credit the relevant Persons' accounts
at such Clearing Agency on the applicable Distribution Dates. Payments in
respect of the Common Securities shall be made in such manner as shall be
mutually agreed between the Property Trustee and the Holder of the Common
Securities.
Section 4.5 Tax Returns and Reports.
The Administrative Trustees shall prepare (or cause to be prepared), at
the Depositor's expense, and file all United States federal, state and local tax
and information returns and reports required to be filed by or in respect of the
Trust. In this regard, the Administrative Trustees shall (a) prepare and file
(or cause to be prepared and filed) the appropriate Internal Revenue Service
Form required to be filed in respect of the Trust in each taxable year of the
Trust and (b) prepare and furnish (or cause to be prepared and furnished) to
each Securityholder the appropriate Internal Revenue Service form required to be
furnished to such Securityholder or the information required to be provided on
such form. The Administrative Trustees shall provide the Depositor and the
Property Trustee with a copy of all such returns, 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.
Section 4.6 Payment of Taxes, Duties, Etc. of the Trust.
Upon receipt under the Debentures of Additional Sums, the Property
Trustee shall promptly pay any taxes, duties or governmental charges of
whatsoever nature (other than withholding taxes) imposed on the Trust by the
United States or any other taxing authority.
Section 4.7 Payments under Indenture.
Any amount payable hereunder to any Holder of Preferred Securities (and
any Owner with respect thereto) shall be reduced by the amount of any
corresponding payment such Holder (and Owner) has directly received pursuant to
Section 13.14 of the Indenture.
ARTICLE 5
TRUST SECURITIES CERTIFICATES
Section 5.1 Initial Ownership.
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Upon the formation of the Trust and the contribution by the Depositor
pursuant to Section 2.3 and until the issuance of the Trust Securities, and at
any time during which no Trust Securities are outstanding, the Depositor shall
be the sole beneficial owner of the Trust.
Section 5.2 The Trust Securities Certificates.
The Preferred Securities Certificates shall be issued in
minimum denominations of $__ Liquidation Amount and integral multiples of $__ in
excess thereof, and the Common Securities Certificates shall be issued in
denominations of $__ Liquidation Amount and integral multiples 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 manual or facsimile 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 Sections 5.4, 5.11
and 5.13.
Section 5.3 Authentication and Delivery of Trust Securities
Certificates.
On the Closing Date, the Administrative Trustees shall cause Trust
Securities Certificates, in an aggregate Liquidation Amount as provided in
Sections 2.4 and 2.5, to be executed on behalf of the Trust, authenticated and
delivered to or upon the written order of the Depositor, signed by its chairman
of the board, its president, any senior vice president or any vice president,
treasurer or assistant treasurer or controller without further corporate action
by the Depositor, in authorized denominations. No Trust Securities Certificate
shall entitle its Holder to any benefit under this Trust Agreement, or shall be
valid for any purpose, unless such Trust Securities Certificate shall have been
executed on behalf of the Trust by at least one Administrative Trustee and there
shall appear on such Trust Securities Certificate a certificate of
authentication substantially in the form set forth in Exhibit C or Exhibit E, as
applicable, executed by the Property Trustee by manual signature; such
authentication shall constitute conclusive evidence that such Trust Securities
Certificate shall have been duly authenticated and delivered hereunder. All
Trust Securities Certificates shall be dated the date of their authentication.
Section 5.4 Registration of Transfer and Exchange of Preferred
Securities Certificates.
The Property Trustee, as "Securities Registrar," shall keep or cause to
be kept, at the office or agency maintained pursuant to Section 5.8, a
"Securities Register" in which, subject to such reasonable regulations as it may
prescribe, the Securities Registrar shall provide for the registration of
Preferred Securities Certificates and Common Securities Certificates (subject to
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Section 5.10 in the case of the Common Securities Certificates) and registration
of transfers and exchanges of Preferred Securities Certificates as herein
provided. The Property Trustee shall be the initial Securities Registrar.
Upon surrender for registration of transfer of any Preferred Securities
Certificate at the office or agency maintained pursuant to Section 5.8, the
Administrative Trustees or any one of them shall notify the Securities Registrar
in writing of such transfer and all relevant information regarding the new
Holder, and shall execute on behalf of the Trust, cause to be authenticated by
the Property Trustee and deliver, in the name of the designated transferee or
transferees, one or more new Preferred Securities Certificates in authorized
denominations of a like aggregate Liquidation Amount dated the date of execution
by such Administrative Trustee or Trustees. The Securities Registrar shall not
be required to register the transfer of any Preferred Securities 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 5.8. The Securities
Registrar shall be fully protected in relying upon the information provided to
it by the Administrative Trustees in connection with maintaining the Securities
Register.
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 duly
executed by the Holder or his attorney duly authorized in writing. Each
Preferred Securities Certificate surrendered for registration of transfer or
exchange shall be cancelled and subsequently disposed of by the Securities
Registrar in accordance with its customary practice.
No service charge shall be made for any registration of transfer or
exchange of Preferred Securities Certificates, but the Securities 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 5.5 Mutilated, Destroyed, Lost or Stolen Trust Securities
Certificates.
If (a) any mutilated Trust Securities Certificate shall be surrendered
to the Securities Registrar, or if the Securities Registrar shall receive
evidence to its satisfaction of the destruction, loss or theft of any Trust
Securities Certificate and (b) there shall be delivered to the Securities
Registrar and the Administrative Trustees such security or indemnity as may be
required by them to save each of them harmless, then in the absence of notice
that such Trust Securities Certificate shall have been acquired by a protected
purchaser, the Administrative Trustees, or any one of them, on behalf of the
Trust shall execute and make available for delivery, in exchange for or in lieu
of any such mutilated, destroyed, lost or stolen Trust Securities Certificate, a
new Trust Securities Certificate of like class, tenor and denomination. In
connection with the issuance of any new Trust Securities Certificate under this
Section, the Administrative Trustees or the Securities Registrar may require the
payment of a sum sufficient to cover any tax or other governmental charge that
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may be imposed in connection therewith. Any duplicate Trust Securities
Certificate issued pursuant to this Section shall constitute conclusive evidence
of an undivided beneficial interest in the assets of the Trust, as if originally
issued, whether or not the lost, stolen or destroyed Trust Securities
Certificate shall be found at any time.
Section 5.6 Persons Deemed Securityholders.
Prior to the due presentation of a Trust Securities Certificate for
registration of transfer, the Administrative Trustees or the Securities
Registrar shall treat the Person in whose name any Trust Securities Certificate
shall be registered in the Securities Register as the owner of such Trust
Securities Certificate for the purpose of receiving Distributions and for all
other purposes whatsoever, and neither the Trustees nor the Securities Registrar
shall be bound by any notice to the contrary.
Section 5.7 Access to List of Securityholders' Names and Addresses.
The Administrative Trustees or the Depositor shall furnish or cause to
be furnished a list, in such form as the Property Trustee may reasonably
require, of the names and addresses of the Securityholders as of the most recent
Record Date (a) to the Property Trustee, semi-annually on or before __________
and __________ in each year, and (b) to the Property Trustee, promptly after
receipt by any Administrative Trustee or the Depositor of a request therefor
from the Property Trustee in order to enable the Property Trustee to discharge
its obligations under this Trust Agreement, in each case to the extent such
information is in the possession or control of the Administrative Trustees or
the Depositor and is not identical to a previously supplied list or has not
otherwise been received by the Property Trustee in its capacity as Securities
Registrar. The rights of Securityholders to communicate with other
Securityholders with respect to their rights under this Trust Agreement or under
the Trust Securities, and the corresponding rights of the Trustee shall be as
provided in the Trust Indenture Act. The Property Trustee shall comply with the
provisions of Section 312(b) of the Trust Indenture Act. Each Holder, by
receiving and holding a Trust Securities Certificate shall be deemed to have
agreed not to hold the Depositor or the Administrative Trustees accountable by
reason of the disclosure of its name and address, or by reason of mailing
pursuant to a request made under this Section 5.7, regardless of the source from
which such information was derived.
Section 5.8 Maintenance of Office or Agency.
The Administrative Trustees shall maintain in 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
_______, as the principal corporate trust office for such purposes. The Property
Trustee shall give prompt written notice to the Depositor and to the
Securityholders of any change in the location of the Securities Register or any
such office or agency.
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Section 5.9 Appointment of Paying Agent.
The Paying Agent shall make Distributions and other payments provided
hereby to Securityholders from the Payment Account and shall report the amounts
of such Distributions and payments to the Property Trustee (if such Paying Agent
be other than the Property Trustee) and the Administrative Trustees. Any Paying
Agent shall have the revocable power to withdraw funds from the Payment Account
for the purpose of making the Distributions referred to above. The
Administrative Trustees may revoke such power and remove the Paying Agent if
such Trustees determine in their sole discretion that the Paying Agent shall
have failed to perform its obligations under this Trust Agreement in any
material respect. The Paying Agent shall initially be the Property Trustee, and
any co-paying agent chosen by the Property Trustee, and acceptable to the
Administrative Trustees and the Depositor. Any Person acting as 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 Property Trustee shall no longer be the Paying Agent or a successor
Paying Agent shall resign or be removed, 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 give the Property Trustee notice of any
default by the Depositor in the making of any payment under the Debentures. The
Paying Agent shall return all unclaimed funds to the Property Trustee and upon
removal of a Paying Agent such Paying Agent shall also return all funds in its
possession to the Property Trustee. The provisions of Sections 8.1, 8.3 and 8.6
shall apply to the Property Trustee also in its role as Paying Agent, for so
long as the Property Trustee 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, the Depositor shall acquire, and thereafter
retain, beneficial and record ownership of the Common Securities. To the fullest
extent permitted by law, other than a transfer in connection with a
consolidation or merger of the Depositor into another corporation, or any
conveyance, transfer or lease by the Depositor of its properties and assets
substantially as an entirety to any Person, pursuant to Article 5 of the
Indenture, any attempted transfer of the Common Securities shall be void. The
Administrative Trustees shall cause each Common Securities Certificate issued to
the Depositor to contain a legend stating "THIS CERTIFICATE IS NOT TRANSFERABLE
EXCEPT AS PROVIDED IN THE TRUST AGREEMENT REFERRED TO HEREIN".
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Section 5.11 Book-Entry Preferred Securities Certificates; Common
Securities Certificate.
(a) The Preferred Securities Certificates, upon original
issuance, will be issued in the form of a typewritten Preferred Securities
Certificate or Certificates representing Book-Entry Preferred Securities
Certificates, to be delivered to The Depository Trust Company, the initial
Clearing Agency, by, or on behalf of, the Trust. Such Preferred Securities
Certificate or Certificates representing Book-Entry Preferred Securities
Certificates shall initially be registered on the Securities Register in the
name of Cede & Co., the nominee of the initial Clearing Agency, and no
beneficial owner will receive a Definitive Preferred Securities Certificate
representing such beneficial owner's interest in such Preferred Securities,
except as provided in Section 5.13. Unless and until Definitive Preferred
Securities Certificates have been issued to beneficial owners pursuant to
Section 5.13:
(i) the provisions of this Section 5.11(a) shall be
in full force and effect;
(ii) the Securities Registrar and the Trustees shall
be entitled to deal with the Clearing Agency for all purposes of this Trust
Agreement relating to the Book-Entry Preferred Securities Certificates
(including the payment of Distributions on, or the Liquidation Amount or
Redemption Price of, the Book-Entry Preferred Securities and the giving of
instructions or directions to Owners of Book-Entry Preferred Securities) as the
sole Holder of Book-Entry Preferred Securities and shall have no obligations to
the Owners thereof;
(iii) to the extent that the provisions of this
Section 5.11 conflict with any other provisions of this Trust Agreement, the
provisions of this Section 5.11 shall control; and
(iv) the rights of the Owners of the Book-Entry
Preferred Securities Certificates shall be exercised only through the Clearing
Agency and shall be limited to those established by law and agreements between
such Owners and the Clearing Agency and/or the Clearing Agency Participants and
the applicable rules of the Clearing Agency. Pursuant to the Certificate
Depository Agreement, unless and until Definitive Preferred Securities
Certificates are issued pursuant to Section 5.13, the Clearing Agency will make
book-entry transfers among the Clearing Agency Participants and receive and
transmit payments on the Preferred Securities to such Clearing Agency
Participants.
