EXHIBIT 4.9
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DECLARATION OF TRUST
EQUITABLE OF IOWA COMPANIES
CAPITAL TRUST
Dated as of March 19, 1996
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TABLE OF CONTENTS
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Interpretation and Definitions
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application
SECTION 2.2 Lists of Holders of Securities
SECTION 2.3 Reports by the Property Trustee
SECTION 2.4 Periodic Reports to the Property Trustee
SECTION 2.5 Evidence of Compliance with Conditions Precedent
SECTION 2.6 Events of Default; Waiver
SECTION 2.7 Event of Default; Notice
ARTICLE III
ORGANIZATION
SECTION 3.1 Name and Organization
SECTION 3.2 Office
SECTION 3.3 Purpose
SECTION 3.4 Authority
SECTION 3.5 Title to Property of the Trust
SECTION 3.6 Powers and Duties of the Regular Trustees
SECTION 3.7 Prohibition of Actions by the Trust and the Trustees
SECTION 3.8 Powers and Duties of the Property Trustee
SECTION 3.9 Certain Duties and Responsibilities of the Property Trustee
SECTION 3.10 Certain Rights of Property Trustee
SECTION 3.11 Delaware Trustee
SECTION 3.12 Execution of Documents
SECTION 3.13 Not Responsible for Recitals or Issuance of Securities
SECTION 3.14 Duration of Trust
SECTION 3.15 Mergers
SECTION 3.16 Property Trustee May File Proofs of Claim
ARTICLE IV
SPONSOR
SECTION 4.1 Sponsor's Purchase of Common Securities
SECTION 4.2 Responsibilities of the Sponsor
ARTICLE V
TRUSTEES
SECTION 5.1 Number of Trustees
SECTION 5.2 Delaware Trustee
SECTION 5.3 Property Trustee; Eligibility
SECTION 5.4 Qualifications of Regular Trustees and Delaware Trustee
Generally
SECTION 5.5 Initial Trustees
SECTION 5.6 Appointment, Removal and Resignation of Trustees
SECTION 5.7 Vacancies among Trustees
SECTION 5.8 Effect of Vacancies
SECTION 5.9 Meetings
SECTION 5.10 Delegation of Power
SECTION 5.11 Merger, Conversion, Consolidation or Succession to Business
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 Distributions
ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 General Provisions Regarding Securities
ARTICLE VIII
TERMINATION OF TRUST
SECTION 8.1 Termination of Trust
ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1 Transfer of Securities
SECTION 9.2 Transfer of Certificates
SECTION 9.3 Deemed Security Holders
SECTION 9.4 Book Entry Interests
SECTION 9.5 Notices to Clearing Agency
SECTION 9.6 Appointment of Successor Clearing Agency
SECTION 9.7 Definitive Preferred Security Certificates
SECTION 9.8 Mutilated, Destroyed, Lost or Stolen Certificates
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 Liability
SECTION 10.2 Exculpation
SECTION 10.3 Fiduciary Duty
SECTION 10.4 Indemnification
SECTION 10.5 Outside Businesses
ARTICLE XI
ACCOUNTING
SECTION 11.1 Fiscal Year
SECTION 11.2 Certain Accounting Matters
SECTION 11.3 Banking
SECTION 11.4 Withholding
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 Amendments
SECTION 12.2 Meetings of the Holders of Securities; Action by Written Consent
ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE
SECTION 13.1 Representations and Warranties of the Property Trustee
SECTION 13.2 Representations and Warranties of the Delaware Trustee
ARTICLE XIV
MISCELLANEOUS
SECTION 14.1 Notices
SECTION 14.2 Governing Law
SECTION 14.3 Intention of the Parties
SECTION 14.4 Headings
SECTION 14.5 Successors and Assigns
SECTION 14.6 Partial Enforceability
SECTION 14.7 Counterparts
CROSS-REFERENCE TABLE *
Section of Trust
Indenture Act Section of
of 1939, as amended Declaration
310(a) 5.3(a)
310(b) 5.3(c)
310(c) Inapplicable
311(a) 2.2(b)
311(b) 2.2(b)
311(c) Inapplicable
312(a) 2.2(a)
312(b) 2.2(b)
313 2.3
314(a) 2.4
314(b) Inapplicable
314(c) 2.5
314(d) Inapplicable
314(e) 2.5
315(a) 3.9(b)
315(b) 2.7
315(c) 3.9(a)
315(d) 3.9(b)
316(a) 2.6
316(c) 3.6(e)
317(a) 3.16
317(b) 3.8(h)
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* This Cross-Reference Table does not constitute
part of the Declaration and shall not affect the
interpretation of any of its terms or provisions.
DECLARATION OF TRUST
THIS DECLARATION OF TRUST ("Declaration") dated as of March 19,
1996 between Equitable of Iowa Companies, an Iowa corporation, as
Sponsor, and Fred S. Hubbell, Paul E. Larson, John A. Merriman, The
First National Bank of Chicago, a national banking association, and
First Chicago Delaware, Inc., a Delaware corporation, not in their
individual capacities but solely as Trustees, and the holders, from time
to time, of undivided beneficial interests in the Trust to be issued
from time to time pursuant to this Declaration.
WHEREAS, the Sponsor desires to establish a statutory business
trust (the "Trust") under the Business Trust Act (as hereinafter
defined); and
WHEREAS, the sole purpose of the Trust shall be to issue and sell
certain securities representing undivided beneficial interests in the
assets of the Trust, to invest the proceeds from such sales in the
Debentures issued by the Debenture Issuer (as those terms are
hereinafter defined) and to engage in activities necessary, appropriate,
convenient or incidental thereto.
NOW, THEREFORE, it being the intention of the parties hereto that
the Trust constitute a business trust under the Business Trust Act,
the Trustees hereby declare that all assets contributed to the Trust be
held in trust for the benefit of the holders, from time to time, of the
securities representing undivided beneficial interests in the assets of
the Trust issued hereunder, subject to the provisions of this
Declaration.
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Interpretation and Definitions.
Unless the context otherwise requires:
(a) capitalized terms used in this Declaration but not defined in the
preamble above have the respective meanings assigned to them in
this Section 1.1;
(b) a term defined anywhere in this Declaration has the same meaning
throughout;
(c) all references to "the Declaration" or "this Declaration" are to
this Declaration as modified, supplemented or amended from time to
time;
(d) all references in this Declaration to Articles and Sections are to
Articles and Sections of this Declaration unless otherwise
specified;
(e) a term defined in the Trust Indenture Act has the same meaning when
used in this Declaration unless otherwise defined in this
Declaration or unless the context otherwise requires; and
(f) a reference to the singular includes the plural and vice versa.
"AFFILIATE" has the same meaning as given to that term in Rule 405 of
the Securities Act or any successor rule thereunder.
"AUTHORIZED OFFICER" of a Person means any Person that is authorized to
bind such Person.
"BOOK ENTRY INTEREST" means a beneficial interest in a Global
Certificate, ownership and transfers of which shall be maintained and made
through book entries by a Clearing Agency as described in Section 9.4.
"BUSINESS DAY" means any day other than a day on which banking
institutions in New York, New York are authorized or required by law to
close.
"BUSINESS 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.
"CERTIFICATE" means a Common Security Certificate or a Preferred
Security Certificate.
"CERTIFICATE OF TRUST" has the meaning specified in Section 3.1.
"CLEARING AGENCY" means an organization registered as a "Clearing
Agency" pursuant to Section 17A of the Exchange Act that is acting as
depositary for the Preferred Securities and in whose name or in the name
of a nominee of that organization shall be registered a Global Certificate
and which shall undertake to effect book entry transfers and pledges of the
Preferred Securities.
"CLEARING AGENCY PARTICIPANT" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time the
Clearing Agency effects book entry transfers and pledges of securities
deposited with the Clearing Agency.
"CLOSING DATE" means the date on which the Preferred Securities are
sold pursuant to the terms of the Underwriting Agreement.
"CODE" means the Internal Revenue Code of 1986, as amended from
time to time, or any successor legislation. A reference to a specific
section of the Code refers not only to such specific section but also to
any corresponding provision of any federal tax statute enacted after the
date of this Declaration, as such specific section or corresponding
provision is in effect on the date of application of the provisions of
this Declaration containing such reference.
"COMMISSION" means the Securities and Exchange Commission.
"COMMON SECURITIES GUARANTEE" means the guarantee agreement of
the Sponsor in respect of the Common Securities.
"COMMON SECURITY" has the meaning specified in Section 7.1.
"COMMON SECURITY CERTIFICATE" means a definitive certificate in
fully registered form representing a Common Security.
"COMPANY INDEMNIFIED PERSON" means (a) any Regular Trustee; (b) any
Affiliate of any Regular Trustee; (c) any officers, directors, shareholders,
members, partners, employees, representatives or agents of any Regular
Trustee or any Affiliate thereof; or (d) any officer, employee or agent of
the Trust or its Affiliates.
"CORPORATE TRUST OFFICE" means the office of the Property Trustee
at which the corporate trust business of the Property Trustee shall, at
any particular time, be principally administered, which office at the
date of execution of this Declaration is located at One First National
Plaza - Suite 0126, Chicago, Illinois 60670-0126, Attention: Corporate
Trust Services Division; telecopy no. (312) 407-7108.
"COVERED PERSON" means (a) any officer, director, shareholder,
partner, member, representative, employee or agent of (i) the Trust or
(ii) the Trust's Affiliates; and (b) any Holder of Securities.
"DEBENTURE ISSUER" means Equitable of Iowa Companies in its capacity
as issuer of the Debentures under the Indenture.
"DEBENTURE TRUSTEE" means The First National Bank of Chicago, as
trustee under the Indenture until a successor is appointed thereunder,
and thereafter means such successor trustee.
"DEBENTURES" means the series of junior subordinated deferrable
interest debentures to be issued by the Debenture Issuer under the
Indenture to be held by the Property Trustee.
"DEFINITIVE PREFERRED SECURITY CERTIFICATES" has the meaning set
forth in Section 9.4.
"DELAWARE TRUSTEE" has the meaning set forth in Section 5.2.
"DISTRIBUTION" means a distribution payable to Holders of
Securities in accordance with Section 6.1.
"DTC" means The Depository Trust Company, the initial Clearing Agency.
"EVENT OF DEFAULT" in respect of the Securities means an Event of
Default (as defined in the Indenture) has occurred and is continuing in
respect of the Debentures.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended
from time to time, or any successor legislation.
"FIDUCIARY INDEMNIFIED PERSON" has the meaning set forth in Section
10.4(b).
"FISCAL YEAR" has the meaning set forth in Section 11.1.
"GLOBAL CERTIFICATE" has the meaning set forth in Section 9.4.
"HOLDER" means a Person in whose name a Certificate representing a
Security is registered, such Person being a beneficial owner within the
meaning of the Business Trust Act, PROVIDED, HOWEVER, that in determining
whether the Holders of the requisite liquidation amount of Preferred
Securities have voted on any matter provided for in this Declaration,
then for the purpose of such determination only (and not for any other
purpose hereunder), if the Preferred Securities remain in the form of one
or more Global Certificates, the term "Holders" shall mean the holder of
the Global Certificate acting at the direction of the Preferred Security
Beneficial Owners.
"INDEMNIFIED PERSON" means a Company Indemnified Person or a
Fiduciary Indemnified Person.
"INDENTURE" means the Indenture dated as of January 17, 1995, among
the Debenture Issuer and the Debenture Trustee, and any indenture
supplemental thereto pursuant to which the Debentures are to be issued.
"INVESTMENT COMPANY" means an investment company as defined in the
Investment Company Act and the regulations promulgated thereunder.
"INVESTMENT COMPANY ACT" means the Investment Company Act of 1940,
as amended from time to time, or any successor legislation.
"LEGAL ACTION" has the meaning set forth in Section 3.6(g).
"LIST OF HOLDERS" has the meaning specified in Section 2.2(a).
"MAJORITY IN LIQUIDATION AMOUNT" means, except as provided in the
terms of the Preferred Securities or by the Trust Indenture Act, Holder(s)
of outstanding Securities, voting together as a single class, or, as the
context may require, Holders of outstanding Preferred Securities or Holders
of outstanding Common Securities, voting separately as a class, who are the
record owners of more than 50% of the aggregate liquidation amount (including
the stated amount that would be paid on redemption, liquidation or otherwise,
plus accrued and unpaid Distributions to the date upon which the voting
percentages are determined) of all outstanding Securities of the relevant
class.
"OFFICERS' CERTIFICATE" means, with respect to any Person (other than
Regular Trustees who are natural persons), a certificate signed by two
Authorized Officers of such Person. Any Officers' Certificate delivered with
respect to compliance with a condition or covenant provided for in this
Declaration shall include:
(a) a statement that each officer signing the Officers' Certificate has
read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Officers'
Certificate;
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable
such officer to express an informed opinion as to whether or not
such covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such officer,
such condition or covenant has been complied with ;
PROVIDED, that the term "Officers' Certificate" when used with reference to
Regular Trustees who are natural persons shall mean a certificate signed by
two of the Regular Trustees which otherwise satisfies the foregoing
requirements.
"PAYING AGENT" has the meaning specified in Section 3.8(h).
"PAYMENT AMOUNT" has the meaning specified in Section 6.1.
"PERSON" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever
nature.
"PREFERRED SECURITIES GUARANTEE" means the guarantee agreement of
the Sponsor in respect of the Preferred Securities.
"PREFERRED SECURITY" has the meaning specified in Section 7.1.
"PREFERRED SECURITY BENEFICIAL OWNER" means, with respect to a Book
Entry Interest, a Person who is the beneficial owner of such Book Entry
Interest, as reflected on the books of the Clearing Agency, or on the
books of a Person maintaining an account with such Clearing Agency
(directly as a Clearing Agency Participant or as an indirect participant,
in each case in accordance with the rules of such Clearing Agency).
"PREFERRED SECURITY CERTIFICATE" means a certificate representing a
Preferred Security.
"PRICING AGREEMENT" means the pricing agreement between the Trust,
the Debenture Issuer and the underwriters designated by the Regular
Trustees with respect to the offer and sale of the Preferred Securities.
"PROPERTY TRUSTEE" means the Trustee meeting the eligibility
requirements set forth in Section 5.3
"PROPERTY TRUSTEE ACCOUNT" has the meaning set forth in Section 3.8(c).
"QUORUM" means a majority of the Regular Trustees or, if there are
only two Regular Trustees, both of them.
"REGULAR TRUSTEE" means any Trustee other than the Property Trustee
and the Delaware Trustee.
"RELATED PARTY" means, with respect to the Sponsor, any direct or
indirect wholly owned subsidiary of the Sponsor or any Person that owns,
directly or indirectly, 100% of the outstanding voting securities of the
Sponsor.
"RESPONSIBLE OFFICER" means, with respect to the Property Trustee,
any officer within the Corporate Trust Office of the Property Trustee,
including any vice-president, any assistant vice-president, the secretary,
any assistant secretary, the treasurer, any assistant treasurer or other
officer of the Corporate Trust Office of the Property Trustee customarily
performing functions similar to those performed by any of the above
designated officers and also means, with respect to a particular corporate
trust matter, any other officer to whom such matter is referred because of
that officer's knowledge of and familiarity with the particular subject.
"RULE 3a-5" means Rule 3a-5 under the Investment Company Act or any
successor rule thereunder.
"RULE 3a-7" means Rule 3a-7 under the Investment Company Act or any
successor rule thereunder.
"SECURITIES" means the Common Securities and the Preferred Securities.
"SECURITIES ACT" means the Securities Act of 1933, as amended from
time to time, or any successor legislation.
"SECURITIES GUARANTEES" means the Common Securities Guarantee and the
Preferred Securities Guarantee.
"SPONSOR" means Equitable of Iowa Companies, an Iowa corporation,
or any successor entity in a merger, consolidation or amalgamation, in
its capacity as sponsor of the Trust.
"SUCCESSOR DELAWARE TRUSTEE" has the meaning specified in Section 5.6(b).
"SUCCESSOR ENTITY" has the meaning specified in Section 3.15(b)(i).
"SUCCESSOR PROPERTY TRUSTEE" has the meaning specified in Section 5.6(b).
"SUCCESSOR SECURITY" has the meaning specified in Section 3.15(b)(i)(B).
"SUPER MAJORITY" has the meaning set forth in Section 2.6(a) (ii).
"10% IN LIQUIDATION AMOUNT" means, except as provided in the terms of
the Preferred Securities or by the Trust Indenture Act, Holder(s) of
outstanding Securities, voting together as a single class, or, as the context
may require, Holders of outstanding Preferred Securities or Holders of
outstanding Common Securities, voting separately as a class, who are the
record owners of 10% or more of the aggregate liquidation amount (including
the stated amount that would be paid on redemption, liquidation or otherwise,
plus accrued and unpaid Distributions to the date upon which the voting
percentages are determined) of all outstanding Securities of the relevant
class.
"TREASURY REGULATIONS" means the income tax regulations, including
temporary and proposed regulations, promulgated under the Code by the United
States Treasury, as such regulations may be amended from time to time
(including corresponding provisions of succeeding regulations).
"TRUST INDENTURE ACT" means the Trust Indenture Act of 1939, as
amended from time to time, or any successor legislation.
"TRUSTEE" or "TRUSTEES" means each Person who has signed this
Declaration as a trustee, so long as such Person shall continue in
office in accordance with the terms hereof, and all other Persons who
may from time to time be duly appointed, qualified and serving as
Trustees in accordance with the provisions hereof, and references herein
to a Trustee or the Trustees shall refer to such Person or Persons
solely in their capacity as trustees hereunder.
"TRUSTEES' AUTHORIZATION CERTIFICATE" means a written certificate
signed by two of the Regular Trustees for the purpose of establishing
the terms and form of the Preferred Securities and the Common Securities
as determined by the Regular Trustees.
"UNDERWRITING AGREEMENT" means the Underwriting Agreement for the
offering and sale of Preferred Securities between the Trust, the
Debenture Issuer and the underwriters designated by the Regular
Trustees.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application.
(a) This Declaration is subject to the provisions of the Trust
Indenture Act that are required to be part of this Declaration and
shall, to the extent applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is a
Trustee for the purposes of the Trust Indenture Act.
(c) If and to the extent that any provision of this Declaration
limits, qualifies or conflicts with the duties imposed by Sections 310
to 317, inclusive, of the Trust Indenture Act, such imposed duties shall
control.
(d) The application of the Trust Indenture Act to this Declaration
shall not affect the nature of the Securities as equity securities
representing undivided beneficial interests in the assets of the Trust.
SECTION 2.2 Lists of Holders of Securities.
(a) Each of the Sponsor and the Regular Trustees on behalf of the
Trust shall provide the Property Trustee with a list, in such form as the
Property Trustee may reasonably require, of the names and addresses of
the Holders of the Securities ("List of Holders"), (i) within one
Business Day after January 1 and June 30 of each year and current as of
such date, and (ii) at any other time, within 30 days of receipt by the
Trust of a written request from the Property Trustee for a List of
Holders as of a date no more than 14 days before such List of Holders is
given to the Property Trustee; PROVIDED THAT neither the Sponsor nor the
Regular Trustees on behalf of the Trust shall be obligated to provide
such List of Holders at any time the List of Holders does not differ
from the most recent List of Holders given to the Property Trustee by
the Sponsor and the Regular Trustees on behalf of the Trust. The
Property Trustee shall preserve, in as current a form as is reasonably
practicable, all information contained in Lists of Holders given to it
or which it receives in the capacity as Paying Agent (if acting in such
capacity) PROVIDED THAT the Property Trustee may destroy any List of
Holders previously given to it on receipt of a new List of Holders.
(b) The Property Trustee shall comply with its obligations under,
and shall be entitled to the benefits of, Sections 311(a), 311(b) and
312(b) of the Trust Indenture Act.
SECTION 2.3 Reports by the Property Trustee.
Within 60 days after May 15 of each year(commencing with the year
of the first anniversary of the issuance of the Preferred Securities),
the Property Trustee shall provide to the Holders of the Preferred
Securities such reports as are required by Section 313 of the Trust
Indenture Act, if any, in the form and in the manner provided by Section
313 of the Trust Indenture Act. The Property Trustee shall also comply
with the requirements of Section 313(d) of the Trust Indenture Act.
SECTION 2.4 Periodic Reports to the Property Trustee.
Each of the Sponsor and the Regular Trustees on behalf of the Trust
shall provide to the Property Trustee such documents, reports and
information as required by Section 314 (if any) of the Trust Indenture
Act and the compliance certificate required by Section 314 of the Trust
Indenture Act in the form, in the manner and at the times required by
Section 314 of the Trust Indenture Act.
SECTION 2.5 Evidence of Compliance with Conditions Precedent.
Each of the Sponsor and the Regular Trustees on behalf of the Trust
shall provide to the Property Trustee such evidence of compliance with
any conditions precedent, if any, provided for in this Declaration that
relate to any of the matters set forth in Section 314(c) of the Trust
Indenture Act. Any certificate or opinion required to be given by an
officer pursuant to Section 314(c)(1) may be given in the form of an
Officers' Certificate.
SECTION 2.6 Events of Default; Waiver.
(a) The Holders of a Majority in Liquidation Amount of the
Preferred Securities may, by vote, on behalf of the Holders of all of
the Preferred Securities, waive any past Event of Default in respect of
the Preferred Securities and its consequences, PROVIDED THAT, if the
underlying Event of Default under the Indenture:
(i) is not waivable under the Indenture, the Event of Default under
the Declaration shall also not be waivable; or
(ii) requires the consent or vote of greater than a majority in
principal amount of the holders of the Debentures (a "Super
Majority") to be waived under the Indenture, the Event of
Default under the Declaration may only be waived by the vote of
the Holders of at least the proportion in liquidation amount of
the Preferred Securities that the relevant Super Majority
represents of the aggregate principal amount of the Debentures
outstanding.
The foregoing provisions of this Section 2.6(a) shall be in lieu of
Section 316(a)(1)(B) of the Trust Indenture Act and such Section 316(a)(1)(B)
of the Trust Indenture Act is hereby expressly excluded from this Declaration
and the Securities, as permitted by the Trust Indenture Act. Upon such waiver,
any such default shall cease to exist, and any Event of Default with respect
to the Preferred Securities arising therefrom shall be deemed to have been
cured, for every purpose of this Declaration and the Preferred Securities,
but no such waiver shall extend to any subsequent or other default or Event
of Default with respect to the Preferred Securities or impair any right
consequent thereon.
(b) The Holders of a Majority in Liquidation Amount of the Common
Securities may, by vote, on behalf of the Holders of all of the Common
Securities, waive any past Event of Default in respect of the Common
Securities and its consequences, PROVIDED THAT, if the underlying Event
of Default under the Indenture:
(i) is not waivable under the Indenture, except where the Holders of
the Common Securities are deemed to have waived such Event of
Default under the Declaration as provided below in this Section
2.6(b), the Event of Default under the Declaration shall also not
be waivable; or
(ii) requires the consent or vote of a Super Majority to be waived under
the Indenture, except where the Holders of the Common Securities
are deemed to have waived such Event of Default under the Declaration
as provided below in this Section 2.6(b), the Event of Default
under the Declaration may only be waived by the vote of the Holders
of at least the proportion in liquidation amount of the Common
Securities that the relevant Super Majority represents of the
aggregate principal amount of the Debentures outstanding;
PROVIDED FURTHER, each Holder of Common Securities will be deemed to have
waived any such Event of Default and all Events of Default with respect to
the Common Securities and the consequences thereof until all Events of
Default with respect to the Preferred Securities have been cured, waived or
otherwise eliminated, and until such Events of Default with respect to the
Preferred Securities have been so cured, waived or otherwise eliminated, the
Property Trustee will be deemed to be acting solely on behalf of the Holders
of the Preferred Securities and only the Holders of the Preferred Securities
will have the right to direct the Property Trustee in accordance with the
terms of the Securities. The foregoing provisions of this Section 2.6(b)
shall be in lieu of Sections 316(a)(1)(A) and 316(a)(1)(B) of the Trust
Indenture Act and such Sections 316(a)(1)(A) and 316(a)(1)(B) of the Trust
Indenture Act are hereby expressly excluded from this Declaration and the
Securities, as permitted by the Trust Indenture Act. Subject to the foregoing
provisions of this Section 2.6(b), upon such waiver, any such default shall
cease to exist and any Event of Default with respect to the Common Securities
arising therefrom shall be deemed to have been cured for every purpose of
this Declaration, but no such waiver shall extend to any subsequent or other
default or Event of Default with respect to the Common Securities or impair
any right consequent thereon.
(c) A waiver of an Event of Default under the Indenture by the Property
Trustee at the direction of the Holders of the Preferred Securities
constitutes a waiver of the corresponding Event of Default with respect to
the Preferred Securities under this Declaration. The foregoing provisions of
this Section 2.6(c) shall be in lieu of Section 316(a)(1)(B) of the Trust
Indenture Act and such Section 316(a)(1)(B) of the Trust Indenture Act is
hereby expressly excluded from this Declaration and the Securities, as
permitted by the Trust Indenture Act.
SECTION 2.7 Event of Default; Notice.
(a) The Property Trustee shall, within 90 days after the occurrence
of an Event of Default, transmit by mail, first class postage prepaid, to
the Holders of the Securities, notices of all defaults with respect to the
Securities actually known to a Responsible Officer of the Property Trustee,
unless such defaults have been cured before the giving of such notice (the
term "defaults" for the purposes of this Section 2.7(a) being hereby defined
to be an Event of Default as defined in the Indenture, not including any
periods of grace provided for therein and irrespective of the giving of any
notice provided therein); PROVIDED THAT, except for a default in the payment
of principal of (or premium, if any) or interest on any of the Debentures or
in the payment of any sinking fund installment established for the Debentures,
the Property Trustee shall be protected in withholding such notice if and so
long as a Responsible Officer of the Property Trustee in good faith determines
that the withholding of such notice is in the interests of the Holders of the
Securities.