(b) A single Common Securities Certificate representing the
Common Securities shall be issued to the Depositor in the form of a definitive
Common Securities Certificate.
Section 5.12 Notices to Clearing Agency.
To the extent that a notice or other communication to the Owners is
required under this Trust Agreement, unless and until Definitive Preferred
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Securities Certificates shall have been issued to Owners pursuant to Section
5.13, the Trustees shall give all such notices and communications specified
herein to be given to Owners to the Clearing Agency, and shall have no
obligations to the Owners.
Section 5.13 Definitive Preferred Securities Certificates.
If (a) the Depositor advises the Trustees in writing that the Clearing
Agency is no longer willing or able to properly discharge its responsibilities
with respect to the Preferred Securities Certificates, and the Depositor is
unable to locate a qualified successor within 90 days of receipt by the
Depositor of such written advice, (b) the Depositor at its option advises the
Trustees in writing that it elects to terminate the book-entry system through
the Clearing Agency or (c) after the occurrence of a Debenture Event of Default,
Owners of Preferred Securities Certificates representing beneficial interests
aggregating at least a majority of the Liquidation Amount advise the
Administrative Trustees 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 Administrative Trustees shall notify
the Clearing Agency and the Clearing Agency shall notify all Owners of Preferred
Securities Certificates and the other Trustees of the occurrence of any such
event and of the availability of the Definitive Preferred Securities
Certificates to Owners of such class or classes, as applicable, requesting the
same. Upon surrender to the 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 on
behalf of the Trust, and cause to be authenticated by the Property Trustee the
Definitive Preferred Securities Certificates in accordance with the instructions
of the Clearing Agency. Neither the Securities Registrar nor the Trustees shall
be liable for any delay in delivery of such instructions and may conclusively
rely on, and shall be 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 2.9, and
the Securityholders shall not have any right or title therein other than the
undivided beneficial interest in the assets of the Trust conferred by their
Trust Securities and they shall have no right to call for any partition or
division of property, profits or rights of the Trust except as described below.
The Trust Securities shall be personal property giving only the rights
specifically set forth therein and in this Trust Agreement. The Trust Securities
shall have no preemptive or similar rights and when issued and delivered to
Securityholders against payment of the purchase price therefor will be fully
paid and nonassessable by the Trust. The Holders of the Trust Securities, in
29
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 6
ACTS OF SECURITYHOLDERS; MEETINGS; VOTING
Section 6.1 Voting Rights.
(a) Except as otherwise required by law or as provided in this
Section, Sections 8.10 or 10.2 or the Indenture, no Holder of Preferred
Securities shall have any right to vote or in any manner otherwise control the
administration, operation and management of the Trust or the obligations of the
parties hereto, nor shall anything herein set forth, or contained in the terms
of the Trust Securities Certificates, be construed so as to constitute the
Securityholders from time to time as partners or members of an association.
(b) So long as any Debentures are held by the Property
Trustee, the Trustees shall not (i) direct the time, method and place of
conducting any proceeding for any remedy available to the Debenture Trustee, or
executing any trust or power conferred on the Debenture Trustee with respect to
such Debentures, (ii) waive any past default which is waivable under Section
6.04 or 9.02 of the Indenture, (iii) exercise any right to rescind or annul a
declaration that the principal of all the Debentures shall be due and payable or
(iv) consent to any amendment, modification or termination of the Indenture or
the Debentures, where such consent shall be required, without, in each case,
obtaining the prior approval of the Holders of a majority in Liquidation Amount
of all Outstanding Preferred Securities; provided, however, that where a consent
under the Indenture would require the consent of greater than a majority in
aggregate principal amount of the holders of the Debentures or the consent of
each holder of Debentures affected thereby, no such consent shall be given by
the Property Trustee without the prior written consent of the Holders of such
greater percentage in Liquidation Amount of all Outstanding Preferred Securities
or each Holder of Preferred Securities, as the case may be. The Trustees shall
not revoke any action previously authorized or approved by a vote of the Holders
of Preferred Securities, except by a subsequent vote of the Holders of Preferred
Securities. The Property Trustee shall notify all Holders of the Preferred
Securities of any notice of default received from the Debenture Trustee with
respect to the Debentures. In addition to obtaining the foregoing approvals of
the Holders of the Preferred Securities, prior to taking any of the foregoing
actions, the Trustees shall, at the expense of the Depositor, obtain an Opinion
of Counsel experienced in such matters to the effect that the Trust will not be
classified as an association taxable as a corporation or partnership for United
States federal income tax purposes on account of such action. This Section
6.1(b) is subject to Section 6.1(e).
(c) If any proposed amendment to the Trust Agreement provides
for, or the Trustees otherwise propose to effect, (i) any action that would
adversely affect in any material respect the powers, preferences or special
rights of the Preferred Securities, whether by way of amendment to this Trust
Agreement or otherwise, or (ii) the dissolution, winding-up or termination of
30
the Trust, other than pursuant to the terms of this Trust Agreement, then the
Holders of Outstanding Preferred Securities as a class will be entitled to vote
on such amendment or proposal and such amendment or proposal shall not be
effective except with the approval of the Holders of at least a majority in
Liquidation Amount of the Outstanding Preferred Securities.
(d) If a Debenture Event of Default occurs and is continuing,
then the Holders of at least 25% in aggregate Liquidation Amount of the
Preferred Securities then Outstanding shall have the right to declare the
principal of all the Debentures immediately due and payable. In accordance with
and subject to the provisions of the Indenture, the Holders of a majority in
aggregate Liquidation Amount of the Preferred Securities then Outstanding shall
have the right to (i) rescind or annul a declaration that the principal of all
the Debentures be due and payable, (ii) waive any past default and its
consequences which is waivable under the Indenture, except that when such waiver
would require the consent of holders of greater than a majority in aggregate
principal amount of the Debentures or the consent of each holder of Debentures
affected thereby, no such waiver shall be effective without the consent of the
Holders of such greater percentage in Liquidation Amount of all Outstanding
Preferred Securities or each Holder of Preferred Securities, as the case may be,
(iii) consent to any amendment, modification or termination of the Indenture or
Debentures when consent is required and (iv) direct the Property Trustee to
direct the time, method and place of conducting any proceeding for any remedy
available to the Debenture Trustee or executing any trust or power conferred on
the Debenture Trustee. This Section 6.1(d) is subject to Section 6.1(e).
(e) Notwithstanding Sections 6.1(b), 6.1(d), 6.3 and 6.6
herein; if: (i) there are outstanding under the Indenture (including, solely for
purposes of this Section 6.1(e), each supplemental indenture or board resolution
referred to in Section 2.02(b) of the Indenture) one or more Debentures and one
or more series that constitute a Pari Passu Series (as defined in the Indenture)
in respect of the Debentures and (ii) the Indenture provides that any consent,
waiver, declaration, rescission, direction or other matter to be acted upon
requires the consent of or other action by the holders of a majority or other
proportion in principal amount of the securities of a series and all affected
Pari Passu Series, treating all such series as a single class, the Holders of
the Preferred Securities shall participate in such action, as part of a single
class consisting of (1) such Holders, (2) the holders of preferred securities of
all Trusts (as defined in the Indenture), other than the Trust, that hold
securities of an affected Pari Passu Series, and (3) all other holders of
securities of such affected Pari Passu Series substituting for such purpose the
liquidation preference of such holders for an equivalent amount of principal of
Debentures (on a dollar-for-dollar basis) as to which such holders so
participate.
Section 6.2 Notice of Meetings.
Notice of all meetings of the Preferred Securityholders, stating the
time, place and purpose of the meeting, shall be given by the Administrative
Trustees pursuant to Section 10.8 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.
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Section 6.3 Meetings of Preferred Securityholders.
No annual meeting of Securityholders is required to be held. The
Administrative Trustees, however, shall call a meeting of Securityholders to
vote on any matter upon the written request of Securityholders of record of 25%
of the Preferred Securities (based upon their Liquidation Amount) and the
Administrative Trustees or the Property Trustee may, at any time in their
discretion, call a meeting of Preferred Securityholders to vote on any matters
as to which such Securityholders are entitled to vote.
Securityholders of record of 50% of the Preferred Securities (based
upon their Liquidation Amount), present in person or by proxy, shall constitute
a quorum at any meeting of such Securityholders.
If a quorum is present at a meeting, an affirmative vote by the
Securityholders of record present, in person or by proxy, holding a majority of
the Preferred Securities (based upon their Liquidation Amount) held by such
Securityholders of record present, either in person or by proxy, at such meeting
shall constitute the action of the Securityholders, unless this Trust Agreement
or the Indenture requires a greater or lesser number of affirmative votes. This
Section 6.3 is subject to Section 6.1(e).
Section 6.4 Voting Rights.
Securityholders shall be entitled to one vote for each $__ of
Liquidation Amount represented by their Trust Securities in respect of any
matter as to which such Securityholders are entitled to vote.
Section 6.5 Proxies, etc.
At any meeting of Securityholders, any Securityholder entitled to vote
thereat may vote by proxy, provided that no proxy shall be voted at any meeting
unless it shall have been placed 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. No proxy shall be valid for
more than three years after its date of execution.
Section 6.6 Securityholder Action by Written Consent.
Subject to Section 6.1(e), any action which may be taken by
Securityholders at a meeting may be taken without a meeting if Securityholders
holding a majority of all Outstanding Trust Securities (based upon their
Liquidation Amount) entitled to vote in respect of such action (or such larger
or smaller proportion thereof as shall be required by any express provision of
this Trust Agreement or the Indenture) shall consent to the action in writing or
by other means permitted by rules or programs of the Clearing Agency.
Section 6.7 Record Date for Voting and Other Purposes.
32
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 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 6.8 Acts of Securityholders.
Any request, demand, authorization, direction, notice, consent, waiver
or other action provided or permitted by this Trust Agreement to be given, made
or taken by Securityholders 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 Trustees. 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 8.1) conclusive in favor
of the Trustees, if made in the manner provided in this Section.
The fact and date of the execution by any Person of any such instrument
or writing may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged to him the execution thereof. Where such execution is by
a signer acting in a capacity other than his individual capacity, such
certificate or affidavit shall also constitute sufficient proof of his
authority. The fact and date of the execution of any such instrument or writing,
or the authority of the Person executing the same, may also be proved in any
other manner which any Trustee receiving the same deems sufficient.
Any Act of Securityholders may also be taken by electronic means
through any program administered by the Clearing Agency and shall be evidenced
in accordance with its rules and procedures.
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The ownership of Preferred Securities shall be proved by the Securities
Register.
Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the Securityholder of any Trust Security shall bind every future
Securityholder of the same Trust Security and the Securityholder of every Trust
Security issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted or suffered to
be done by the Trustees or the Trust in reliance thereon, whether or not
notation of such action is made upon such Trust Security.