(b) The Property Trustee shall not be deemed to have knowledge of any
default except:
(i) a default under Sections 5.1(a) and 5.1(b) of the Indenture; or
(ii) any default as to which the Property Trustee shall have received
written notice or of which a Responsible Officer of the Property
Trustee charged with the administration of this Declaration shall
have actual knowledge.
ARTICLE III
ORGANIZATION
SECTION 3.1 Name and Organization.
The Trust hereby created is named "Equitable of Iowa Companies Capital
Trust" as such name may be modified from time to time by the Regular Trustees
following written notice to the Holders of Securities. The Trust's activities
may be conducted under the name of the Trust or any other name deemed
advisable by the Regular Trustees. The Trustees are hereby authorized and
directed to execute and file a certificate of trust (the "Certificate of
Trust") with the Delaware Secretary of State in accordance with the
provisions of Section 3810 of the Business Trust Act. This Declaration, as
amended or supplemented from time to time, and the Trustees' Authorization
Certificate, when issued, shall constitute the governing instrument of the
Trust.
SECTION 3.2 Office.
The address of the principal office of the Trust is c/o Equitable of
Iowa Companies, 604 Locust Street, Des Moines, Iowa 50309. On ten Business
Days written notice to the Holders of Securities, the Regular Trustees may
designate another principal office.
SECTION 3.3 Purpose.
The exclusive purposes and functions of the Trust are (a) to issue and
sell Securities and use the gross proceeds from such sale to acquire the
Debentures, and (b) except as otherwise limited herein, to engage in only
those other activities necessary, appropriate, convenient or incidental
thereto. The Trust shall not borrow money, issue debt or reinvest proceeds
derived from investments, pledge any of its assets or otherwise undertake
(or permit to be undertaken) any activity that would cause the Trust not
to be classified for United States federal income tax purposes as a grantor
trust.
The Trust will be classified as a grantor trust for United States
federal income tax purposes under Subpart E of Subchapter J of the Code,
pursuant to which the owners of the Preferred Securities and the Common
Securities will be the owners of the Trust for United States federal
income tax purposes, and such owners will include directly in their
gross income the income, gain, deduction or loss of the Trust as if the
Trust did not exist. By the acceptance of this Trust, none of the
Trustees, the Sponsor, the Holders of the Preferred Securities or Common
Securities or the Preferred Securities Beneficial Owners will take any
position for United States federal income tax purposes which is contrary
to the classification of the Trust as a grantor trust.
SECTION 3.4 Authority.
Subject to the limitations provided in this Declaration and to the
specific duties of the Property Trustee, the Regular Trustees shall have
exclusive and complete authority to carry out the purposes of the Trust.
An action taken by the Regular Trustees in accordance with their powers
shall constitute the act of and serve to bind the Trust and an action
taken by the Property Trustee on behalf of the Trust in accordance with
its powers shall constitute the act of and serve to bind the Trust. In
dealing with the Trustees acting on behalf of the Trust, no person shall
be required to inquire into the authority of the Trustees to bind the
Trust. Persons dealing with the Trust are entitled to rely conclusively
on the power and authority of the Trustees as set forth in this
Declaration.
SECTION 3.5 Title to Property of the Trust.
Except as provided in Section 3.8 with respect to the Debentures
and the Property Trustee Account or as otherwise provided in this
Declaration, legal title to all assets of the Trust shall be vested in
the Trust. The Holders shall not have legal title to any part of the
assets of the Trust, but shall have an undivided beneficial interest in
the assets of the Trust.
SECTION 3.6 Powers and Duties of the Regular Trustees.
The Regular Trustees shall have the exclusive power, duty and authority
to cause the Trust to engage in the following activities:
(a) to establish the terms and form of the Preferred Securities and
the Common Securities in the manner specified in Section 7.1 and
issue and sell the Preferred Securities and the Common Securities
in accordance with this Declaration; PROVIDED, HOWEVER, that the
Trust may issue no more than one series of Preferred Securities
and no more than one series of Common Securities, and, PROVIDED
FURTHER, that there shall be no interests in the Trust other than
the Securities, and the issuance of Securities shall be limited to
a one-time, simultaneous issuance of both Preferred Securities and
Common Securities on the Closing Date;
(b) in connection with the issue and sale of the Preferred Securities,
at the direction of the Sponsor, to:
(i) execute and file with the Commission a registration statement
on Form S-3 prepared by the Sponsor, including any amendments
thereto, pertaining to the Preferred Securities (and any other
securities of the Sponsor which the Sponsor may desire to
include in such registration statement);
(ii) execute and file any documents prepared by the Sponsor, or
take any acts as determined by the Sponsor to be necessary,
in order to qualify or register all or part of the Preferred
Securities in any State in which the Sponsor has determined
to qualify or register such Preferred Securities for sale;
(iii) execute and file an application, prepared by the Sponsor, to
the New York Stock Exchange, Inc. or any other national
stock exchange or the Nasdaq Stock Market's National Market
System for listing upon notice of issuance of any Preferred
Securities;
(iv) execute and file with the Commission a registration statement
on Form 8-A, including any amendments thereto, prepared by
the Sponsor, relating to the registration of the Preferred
Securities under Section 12(b) of the Exchange Act; and
(v) execute and enter into the Underwriting Agreement and Pricing
Agreement providing for the sale of the Preferred Securities;
(c) to acquire the Debentures with the proceeds of the sale of the
Preferred Securities and the Common Securities; PROVIDED, HOWEVER,
that the Regular Trustees shall cause legal title to the Debentures
to be held of record in the name of the Property Trustee for the
benefit of the Holders of the Preferred Securities and the Holders
of the Common Securities;
(d) to give the Sponsor and the Property Trustee prompt written notice
of the occurrence of certain events (as may be specified in the
terms of the Securities) arising from a change in law or a change
in legal interpretation or other circumstances specified in the
terms of the Securities PROVIDED THAT the Regular Trustees shall
consult with the Sponsor and the Property Trustee before taking or
refraining from taking any action in relation to any such event;
(e) to establish a record date with respect to all actions to be taken
hereunder that require a record date be established, including and
with respect to, for the purposes of Section 316(c) of the Trust
Indenture Act, Distributions, voting rights, redemptions and
exchanges, and to issue relevant notices to the Holders of
Preferred Securities and Holders of Common Securities as to such
actions and applicable record dates;
(f) to take all actions and perform such duties as may be required of
the Regular Trustees pursuant to the terms of the Securities;
(g) 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 3.8(e), the
Property Trustee has the exclusive power to bring such Legal Action;
(h) to employ or otherwise engage employees and agents (who may be
designated as officers with titles) and managers, contractors,
advisors and consultants and pay reasonable compensation for such
services;
(i) to cause the Trust to comply with the Trust's obligations under the
Trust Indenture Act;
(j) to give the certificate required by Section 314(a)(4) of the Trust
Indenture Act to the Property Trustee, which certificate may be
executed by any Regular Trustee;
(k) to incur expenses that are necessary or desirable to carry out any
of the purposes of the Trust;
(l) to act as, or appoint another Person to act as, registrar and
transfer agent for the Securities;
(m) to give prompt written notice to the Holders of the Securities of
any notice received from the Debenture Issuer of its election (i)
to defer payments of interest on the Debentures by extending the
interest payment period under the Debentures as authorized by the
Indenture, or (ii) to extend the maturity date of the Debentures
if so authorized by the Indenture, provided that any such extension
of the maturity date will not adversely affect the federal income
tax status of the Trust;
(n) 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 business 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 Preferred Securities or
to enable the Trust to effect the purposes for which the Trust
was created;
(o) to take any action, not inconsistent with this Declaration or with
applicable law, that the Regular Trustees determine in their
discretion to be necessary or desirable in carrying out the
purposes and functions of the Trust as set out in Section 3.3 or
the activities of the Trust as set out in this Section 3.6,
including, but not limited to:
(i) causing the Trust not to be deemed to be an Investment Company
required to be registered under the Investment Company Act;
(ii) causing the Trust to be classified for United States federal
income tax purposes as a grantor trust; and
(iii) cooperating with the Debenture Issuer to ensure that the
Debentures will be treated as indebtedness of the Debenture
Issuer for United States federal income tax purposes,
PROVIDED THAT such action does not adversely affect the interests
of Holders;
(p) 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 Regular
Trustees, on behalf of the Trust; and
(q) to execute all documents or instruments, perform all duties and
powers, and do all things for and on behalf of the Trust in all
matters necessary or desirable to the foregoing.
The Regular Trustees must exercise the powers set forth in this Section
3.6 in a manner that is consistent with the purposes and functions of the
Trust set out in Section 3.3, and the Regular Trustees shall not take any
action that is inconsistent with the purposes and functions of the Trust set
forth in Section 3.3.
Subject to this Section 3.6, the Regular Trustees shall have none of the
powers or the authority of the Property Trustee set forth in Section 3.8.
Any expenses incurred by the Regular Trustees pursuant to this Section
3.6 shall be reimbursed by the Debenture Issuer.
SECTION 3.7 Prohibition of Actions by the Trust and the Trustees.
(a) The Trust shall not, and the Trustees (including the Property
Trustee) shall cause the Trust not to, engage in any activity other than
as required or authorized by this Declaration. In particular, the Trust
shall not and the Trustees (including the Property Trustee) shall cause
the Trust not to:
(i) invest any proceeds received by the Trust from holding the
Debentures, but shall distribute all such proceeds to Holders of
Securities pursuant to the terms of this Declaration and of the
Securities;
(ii) acquire any assets other than as expressly provided herein;
(iii) possess Trust property for other than a Trust purpose;
(iv) make any loans or incur any indebtedness other than loans
represented by the Debentures;
(v) possess any power or otherwise act in such a way as to vary the
Trust assets or the terms of the Securities in any way whatsoever
(except to the extent expressly authorized in this Declaration or
by the terms of the Securities);
(vi) issue any securities or other evidences of beneficial ownership
of, or beneficial interest in, the Trust other than the
Securities; or
(vii) other than as provided in this Declaration or by the terms of the
Securities, (A) direct the time, method and place of exercising
any trust or power conferred upon the Debenture Trustee with
respect to the Debentures, (B) waive any past default that is
waivable under the Indenture, (C) exercise any right to rescind
or annul any declaration that the principal of all the Debentures
shall be due and payable, or (D) consent to any amendment,
modification or termination of the Indenture or the Debentures
where such consent shall be required unless the Trust shall have
received an opinion of counsel to the effect that such
modification will not cause more than an insubstantial risk that
for United States federal income tax purposes the Trust will not be
classified as a grantor trust.
SECTION 3.8 Powers and Duties of the Property Trustee.
(a) The legal title to the Debentures shall be owned by and held
of record in the name of the Property Trustee in trust for the benefit
of the Trust and the Holders of the Securities. The right, title and
interest of the Property Trustee to the Debentures shall vest
automatically in each Person who may hereafter be appointed as Property
Trustee in accordance with Section 5.6. Such vesting and cessation of
title shall be effective whether or not conveyancing documents with
regard to the Debentures have been executed and delivered.
(b) The Property Trustee shall not transfer its right, title and
interest in the Debentures to the Regular Trustees or to the Delaware
Trustee (if the Property Trustee does not also act as Delaware Trustee).
(c) The Property Trustee shall:
(i) establish and maintain a segregated non-interest bearing trust
account (the "Property Trustee Account") in the name of and under
the exclusive control of the Property Trustee on behalf of the
Holders of the Securities and, upon the receipt of payments of
funds made in respect of the Debentures held by the Property
Trustee, deposit such funds into the Property Trustee Account and
make payments to the Holders of the Preferred Securities and
Holders of the Common Securities from the Property Trustee Account
in accordance with Section 6.1. Funds in the Property Trustee
Account shall be held uninvested until disbursed in accordance
with this Declaration. The Property Trustee Account shall be an
account that is maintained with a banking institution the rating on
whose long-term unsecured indebtedness is at least equal to the
rating assigned to the Preferred Securities by a "nationally
recognized statistical rating organization", as that term is
defined for purposes of Rule 436(g)(2) under the Securities Act;
(ii) engage in such ministerial activities as shall be necessary or
appropriate to effect the redemption of the Preferred Securities
and the Common Securities to the extent the Debentures are
redeemed or mature; and
(iii) upon written notice of distribution issued by the Regular Trustees
in accordance with the terms of the Securities, engage in such
ministerial activities as shall be necessary or appropriate to
effect the distribution of the Debentures to Holders of Securities
upon the occurrence of certain special events (as may be defined
in the terms of the Securities) arising from a change in law or a
change in legal interpretation or other specified circumstances
pursuant to the terms of the Securities.
(d) The Property Trustee shall take all actions and perform such
duties as may be specifically required of the Property Trustee pursuant
to the terms of the Securities.
(e) The Property Trustee shall take any Legal Action which arises
out of or in connection with an Event of Default of which a Responsible
Officer of the Property Trustee has actual knowledge or the Property
Trustee's duties and obligations under this Declaration or the Trust
Indenture Act.
(f) The Property Trustee shall continue to serve as a Trustee
until either:
(i) the Trust has been completely liquidated and the proceeds of the
liquidation distributed to the Holders of Securities pursuant to
the terms of the Securities; or
(ii) a Successor Property Trustee has been appointed and has accepted
that appointment in accordance with Section 5.6.
(g) The Property Trustee shall have the legal power to exercise all
of the rights, powers and privileges of a holder of Debentures under the
Indenture and, if an Event of Default actually known to a Responsible Officer
of the Property Trustee occurs and is continuing, the Property Trustee shall,
for the benefit of Holders of the Securities, enforce its rights as holder of
the Debentures subject to the rights of the Holders pursuant to the terms of
such Securities.
(h) The Property Trustee may authorize one or more Persons (each, a
"Paying Agent") to pay Distributions, redemption payments or liquidation
payments on behalf of the Trust with respect to all Securities and any such
Paying Agent shall comply with Section 317(b) of the Trust Indenture Act.
Any Paying Agent may be removed by the Property Trustee at any time and a
successor Paying Agent or additional Paying Agents may be appointed at any
time by the Property Trustee. In the event the Preferred Securities do not
remain in the form of one or more Global Certificates, the Property Trustee
will act as Paying Agent and may designate an additional or substitute Paying
Agent at any time.
(i) Subject to this Section 3.8, the Property Trustee shall have none
of the duties, liabilities, powers or the authority of the Regular Trustees
set forth in Section 3.6.
The Property Trustee must exercise the powers set forth in this
Section 3.8 in a manner that is consistent with the purposes and
functions of the Trust set out in Section 3.3, and the Property Trustee
shall not take any action that is inconsistent with the purposes and
functions of the Trust set out in Section 3.3.
SECTION 3.9 Certain Duties and Responsibilities of the Property Trustee.
(a) The Property Trustee, before the occurrence of any Event of
Default and after the curing of all Events of Default that may have
occurred, shall undertake to perform only such duties as are specifically
set forth in this Declaration and no implied covenants shall be read into
this Declaration against the Property Trustee. In case an Event of Default
has occurred (that has not been cured or waived pursuant to Section 2.6)
of which a Responsible Officer of the Property Trustee has actual knowledge,
the Property Trustee shall exercise such of the rights and powers vested in
it by this Declaration, and use the same degree of care and skill in their
exercise, as a prudent person would exercise or use under the circumstances
in the conduct of his or her own affairs.
(b) No provision of this Declaration 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) prior to the occurrence of an Event of Default and after the
curing or waiving of all such Events of Default that may have
occurred:
(A) the duties and obligations of the Property Trustee shall be
determined solely by the express provisions of this
Declaration and the Property Trustee shall not be liable
except for the performance of such duties and obligations as
are specifically set forth in this Declaration, and no
implied covenants or obligations shall be read into this
Declaration against the Property Trustee; and
(B) in the absence of bad faith on the part of the Property
Trustee, the Property Trustee may conclusively rely, as to
the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or
opinions furnished to the Property Trustee and conforming
to the requirements of this Declaration; but in the case of
any such certificates or opinions that by any provision hereof
are specifically required to be furnished to the Property
Trustee, the Property Trustee shall be under a duty to examine
the same to determine whether or not they conform to the
requirements of this Declaration;
(ii) the Property Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer of the Property
Trustee, unless it shall be proved that the Property Trustee was
negligent in ascertaining the pertinent facts;
(iii) 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 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 Declaration;
(iv) no provision of this Declaration shall require the Property
Trustee to expend or risk its own funds or otherwise incur
personal financial liability in the performance of any of its
duties or in the exercise of any of its rights or powers, if it
shall have reasonable grounds for believing that the repayment of
such funds or liability is not reasonably assured to it under the
terms of this Declaration or indemnity reasonably satisfactory to
the Property Trustee against such risk or liability is not
reasonably assured to it;
(v) the Property Trustee's sole duty with respect to the custody, safe
keeping and physical preservation of the Debentures and the
Property Trustee 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 Declaration
and the Trust Indenture Act;
(vi) the Property Trustee shall have no duty or liability for or with
respect to the value, genuineness, existence or sufficiency of the
Debentures or the payment of any taxes or assessments levied
thereon or in connection therewith;
(vii) the Property Trustee shall not be liable for any interest on any
money received by it except as it may otherwise agree with the
Sponsor. Money held by the Property Trustee need not be segregated
from other funds held by it except in relation to the Property
Trustee Account maintained by the Property Trustee pursuant to
Section 3.8(c)(i) and except to the extent otherwise required by
law; and
(viii) the Property Trustee shall not be responsible for monitoring the
compliance by the Regular Trustees or the Sponsor with their
respective duties under this Declaration, nor shall the Property
Trustee be liable for any default or misconduct of the Regular
Trustees or the Sponsor.
SECTION 3.10 Certain Rights of Property Trustee.
(a) Subject to the provisions of Section 3.9:
(i) the Property Trustee may conclusively rely and shall be fully
protected in acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document believed by
it to be genuine and to have been signed, sent or presented by
the proper party or parties;
(ii) any direction or act of the Sponsor or the Regular Trustees
contemplated by this Declaration shall be sufficiently evidenced
by an Officers' Certificate (or, with respect to the establishment
of the terms and form of the Securities by the Regular Trustees,
by a Trustees' Authorization Certificate);
(iii) whenever in the administration of this Declaration, the Property
Trustee shall deem it desirable that a matter be proved or
established before taking, 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 conclusively rely upon an Officers' Certificate
which, upon receipt of such request, shall be promptly delivered
by the Sponsor or the Regular Trustees;
(iv) 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 registration thereof;
(v) the Property Trustee may consult with counsel or other experts
and the advice or opinion of such counsel and experts with respect
to legal matters or advice within the scope of such experts' area
of expertise shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by
it hereunder in good faith and in accordance with such advice or
opinion, such counsel may be counsel to the Sponsor 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 Declaration from any court
of competent jurisdiction;
(vi) the Property Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Declaration at the
request or direction of any Holder, unless such Holder shall have
provided to the Property Trustee security and indemnity,
reasonably satisfactory to the Property Trustee, against the
costs, expenses (including attorneys' fees and expenses and the
expenses of the Property Trustee's agents, nominees or custodians)
and liabilities that might be incurred by it in complying with
such request or direction, including such reasonable advances as
may be requested by the Property Trustee; provided that, nothing
contained in this Section 3.10(a)(vi) shall be taken to relieve
the Property Trustee, upon the occurrence of an Event of Default,
of its obligation to exercise the rights and powers vested in it
by this Declaration;
(vii) the Property Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence
of indebtedness or other paper or document, but the Property
Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit;
(viii) the Property Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by
or through agents, custodians, nominees or attorneys and the
Property Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with
due care by it hereunder;
(ix) any action taken by the Property Trustee or its agents hereunder
shall bind the Trust and the Holders of the Securities, and the
signature of the Property Trustee or its agents alone shall be
sufficient and effective to perform any such action and no third
party shall be required to inquire as to the authority of the
Property Trustee to so act or as to its compliance with any of
the terms and provisions of this Declaration, both of which shall
be conclusively evidenced by the Property Trustee's or its agent's
taking such action;
(x) whenever in the administration of this Declaration the Property
Trustee shall deem it desirable to receive instructions with
respect to enforcing any remedy or right or taking any other
action hereunder, the Property Trustee (i) may request
instructions from the Holders of the Securities which
instructions may only be given by the Holders of the same
proportion in liquidation amount of the Securities as would be
entitled to direct the Property Trustee under the terms of the
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 conclusively relying on or acting in or accordance
with such instructions; and
(xi) except as otherwise expressly provided by this Declaration, the
Property Trustee shall not be under any obligation to take any
action that is discretionary under the provisions of this
Declaration.
(b) No provision of this Declaration 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 3.11 Delaware Trustee.
Notwithstanding any other provision of this Declaration other than
Section 5.2, 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 Regular Trustees or the Property Trustee
described in this Declaration. Except as set forth in Section 5.2, the
Delaware Trustee shall be a Trustee for the sole and limited purpose of
fulfilling the requirements of Section 3807 of the Business Trust Act.
SECTION 3.12 Execution of Documents.
Unless otherwise determined by the Regular Trustees, and except as
otherwise required by the Business Trust Act, a majority of the Regular
Trustees or, if there are only two, both Regular Trustees or, if there
is only one, such Regular Trustee is authorized to execute on behalf of
the Trust any documents that the Regular Trustees have the power and
authority to execute pursuant to Section 3.6; PROVIDED THAT, the
registration statement referred to in Section 3.6(b)(i), including any
amendments thereto, shall be signed by all of the Regular Trustees.
SECTION 3.13 Not Responsible for Recitals or Issuance of Securities.
The recitals contained in this Declaration and the Securities shall
be taken as the statements of the Sponsor, and the Trustees do not
assume any responsibility for their correctness. The Trustees make no
representations as to the value or condition of the property of the
Trust or any part thereof. The Trustees make no representations as to
the validity or sufficiency of this Declaration, the Securities or the
Debentures or the Indenture.
SECTION 3.14 Duration of Trust.
The Trust, unless terminated pursuant to the provisions of Article VIII
hereof, shall have existence for twenty-five (25) years from the Closing Date.
SECTION 3.15 Mergers.
(a) The Trust may not consolidate, amalgamate, merge with or into,
or be replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other body, except as
described in Section 3.15(b) and (c).
(b) The Trust may, with the consent of the Regular Trustees or, if there
are more than two, a majority of the Regular Trustees and without the consent
of the Holders of the Securities, the Delaware Trustee or the Property Trustee,
consolidate, amalgamate, merge with or into, or be replaced by a trust
organized as such under the laws of any State; PROVIDED THAT:
(i) such successor entity (the "Successor Entity") either:
(A) expressly assumes all of the obligations of the Trust under
the Securities; or
(B) substitutes for the Securities other securities having
substantially the same terms as the Preferred Securities
(the "Successor Securities") so long as the Successor
Securities rank the same as the Preferred Securities rank
with respect to Distributions and payments upon liquidation,
redemption and otherwise;
(ii) the Debenture Issuer expressly acknowledges a trustee of the
Successor Entity that possesses the same powers and duties as the
Property Trustee as the holder of the Debentures;
(iii) the Preferred Securities or any Successor Securities are listed,
or any Successor Securities will be listed upon notification of
issuance, on any national securities exchange or with any other
organization on which the Preferred Securities are then listed or
quoted;
(iv) such merger, consolidation, amalgamation or replacement does not
cause the Preferred Securities (including any Successor Securities)
to be downgraded by any nationally recognized statistical rating
organization then rating the Preferred Securities at the request
of the Sponsor;
(v) such merger, consolidation, amalgamation or replacement does not
adversely affect the rights, preferences and privileges of the
Holders of the Securities (including any Successor Securities) in
any material respect (other than with respect to any dilution of
such Holders' interests in the Preferred Securities as a result
of such merger, consolidation, amalgamation or replacement);
(vi) such Successor Entity has a purpose identical to that of the Trust;
(vii) prior to such merger, consolidation, amalgamation or replacement,
the Sponsor has received an opinion of qualified independent
counsel to the Trust experienced in such matters to the effect
that:
(A) such merger, consolidation, amalgamation or replacement does
not adversely affect the rights, preferences and privileges
of the Holders of the Securities (including any Successor
Securities) in any material respect (other than with respect
to any dilution of such Holders' interests in the Preferred
Securities as a result of such merger, consolidation,
amalgamation or replacement);
(B) following such merger, consolidation, amalgamation or
replacement, neither the Trust nor the Successor Entity will
be required to register as an Investment Company; and
(C) following such merger, consolidation, amalgamation or
replacement, the Trust (or the Successor Entity) will
continue to be classified as a grantor trust for United
States federal income tax purposes; and
(viii) the Sponsor guarantees the obligations of such Successor Entity
under the Successor Securities at least to the extent provided by the
Preferred Securities Guarantee.
(c) Notwithstanding Section 3.15(b), the Trust shall not, except with
the consent of Holders of 100% in liquidation amount of the Securities,
consolidate, amalgamate, merge with or into, or be replaced by any other
entity or permit any other entity to consolidate, amalgamate, merge with or
into, or replace it if such consolidation, amalgamation, merger or
replacement would cause the Trust or Successor Entity to be classified as
other than a grantor trust for United States federal income tax purposes.
SECTION 3.16 Property Trustee May File Proofs of Claim. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other similar
judicial proceeding relative to the Trust or any other obligor upon the
Securities or the property of the Trust or of such other obligor or
their creditors, the Property Trustee (irrespective of whether any
Distributions on the Securities shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of whether the
Property Trustee shall have made any demand on the Trust for the payment
of any past due Distributions) shall be entitled and empowered, to the
fullest extent permitted by law, by intervention in such proceeding or
otherwise:
(a) to file and prove a claim for the whole amount of any Distributions
owing and unpaid in respect of the Securities (or, if the Securities
are original issue discount Securities, such portion of the
liquidation amount as may be specified in the terms of such
Securities) and to file such other papers or documents as may be
necessary or advisable in order to have the claims of the Property
Trustee (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Property Trustee, its
agents and counsel) and of the Holders allowed in such judicial
proceeding, and
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized
by each Holder to make such payments to the Property Trustee and, in the
event the Property Trustee shall consent to the making of such payments
directly to the Holders, to pay to the Property Trustee any amount due it for
the reasonable compensation, expenses, disbursements and advances of the
Property Trustee, its agents and counsel, and any other amounts due the
Property Trustee.