Without limiting the foregoing, a Securityholder entitled hereunder to
take any action hereunder with regard to any particular Trust Security may do so
with regard to all or any part of the Liquidation Amount of such Trust Security
or by one or more duly appointed agents each of which may do so pursuant to such
appointment with regard to all or any part of such Liquidation Amount.
If any dispute shall arise between the Securityholders and the
Administrative Trustees or among such Securityholders or Trustees with respect
to the authenticity, validity or binding nature of any request, demand,
authorization, direction, consent, waiver or other Act of such Securityholder or
Trustee under this Article VI, then the determination of such matter by the
Property Trustee shall be conclusive with respect to such matter.
A Securityholder may institute a legal proceeding directly against the
Depositor under the Guarantee to enforce its rights under the Guarantee without
first instituting a legal proceeding against the Guarantee Trustee (as defined
in the Guarantee), the Trust or any other Person. If the Property Trustee fails
to enforce its rights under the Indenture as the Holder of the Debentures, any
Securityholder may institute legal proceedings against the Depositor to enforce
such Property Trustee's rights under the Indenture without first instituting any
legal proceedings against the Property Trustee or any other person or entity.
Section 6.9 Inspection of Records.
Upon reasonable notice to the Administrative Trustees and the Property
Trustee, the records of the Trust shall be open to inspection by Securityholders
during normal business hours for any purpose reasonably related to such
Securityholder's interest as a Securityholder.
ARTICLE 7
REPRESENTATIONS AND WARRANTIES
Section 7.1 Representations and Warranties of the Bank, the Property
Trustee and the Delaware Trustee.
The Bank, and any successor Property Trustee or Delaware Trustee,
hereby represents and warrants for the benefit of the Depositor and the
Securityholders that:
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(a) the Bank is a Delaware banking corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware;
(b) the Bank has full corporate power, authority and legal
right to execute, deliver and perform its obligations under this Trust
Agreement;
(c) this Trust Agreement has been duly authorized, executed
and delivered by the Bank and constitutes the valid and legally binding
agreement of the Bank 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 Bank of
this Trust Agreement has been duly authorized by all necessary corporate or
other action on the part of the Bank, and does not require any approval of
stockholders of the Bank and such execution, delivery and performance will not
(i) violate the Bank's Certificate of Incorporation or By-laws, (ii) violate any
provision of, or constitute, with or without notice or lapse of time, a default
under, or result in the creation or imposition of, any Lien on any properties
included in the Trust Property pursuant to the provisions of, any indenture,
mortgage, credit agreement, license or other agreement or instrument to which
the Bank is a party or by which it is bound, or (iii) violate any law,
governmental rule or regulation of the United States or the State of Delaware,
as the case may be, governing the banking, trust or corporate powers of the
Bank, or any indenture, mortgage, bank credit agreement, note or bond purchase
agreement, long-term lease, license or other agreement or any order, judgment or
decree applicable to the Bank;
(e) neither the authorization, execution or delivery by the
Bank of this Trust Agreement nor the consummation of any of the transactions by
the Bank, the Property Trustee, or the Delaware Trustee (as appropriate in
context) contemplated herein or therein requires the consent or approval of, the
giving of notice to, the registration with or the taking of any other action
with respect to any governmental authority or agency under any existing law
governing the banking, trust or corporate powers of the Bank under the federal
laws of the United States or the State of Delaware;
(f) there are no proceedings pending or, to the best of the
Bank's knowledge, threatened against or affecting the Bank, the Property Trustee
or the Delaware Trustee in any court or before any governmental authority,
agency or arbitration board or tribunal which, individually or in the aggregate,
would materially and adversely affect the Trust or would question the right,
power and authority of the Bank to enter into or perform its obligations as one
of the Trustees under this Trust Agreement; and
(g) it is a Person eligible to act as Property Trustee
pursuant to the Trust Indenture Act, and to act as Delaware Trustee pursuant to
the Delaware Statutory Trust Act, as applicable, and has a combined capital and
surplus of at least $50,000,000.
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Section 7.2 Representations and Warranties of Depositor.
The Depositor hereby represents and warrants for the benefit of the
Securityholders that:
(a) the Trust Securities Certificates issued on the Closing
Date on behalf of the Trust have been duly authorized and, upon their execution,
issuance and delivery, will have been, duly and validly executed, issued and
delivered by the Trustees pursuant to the terms and provisions of, and in
accordance with the requirements of, this Trust Agreement and the
Securityholders will be, entitled to the benefits of this Trust Agreement; and
(b) there are no taxes, fees or other governmental charges
payable by the Trust (or the Trustees on behalf of the Trust) under the laws of
the State of Delaware or any political subdivision thereof in connection with
the execution, delivery and performance by the Bank, the Property Trustee or the
Delaware Trustee, as the case may be, of this Trust Agreement.
ARTICLE 8
THE TRUSTEES
Section 8.1 Duties, Responsibilities and Limitation of Liability.
(a) The duties, rights and responsibilities of the Trustees
shall be as provided by this Trust Agreement and the Delaware Statutory Trust
Act and, in the case of the Property Trustee, by the Trust Indenture Act.
Notwithstanding the foregoing, no provision of this Trust Agreement shall
require the Trustees to expend or risk their own funds or otherwise incur any
financial liability in the performance of any of their duties hereunder, or in
the exercise of any of their rights or powers, if they shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to them. 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 8.1. No Trustee shall be
liable hereunder except for its own gross negligence or willful misconduct;
provided, however, to the extent required by the Trust Indenture Act, nothing in
this Trust Agreement shall be construed to release the Property Trustee from
liability for its own negligent action, its own failure to act, or its own
willful misconduct. To the extent that, at law or in equity, a Trustee has
duties (including fiduciary duties) and liabilities relating thereto to the
Trust or to the Securityholders, such Trustee shall not be liable to the Trust
or to any Securityholder for such Trustee's good faith reliance on the
provisions of this Trust Agreement. The provisions of this Trust Agreement, to
the extent that they restrict the duties and liabilities of a Trustee otherwise
existing at law or in equity, are agreed by the Depositor and the
Securityholders to replace such other duties and liabilities of such Trustee.
(b) All payments made by the Property Trustee or a Paying
Agent in respect of the Trust Securities shall be made only from the revenue and
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proceeds from the Trust Property and only to the extent that there shall be
sufficient revenue or proceeds from the Trust Property to enable the Property
Trustee or a Paying Agent to make payments in accordance with the terms hereof.
Each Securityholder, by its acceptance of a Trust Security, agrees that it will
look solely to the revenue and proceeds from the Trust Property to the extent
legally available for distribution to it as herein provided and that the
Trustees are not personally liable to it for any amount distributable in respect
of any Trust Security or for any other liability in respect of any Trust
Security. This Section 8.1(b) does not limit the liability of the Trustees
expressly set forth elsewhere in this Trust Agreement or, in the case of the
Property Trustee, in the Trust Indenture Act.
(c) No provision of this Trust Agreement shall be construed to
relieve the Property Trustee from liability for its own negligent action, its
own negligent failure to act, or its own willful misconduct, except that:
(i) the Property Trustee shall not be liable for any
error of judgment made in good faith by an authorized officer of the Property
Trustee, unless it shall be proved that the Property Trustee was negligent in
ascertaining the pertinent facts;
(ii) the Property Trustee shall not be liable with
respect to any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of not less than a majority in
Liquidation Amount of the Trust Securities relating to the time, method and
place of conducting any proceeding for any remedy available to the Property
Trustee, or exercising any trust or power conferred upon the Property Trustee
under this Trust Agreement;
(iii) the Property Trustee's sole duty with respect
to the custody, safe keeping and physical preservation of the Debentures and the
Payment Account shall be to deal with such Property in a similar manner as the
Property Trustee deals with similar property for its own account, subject to the
protections and limitations on liability afforded to the Property Trustee under
this Trust Agreement and the Trust Indenture Act;
(iv) 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 3.1 and except to the extent otherwise
required by law; and
(v) the Property Trustee shall not be responsible for
monitoring the compliance by the Administrative Trustees or the Depositor with
their respective duties under this Trust Agreement, nor shall the Property
Trustee be liable for the default or misconduct of the Administrative Trustees
or the Depositor.
(d) No Trustee (each an "Indemnified Person") shall be liable,
responsible or accountable in damages or otherwise to the Trust, any of the
Trust's Affiliates or any Securityholder for any loss, damage or claim incurred
by reason of any act or omission performed or omitted by such Indemnified Person
in good faith on behalf of the Trust and in a manner such Indemnified Person
reasonably believed to be within the scope of the authority conferred on such
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Indemnified Person by this Agreement or by law, except that an Indemnified
Person shall be liable for any such loss, damage or claim incurred by reason of
such Indemnified Person's gross negligence or willful misconduct with respect to
such acts or omissions. An Indemnified Person shall be fully protected in
relying in good faith upon the records of the Trust and upon such information,
opinions, reports or statements presented to the Trust by any Person as to
matters the Indemnified Person reasonably believes are within such other
Person's professional or expert competence and who has been selected with
reasonable care by or on behalf of the Trust, including information, opinions,
reports or statements as to the value and amount of the assets, liabilities,
profits, losses, or any other facts pertinent to the existence and amount of
assets from which Distributions to Securityholders might properly be paid.
Section 8.2 Notices.
Within five Business Days after the occurrence of any Event of Default
actually known to the Property Trustee, the Property Trustee shall transmit, in
the manner and to the extent provided in Section 10.8, notice of such Event of
Default to the Securityholders, the Administrative Trustees and the Depositor,
unless such Event of Default shall have been cured or waived.
Within five Business Days after the receipt of notice of the
Depositor's exercise of its right to extend the interest payment period for the
Debentures pursuant to the Indenture, the Administrative Trustees shall
transmit, in the manner and to the extent provided in Section 10.9, notice of
such exercise to the Securityholders and the Property Trustee, unless such
exercise shall have been revoked.
Section 8.3 Certain Rights of Property Trustee.