Nothing herein contained shall be deemed to authorize the Property
Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement adjustment or compensation
affecting the Securities or the rights of any Holder thereof or to authorize
the Property Trustee to vote in respect of the claim of any Holder in any
such proceeding.
ARTICLE IV
SPONSOR
SECTION 4.1 Sponsor's Purchase of Common Securities.
On the Closing Date the Sponsor will purchase all of the Common
Securities issued by the Trust, in an amount at least equal to 3% of
the capital of the Trust, at the same time as the Preferred Securities
are sold.
SECTION 4.2 Responsibilities of the Sponsor.
In connection with the issue and sale of the Preferred Securities,
the Sponsor shall have the exclusive right and responsibility to engage
in the following activities:
(a) to prepare for filing by the Trust with the Commission a
registration statement on Form S-3 pertaining to the Preferred
Securities, including any amendments thereto (which registration
statement may also include other securities of the Sponsor);
(b) 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 the Trust, and advise the Trust of actions it must take,
and prepare for execution and filing any documents to be executed
and filed by the Trust, as the Sponsor deems necessary or advisable
in order to comply with the applicable laws of any such States;
(c) to prepare for filing by the Trust an application to the New York
Stock Exchange, Inc. or any other national stock exchange or the
Nasdaq Stock Market's National Market System for listing upon
notice of issuance of any Preferred Securities;
(d) to prepare for filing by the Trust with the Commission a
registration statement on Form 8-A relating to the registration of
the Preferred Securities under Section 12(b) of the Exchange Act,
including any amendments thereto; and
(e) to negotiate the terms of the Underwriting Agreement and Pricing
Agreement providing for the sale of the Preferred Securities.
ARTICLE V
TRUSTEES
SECTION 5.1 Number of Trustees.
The number of Trustees initially shall be five (5), and:
(a) at any time before the issuance of any Securities, the Sponsor may,
by written instrument, increase or decrease the number of Trustees;
and
(b) after the issuance of any Securities, the number of Trustees may be
increased or decreased by vote of the Holders of a Majority in
Liquidation Amount of the Common Securities voting as a class at a
meeting of the Holders of the Common Securities or by written
consent in lieu of such meeting.
PROVIDED THAT, if the Property Trustee does not also act as Delaware
Trustee, the number of Trustees shall be at least three (3).
SECTION 5.2 Delaware Trustee.
If required by the Business Trust Act, one Trustee (the "Delaware
Trustee") shall be:
(a) a natural person who is a resident of the State of Delaware; or
(b) if not a natural person, an entity which has its principal place
of business in the State of Delaware, and otherwise meets the
requirements of applicable law,
PROVIDED THAT, if the Property Trustee has its principal place of
business in the State of Delaware and otherwise meets the requirements
of applicable law, then the Property Trustee shall also be the Delaware
Trustee and Section 3.11 shall have no application.
SECTION 5.3 Property Trustee; Eligibility.
(a) There shall at all times be one Trustee which shall act as
Property Trustee which shall:
(i) not be an Affiliate of the Sponsor;
(ii) be a corporation organized and doing business under the laws of
the United States of America or any State or Territory thereof or
of the District of Columbia, or a corporation or other Person
permitted by the Commission to act as an institutional trustee
under the Trust Indenture Act, authorized under such laws to
exercise corporate trust powers, having a combined capital and
surplus of at least 50 million U.S. dollars ($50,000,000), and
subject to supervision or examination by Federal, State,
Territorial or District of Columbia authority. If such corporation
publishes reports of condition at least annually, pursuant to law
or to the requirements of the supervising or examining authority
referred to above, then for the purposes of this Section 5.3(a)(ii),
the combined capital and surplus of such corporation shall be
deemed to be its combined capital and surplus as set forth in its
most recent report of condition so published; and
(iii) if the Trust is excluded from the definition of an Investment
Company solely by means of Rule 3a-7 and to the extent Rule 3a-7
requires a trustee having certain qualifications to hold title to
the "eligible assets" (as defined in Rule 3a-7) of the Trust, the
Property Trustee shall possess those qualifications.
(b) If at any time the Property Trustee shall cease to be eligible to
so act under Section 5.3(a), the Property Trustee shall immediately
resign in the manner and with the effect set forth in Section
5.6(c).
(c) If the Property Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust
Indenture Act, the Property Trustee and the Holder of the Common
Securities (as if it were the Obliger referred to in Section 310(b)
of the Trust Indenture Act) shall in all respects comply with the
provisions of Section 310(b) of the Trust Indenture Act.
(d) The Preferred Securities Guarantee shall be deemed to be
specifically described in this Declaration for purposes of clause
(i) of the first provision contained in Section 310(b) of the
Trust Indenture Act.
SECTION 5.4 Qualifications of Regular Trustees and Delaware Trustee
Generally.
Each Regular Trustee and the Delaware Trustee (unless the Property
Trustee also acts as Delaware 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 Authorized Officers.
SECTION 5.5 Initial Trustees.
The initial Regular Trustees shall be:
Fred S. Hubbell
Paul E. Larson
John A. Merriman
c/o Equitable of Iowa Companies
604 Locust Street
Des Moines, Iowa 50309
The initial Property Trustee shall be:
The First National Bank of Chicago
One First National Plaza, Suite 0126
Chicago, Illinois 60670-0126
Attn: Corporate Trust Services Division
The initial Delaware Trustee shall be:
First Chicago Delaware, Inc.
c/o FCC National Bank
300 King Street
Wilmington, Delaware 19801
SECTION 5.6 Appointment, Removal and Resignation of Trustees.
(a) Subject to Section 5.6(b), Trustees may be appointed or removed
without cause at any time:
(i) until the issuance of any Securities, by written instrument
executed by the Sponsor; and
(ii) after the issuance of any Securities, by vote of the Holders of
a Majority in Liquidation Amount of the Common Securities voting
as a class at a meeting of the Holders of the Common Securities.
(b) The Trustee that acts as Property Trustee shall not be removed in
accordance with Section 5.6(a) until a successor Trustee possessing the
qualifications to act as Property Trustee under Section 5.3 (a "Successor
Property Trustee") has been appointed and has accepted such appointment by
written instrument executed by such Successor Property Trustee and delivered
to the Regular Trustees and the Sponsor. The Trustee that acts as Delaware
Trustee shall not be removed in accordance with Section 5.6(a) until a
successor Trustee possessing the qualifications to act as Delaware Trustee
under Sections 5.2 and 5.4 (a "Successor Delaware Trustee") has been
appointed and has accepted such appointment by written instrument executed
by such Successor Delaware Trustee and delivered to the Regular Trustees and
the Sponsor.
(c) A Trustee appointed to office shall hold office until his or its
successor shall have been appointed, until his death or its dissolution or
until his or its removal or resignation. Any Trustee may resign from office
(without need for prior or subsequent accounting) by an instrument in writing
signed by the Trustee and delivered to the Sponsor and the Trust, which
resignation shall take effect upon such delivery or upon such later date as
is specified therein; PROVIDED, HOWEVER, that:
(i) No such resignation of the Trustee that acts as the Property
Trustee shall be effective:
(A) until a Successor Property Trustee has been appointed and has
accepted such appointment by instrument executed by such
Successor Property Trustee and delivered to the Trust, the
Sponsor and the resigning Property Trustee; or
(B) until the assets of the Trust have been completely liquidated
and the proceeds thereof distributed to the holders of the
Securities; and
(ii) no such resignation of the Trustee that acts as the Delaware
Trustee shall be effective until a Successor Delaware Trustee
has been appointed and has accepted such appointment by instrument
executed by such Successor Delaware Trustee and delivered to the
Trust, the Sponsor and the resigning Delaware Trustee.
(d) The Holders of the Common Securities shall use their best efforts
to promptly appoint a Successor Delaware Trustee or Successor
Property Trustee, as the case may be, if the Property Trustee or the
Delaware Trustee delivers an instrument of resignation in accordance
with this Section 5.6.
(e) If no Successor Property Trustee or Successor Delaware Trustee, as
the case may be, shall have been appointed and accepted appointment
as provided in this Section 5.6 within 60 days after delivery to
the Sponsor and the Trust of an instrument of resignation, the
resigning Property Trustee or Delaware Trustee, as applicable, may
petition any court of competent jurisdiction for appointment of a
Successor Property Trustee or Successor Delaware Trustee, as
applicable. Such court may thereupon, after prescribing such
notice, if any, as it may deem proper, appoint a Successor Property
Trustee or Successor Delaware Trustee, as the case may be.
(f) No Property Trustee or Delaware Trustee shall be liable for the
acts or omissions to act of any Successor Property Trustee or
Successor Delaware Trustee, as the case may be.
SECTION 5.7 Vacancies among Trustees.
If a Trustee ceases to hold office for any reason and the number of
Trustees is not reduced pursuant to Section 5.1, or if the number of Trustees
is increased pursuant to Section 5.1, a vacancy shall occur. A resolution
certifying the existence of such vacancy by the Regular Trustees or, if
there are more than two, a majority of the Regular Trustees shall be
conclusive evidence of the existence of such vacancy. The vacancy shall be
filled with a Trustee appointed in accordance with Section 5.6.
SECTION 5.8 Effect of Vacancies.
The death, resignation, retirement, removal, bankruptcy, dissolution,
liquidation, incompetence or incapacity to perform the duties of a Trustee
shall not operate to annul the Trust. Whenever a vacancy in the number of
Regular Trustees shall occur, until such vacancy is filled by the appointment
of a Regular Trustee in accordance with Section 5.6, the Regular Trustees in
office, regardless of their number, shall have all the powers granted to the
Regular Trustees and shall discharge all the duties imposed upon the Regular
Trustees by this Declaration.
SECTION 5.9 Meetings.
If there is more than one Regular Trustee, meetings of the Regular
Trustees shall be held from time to time upon the call of any Regular Trustee.
Regular meetings of the Regular Trustees may be held at a time and place
fixed by resolution of the Regular Trustees. Notice of any in-person meetings
of the Regular Trustees shall be hand delivered or otherwise delivered in
writing (including by facsimile, with a hard copy by overnight courier) not
less than 48 hours before such meeting. Notice of any telephonic meetings of
the Regular Trustees shall be hand delivered or otherwise delivered in
writing (including by facsimile, with a hard copy by overnight courier) not
less than 24 hours before a meeting. Notices shall contain a brief statement
of the time, place and anticipated purposes of the meeting. The presence
(whether in person or by telephone) of a Regular Trustee at a meeting shall
constitute a waiver of notice of such meeting except where a Regular Trustee
attends a meeting for the express purpose of objecting to the transaction of
any activity on the ground that the meeting has not been lawfully called or
convened. Unless provided otherwise in this Declaration, any action of the
Regular Trustees may be taken at a meeting by vote of a majority of the
Regular Trustees present (whether in person or by telephone) and eligible to
vote with respect to such matter, provided that a Quorum is present, or
without a meeting by the unanimous written consent of the Regular Trustees.
In the event there is only one Regular Trustee, any and all action of such
Regular Trustee shall be evidenced by a written consent of such Regular
Trustee.
SECTION 5.10 Delegation of Power.
(a) Any Regular Trustee may, by power of attorney consistent with
applicable law, delegate to any natural person over the age of 21 his,
her or its power for the purpose of executing any documents contemplated
in Section 3.6, including any registration statement or amendment
thereto filed with the Commission, or making any other governmental
filing.
(b) The Regular Trustees shall have power to delegate from time to
time to such of their number or to officers of the Trust the doing of
such things and the execution of such instruments either in the name of
the Trust or the names of the Regular Trustees or otherwise as the
Regular 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 5.11 Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Property Trustee or the Delaware
Trustee, as the case may be, may be merged or converted or with which
either may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Property Trustee or the
Delaware Trustee, as the case may be, shall be a party, or any
corporation succeeding to all or substantially all the corporate trust
business of the Property Trustee or the Delaware Trustee, as the case
may be, shall be the successor of the Property Trustee or the Delaware
Trustee, as the case may be, hereunder, provided such corporation shall
be otherwise qualified and eligible under this Article without the
execution or filing of any paper or any further act on the part of any
of the parties hereto.
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 Distributions.
Holders shall receive Distributions (as defined herein) in accordance
with the applicable terms of the relevant Holder's Securities. Distributions
shall be made on the Preferred Securities and the Common Securities in
accordance with the preferences set forth in their respective terms. If and
to the extent that the Debenture Issuer makes a payment of interest
(including Compounded Interest (as defined in the Indenture) and Additional
Interest (as defined in the Indenture)), premium and/or principal on the
Debentures held by the Property Trustee (the amount of any such payment being
a "Payment Amount"), the Property Trustee shall and is directed, to the
extent funds are available for that purpose, to make a distribution (a
"Distribution") of the Payment Amount to Holders.
ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 General Provisions Regarding Securities.
(a) The Regular Trustees shall on behalf of the Trust issue one class
of preferred securities representing undivided beneficial interests in the
assets of the Trust having such terms and in such form as shall be
established by the Regular Trustees (the "Preferred Securities") and one
class of common securities representing undivided beneficial interests in the
assets of the Trust having such terms and in such form as shall be
established by the Regular Trustees (the "Common Securities"). The terms
and form of the Preferred Securities and the Common Securities as established
by the Regular Trustees shall be set forth in a Trustees' Authorization
Certificate prepared prior to issuance of the Securities. The Trust shall
issue no securities or other interests in the assets of the Trust other than
the Preferred Securities and the Common Securities.
(b) The Certificates shall be signed on behalf of the Trust by a
Regular Trustee. Such signature shall be the manual or facsimile signature
of any present or any future Regular Trustee. In case any Regular Trustee of
the Trust who shall have signed any of the Certificates shall cease to be
such Regular Trustee before the Certificates so signed shall be delivered by
the Trust, such Certificates nevertheless may be delivered as though the
person who signed such Certificates had not ceased to be such Regular
Trustee; and any Certificate may be signed on behalf of the Trust by such
persons who, at the actual date of execution of such Certificate, shall be
the Regular Trustees of the Trust, although at the date of the execution and
delivery of the Declaration any such person was not such a Regular Trustee.
Certificates shall be printed, lithographed or engraved or may be produced
in any other manner as is reasonably acceptable to the Regular Trustees, as
evidenced by their execution thereof, and may have such letters, numbers or
other marks of identification or designation and such legends or endorsements
as the Regular Trustees may deem appropriate, or as may be required to comply
with any law or with any rule or regulation of any stock exchange on which
Securities may be listed, or to conform to usage.
(c) The consideration received by the Trust for the issuance of the
Securities shall constitute a contribution to the capital of the Trust and
shall not constitute a loan to the Trust.
(d) Upon issuance of the Securities as provided in this Declaration,
the Securities so issued shall be deemed to be validly issued, fully paid
and non-assessable.
(e) Every Person, by virtue of having become a Holder or a Preferred
Security Beneficial Owner in accordance with the terms of this Declaration,
shall be deemed to have expressly assented and agreed to the terms of, and
shall be bound by, this Declaration and the terms of the Securities, the
Securities Guarantees, the Indenture and the Debentures.
ARTICLE VIII
TERMINATION OF TRUST
SECTION 8.1 Termination of Trust.
(a) The Trust shall terminate upon the earlier of:
(i) the bankruptcy of the Holder of the Common Securities or the
Sponsor;
(ii) the filing of a certificate of dissolution or its equivalent
with respect to the Holder of the Common Securities or the
Sponsor; the filing of a certificate of cancellation with respect
to the Trust or the revocation of the Holder of the Common
Securities' or the Sponsor's charter and the expiration of 90
days after the date of revocation without a reinstatement thereof;
(iii) upon the entry of a decree of judicial dissolution of the Holder
of the Common Securities, the Sponsor or the Trust;
(iv) when all of the Securities shall have been called for redemption
and the amounts necessary for redemption thereof shall have been
paid to the Holders in accordance with the terms of the Securities;
(v) the occurrence and continuation of certain events (as may be
specified in the terms of the Securities) arising from a change
in law or a change in legal interpretation or other circumstances
specified in the terms of the Securities pursuant to which the
Trust shall have been dissolved in accordance with the terms of
the Securities and all of the Debentures shall have been
distributed to the Holders of Securities in exchange for all of
the Securities;
(vi) before the issuance of any Securities, when all of the Regular
Trustees and the Sponsor shall have consented to termination of
the Trust; or
(vii) the expiration of the term of the Trust as set forth in Section
3.14.
(b) As soon as is practicable after the occurrence of an event
referred to in Section 8.1(a) and upon completion of the winding up of
the Trust and its termination, the Trustees shall file a certificate of
cancellation with the Secretary of State of the State of Delaware.
(c) The provisions of Section 3.9 and Article X shall survive the
termination of the Trust.
ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1 Transfer of Securities.
(a) Securities may only be transferred, in whole or in part, in
accordance with the terms and conditions set forth in this Declaration and
in the terms of the Securities. Any transfer or purported transfer of any
Security not made in accordance with this Declaration shall be null and void.
(b) Subject to this Article IX, Preferred Securities shall be freely
transferable.
(c) Subject to this Article IX, the Sponsor and any Related Party may
only transfer Common Securities to the Sponsor or a Related Party of the
Sponsor; PROVIDED THAT, any such transfer is subject to the condition
precedent that the transferor obtain the written opinion of qualified
independent counsel experienced in such matters that such transfer would
not cause more than an insubstantial risk that:
(i) the Trust would not be classified for United States federal income
tax purposes as a grantor trust; and
(ii) the Trust would be an Investment Company or the transferee would
become an Investment Company.
SECTION 9.2 Transfer and Exchange of Certificates.
The Regular Trustees shall provide for the registration of Certificates
and of transfers or exchanges of Certificates, which will be effected without
charge but only upon payment (with such indemnity as the Regular Trustees may
require) in respect of any tax or other government charges that may be
imposed in relation to it. Upon surrender for registration of transfer of any
Certificate, the Regular Trustees shall cause one or more new Certificates to
be issued in the name of the designated transferee or transferees. Upon
surrender for exchange of any Certificate, the Regular Trustees shall cause
one or more new Certificates in the same aggregate liquidation amount as the
Certificate surrendered for exchange to be issued in the name of the Holder
of the Certificate so surrendered. Every Certificate surrendered for
registration of transfer or for exchange shall be accompanied by a written
instrument of transfer in form satisfactory to the Regular Trustees duly
executed by the Holder or such Holder's attorney duly authorized in writing.
Each Certificate surrendered for registration of transfer or for exchange
shall be canceled by the Regular Trustees. A transferee of a Certificate
shall be entitled to the rights and subject to the obligations of a Holder
hereunder upon the receipt by such transferee of a Certificate. By acceptance
of a Certificate, each transferee shall be deemed to have agreed to be bound
by this Declaration.
SECTION 9.3 Deemed Security Holders.
The Trustees may treat the Person in whose name any Certificate shall
be registered on the books and records of the Trust as the sole holder of
such Certificate and of the Securities represented by such Certificate for
purposes of receiving Distributions and for all other purposes whatsoever
and, accordingly, shall not be bound to recognize any equitable or other
claim to or interest in such Certificate or in the Securities represented by
such Certificate on the part of any Person, whether or not the Trust shall
have actual or other notice thereof.
SECTION 9.4 Book Entry Interests.
Unless otherwise specified in the terms of the Preferred Securities, the
Preferred Securities Certificates, on original issuance, will be issued in
the form of one or more fully registered, global Preferred Security
Certificates (each a "Global Certificate"), to be delivered to DTC, the
initial Clearing Agency, by, or on behalf of, the Trust. Such Global
Certificates shall initially be registered on the books and records of the
Trust in the name of Cede & Co., the nominee of DTC, and no Preferred
Security Beneficial Owner will receive a definitive Preferred Security
Certificate representing such Preferred Security Beneficial Owner's interests
in such Global Certificates, except as provided in Section 9.7. Unless and
until definitive, fully registered Preferred Security Certificates (the
"Definitive Preferred Security Certificates") have been issued to the
Preferred Security Beneficial Owners pursuant to Section 9.7:
(a) the provisions of this Section 9.4 shall be in full force and
effect;
(b) the Trust and the Trustees shall be entitled to deal with the
Clearing Agency for all purposes of this Declaration (including the
payment of Distributions on the Global Certificates and receiving
approvals, votes or consents hereunder) as the Holder of the Preferred
Securities and the sole holder of the Global Certificates and shall have
no obligation to the Preferred Security Beneficial Owners;
(c) to the extent that the provisions of this Section 9.4 conflict
with any other provisions of this Declaration, the provisions of this
Section 9.4 shall control; and
(d) the rights of the Preferred Security Beneficial Owners shall be
exercised only through the Clearing Agency and shall be limited to those
established by law and agreements between such Preferred Security
Beneficial Owners and the Clearing Agency and/or the Clearing Agency
Participants. DTC will make book entry transfers among the Clearing
Agency Participants and receive and transmit payments of Distributions
on the Global Certificates to such Clearing Agency Participants.
SECTION 9.5 Notices to Clearing Agency.
Whenever a notice or other communication to the Preferred Security
Holders is required under this Declaration, unless and until Definitive
Preferred Security Certificates shall have been issued to the Preferred
Security Beneficial Owners pursuant to Section 9.7, the Regular Trustees
shall give all such notices and communications specified herein to be
given to the Preferred Security Holders to the Clearing Agency, and shall
have no notice obligations to the Preferred Security Beneficial Owners.
SECTION 9.6 Appointment of Successor Clearing Agency.
If any Clearing Agency elects to discontinue its services as securities
depositary with respect to the Preferred Securities, the Regular Trustees
may, in their sole discretion, appoint a successor Clearing Agency with
respect to such Preferred Securities.
SECTION 9.7 Definitive Preferred Security Certificates.
If:
(a) a Clearing Agency elects to discontinue its services as securities
depositary with respect to the Preferred Securities and a successor
Clearing Agency is not appointed within 90 days after such discontinuance
pursuant to Section 9.6; or
(b) the Regular Trustees elect after consultation with the Sponsor to
terminate the book entry system through the Clearing Agency with respect
to the Preferred Securities, then:
(i) Definitive Preferred Security Certificates shall be prepared
by the Regular Trustees on behalf of the Trust with respect to
such Preferred Securities; and
(ii) upon surrender of the Global Certificates by the Clearing
Agency, accompanied by registration instructions, the Regular
Trustees shall cause Definitive Preferred Security Certificates
to be delivered to the Preferred Security Beneficial Owners in
accordance with the instructions of the Clearing Agency. Neither
the Trustees nor the Trust shall be liable for any delay in
delivery of such instructions and each of them may conclusively
rely on, and shall be protected in relying on, said instructions
of the Clearing Agency. The Definitive Preferred Security
Certificates shall be printed, lithographed or engraved or may
be produced in any other manner as is reasonably acceptable to the
Regular Trustees, as evidenced by their execution thereof, and may
have such letters, numbers or other marks of identification or
designation and such legends or endorsements as the Regular
Trustees may deem appropriate, or as may be required to comply
with any law or with any rule or regulation made pursuant thereto
or with any rule or regulation of any stock exchange on which
Preferred Securities may be listed, or to conform to usage.
SECTION 9.8 Mutilated, Destroyed, Lost or Stolen Certificates.
If:
(a) any mutilated Certificates should be surrendered to the Regular
Trustees, or if the Regular Trustees shall receive evidence to their
satisfaction of the destruction, loss or theft of any Certificate; and
(b) there shall be delivered to the Regular Trustees such security or
indemnity as may be required by them to keep each of them, the Sponsor
and the Trust harmless,
then, in the absence of notice that such Certificate shall have been
acquired by a bona fide purchaser, any Regular Trustee on behalf of the
Trust shall execute and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of
like denomination. In connection with the issuance of any new Certificate
under this Section 9.8, the Regular Trustees may require the payment of a
sum sufficient to cover any tax or other governmental charge that may be
imposed in connection therewith. Any duplicate Certificate issued pursuant
to this Section shall constitute conclusive evidence of an ownership interest
in the relevant Securities, as if originally issued, whether or not the lost,
stolen or destroyed Certificate shall be found at any time.
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 Liability.
(a) Except as expressly set forth in this Declaration, the Securities
Guarantees and the terms of the Securities, the Sponsor shall not be:
(i) personally liable for the return of any portion of the capital
contributions (or any return thereon) of the Holders of the Securities
which shall be made solely from assets of the Trust; and
(ii) be required to pay to the Trust or to any Holder of Securities
any deficit upon dissolution of the Trust or otherwise.
(b) The Holder of the Common Securities shall be liable for all of the
debts and obligations of the Trust (other than with respect to the Securities)
to the extent not satisfied out of the Trust's assets.
(c) Pursuant to Section 3803(a) of the Business Trust Act, the Holders
of the Preferred Securities 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 Exculpation.
(a) No Indemnified Person shall be liable, responsible or accountable
in damages or otherwise to the Trust or any Covered Person for any loss,
damage or claim incurred by reason of any act or omission performed or
omitted by such Indemnified Person in good faith 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 Indemnified Person by this
Declaration or by law, except that an Indemnified Person shall be liable for
any such loss, damage or claim incurred by reason of such Indemnified
Person's gross negligence or willful misconduct with respect to such acts
or omissions.
(b) An Indemnified Person shall be fully protected in relying in good
faith upon the records of the 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 Holders of Securities might properly be paid.
SECTION 10.3 Fiduciary Duty.
(a) To the extent that, at law or in equity, an Indemnified Person has
duties (including fiduciary duties) and liabilities relating thereto to the
Trust or to any other Covered Person, an Indemnified Person acting under this
Declaration shall not be liable to the Trust or to any other Covered Person
for its good faith reliance on the provisions of this Declaration. The
provisions of this Declaration, to the extent that they restrict the duties
and liabilities of an Indemnified Person otherwise existing at law or in
equity (other than the duties imposed on the Property Trustee under the Trust
Indenture Act), are agreed by the parties hereto to replace such other duties
and liabilities of such Indemnified Person.