Subject to the provisions of Section 8.1:
(a) the Property Trustee may rely and shall be protected in
acting or refraining from acting in good faith upon any resolution, Opinion of
Counsel, certificate, written representation of a Holder or transferee,
certificate of auditors or any other certificate, statement, instrument,
opinion, report, notice, request, consent, order, appraisal, bond, debenture,
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) if, (i) in performing its duties under this Trust
Agreement the Property Trustee is required to decide between alternative courses
of action or (ii) in construing any of the provisions in this Trust Agreement
the Property Trustee finds the same ambiguous or inconsistent with any other
provisions contained herein or (iii) the Property Trustee is unsure of the
application of any provision of this Trust Agreement, then, except as to any
matter as to which the Preferred Securityholders are entitled to vote under the
terms of this Trust Agreement, the Property Trustee shall deliver a notice to
the Depositor requesting written instructions of the Depositor as to the course
of action to be taken. The Property Trustee shall take such action, or refrain
from taking such action, as the Property Trustee shall be instructed in writing
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to take, or to refrain from taking, by the Depositor; provided, however, that if
the Property Trustee does not receive such instructions of the Depositor within
ten Business Days after it has delivered such notice, or such reasonably shorter
period of time set forth in such notice (which to the extent practicable shall
not be less than two Business Days), it may, but shall be under no duty to, take
or refrain from taking such action not inconsistent with this Trust Agreement as
it shall deem advisable and in the best interests of the Securityholders, in
which event the Property Trustee shall have no liability except for its own bad
faith, negligence or willful misconduct;
(c) any direction or act of the Depositor or the
Administrative Trustees contemplated by this Trust Agreement shall be
sufficiently evidenced by an Officer's Certificate;
(d) whenever in the administration of this Trust Agreement,
the Property Trustee shall deem it desirable that a matter be established before
undertaking, suffering or omitting any action hereunder, the Property Trustee
(unless other evidence is herein specifically prescribed) may, in the absence of
bad faith on its part, request and rely upon an Officer's Certificate which,
upon receipt of such request, shall be promptly delivered by the Depositor or
the Administrative Trustees;
(e) the Property Trustee shall have no duty to see to any
recording, filing or registration of any instrument (including any financing or
continuation statement or any filing under tax or securities laws) or any
rerecording, refiling or reregistration thereof;
(f) the Property Trustee may consult with counsel 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 and in
accordance with such advice, such counsel may be counsel to the Depositor or any
of its Affiliates, and may include any of its employees. The Property Trustee
shall have the right at any time to seek instructions concerning the
administration of this Trust Agreement from any court of competent jurisdiction;
(g) the Property Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Trust Agreement at the
request or direction of any of the Securityholders pursuant to this Trust
Agreement, unless such Securityholders shall have offered to the Property
Trustee reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by it in compliance with such request or
direction;
(h) the Property Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order,
approval, bond, debenture, note or other evidence of indebtedness or other paper
or document, unless requested in writing to do so by one or more
Securityholders, but the Property Trustee may make such further inquiry or
investigation into such facts or matters as it may see fit;
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(i) the Property Trustee may execute any of the powers
hereunder or perform any duties hereunder either directly or by or through its
agents or attorneys, provided that the Property Trustee shall be responsible for
its own negligence or recklessness with respect to selection of any agent or
attorney appointed by it hereunder;
(j) whenever in the administration of this Trust Agreement the
Property Trustee shall deem it desirable to receive instructions with respect to
enforcing any remedy or right or taking any other action hereunder the Property
Trustee (i) may request instructions from the Holders of the Trust Securities
which instructions may only be given by the Holders of the same proportion in
Liquidation Amount of the Trust Securities as would be entitled to direct the
Property Trustee under the terms of the Trust Securities in respect of such
remedy, right or action, (ii) may refrain from enforcing such remedy or right or
taking such other action until such instructions are received, and (iii) shall
be protected in acting in accordance with such instructions; and
(k) except as otherwise expressly provided by this Trust
Agreement, the Property Trustee shall not be under any obligation to take any
action that is discretionary under the provisions of this Trust Agreement.
No provision of this Trust Agreement shall be deemed to impose any duty or
obligation on the Property Trustee to perform any act or acts or exercise any
right, power, duty or obligation conferred or imposed on it, in any jurisdiction
in which it shall be illegal, or in which the Property Trustee shall be
unqualified or incompetent in accordance with applicable law, to perform any
such act or acts, or to exercise any such right, power, duty or obligation. No
permissive power or authority available to the Property Trustee shall be
construed to be a duty.
Section 8.4 Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Trust Securities Certificates
shall be taken as the statements of the Trust, and the Trustees do not assume
any responsibility for their correctness. The Trustees shall not be accountable
for the use or application by the Depositor of the proceeds of the Debentures.
Section 8.5 May Hold Securities.
Except as provided in the definition of the term "Outstanding" in
Article I, 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, subject to Sections 8.8 and 8.13, may otherwise deal with the
Trust with the same rights it would have if it were not a Trustee or such other
agent.
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Section 8.6 Compensation; Indemnity; Fees.
The Depositor agrees:
(a) to pay to the Trustees from time to time reasonable
compensation (in the case of the Property Trustee and Delaware Trustee, pursuant
to a written fee agreement) for all services rendered by them 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 their agents and counsel), except any such expense,
disbursement or advance as may be attributable to their negligence or willful
misconduct (or, in the case of an Administrative Trustee or the Delaware
Trustee, any such expense, disbursement or advance as may be attributable to
its, his or her gross negligence or willful misconduct);
(c) to indemnify each of the Trustees or any predecessor
Trustee for, and to hold the Trustees harmless against, any loss, damage,
claims, liability, penalty or expense incurred arising out of or in connection
with the acceptance or administration of this Trust Agreement, including the
costs and expenses of defending itself against any claim or liability in
connection with the exercise or performance of any of its powers or duties
hereunder, except any such expense, disbursement or advance as may be
attributable to such Trustee's negligence or willful misconduct for (or, in the
case of an Administrative Trustee or the Delaware Trustee, any such expense,
disbursement or advance as may be attributable to its, his or her gross
negligence or willful misconduct); and
(d) that, as to the Administrative Trustees, the
indemnifications set forth in this Agreement are not exclusive and the
Administrative Trustees shall be entitled to be indemnified to the fullest
extent permitted by law, contract or otherwise.
No Trustee may claim any lien or charge on any Trust Property as a
result of any amount due pursuant to this Section 8.6.
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Section 8.7 Corporate Property Trustee Required; Eligibility of
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 is eligible pursuant to the Trust Indenture Act to act as such and has a
combined capital and surplus of at least $50,000,000. If any such Person
publishes reports of condition at least annually, pursuant to law or to the
requirements of its supervising or examining authority, then for the purposes of
this Section, the combined capital and surplus of such Person shall be deemed to
be its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time the Property Trustee with respect to the
Trust Securities shall cease to be eligible in accordance with the provisions of
this Section, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article VIII.
(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 that
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 and that otherwise meets the requirements of applicable
Delaware law that shall act through one or more persons authorized to bind such
entity.
Section 8.8 Conflicting Interests.
If the Property Trustee has or shall acquire a conflicting interest
within the meaning of the Trust Indenture Act, the Property Trustee shall either
eliminate such interest or resign, to the extent and in the manner provided by,
and subject to the provisions of, the Trust Indenture Act and this Trust
Agreement.
Section 8.9 Co-Trustees and Separate Trustee.
Unless an Event of Default shall have occurred and be continuing, at
any time or times, for the purpose of meeting the legal requirements of the
Trust Indenture Act or of any jurisdiction in which any part of the Trust
Property may at the time be located, the Depositor and the Administrative
Trustees, by agreed action of the majority of such Trustees, shall have power to
appoint, and upon the written request of the Administrative Trustees, the
Depositor shall for such purpose join with the Administrative Trustees in the
execution, delivery, and performance of all instruments and agreements necessary
or proper to appoint, one or more Persons approved by the Property Trustee
either to act as co-trustee, jointly with the Property Trustee, of all or any
part of such Trust Property, or to the extent required by law to act as separate
trustee of any such property, in either case with such powers as may be provided
in the instrument of appointment, and to vest in such Person or Persons in the
capacity aforesaid, any property, title, right or power deemed necessary or
42
desirable, subject to the other provisions of this Trust Agreement. 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 a Debenture Event of Default has occurred
and is continuing, the Property Trustee alone shall have power to make such
appointment. Any co-trustee or separate trustee appointed pursuant to this
Section 8.9 shall satisfy the requirements of Section 8.7.
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, authenticated 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 and not by such co-trustee or
separate trustee.
(b) The rights, powers, duties, and obligations hereby
conferred or imposed upon the Property Trustee in respect of any property
covered by such appointment shall be conferred or imposed upon and exercised or
performed by the Property Trustee or by the Property Trustee and such co-trustee
or separate trustee jointly, as shall be provided in the instrument appointing
such co-trustee or separate trustee, except to the extent that under any law of
any jurisdiction in which any particular act is to be performed, the Property
Trustee shall be incompetent or unqualified to perform such act, in which event
such rights, powers, duties, and obligations shall be exercised and performed by
such co-trustee or separate trustee.
(c) The Property Trustee at any time, by an instrument in
writing executed by it, with the written concurrence of the Depositor, may
accept the resignation of or remove any co-trustee or separate trustee appointed
under this Section, and, in case a Debenture Event of Default has occurred and
is continuing, the Property Trustee shall have power to accept the resignation
of, or remove, any such co-trustee or separate trustee without the concurrence
of the Depositor. Upon the written request of the Property Trustee, the
Depositor shall join with the Property Trustee in the execution, delivery, and
performance of all instruments and agreements necessary or proper to effectuate
such resignation or removal. A successor to any co-trustee or separate trustee
so resigned or removed may be appointed in the manner provided in this Section.
(d) No co-trustee or separate trustee hereunder shall be
personally liable by reason of any act or omission of the Property Trustee, or
any other trustee hereunder.
(e) The Property Trustee shall not be liable by reason of any
act of a co-trustee or separate trustee.
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(f) Any Act of Holders delivered to the Property Trustee shall
be deemed to have been delivered to each such co-trustee and separate trustee.
Section 8.10 Resignation and Removal; Appointment of Successor.
No resignation or removal of any Trustee (the "Relevant Trustee") and
no appointment of a successor Trustee pursuant to this Article shall become
effective until the acceptance of appointment by the successor Trustee in
accordance with the applicable requirements of Section 8.11.
Subject to the immediately preceding paragraph, the Relevant Trustee
may resign at any time by giving written notice thereof to the Securityholders.
If the instrument of acceptance by the successor 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 Relevant Trustee may petition, at
the expense of the Depositor, any court of competent jurisdiction for the
appointment of a successor Relevant Trustee with respect to the Trust
Securities.
Unless a Debenture Event of Default shall have occurred and be
continuing, any Trustee may be removed at any time by Act of the Holders of the
Common Securities. If a Debenture Event of Default shall have occurred and be
continuing, the Property Trustee or the Delaware Trustee, or both of them, may
be removed at such time by Act of the Holders of a majority in Liquidation
Amount of the Preferred Securities, delivered to the Relevant Trustee (in its
individual capacity and on behalf of the Trust). An Administrative Trustee may
be removed by the Common Securityholder at any time.
If any Trustee shall resign, be removed or become incapable of acting
as Trustee, or if a vacancy shall occur in the office of any Trustee for any
cause, at a time when no Debenture Event of Default shall have occurred and be
continuing, the Common Securityholder, by Act of the Common Securityholder
delivered to the retiring Trustee, shall promptly appoint a successor Trustee or
Trustees with respect to the Trust Securities and the Trust, and the retiring
Trustee shall comply with the applicable requirements of Section 8.11. If the
Property Trustee or the Delaware Trustee shall resign, be removed or become
incapable of continuing to act as the Property Trustee or the Delaware Trustee,
as the case may be, at a time when a Debenture Event of Default is continuing,
the Preferred Securityholders, by Act of the Securityholders of a majority in
Liquidation Amount of the Preferred Securities then Outstanding delivered to the
retiring Relevant Trustee, shall promptly appoint a successor Relevant Trustee
or Trustees with respect to the Trust Securities and the Trust, and such
successor Trustee shall comply with the applicable requirements of Section 8.11.
If an Administrative Trustee shall resign, be removed or become incapable of
acting as Administrative Trustee, at a time when a Debenture Event of Default
shall have occurred and be continuing, the Common Securityholder shall appoint a
successor Administrative Trustee. If no successor Relevant Trustee with respect
to the Trust Securities shall have been so appointed in accordance with this
Section 8.10 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,
44
petition any court of competent jurisdiction for the appointment of a successor
Relevant Trustee with respect to the Trust Securities.
The Property Trustee shall give notice of each resignation and each
removal of a Trustee and each appointment of a successor Trustee to all
Securityholders in the manner provided in Section 10.8 and shall give notice to
the Depositor. Each notice shall include the name of the successor Relevant
Trustee and the address of its Corporate Trust Office if it is the Property
Trustee.
Notwithstanding the foregoing or any other provision of this Trust
Agreement, in the event any Administrative Trustee or a Delaware Trustee who is
a natural person dies or becomes, in the opinion of the Depositor, incompetent
or incapacitated, the vacancy created by such death, incompetence or incapacity
may be filled by (a) the unanimous act of remaining Administrative Trustees if
there are at least two of them or (b) otherwise by the Depositor (with the
successor in each case being a Person who satisfies the eligibility requirement
for Administrative Trustees set forth in Section 8.7).