(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises between any
Covered Persons; or
(ii) whenever this Declaration or any other agreement contemplated
herein or therein provides that an Indemnified Person shall act in
a manner that is, or provides terms that are, fair and reasonable to
the Trust or any Holder of Securities,
the Indemnified Person shall resolve such conflict of interest, take such
action or provide such terms, considering in each case the relative interest
of each party (including its own interest) to such conflict, agreement,
transaction or situation and the benefits and burdens relating to such
interests, any customary or accepted industry practices and any applicable
generally accepted accounting practices or principles. In the absence of bad
faith by the Indemnified Person, the resolution, action or term so made,
taken or provided by the Indemnified Person shall not constitute a breach of
this Declaration or any other agreement contemplated herein or of any duty or
obligation of the Indemnified Person at law or in equity or otherwise.
(c) Whenever in this Declaration an Indemnified Person is permitted or
required to make a decision:
(i) in its "discretion" or under a grant of similar authority, the
Indemnified Person shall be entitled to consider such interests and
factors as it desires, including its own interests, and shall have no
duty or obligation to give any consideration to any interest of or
factors affecting the Trust or any other Person; or
(ii) in its "good faith" or under another express standard, the
Indemnified Person shall act under such express standard and shall
not be subject to any other or different standard imposed by this
Declaration or by applicable law.
SECTION 10.4 Indemnification.
(a)(i) The Debenture Issuer shall indemnify, to the full extent
permitted by law, any Company Indemnified Person who was or is a party
or is threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the Trust) by
reason of the fact that he is or was a Company Indemnified Person against
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
Trust, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The termination of
any action, suit or proceeding by judgment, order, settlement, conviction
or upon a plea of nolo contendere or its equivalent, shall not, of itself,
create a presumption that the Company Indemnified Person did not act in good
faith and in a manner which he reasonably believed to be in or not opposed
to the best interests of the Trust, and, with respect to any criminal action
or proceeding, had reasonable cause to believe that his conduct was unlawful.
(ii) The Debenture Issuer shall indemnify, to the full extent
permitted by law, any Company Indemnified Person who was or is a party or
is threatened to be made a party to any threatened, pending or completed
action or suit by or in the right of the Trust to procure a judgment in
its favor by reason of the fact that he is or was a Company Indemnified
Person against expenses (including attorneys' fees) actually and reasonably
incurred by him in connection with the defense or settlement of such action
or suit if he acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the Trust and except that no
such indemnification shall be made in respect of any claim, issue or matter
as to which such Company Indemnified Person shall have been adjudged to be
liable to the Trust unless and only to the extent that the Court of Chancery
of Delaware or the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of liability but
in view of all the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses which such Court of
Chancery or such other court shall deem proper.
(iii) Any indemnification under paragraphs (i) and (ii) of this
Section 10.4(a) (unless ordered by a court) shall be made by the Debenture
Issuer only as authorized in the specific case upon a determination that
indemnification of the Company Indemnified Person is proper in the
circumstances because he has met the applicable standard of conduct set
forth in paragraphs (i) and (ii). Such determination shall be made (1) by
the Regular Trustees by a majority vote of a quorum consisting of such
Regular Trustees who were not parties to such action, suit or proceeding,
(2) if such a quorum is not obtainable, or, even if obtainable, if a
quorum of disinterested Regular Trustees so directs, by independent legal
counsel in a written opinion, or (3) by the Common Security Holder of the
Trust.
(iv) Expenses (including attorneys' fees) incurred by a Company
Indemnified Person in defending a civil, criminal, administrative or
investigative action, suit or proceeding referred to in paragraphs (i) and
(ii) of this Section 10.4(a) shall be paid by the Debenture Issuer in
advance of the final disposition of such action, suit or proceeding upon
receipt of an undertaking by or on behalf of such Company Indemnified Person
to repay such amount if it shall ultimately be determined that he is not
entitled to be indemnified by the Debenture Issuer as authorized in this
Section 10.4(a). Notwithstanding the foregoing, no advance shall be made
by the Debenture Issuer if a determination is reasonably and promptly made
(i) by the Regular Trustees by a majority vote of a quorum of disinterested
Regular Trustees, (ii) if such a quorum is not obtainable, or, even if
obtainable, if a quorum of disinterested Regular Trustees so directs, by
independent legal counsel in a written opinion or (iii) the Common Security
Holder of the Trust, that, based upon the facts known to the Regular Trustees,
counsel or the Common Security Holder at the time such determination is made,
such Company Indemnified Person acted in bad faith or in a manner that such
person did not believe to be in or not opposed to the best interests of the
Trust, or, with respect to any criminal proceeding, that such Company
Indemnified Person believed or had reasonable cause to believe his conduct
was unlawful. In no event shall any advance be made in instances where the
Regular Trustees, independent legal counsel or Common Security Holder
reasonably determine that such person deliberately breached his duty to the
Trust or its Common or Preferred Security Holders.
(v) The indemnification and advancement of expenses provided by, or
granted pursuant to, the other paragraphs of this Section 10.4(a) shall not
be deemed exclusive of any other rights to which those seeking indemnification
and advancement of expenses may be entitled under any agreement, vote of
stockholders or disinterested directors of the Debenture Issuer or Preferred
Security Holders of the Trust or otherwise, both as to action in his official
capacity and as to action in another capacity while holding such office. All
rights to indemnification under this Section 10.4(a) shall be deemed to be
provided by a contract between the Debenture Issuer and each Company
Indemnified Person who serves in such capacity at any time while this
Section 10.4(a) is in effect. Any repeal or modification of this Section
10.4(a) shall not affect any rights or obligations then existing.
(vi) The Debenture Issuer or the Trust may purchase and maintain
insurance on behalf of any person who is or was a Company Indemnified Person
against any liability asserted against him and incurred by him in any such
capacity, or arising out of his status as such, whether or not the Debenture
Issuer would have the power to indemnify him against such liability under
the provisions of this Section 10.4(a).
(vii) For purposes of this Section 10.4(a), references to "the Trust"
shall include, in addition to the resulting or surviving entity, any
constituent entity (including any constituent of a constituent) absorbed in
a consolidation or merger, so that any person who is or was a director,
trustee, officer or employee of such constituent entity, or is or was serving
at the request of such constituent entity as a director, trustee, officer,
employee or agent of another entity, shall stand in the same position under
the provisions of this Section 10.4(a) with respect to the resulting or
surviving entity as he would have with respect to such constituent entity if
its separate existence had continued.
(viii) The indemnification and advancement of expenses provided by, or
granted pursuant to, this Section 10.4(a) shall, unless otherwise provided
when authorized or ratified, continue as to a person who has ceased to be a
Company Indemnified Person and shall inure to the benefit of the heirs,
executors and administrators of such a person. The obligation to indemnify
as set forth in this Section 10.4(a) shall survive the satisfaction and
discharge of this Declaration.
(b) The Debenture Issuer agrees to indemnify the (i) Property
Trustee, (ii) the Delaware Trustee, (iii) any Affiliate of the Property
Trustee and the Delaware Trustee, and (iv) any officers, directors,
shareholders, members, partners, employees, representatives, custodians,
nominees or agents of the Property Trustee and the Delaware Trustee (each
of the Persons in (i) through (iv) being referred to as a "Fiduciary
Indemnified Person") for, and to hold each Fiduciary Indemnified Person
harmless against, any loss, liability or expense incurred without negligence
or bad faith on its part, arising out of or in connection with the acceptance
or administration of the trust or trusts hereunder, including the costs and
expenses (including reasonable legal fees and expenses) of defending itself
against or investigating any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder. The
obligation to indemnify as set forth in this Section 10.4(b) shall survive
the satisfaction and discharge of this Declaration.
SECTION 10.5 Outside Businesses.
Any Covered Person, the Sponsor, the Delaware Trustee and the Property
Trustee may engage in or possess an interest in other business ventures of
any nature or description, independently or with others, similar or
dissimilar to the business of the Trust, and the Trust and the Holders of
Securities shall have no rights by virtue of this Declaration in and to such
independent ventures or the income or profits derived therefrom, and the
pursuit of any such venture, even if competitive with the business of the
Trust, shall not be deemed wrongful or improper. No Covered Person, the
Sponsor, the Delaware Trustee or the Property Trustee shall be obligated to
present any particular investment or other opportunity to the Trust even if
such opportunity is of a character that, if presented to the Trust, could be
taken by the Trust, and any Covered Person, the Sponsor, the Delaware Trustee
and the Property Trustee shall have the right to take for its own account
(individually or as a partner or fiduciary) or to recommend to others any
such particular investment or other opportunity. Any Covered Person, the
Delaware Trustee and the Property Trustee may engage or be interested in any
financial or other transaction with the Sponsor or any Affiliate of the
Sponsor, or may act as depositary for, trustee or agent for, or act on any
committee or body of holders of, securities or other obligations of the
Sponsor or its Affiliates.
ARTICLE XI
ACCOUNTING
SECTION 11.1 Fiscal Year.
The fiscal year ("Fiscal Year") of the Trust shall be the calendar
year, or such other year as is required by the Code.
SECTION 11.2 Certain Accounting Matters.
(a) At all times during the existence of the Trust, the Regular
Trustees shall keep, or cause to be kept, full books of account, records
and supporting documents, which shall reflect in reasonable detail, each
transaction of the Trust. The books of account shall be maintained on
the accrual method of accounting, in accordance with generally accepted
accounting principles. The Trust shall use the accrual method of
accounting for United States federal income tax purposes. The books of
account and the records of the Trust shall be examined by and reported
upon as of the end of each Fiscal Year of the Trust by a firm of
independent certified public accountants selected by the Regular
Trustees.
(b) The Regular Trustees shall cause to be prepared and delivered
to each of the Holders of Securities, within 90 days after the end of
each Fiscal Year of the Trust, annual financial statements of the Trust,
including a balance sheet of the Trust as of the end of such Fiscal
Year, and the related statements of income or loss.
(c) The Regular Trustees shall cause to be duly prepared and delivered
to each of the Holders of Securities, any annual United States federal income
tax information statement, required by the Code, containing such information
with regard to the Securities held by each Holder as is required by the Code
and the Treasury Regulations. Notwithstanding any right under the Code to
deliver any such statement at a later date, the Regular Trustees shall
endeavor to deliver all such statements within 30 days after the end of each
Fiscal Year of the Trust.
(d) The Regular Trustees shall cause to be duly prepared and filed with
the appropriate taxing authority, an annual United States federal income tax
return, on a Form 1041 or such other form required by United States federal
income tax law, and any other annual income tax returns required to be filed
by the Regular Trustees on behalf of the Trust with any state or local taxing
authority.
SECTION 11.3 Banking.
The Trust shall maintain one or more bank accounts in the name and for
the sole benefit of the Trust; PROVIDED, HOWEVER, that all payments of funds
in respect of the Debentures held by the Property Trustee shall be made
directly to the Property Trustee Account and no other funds of the Trust
shall be deposited in the Property Trustee Account. The sole signatories for
such accounts shall be designated by the Regular Trustees; PROVIDED, HOWEVER,
that the Property Trustee shall designate the signatories for the Property
Trustee Account.
SECTION 11.4 Withholding.
The Trust and the Regular Trustees shall comply with all withholding
requirements under United States federal, state and local law. The Trust
shall request, and the Holders shall provide to the Trust, such forms or
certificates as are necessary to establish an exemption from withholding
with respect to each Holder, and any representations and forms as shall
reasonably be requested by the Trust to assist it in determining the extent
of, and in fulfilling, its withholding obligations. The Regular Trustees
shall file required forms with applicable jurisdictions and, unless an
exemption from withholding is properly established by a Holder, shall remit
amounts withheld with respect to the Holder to applicable jurisdictions. To
the extent that the Trust is required to withhold and pay over any amounts
to any authority with respect to distributions or allocations to any Holder,
the amount withheld shall be deemed to be a distribution in the amount of the
withholding to the Holder. In the event of any claimed over withholding,
Holders shall be limited to an action against the applicable jurisdiction. If
the amount required to be withheld was not withheld from actual Distributions
made, the Trust may reduce subsequent Distributions by the amount of such
withholding.
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 Amendments.