Section 8.11 Acceptance of Appointment by Successor.
In case of the appointment hereunder of a successor Relevant Trustee
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 Trustee all the rights, powers and
trusts of the retiring Relevant Trustee and shall duly assign, transfer and
deliver to the successor Trustee all property and money held by such retiring
Relevant Trustee hereunder.
In case of the appointment hereunder of a successor Relevant Trustee
with respect to the Trust Securities and the Trust, the retiring Relevant
Trustee and each successor Relevant Trustee with respect to the Trust Securities
shall execute and deliver an amendment hereto wherein each successor Relevant
Trustee shall accept such appointment and which (a) shall contain such
provisions as shall be necessary or desirable to transfer and confirm to, and to
vest in, each successor Relevant Trustee all the rights, powers, trusts and
duties of the retiring Relevant Trustee with respect to the Trust Securities and
the Trust and (b) shall add to or change any of the provisions of this Trust
Agreement as shall be necessary to provide for or facilitate the administration
of the trusts hereunder by more than one Relevant Trustee, it being understood
that nothing herein or in such amendment shall constitute such Relevant Trustees
co-trustees of the same trust and that each such Relevant Trustee shall be
trustee of a trust or trusts hereunder separate and apart from any trust or
trusts hereunder administered by any other such Relevant Trustee and upon the
execution and delivery of such amendment the resignation or removal of the
retiring Relevant Trustee shall become effective to the extent provided therein
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and each such successor Relevant Trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and duties
of the retiring Relevant Trustee with respect to the Trust Securities and the
Trust; but, on request of the Trust or any successor Relevant Trustee such
retiring Relevant Trustee shall duly assign, transfer and deliver to such
successor Relevant Trustee all Trust Property, all proceeds thereof and money
held by such retiring Relevant Trustee hereunder with respect to the Trust
Securities and the Trust.
Upon request of any such successor Relevant Trustee, the Trust shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Relevant Trustee all such rights, powers and trusts
referred to in the first or second preceding paragraph, as the case may be.
No successor Relevant Trustee shall accept its appointment unless at
the time of such acceptance such successor Relevant Trustee shall be qualified
and eligible under this Article.
Section 8.12 Merger, Conversion, Consolidation or Succession to
Business.
Any Person into which the Property Trustee, the 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 Person 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 shall be or become a creditor of the
Depositor or the Trust (or any other obligor upon the Debentures or the Trust
Securities), within three months prior to a failure by the Depositor to make
payment in full of principal or interest, when and as the same becomes due and
payable, or subsequent to such failure, the Property Trustee shall be subject to
and shall take all actions necessary in order to comply with the provisions of
the Trust Indenture Act regarding the collection of claims against the Depositor
or Trust (or any such other obligor). For purposes of Section 311(b)(4) and (6)
of the Trust Indenture Act:
(a) "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; and
(b) "self-liquidating paper" means any draft, xxxx of
exchange, acceptance or obligation which is made, drawn, negotiated or incurred
by the Depositor or the Trust (or any such obligor) for the purpose of financing
the purchase, processing, manufacturing, shipment, storage or sale of goods,
46
wares or merchandise and which is secured by documents evidencing title to,
possession 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 simultaneously with the creation of the creditor relationship
with the Depositor or the Trust (or any such obligor) 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) On or before _________ of each year, commencing ________,
the Property Trustee shall transmit to the Securityholders such reports
concerning the Property Trustee, its actions under this Trust Agreement and the
property and funds in its possession in its capacity as the Property Trustee as
may be required pursuant to Section 313 of the Trust Indenture Act in the manner
provided pursuant thereto.
(b) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Property Trustee with each national
securities exchange upon which the Trust Securities are listed, with the
Commission and with the Depositor.
Section 8.15 Reports to the Property Trustee.
The Depositor and the Administrative Trustees on behalf of the Trust
shall provide to the Property Trustee such documents, reports and information as
required by Section 314 of the Trust Indenture Act (if any) and the compliance
certificate required by Section 314(a)(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.
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 an Officer's Certificate evidencing
compliance with any conditions precedent, if any, provided for in this Trust
Agreement that relate to any of the matters set forth in Section 314(c) of the
Trust Indenture Act. Any certificate or opinion required to be given by an
officer pursuant to Section 314(c)(1) of the Trust Indenture Act shall comply
with Section 314(e) of the Trust Indenture Act.
Section 8.17 Number of Trustees.
(a) The number of Trustees shall be four, provided that the
Holder of all of the Common Securities by written instrument may increase the
number of Administrative Trustees or decrease the number thereof to one but not
zero. The Property Trustee and the Delaware Trustee may be the same Person.
(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 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 2.7(a), including any registration statement or
amendment thereto filed with the Commission, or making any other governmental
filing; and
(b) The Administrative Trustees shall have power to delegate
from time to time to such of their number 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 Enforcement of Rights of Property Trustee by
Securityholders.
If a Debenture Event of Default occurs and is continuing, then (i)
subject to Section 6.1(d) and the remaining provisions of this Section 8.19, the
Holders of Preferred Securities will rely on the enforcement by the Property
Trustee of its rights against the Depositor as the holder of the Debentures and
(ii) subject to Section 6.1(d), the Holders of a majority in aggregate
Liquidation Amount of the Preferred Securities will have the right to 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, provided that such direction shall not be in conflict with
any rule of law or with this Trust Agreement, and could not involve the Property
Trustee in personal liability in circumstances where reasonable indemnity would
not be adequate, or the Holders of a majority in aggregate Liquidation Amount of
the Preferred Securities may, on behalf of all Holders, consent to the waiver of
any past default and its consequences. If the Property Trustee fails to enforce
its rights under the Debentures, a Holder of Preferred Securities may, to the
extent permitted by applicable law, institute a legal proceeding against the
Depositor to enforce its rights under this Trust Agreement without first
instituting any legal proceeding against the Property Trustee or any other
Person, including the Trust; it being understood and intended that no one or
more of such Holders shall have any right in any manner whatsoever by virtue of,
or by availing of, any provision of this Trust Agreement to affect, disturb or
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prejudice the rights of any other of such Holders or to obtain or to seek to
obtain priority or preference over any other of such Holders or to enforce any
right under this Trust Agreement, except in the manner herein provided and for
the equal and ratable benefit of all such Holders. Notwithstanding the
foregoing, a Holder of Preferred Securities may institute a legal proceeding
directly against the Depositor without first instituting a legal proceeding
against or requesting or directing that action be taken by the Property Trustee
or any other Person, for enforcement of payment to such Holder of principal of
or interest on the Debentures having a principal amount equal to the aggregate
stated Liquidation Amount of the Preferred Securities of such Holder on or after
the due dates therefor specified or provided for in the Debentures.
ARTICLE 9
TERMINATION, LIQUIDATION AND MERGER
Section 9.1 Termination Upon Expiration Date.
Unless earlier terminated, the Trust shall automatically terminate on
________ (the "Expiration Date"), following the distribution of the Trust
Property in accordance with Section 9.4.
Section 9.2 Early Termination.
The first to occur of any of the following events is an "Early
Termination Event", the occurrence of which shall result in the dissolution and
termination of the Trust in accordance with the terms hereof:
(a) the occurrence of a Bankruptcy Event in respect of, or the
dissolution or liquidation of, the Depositor;
(b) the delivery of written direction given to the Property
Trustee from the Depositor at any time (which direction is optional and wholly
within the discretion of the Depositor) to terminate the Trust and distribute
Debentures to Securityholders in exchange for the Preferred Securities as
provided in Section 9.4;
(c) the redemption or other payment in full of all of the
Debentures, and the consequent redemption of the Trust Securities; and
(d) an order for dissolution of the Trust shall have been
entered by a court of competent jurisdiction.
Section 9.3 Termination.
The respective obligations and responsibilities of the Trustees and the
Trust created and continued hereby shall terminate upon the latest to occur of
the following: (a) the distribution by the Property Trustee to Securityholders
upon the liquidation of the Trust pursuant to Section 9.4, or upon the
redemption of all of the Trust Securities pursuant to Section 4.2, of all
amounts required to be distributed hereunder upon the final payment of the Trust
49
Securities; (b) the payment of any expenses owed by the Trust; (c) the discharge
of all administrative duties of the Administrative Trustees, including the
performance of any tax reporting obligations with respect to the Trust or the
Securityholders and (d) the filing of a certificate of cancellation in
accordance with the Delaware Statutory Trust Act.
Section 9.4 Liquidation.
(a) If an Early Termination Event specified in clause (a), (b)
or (d) of Section 9.2 occurs or upon the Expiration Date, the Trust shall be
liquidated by the Trustees as expeditiously as the Trustees determine to be
possible by distributing, after satisfaction of liabilities to creditors of the
Trust as provided by applicable law, to each Securityholder a Like Amount of
Debentures, subject to Section 9.4(d). Notice of liquidation shall be given by
the Property Trustee 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
procedures by which Holders may exchange Trust Securities Certificates for
Debentures, as the Administrative Trustees or the Property Trustee shall deem
appropriate.
(b) Except where Section 9.2(c) or 9.4(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 9.2(c) or 9.4(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)
the Depositor shall use its reasonable efforts to have the Debentures listed on
any national securities exchange or other organization on which the Preferred
Securities are then listed, (iv) any Trust Securities Certificates not so
surrendered for exchange will be deemed to represent a Like Amount of
Debentures, accruing interest at the rate provided for in the Debentures from
the last Distribution Date on which a Distribution was made on such Trust
Certificates until such certificates are so surrendered (and until such
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certificates are so surrendered, no payments of interest or principal will be
made to holders of Trust Securities Certificates with respect to such
Debentures) and (v) all rights of Securityholders holding Trust Securities will
cease, except the right of such Securityholders to receive Debentures upon
surrender of Trust Securities Certificates.
(d) In the event an Early Termination Event specified in
Section 9.2(a) or (d) occurs, and 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 dissolved, wound-up
or terminated, by the Property Trustee in such manner as the Property Trustee
determines. In such event, on the date of the dissolution, winding-up or other
termination of the Trust, Securityholders will be entitled to receive out of the
assets of the Trust available for distribution to Securityholders, after
satisfaction of liabilities to creditors of the Trust (evidenced by a
certificate of the Administrative Trustees) as provided by applicable law, 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 dissolution, 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 dissolution, winding-up or
termination pro rata (determined as aforesaid) with Holders of Preferred
Securities, except that, if a Debenture Event of Default has occurred and is
continuing, the Preferred Securities shall have a priority over the Common
Securities pursuant to Section 4.3.
Section 9.5 Mergers, Consolidations, Amalgamations or Replacements
of the Trust.
The Trust may not merge with or into, consolidate, amalgamate, or be
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other body, except pursuant
to this Section 9.5. At the request of the Depositor, with the consent of the
Administrative Trustees and without the consent of the holders of the Preferred
Securities, the Property Trustee or the Delaware Trustee, the Trust may merge
with or into, consolidate, amalgamate, or be replaced by or convey, transfer or
lease its properties and assets substantially as an entirety to a trust
organized as such under the laws of any State; provided, that (i) such successor
entity either (a) expressly assumes all of the obligations of the Trust with
respect to the Preferred Securities or (b) substitutes for the Preferred
Securities other securities having substantially the same terms as the Preferred
Securities (the "Successor Securities") so long as the Successor Securities rank
the same as the Preferred Securities rank in priority with respect to
distributions and payments upon liquidation, redemption and otherwise, (ii) the
Depositor expressly appoints a trustee of such successor entity possessing the
same powers and duties as the Property Trustee as the holder of the Debentures,
(iii) the Successor Securities are listed, or any Successor Securities will be
listed upon notification of issuance, on any national securities exchange or
other organization on which the Preferred Securities are then listed, if any,
51
(iv) such merger, consolidation, amalgamation, replacement, conveyance, transfer
or lease does not cause the Preferred Securities (including any Successor
Securities) to be downgraded by any nationally recognized statistical rating
organization, (v) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights, preferences
and privileges of the holders of the Preferred Securities (including any
Successor Securities) in any material respect, (vi) such successor entity has a
purpose identical to that of the Trust, (vii) prior to such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease the
Depositor has received an Opinion of Counsel to the effect that (a) such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease does not
adversely affect the rights, preferences and privileges of the holders of the
Preferred Securities (including any Successor Securities) in any material
respect, and (b) following such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, neither the Trust nor such successor
entity will be required to register as an investment company under the 1940 Act
and (viii) the Depositor owns all of the Common Securities of such successor
entity and guarantees the obligations of such successor entity under the
Successor Securities at least to the extent provided by the Guarantee.
Notwithstanding the foregoing, the Trust shall not, except with the consent of
holders of 100% in Liquidation Amount of the Preferred Securities, consolidate,
amalgamate, merge with or into, or be replaced by or convey, transfer or lease
its properties and assets substantially as an entirety to any other entity or
permit any other entity to consolidate, amalgamate, merge with or into, or
replace it if such consolidation, amalgamation, merger, replacement, conveyance,
transfer or lease would cause the Trust or the successor entity to be classified
as other than a grantor trust for federal income tax purposes.
ARTICLE 10
MISCELLANEOUS PROVISIONS
Section 10.1 Limitation of Rights and Liability of Securityholders.
(a) The bankruptcy, death, dissolution or incapacity of
any Person having an interest, beneficial or otherwise, in Trust Securities
shall not operate to terminate this Trust Agreement, nor entitle the legal
representatives or heirs of such Person or any Securityholder for such Person,
to claim an accounting, take any action or bring any proceeding in any court for
a partition or winding up of the arrangements contemplated hereby, nor otherwise
affect the rights, obligations and liabilities of the parties hereto or any of
them.
(b) Pursuant to Section 3803(a) of the Delaware Statutory
Trust Act, the Securityholders 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.
Section 10.2 Amendment.
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(a) This Trust Agreement may be amended from time to time by
the Trustees and the Depositor, without the consent of any Securityholders, (i)
to cure any ambiguity, correct or supplement any provision herein which may be
inconsistent with any other provision herein, or to make any other provisions
with respect to matters or questions arising under this Trust Agreement, which
shall not be inconsistent with the other provisions of this Trust Agreement,
(ii) to modify, eliminate or add to any provisions of this Trust Agreement to
such extent as shall be necessary to ensure that the Trust will be classified
for United States Federal income tax purposes as a grantor trust at all times
that any Trust Securities are outstanding or to ensure that the Trust will not
be required to register as an "investment company" under the 1940 Act, or (iii)
to reduce or increase the Liquidation Amount per Trust Security and
simultaneously to correspondingly increase or decrease the number of Trust
Securities issued and Outstanding solely for the purpose of maintaining the
eligibility of the Preferred Securities for quotation or listing on any national
securities exchange or other organization on which the Preferred Securities are
then quoted or listed; provided, however, that in the case of clause (i), such
action shall not adversely affect in any material respect the interests of any
Securityholder, and any amendments of this Trust Agreement shall become
effective when notice thereof is given to the Securityholders and provided
further, that in the case of clause (iii) the aggregate Liquidation Amount of
the Trust Securities Outstanding upon completion of any such reduction must be
the same as the aggregate Liquidation Amount of the Trust Securities Outstanding
immediately prior to such reduction or increase; and any amendments of this
Trust Agreement shall become effective when notice thereof is given to the
Securityholders.
(b) Except as provided in Section 10.2(c) hereof, any
provision of this Trust Agreement may be amended by the Trustees and the
Depositor with (i) the consent of Securityholders representing not less than a
majority (based upon Liquidation Amounts) of the Trust Securities then
Outstanding and (ii) receipt by the Trustees of an Opinion of Counsel to the
effect that such amendment or the exercise of any power granted to the Trustees
in accordance with such amendment will not affect the Trust's status as a
grantor trust for federal income tax purposes or the Trust's exemption from
status of an "investment company" under the 1940 Act.
(c) In addition to and notwithstanding any other provision in
this Trust Agreement, without the consent of each affected Securityholder (such
consent being obtained in accordance with Section 6.3 or 6.6 hereof), this Trust
Agreement may not be amended to (i) change the amount or timing of any
Distribution (or payment on redemption) on the Trust Securities or otherwise
adversely affect the amount of any Distribution (or payment on redemption)
required to be made in respect of the Trust Securities as of a specified date,
(ii) restrict the right of a Securityholder to institute suit for the
enforcement of any such payment on or after such date, (iii) change the purpose
of the Trust or (iv) authorize the issuance of any additional beneficial
interests in the Trust; notwithstanding any other provision herein, without the
unanimous consent of the Securityholders (such consent being obtained in
accordance with Section 6.3 or 6.6 hereof), this paragraph (c) of this Section
10.2 may not be amended.
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(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 be treated other than as a grantor
trust for United States federal income tax purposes or to fail or cease to
qualify for the exemption from status of an "investment company" under the 1940
Act.
(e) Notwithstanding anything in this Trust Agreement to the
contrary, without the consent of the Depositor, this Trust Agreement may not be
amended in a manner which imposes any additional obligation on the Depositor.
(f) In the event that any amendment to this Trust Agreement is
made, the Administrative Trustees shall promptly provide to the Depositor a copy
of such amendment.
(g) Neither the Property Trustee nor the Delaware Trustee
shall be required to enter into any amendment to this Trust Agreement which
affects its own rights, duties or immunities under this Trust Agreement. The
Property Trustee shall be entitled to receive an Opinion of Counsel and an
Officer's Certificate stating that any amendment to this Trust Agreement is in
compliance with this Trust Agreement.
Section 10.3 Separability.
In case any provision in this Trust Agreement or in the Trust
Securities Certificates shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
Section 10.4 Governing Law.
Each party hereto and any party accepting a Trust Security (i)
irrevocably submits to the non-exclusive jurisdiction and venue of any Delaware
State court or Federal court sitting in Wilmington, Delaware in any action
arising out of this Agreement, and (ii) consents to the service of process by
mail. Nothing herein shall affect the right of any party to serve legal process
in any manner permitted by law or affect its right to bring any action in any
other court. 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 and enforced in accordance with and
governed by the laws of the State of Delaware (without regard to conflicts of
laws principles), PROVIDED, HOWEVER, THAT THERE SHALL NOT BE APPLICABLE TO THE
PARTIES HEREUNDER OR THIS TRUST AGREEMENT ANY PROVISION OF THE LAWS (COMMON OR
STATUTORY) OF THE STATE OF DELAWARE PERTAINING TO TRUSTS THAT RELATE TO OR
REGULATE, IN A MANNER INCONSISTENT WITH THE TERMS HEREOF, (A) THE FILING WITH
ANY COURT OR GOVERNMENTAL BODY OR AGENCY OF TRUSTEE ACCOUNTS OR SCHEDULES OF
TRUSTEE FEES AND CHARGES, (B) AFFIRMATIVE REQUIREMENTS TO POST BONDS FOR
TRUSTEES, OFFICERS, AGENTS OR EMPLOYEES OF A TRUST, (C) THE NECESSITY FOR
OBTAINING COURT OR OTHER GOVERNMENTAL APPROVAL CONCERNING THE ACQUISITION,
54
HOLDING OR DISPOSITION OF REAL OR PERSONAL PROPERTY, (D) FEES OR OTHER SUMS
PAYABLE TO TRUSTEES, OFFICERS, AGENTS OR EMPLOYEES OF A TRUST, (E) THE
ALLOCATION OF RECEIPTS AND EXPENDITURES TO INCOME OR PRINCIPAL, (F) RESTRICTIONS
OR LIMITATIONS ON THE PERMISSIBLE NATURE, AMOUNT OR CONCENTRATION OF TRUST
INVESTMENTS OR REQUIREMENTS RELATING TO THE TITLING, STORAGE OR OTHER MANNER OF
HOLDING OR INVESTING TRUST ASSETS OR (G) THE ESTABLISHMENT OF FIDUCIARY OR OTHER
STANDARDS OF RESPONSIBILITY OR LIMITATIONS ON THE ACTS OR POWERS OF TRUSTEES
THAT ARE INCONSISTENT WITH THE LIMITATIONS OR AUTHORITIES AND POWERS OF THE
TRUSTEES HEREUNDER AS SET FORTH OR REFERENCED IN THIS TRUST AGREEMENT. SECTION
3540 OF TITLE 12 OF THE DELAWARE CODE SHALL NOT APPLY TO THE TRUST.
Section 10.5 Notice of Deferral of Distribution.
In the event that the Depositor exercises its right to extend an
interest payment period in respect of the Debentures pursuant to Section 11.02
of the Indenture and notice of such extension has been provided by the Depositor
to the Property Trustee, the Property Trustee shall give written notice of such
extension and of the deferral of the related Distribution on the Trust
Securities, by first-class mail, postage prepaid, mailed not later than ten days
prior to the Distribution Date upon which such Distribution would otherwise be
payable, to each Holder of Preferred Securities at such Holder's address
appearing in the Securities Register.
Section 10.6 Successors.
This Trust Agreement shall be binding upon and shall inure to the
benefit of any successor to the Depositor, the Trust or the Relevant Trustee,
including any successor by operation of law. Except in connection with a
consolidation, merger or sale involving the Depositor that is permitted under
Article 5 of the Indenture and pursuant to which the assignee agrees in writing
to perform the Depositor's obligations hereunder, the Depositor shall not assign
its obligations hereunder.
Section 10.7 Headings.
The Article and Section headings are for convenience only and shall not
affect the construction of this Trust Agreement.
Section 10.8 Reports, Notices and Demands.
Any notice, request or other communication required or permitted to be
given to the Trust, the Property Trustee, the Delaware Trustee or the
Administrative Trustees hereunder shall be in writing, duly signed by the party
giving such notice, and delivered in person, telecopied, mailed by first class
mail (registered or certified, return receipt requested) or overnight air
courier guaranteeing next day delivery as follows:
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(a) if given to the Trust or to the Administrative Trustees,
to the address set forth below or such other address as the Trust or
Administrative Trustees may give notice of to the Property Trustee, the Delaware
Trustee and the Holders:
Harleysville Group Capital Trust __
c/o Harleysville Group Inc.
000 Xxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Facsimile No.: (000) 000-0000
Attention: Administrative Trustees of Harleysville
Group Capital Trust __
(b) if given to the Property Trustee, to the Property
Trustee's address set forth below or such other address as the Property Trustee
may give notice of to the Delaware Trustee, the Administrative Trustees and the
Holders:
Wilmington Trust Company
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx
00000-0000
(c) if given to the Delaware Trustee, to the Delaware
Trustee's address set forth below or such other address as the Delaware Trustee
may give notice of to the Property Trustee, the Administrative Trustees and the
Holders:
Wilmington Trust Company
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx
00000-0000
(d) if given to the Common Securityholder, at the address of
the Depositor set forth below or such other address as the Common Securityholder
may give notice thereof:
Harleysville Group Inc.