(a) Except as otherwise provided in this Declaration or by any
applicable terms of the Securities, this Declaration may only be amended
by a written instrument approved and executed by the Regular Trustees
(or, if there are more than two Regular Trustees, a majority of the
Regular Trustees) and:
(i) by the Property Trustee if the amendment affects the rights,
powers, duties, obligations or immunities of the Property Trustee; and
(ii) by the Delaware Trustee if the amendment affects the rights,
powers, duties, obligations or immunities of the Delaware Trustee;
(b) no amendment shall be made, and any such purported amendment
shall be void and ineffective:
(i) unless, in the case of any proposed amendment, the Property
Trustee shall have first received an Officers' Certificate from each of
the Trust and the Sponsor that such amendment is permitted by, and
conforms to, the terms of this Declaration (including the terms of the
Securities);
(ii) unless, in the case of any proposed amendment which affects the
rights, powers, duties, obligations or immunities of the Property
Trustee, the Property Trustee shall have first received:
(A) an Officers' Certificate from each of the Trust and the
Sponsor that such amendment is permitted by, and conforms to, the
terms of this Declaration (including the terms of the Securities);
and
(B) an opinion of counsel (who may be counsel to the Sponsor or
the Trust) that such amendment is permitted by, and conforms to,
the terms of this Declaration (including the terms of the
Securities); and
(iii) to the extent the result of such amendment would be to:
(A) cause the Trust to fail to continue to be classified for
purposes of United States federal income taxation as a grantor
trust;
(B) reduce or otherwise adversely affect the powers of the
Property Trustee in contravention of the Trust Indenture Act; or
(C) cause the Trust to be deemed to be an Investment Company
required to be registered under the Investment Company Act;
(c) at such time after the Trust has issued any Securities that remain
outstanding, any amendment that would adversely affect the rights, privileges
or preferences of any Holder of Securities may be effected only with such
additional requirements as may be set forth in the terms of such Securities;
(d) Section 9.1(c) and this Section 12.1 shall not be amended without
the consent of all of the Holders of the Securities;
(e) Article IV shall not be amended without the consent of the Holders
of a Majority in Liquidation Amount of the Common Securities;
(f) the rights of the Holders of the Common Securities under Article V
to increase or decrease the number of, and appoint and remove Trustees shall
not be amended without the consent of the Holders of a Majority in
Liquidation Amount of the Common Securities; and
(g) notwithstanding Section 12.1(c), this Declaration may be amended
without the consent of the Holders of the Securities to:
(i) cure any ambiguity;
(ii) correct or supplement any provision in this Declaration that may
be defective or inconsistent with any other provision of this Declaration;
(iii) add to the covenants, restrictions or obligations of the Sponsor;
(iv) to conform to any change in Rule 3a-5 or written change in
interpretation or application of Rule 3a-5 by any legislative body,
court, government agency or regulatory authority which amendment does
not have a material adverse effect on the rights, preferences or
privileges of the Holders; and
(v) to modify, eliminate and add to any provision of this Declaration,
provided such modification, elimination or addition would not adversely
affect the rights, privileges or preferences of any Holder of the Securities.
(h) The issuance of a Trustees' Authorization Certificate by the
Regular Trustees for purposes of establishing the terms and form of the
Securities as contemplated by Section 7.1 shall not be deemed an amendment
of this Declaration subject to the provisions of this Section 12.1.
SECTION 12.2 Meetings of the Holders of Securities; Action by Written
Consent.
(a) Meetings of the Holders of any class of Securities may be called at
any time by the Regular Trustees (or as provided in the terms of the
Securities) to consider and act on any matter on which Holders of such class
of Securities are entitled to act under the terms of this Declaration, the
terms of the Securities or the rules of any stock exchange on which the
Preferred Securities are listed or admitted for trading. The Regular Trustees
shall call a meeting of the Holders of such class if directed to do so by the
Holders of at least 10% in Liquidation Amount of such class of Securities.
Such direction shall be given by delivering to the Regular Trustees one or
more calls in a writing stating that the signing Holders of Securities wish
to call a meeting and indicating the general or specific purpose for which
the meeting is to be called. Any Holders of Securities calling a meeting
shall specify in writing the Certificates held by the Holders of Securities
exercising the right to call a meeting and only those Securities specified
shall be counted for purposes of determining whether the required percentage
set forth in the second sentence of this paragraph has been met.
(b) Except to the extent otherwise provided in the terms of the
Securities, the following provisions shall apply to meetings of Holders
of Securities:
(i) notice of any such meeting shall be given to all the Holders of
Securities having a right to vote thereat at least 7 days and not more
than 60 days before the date of such meeting. Whenever a vote, consent
or approval of the Holders of Securities is permitted or required under
this Declaration or the rules of any stock exchange on which the
Preferred Securities are listed or admitted for trading, such vote,
consent or approval may be given at a meeting of the Holders of
Securities. Any action that may be taken at a meeting of the Holders of
Securities may be taken without a meeting if a consent in writing
setting forth the action so taken is signed by the Holders of Securities
owning not less than the minimum amount of Securities in liquidation
amount that would be necessary to authorize or take such action at a
meeting at which all Holders of Securities having a right to vote
thereon were present and voting. Prompt notice of the taking of action
without a meeting shall be given to the Holders of Securities entitled
to vote who have not consented in writing. The Regular Trustees may
specify that any written ballot submitted to the Security Holders for
the purpose of taking any action without a meeting shall be returned to
the Trust within the time specified by the Regular Trustees;
(ii) each Holder of a Security may authorize any Person to act for it
by proxy on all matters in which a Holder of Securities is entitled to
participate, including waiving notice of any meeting, or voting or
participating at a meeting. No proxy shall be valid after the expiration
of 11 months from the date thereof unless otherwise provided in the
proxy. Every proxy shall be revocable at the pleasure of the Holder of
Securities executing such proxy. Except as otherwise provided herein,
all matters relating to the giving, voting or validity of proxies shall
be governed by the General Corporation Law of the State of Delaware
relating to proxies, and judicial interpretations thereunder, as if the
Trust were a Delaware corporation and the Holders of the Securities were
stockholders of a Delaware corporation;
(iii) each meeting of the Holders of the Securities shall be conducted
by the Regular Trustees or by such other Person that the Regular
Trustees may designate; and
(iv) unless the Business Trust Act, this Declaration, the terms of the
Securities, the Trust Indenture Act or the listing rules of any stock
exchange on which the Preferred Securities are then listed for trading,
otherwise provides, the Regular Trustees, in their sole discretion,
shall establish all other provisions relating to meetings of Holders of
Securities, including notice of the time, place or purpose of any
meeting at which any matter is to be voted on by any Holders of
Securities, waiver of any such notice, action by consent without a
meeting, the establishment of a record date, quorum requirements, voting
in person or by proxy or any other matter with respect to the exercise
of any such right to vote.
ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE
SECTION 13.1 Representations and Warranties of the Property Trustee.
The Trustee that acts as initial Property Trustee represents and
warrants to the Trust and to the Sponsor at the date of this Declaration,
and each Successor Property Trustee represents and warrants to the Trust
and the Sponsor at the time of the Successor Property Trustee's acceptance
of its appointment as Property Trustee that:
(a) the Property Trustee is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation or organization, with trust power and authority to execute
and deliver, and to carry out and perform its obligations under the
terms of, this Declaration;
(b) the Property Trustee satisfies the requirements set forth in
Section 5.3(a);
(c) the execution, delivery and performance by the Property Trustee of
this Declaration has been duly authorized by all necessary corporate
action on the part of the Property Trustee. This Declaration has been
duly executed and delivered by the Property Trustee, and it constitutes
a legal, valid and binding obligation of the Property Trustee,
enforceable against it in accordance with its terms, subject to
applicable bankruptcy, reorganization, moratorium, insolvency and other
similar laws affecting creditors' rights generally and to general
principles of equity and the discretion of the court (regardless of
whether the enforcement of such remedies is considered in a proceeding
in equity or at law);
(d) the execution, delivery and performance of this Declaration by the
Property Trustee does not conflict with or constitute a breach of the
articles of association or incorporation, as the case may be, or the
by-laws (or other similar organizational documents) of the Property
Trustee; and
(e) no consent, approval or authorization of, or registration with or
notice to, any State or Federal banking authority is required for the
execution, delivery or performance by the Property Trustee of this
Declaration.
SECTION 13.2 Representations and Warranties of the Delaware Trustee.
The Trustee that acts as initial Delaware Trustee represents and
warrants to the Trust and to the Sponsor at the date of this Declaration,
and each Successor Delaware Trustee represents and warrants to the Trust
and the Sponsor at the time of the Successor Delaware Trustee's acceptance
of its appointment as Delaware Trustee that:
(a) the Delaware Trustee satisfies the requirements set forth in
Section 5.2 and has the power and authority to execute and deliver, and
to carry out and perform its obligations under the terms of, this
Declaration and, if it is not a natural person, is duly organized,
validly existing and in good standing under the laws of its jurisdiction
of incorporation or organization;
(b) the Delaware Trustee has been authorized to perform its obligations
under the Certificate of Trust and this Declaration. This Declaration
under Delaware law constitutes a legal, valid and binding obligation of
the Delaware Trustee, enforceable against it in accordance with its
terms, subject to applicable bankruptcy, reorganization, moratorium,
insolvency and other similar laws affecting creditors' rights generally
and to general principles of equity and the discretion of the court
(regardless of whether the enforcement of such remedies is considered in
a proceeding in equity or at law); and
(c) no consent, approval or authorization of, or registration with or
notice to, any State or Federal banking authority is required for the
execution, delivery or performance by the Delaware Trustee of this
Declaration.
ARTICLE XIV
MISCELLANEOUS
SECTION 14.1 Notices.
All notices provided for in this Declaration shall be in writing, duly
signed by the party giving such notice, and shall be delivered, telecopied
or mailed by registered or certified mail, as follows:
(a) if given to the Trust, in care of the Regular Trustees at the
Trust's mailing address set forth below (or such other address as the
Trust may give notice of to the Property Trustee, the Delaware Trustee
and the Holders of the Securities):
Equitable of Iowa Companies Capital Trust
c/o Equitable of Iowa Companies
604 Locust Street
Des Moines, Iowa 50309
Telecopy No. (515) 245-6973
(b) if given to the Delaware Trustee, at the mailing address set forth
below (or such other address as Delaware Trustee may give notice of to
the Regular Trustees, the Property Trustee and the Holders of the
Securities):
First Chicago Delaware, Inc.
c/o FCC National Bank
300 King Street
Wilmington, Delaware 19801
Telecopy No. (312) 407-4656
(c) if given to the Property Trustee, at its Corporate Trust Office
(or such other address as the Property Trustee may give notice of to
the Regular Trustees, the Delaware Trustee and the Holders of the
Securities).
(d) if given to the Holder of the Common Securities, at the mailing
address of the Sponsor set forth below (or such other address as the
Holder of the Common Securities may give notice of to the Property
Trustee, the Delaware Trustee and the Trust):
Equitable of Iowa Companies
604 Locust Street
Des Moines, Iowa 50309
Telecopy No. (515) 245-6973
(e) if given to any other Holder, at the address set forth on the books
and records of the Trust.
All such notices shall be deemed to have been given when received in person,
telecopied with receipt confirmed or mailed by first class mail, postage
prepaid except that if a notice or other document is refused delivery or
cannot be delivered because of a changed address of which no notice was
given, such notice or other document shall be deemed to have been delivered
on the date of such refusal or inability to deliver.
SECTION 14.2 Governing Law.
This Declaration and the rights of the parties hereunder shall be
governed by and interpreted in accordance with the laws of the State of
Delaware and all rights and remedies shall be governed by such laws
without regard to principles of conflict of laws.
SECTION 14.3 Intention of the Parties.
It is the intention of the parties hereto that the Trust be classified
for United States federal income tax purposes as a grantor trust. The
provisions of this Declaration shall be interpreted to further this intention
of the parties.
SECTION 14.4 Headings.
Headings contained in this Declaration are inserted for convenience of
reference only and do not affect the interpretation of this Declaration or
any provision hereof.
SECTION 14.5 Successors and Assigns.
Whenever in this Declaration any of the parties hereto is named or
referred to, the successors and assigns of such party shall be deemed to be
included, and all covenants and agreements in this Declaration by the Sponsor
and the Trustees shall bind and inure to the benefit of their respective
successors and assigns, whether so expressed.
SECTION 14.6 Partial Enforceability.
If any provision of this Declaration, or the application of such
provision to any Person or circumstance, shall be held invalid, the
remainder of this Declaration, or the application of such provision to
persons or circumstances other than those to which it is held invalid,
shall not be affected thereby.
SECTION 14.7 Counterparts.
This Declaration may contain more than one counterpart of the signature
page and this Declaration may be executed by the affixing of the signature
of each of the Trustees to one of such counterpart signature pages. All of
such counterpart signature pages shall be read as though one, and they shall
have the same force and effect as though all of the signers had signed a
single signature page.
IN WITNESS WHEREOF, the undersigned have caused these presents to be
executed as of the day and year first above written.
EQUITABLE OF IOWA COMPANIES, as Sponsor
and Debenture Issuer
By: /s/ John A. Merriman
Name: John A. Merriman
Title: General Counsel and Secretary
THE FIRST NATIONAL BANK OF CHICAGO,
as Property Trustee
By: /s/ R. D. Manella
Name: R.D. Manella
Title: Vice President
FIRST CHICAGO DELAWARE, INC.,
as Delaware Trustee
By: /s/ L. Dillard
Name: L. Dillard
Title: Vice President
/s/ Fred S. Hubbell
Fred S. Hubbell, as Regular Trustee
/s/ Paul E. Larson
Paul E. Larson, as Regular Trustee
/s/ John A. Merriman
John A. Merriman, as Regular Trustee
(Signature Page of Declaration of Trust)