000 Xxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Facsimile No.: (000) 000-0000
Attention: Administrative Trustees of Harleysville
Group Capital Trust __
All notices and communications (other than those sent to Holders) shall
be deemed to have been duly given: at the time delivered by hand, if personally
delivered; five Business Days after being deposited in the mail, postage
56
prepaid, if mailed; when receipt is acknowledged or confirmed, if telecopied;
and the next Business Day after timely delivery to the courier, if sent by
overnight courier guaranteeing next day delivery.
Any notice or communication to a Holder shall be mailed by first class
mail or by overnight carrier guaranteeing next day delivery to the address set
forth on the books and records of the Issuer and shall be deemed to have been
duly given: five Business Days after being deposited in the mail, postage
prepaid, if mailed; and the next Business Day after timely delivery to the
courier, if sent by overnight courier guaranteeing next day delivery.
If a notice or communication is sent in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
Section 10.9 Agreement Not to Petition.
Each of the Trustees and the Depositor agree for the benefit of the
Securityholders that, until at least one year and one day after the Trust has
been terminated in accordance with Article IX, they shall not file, or join in
the filing of, a petition against the Trust under any bankruptcy, insolvency,
reorganization or other similar law (including, without limitation, the United
States Bankruptcy Code) (collectively, "Bankruptcy Laws") or otherwise join in
the commencement of any proceeding against the Trust under any Bankruptcy Law.
In the event the Depositor takes action in violation of this Section 10.9, the
Property Trustee agrees, for the benefit of Securityholders, that at the expense
of the Depositor, it shall file an answer with the bankruptcy court or otherwise
properly contest the filing of such petition by the Depositor against the Trust
or the commencement of such action and raise the defense that the Depositor has
agreed in writing not to take such action and should be stopped and precluded
therefrom and such other defenses, if any, as counsel for the Trustee or the
Trust may assert. The provisions of this Section 10.9 shall survive the
termination of this Trust Agreement.
Section 10.10 Limitation of Depositor's Liability.
Except as expressly set forth in this Trust Agreement, the Guarantee
and the terms of the Trust Securities, the Depositor: (i) shall not be
personally liable for the return of any portion of the capital contributions (or
any return thereon) of the Securityholders that shall be made solely from assets
of the Trust and (ii) shall not be required to pay to the Trust or to any
Securityholders any deficit upon dissolution of the Trust or otherwise.
Section 10.11 Trust Indenture Act; Conflict with the Trust Indenture
Act.
(a) This Trust Agreement is subject to the provisions of the
Trust Indenture Act that are required to be part of this Trust Agreement and
shall, to the extent applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is a
trustee for the purposes of the Trust Indenture Act.
57
(c) If any provision hereof limits, qualifies or conflicts
with another provision hereof which is required to be included in this Trust
Agreement by any of the provisions of the Trust Indenture Act, such required
provision shall control. If any provision of this Trust Agreement modifies or
excludes any provision of the Trust Indenture Act which may be so modified or
excluded, the latter provision shall be deemed to apply to this Trust Agreement
as so modified or to be excluded, as the case may be.
(d) The application of the Trust Indenture Act to this Trust
Agreement shall not affect the nature of the Trust Securities as equity
securities representing undivided beneficial interests in the assets of the
Trust.
Section 10.12 Acceptance of Terms of Trust Agreement, Guarantee and
Indenture.
THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST THEREIN
BY OR ON BEHALF OF A SECURITYHOLDER OR ANY BENEFICIAL OWNER, WITHOUT ANY
SIGNATURE OR FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL
ACCEPTANCE BY THE SECURITYHOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN
SUCH TRUST SECURITY OF ALL THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT AND
AGREEMENT TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND
THE INDENTURE, AND SHALL CONSTITUTE THE AGREEMENT OF THE TRUST, SUCH
SECURITYHOLDER AND SUCH OTHERS THAT THE TERMS AND PROVISIONS OF THIS TRUST
AGREEMENT SHALL BE BINDING, OPERATIVE AND EFFECTIVE AS BETWEEN THE TRUST AND
SUCH SECURITYHOLDER AND SUCH OTHERS.
Section 10.13 Counterparts.
This Trust Agreement may be executed in any number of counterparts,
each of which so executed and delivered shall be an original, and all of which
counterparts together shall constitute one and the same agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Amended and
Restated Trust Agreement or have caused this Amended and Restated Trust
Agreement to be executed on their behalf all as of the day and year first above
written.
HARLEYSVILLE GROUP INC.,
as Depositor
By:
-------------------------------------------
Name:
Title:
58
______________________________, not in
its individual capacity, but solely as
Property Trustee and Delaware Trustee
By:
-------------------------------------------
Name:
Title:
By:
-------------------------------------------
Name: __________________, not in
his or her individual capacity, but
solely as Administrative Trustee
By:
-------------------------------------------
Name: __________________, not in
his or her individual capacity, but
solely as Administrative Trustee
59
EXHIBIT A
CERTIFICATE OF TRUST
OF
HARLEYSVILLE GROUP CAPITAL TRUST __
[intentionally omitted]
A-1
EXHIBIT B
The Depository Trust Company
00 Xxxxx Xxxxxx, 00xx Xxxxx,
Xxx Xxxx, Xxx Xxxx 10041-0099
Attention: ____________________
General Counsel's Office
Re: Harleysville Group Capital Trust __
Ladies and Gentlemen:
The purpose of this letter is to set forth certain matters
relating to the issuance and deposit with The Depository Trust Company ("DTC")
of Harleysville Group Capital Trust __ __% Trust Originated Preferred Securities
(the "Preferred Securities"), of Harleysville Group Capital Trust __, a Delaware
statutory trust (the "Issuer"), formed pursuant to a Trust Agreement between
Harleysville Group Inc. ("Harleysville") and ______________________, as Trustee.
The payment of distributions on the Preferred Securities to the extent the
Issuer has funds available for the payment thereof, and payments due upon
liquidation of Issuer or redemption of the Preferred Securities are guaranteed
by Harleysville to the extent set forth in a Guarantee Agreement dated ______ by
Harleysville with respect to the Preferred Securities. Harleysville and the
Issuer propose to sell the Preferred Securities to certain Underwriters (the
"Underwriters") pursuant to an Underwriting Agreement dated _______ by and among
the Underwriters, the Issuer and Harleysville dated _______, and the
Underwriters wish to take delivery of the Preferred Securities through DTC.
______ is acting as transfer agent and registrar with respect to the Preferred
Securities (the "Transfer Agent and Registrar").
To induce DTC to accept the Preferred Securities as eligible
for deposit at DTC, and to act in accordance with DTC's rules with respect to
the Preferred Securities, the Issuer, the Transfer Agent and Registrar and DTC
agree among each other as follows:
1. Prior to the closing of the sale of the Preferred
Securities to the Underwriters, which is expected to occur on or about _______,
there shall be deposited with DTC one or more global certificates (individually
and collectively, the "Global Certificate") registered in the name of DTC's
Preferred Securities nominee, Cede & Co., representing an aggregate of _____
Preferred Securities and bearing 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
B-1
BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered
owner hereof, Cede & Co., has an interest herein.
2. The Amended and Restated Trust Agreement of the Issuer
provides for the voting by holders of the Preferred Securities under certain
limited circumstances. The Issuer shall establish a record date for such
purposes and shall, to the extent possible, give DTC notice of such record date
not less than 15 calendar days in advance of such record date.
3. In the event of a stock split, conversion,
recapitalization, reorganization or any other similar transaction resulting in
the cancellation of all or any part of the Preferred Securities outstanding, the
Issuer or the Transfer Agent and Registrar shall send DTC a notice of such event
at least 5 business days prior to the effective date of such event.
4. In the event of distribution on, or an offering or issuance
of rights with respect to, the Preferred Securities outstanding, the Issuer or
the Transfer Agent and Registrar shall send DTC a notice specifying: (a) the
amount of and conditions, if any, applicable to the payment of any such
distribution or any such offering or issuance of rights; (b) any applicable
expiration or deadline date, or any date by which any action on the part of the
holders of Preferred Securities is required; and (c) the date any required
notice is to be mailed by or on behalf of the Issuer to holders of Preferred
Securities or published by or on behalf of the Issuer (whether by mail or
publication, the "Publication Date"). Such notice shall be sent to 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 Issuer or the Transfer Agent and Registrar will forward
such notice either in a separate secure transmission for each CUSIP number or in
a secure transmission of multiple CUSIP numbers (if applicable) that includes a
manifest or list of each CUSIP number submitted in that transmission. (The party
sending such notice shall have a method to verify subsequently the use of such
means and the timeliness of such notice.) The Publication Date shall be not less
than 30 calendar days nor more than 60 calendar days prior to the payment of any
such distribution or any such offering or issuance of rights with respect to the
Preferred Securities. After establishing the amount of payment to be made on the
Preferred Securities, the Issuer or the Transfer Agent and Registrar will notify
DTC's Dividend Department of such payment 5 business days prior to payment date.
Notices to DTC's Dividend Department by telecopy shall be sent to (212)
709-1723. 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, Xxx Xxxx 00000-0000
B-2
The Issuer or the Transfer Agent and Registrar shall confirm DTC's
receipt of such telecopy by telephoning the Dividend Department at (212)
709-1270.
5. In the event of a redemption by the Issuer of the Preferred
Securities, notice specifying the terms of the redemption and the Publication
Date of such notice shall be sent by the Issuer or the Transfer Agent and
Registrar to DTC not less than 30 calendar days prior to such event by a secure
means in the manner set forth in paragraph 4. Such redemption notice shall be
sent to 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, Xxx Xxxx 00000-0000
6. In the event of any invitation to tender the Preferred
Securities, notice specifying the terms of the tender and the Publication Date
of such notice shall be sent by the Issuer or the Transfer Agent and Registrar
to 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 tenders, exchanges and capital changes), shall be sent,
unless notification to another department is expressly provided for herein, by
telecopy to DTC's Reorganization Department at (000) 000-0000 or (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, Xxx Xxxx 00000-0000
7. All notices and payment advices sent to DTC shall contain
the CUSIP number or numbers of the Preferred Securities and the accompanying
designation of the Preferred Securities, which, as of the date of this letter is
"Harleysville Group Capital Trust __ ___% Trust Originated Preferred
Securities."
8. Distribution payments or other cash payments with respect
to the Preferred Securities evidenced by the Global Certificate shall be
received by 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 Issuer 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:
B-3
NDFS Redemption Department
The Depository Trust Company
0 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
9. DTC may by prior written notice direct the Issuer and 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.
10. In the event of a conversion, redemption, or any other
similar transaction (e.g., tender made and accepted in response to the Issuer's
or the Transfer Agent and Registrar's invitation) necessitating a reduction in
the aggregate number of Preferred Securities outstanding evidenced by the Global
Certificate, DTC, in its discretion: (a) may request the Issuer or the Transfer
Agent and Registrar to issue and countersign a new Global Certificate; or (b)
may make an appropriate notation on the Global Certificate indicating the date
and amount of such reduction.
11. DTC may discontinue its services as a securities
depositary with respect to the Preferred Securities at any time by giving at
least 90 days' prior written notice to the Issuer and the Transfer Agent and
Registrar (at which time DTC will confirm with the Issuer or the Transfer Agent
and Registrar the aggregate number of Preferred Securities deposited with it)
and discharging its responsibilities with respect thereto under applicable law.
Under such circumstances, the Issuer may determine to make alternative
arrangements for book-entry settlement for the Preferred Securities, make
available one or more separate global certificates evidencing Preferred
Securities to any Participant having Preferred Securities credited to its DTC
account, or issue definitive Preferred Securities to the beneficial holders
thereof, and in any such case, DTC agrees to cooperate fully with the Issuer and
the Transfer Agent and Registrar and to return the Global Certificate, duly
endorsed for transfer as directed by the Issuer or the Transfer Agent and
Registrar, together with any other documents of transfer reasonably requested by
the Issuer or the Transfer Agent and Xxxxxxxxx.
00. In the event that the Issuer determines that beneficial
owners of Preferred Securities shall be able to obtain definitive Preferred
Securities, the Issuer or the Transfer Agent and Registrar shall notify DTC of
the availability of certificates. In such event, the Issuer or the Transfer
Agent and Registrar shall issue, transfer and exchange certificates in
appropriate amounts, as required by DTC and others, and DTC agrees to cooperate
fully with the Issuer and the Transfer Agent and Registrar and to return the
Global Certificate, duly endorsed for transfer as directed by the Issuer or the
Transfer Agent and Registrar, together with any other documents of transfer
reasonably requested by the Issuer or the Transfer Agent and Xxxxxxxxx.
00. 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.
B-4
Nothing herein shall be deemed to require the Transfer Agent and
Registrar to advance funds on behalf of Harleysville Group Capital Trust __.
Very truly yours,
Harleysville Group Capital Trust __
(As Issuer)
By: [Name of Trustee]
Administrative Trustee
By:
------------------------------------------
Name:
Title:
(As Transfer Agent and Registrar)
By:
------------------------------------------
Name:
Title:
RECEIVED AND ACCEPTED:
THE DEPOSITORY TRUST COMPANY
By:
------------------------------------
Authorized Officer
B-5
EXHIBIT C
THIS CERTIFICATE IS NOT TRANSFERABLE
EXCEPT AS PROVIDED IN THE TRUST AGREEMENT REFERRED TO HEREIN
Certificate Number Number of Common Securities
C-___
Certificate Evidencing Common Securities
Of
Harleysville Group Capital Trust __
___% Common Securities
(liquidation amount $___ per Common Security)
Harleysville Group Capital Trust __, a statutory trust formed under the
laws of the State of Delaware (the "Trust"), hereby certifies that Harleysville
Group Inc. (the "Holder") is the registered owner of _____ (___) common
securities of the Trust representing undivided beneficial interests in the
assets of the Trust and designated the ___% Common Securities (liquidation
amount $__ per Common Security) (the "Common Securities"). In accordance with
Section 5.10 of the Trust Agreement (as defined below) the Common Securities are
not transferable, except by operation of law or to an Affiliate of the Holder or
a permitted successor under the Indenture, dated as of [ ], between the Holder
and __________________________, as trustee, and any attempted transfer hereof
shall be void. The designations, rights, privileges, restrictions, preferences
and other terms and provisions of the Common Securities are set forth in, and
this certificate and the Common Securities represented hereby are issued and
shall in all respects be subject to the terms and provisions of, the Amended and
Restated Trust Agreement of the Trust dated as of ________, as the same may be
amended from time to time (the "Trust Agreement") including the designation of
the terms of the Common Securities as set forth therein. The Trust will furnish
a copy of the Trust Agreement to the Holder without charge upon written request
to the Trust at its principal place of business or registered office.
Upon receipt of this certificate, the Holder is bound by the
Trust Agreement and is entitled to the benefits thereunder.
IN WITNESS WHEREOF, the Trust has executed this certificate this ______
day of ________ ____.
HARLEYSVILLE GROUP CAPITAL TRUST __
By:
-----------------------------------------
Name:
Administrative Trustee
C-1
CERTIFICATE OF AUTHENTICATION
This is one of the Common Securities referred to in the within mentioned
Trust Agreement.
_________________________________, as
Property Trustee
By:
----------------------------------
Name:
Title:
C-2
EXHIBIT D
AGREEMENT AS TO EXPENSES AND LIABILITIES
This AGREEMENT AS TO EXPENSES AND LIABILITIES (this "Agreement"), is
dated as of ________, between Harleysville Group Inc., a Delaware corporation
("Harleysville"), and Harleysville Group Capital Trust __, a Delaware statutory
trust (the "Trust").
WHEREAS, the Trust intends to issue its Common Securities (the "Common
Securities") to, and purchase ___% of Junior Subordinated Debentures (the
"Debentures") from, Harleysville, and to issue and sell its ____% Trust
Originated Preferred Securities (the "Preferred Securities") with such powers,
preferences and special rights and restrictions as are set forth in the Amended
and Restated Trust Agreement of the Trust dated as of _________, as the same may
be amended from time to time (the "Trust Agreement");
WHEREAS, Harleysville directly or indirectly will own all of the Common
Securities of the Trust and will issue the Debentures;
NOW, THEREFORE, in consideration of the purchase by each holder of the
Preferred Securities, which purchase Harleysville hereby agrees shall benefit
Harleysville and which purchase Harleysville acknowledges will be made in
reliance upon the execution and delivery of this Agreement, Harleysville and the
Trust hereby agree as follows:
ARTICLE I
Section 1.1 Guarantee by Harleysville.
Subject to the terms and conditions hereof, Harleysville
hereby irrevocably and unconditionally guarantees to each person or entity to
whom the Trust is now or hereafter becomes indebted or liable (the
"Beneficiaries") the full payment, when and as due, of any and all Obligations
(as hereinafter defined) to such Beneficiaries. As used herein, "Obligations"
means any costs, expenses or liabilities of the Trust, other than obligations of
the Trust to pay to holders of any Preferred Securities or other similar
interests in the Trust the amounts due such holders pursuant to the terms of the
Preferred Securities or such other similar interests, as the case may be. This
Agreement is intended to be for the benefit of, and to be enforceable by, all
such Beneficiaries, whether or not such Beneficiaries have received notice
hereof.
Section 1.2. Term of Agreement.
This Agreement shall terminate and be of no further force and
effect upon the later of (a) the date on which full payment has been made of all
amounts payable to all holders of all the Preferred Securities (whether upon
redemption, liquidation, exchange or otherwise) and (b) the date on which there
D-1
are no Beneficiaries remaining; provided, however, that this Agreement shall
continue to be effective or shall be reinstated, as the case may be, if at any
time any holder of Preferred Securities or any Beneficiary must restore payment
of any sums paid under the Preferred Securities, under any Obligation, under the
Guarantee Agreement dated the date hereof by Harleysville and
_________________________, as guarantee trustee or under this Agreement for any
reason whatsoever. This Agreement is continuing, irrevocable, unconditional and
absolute.
Section 1.3. Waiver of Notice.
Harleysville hereby waives notice of acceptance of this
Agreement and of any Obligation to which it applies or may apply, and
Harleysville hereby waives presentment, demand for payment, protest, notice of
nonpayment, notice of dishonor, notice of redemption and all other notices and
demands.
Section 1.4. No Impairment.
The obligations, covenants, agreements and duties of
Harleysville under this Agreement shall in no way be affected or impaired by
reason of the happening from time to time of any of the following:
(a) the extension of time for the payment by the Trust of all
or any portion of the Obligations or for the performance of any other
obligation under, arising out of, or in connection with, the
Obligations;
(b) any failure, omission, delay or lack of diligence on the
part of the Beneficiaries to enforce, assert or exercise any right,
privilege, power or remedy conferred on the Beneficiaries with respect
to the Obligations or any action on the part of the Trust granting
indulgence or extension of any kind; 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 of, or other similar proceedings
affecting, the Trust or any of the assets of the Trust.
There shall be no obligation of the Beneficiaries to give notice to, or obtain
the consent of, Harleysville with respect to the happening of any of the
foregoing.
Section 1.5. Enforcement.
A Beneficiary may enforce this Agreement directly against
Harleysville, and Harleysville waives any right or remedy to require that any
action be brought against the Trust or any other person or entity before
proceeding against Harleysville.
Section 1.6. Subrogation.
D-2
Harleysville shall be subrogated to all rights (if any) of the
Trust in respect of any amounts paid to the Beneficiaries by Harleysville under
this Agreement; provided, however, that Harleysville shall not (except to the
extent required by mandatory provisions of law) be entitled to enforce or
exercise any rights that it may acquire by way of subrogation or any indemnity,
reimbursement or other agreement, in all cases as a result of payment under this
Agreement, if, at the time of any such payment, any amounts are due and unpaid
under this Agreement.
ARTICLE II
Section 2.1. Binding Effect.
All guarantees and agreements contained in this Agreement
shall bind the successors, assigns, receivers, trustees and representatives of
Harleysville and shall inure to the benefit of the Beneficiaries.
Section 2.2. Amendment.
So long as there remains any Beneficiary, or any Preferred
Securities of any series are outstanding, this Agreement shall not be modified
or amended in any manner adverse to such Beneficiary or to the holders of the
Preferred Securities.
Section 2.3. Notices.
Any notice, request or other communication required or
permitted to be given hereunder shall be given in writing by delivering the same
against receipt therefor by facsimile transmission (confirmed by mail), telex or
by registered or certified mail, addressed as follows (and if so given, shall be
deemed given when mailed or upon receipt of an answer-back, if sent by telex):
If to Harleysville: Harleysville Group Inc.
000 Xxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000-0000
Facsimile No.: (000) 000-0000
Attention: General Counsel
If to the Trust: Harleysville Group Capital Trust __
c/o
---------------------------------
------------------------------------
------------------------------------
------------------------------------
Section 2.4. Choice of Law. This agreement shall be governed
by and construed, interpreted and enforced in accordance with the laws of the
State of New York.
D-3
THIS AGREEMENT is executed as of the day and year first above written.
HARLEYSVILLE GROUP INC.
By:
-----------------------------------------
Name:
Title:
HARLEYSVILLE GROUP CAPITAL TRUST __
By:
-----------------------------------------
Name:
Administrative Trustee
D-4
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 (as
defined below) 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 certificate is presented by an authorized
representative of The Depository Trust Company (55 Water Street, New York), to
Harleysville Group Capital Trust __ or its agent for registration of transfer,
exchange or payment, and any certificate 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 hereon is made to Cede & Co., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS
WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
Certificate Number Number of Preferred Securities
P-
CUSIP NO.
Certificate Evidencing Preferred Securities
Of
Harleysville Group Capital Trust __
____% Trust Originated Preferred Securities,
(liquidation amount $___ per Preferred Security)
Harleysville Group Capital Trust __, a statutory trust formed under the
laws of the State of Delaware (the "Trust"), hereby certifies that Cede & Co.
(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 Harleysville Group Capital Trust __ ____% Trust
Originated Preferred Securities, (liquidation amount $___ per Preferred
Security) (the "Preferred Securities"). The Preferred Securities are
transferable on the books and records of the Trust, in person or by a duly
authorized attorney, upon surrender of this certificate duly endorsed and in
proper form for transfer as provided in Section 5.4 of the Trust Agreement (as
defined below). The designations, rights, privileges, restrictions, preferences
-i-
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 _________, 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 is entitled
to the benefits of the Guarantee Agreement entered into by Harleysville Group
Inc., a Delaware corporation, and ________________________, as guarantee
trustee, dated as of __________, 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 without charge upon
written request to the Trust at its principal place of business or registered
office.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.
IN WITNESS WHEREOF, the Trust has executed this certificate this _____
day of ______, ____.
HARLEYSVILLE GROUP CAPITAL TRUST __
By:
-----------------------------------------
Name:
Administrative Trustee
CERTIFICATE OF AUTHENTICATION
This is one of the Preferred Securities referred to in the within
mentioned Trust Agreement.
_____________________________, as
Property Trustee
By:
-----------------------------------------
Name:
Title:
-ii-
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)
-iii-
