EXHIBIT 4.1
AMENDED AND RESTATED
DECLARATION OF TRUST
OF
UDS CAPITAL I
Dated as of June 25, 1997
TABLE OF CONTENTS
Page
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Definitions
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application
SECTION 2.2 Lists of Holders of Trust Securities
SECTION 2.3 Reports by the Property Trustee
SECTION 2.4 Periodic Reports to Property Trustee
SECTION 2.5 Evidence of Compliance with Conditions Precedent
SECTION 2.6 Trust Enforcement Events; Waiver
SECTION 2.7 Trust Enforcement Event; Notice
ARTICLE III
ORGANIZATION
SECTION 3.1 Name
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 Trust
Securities
SECTION 3.14 Duration of Trust
SECTION 3.15 Mergers
ARTICLE IV
SPONSOR
SECTION 4.1 Responsibilities of the Sponsor
SECTION 4.2 Indemnification and Expenses of the Trustee
ARTICLE V
TRUST COMMON SECURITIES HOLDER
SECTION 5.1 Company's Purchase of Trust Common Securities
SECTION 5.2 Covenants of the Trust Common Securities Holder
ARTICLE VI
TRUSTEES
SECTION 6.1 Number of Trustees
SECTION 6.2 Delaware Trustee
SECTION 6.3 Property Trustee; Eligibility
SECTION 6.4 Qualifications of Regular Trustees and Delaware Trustee
Generally
SECTION 6.5 Regular Trustees
SECTION 6.6 Delaware Trustee
SECTION 6.7 Appointment, Removal and Resignation of Trustees
SECTION 6.8 Vacancies among Trustees
SECTION 6.9 Effect of Vacancies
SECTION 6.10 Meetings
SECTION 6.11 Delegation of Power
Section 6.12 Merger, Conversion, Consolidation or Succession to
Business
ARTICLE VII
DISTRIBUTIONS
SECTION 7.1 Distributions
ARTICLE VIII
ISSUANCE OF TRUST SECURITIES
SECTION 8.1 Designation and General Provisions Regarding Trust
Securities
SECTION 8.2 Redemption of Trust Securities
SECTION 8.3 Redemption Procedures
SECTION 8.4 Voting Rights of Trust Preferred Securities
SECTION 8.5 Voting Rights of Trust Common Securities
SECTION 8.6 Paying Agent
SECTION 8.7 Listing
SECTION 8.8 Acceptance of Guarantee and Agreements, Limited Partner
ship Agreement.
ARTICLE IX
TERMINATION AND LIQUIDATION OF THE TRUST
SECTION 9.1 Termination of Trust
SECTION 9.2 Liquidation Distribution Upon Termination and Dissolu
tion of the Trust
ARTICLE X
TRANSFER OF INTERESTS
SECTION 10.1 Transfer of Trust Securities
SECTION 10.2 Transfer of Certificates
SECTION 10.3 Deemed Security Holders
SECTION 10.4 Book Entry Interests
SECTION 10.5 Notices to Clearing Agency
SECTION 10.6 Appointment of Successor Clearing Agency
SECTION 10.7 Definitive Trust Preferred Security Certificates
SECTION 10.8 Mutilated, Destroyed, Lost or Stolen Certificates
ARTICLE XI
LIMITATION OF LIABILITY OF
HOLDERS OF TRUST SECURITIES, TRUSTEES OR OTHERS
SECTION 11.1 Liability
SECTION 11.2 Exculpation
SECTION 11.3 Fiduciary Duty
SECTION 11.4 Indemnification
SECTION 11.5 Outside Businesses
ARTICLE XII
ACCOUNTING
SECTION 12.1 Fiscal Year
SECTION 12.2 Certain Accounting Matters
SECTION 12.3 Banking
SECTION 12.4 Withholding
ARTICLE XIII
AMENDMENTS AND MEETINGS
SECTION 13.1 Amendments
SECTION 13.2 Meetings of the Holders of Trust Securities;
Action by Written Consent
ARTICLE XIV
REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE
SECTION 14.1 Representations and Warranties of Property
Trustee
SECTION 14.2 Representations and Warranties of Delaware
Trustee
ARTICLE XV
MISCELLANEOUS
SECTION 15.1 Notices
SECTION 15.2 Governing Law
SECTION 15.3 Intention of the Parties
SECTION 15.4 Headings
SECTION 15.5 Successors and Assigns
SECTION 15.6 Partial Enforceability
SECTION 15.7 Counterparts
CROSS-REFERENCE TABLE*
Section of
Trust Indenture Act Section of
of 1939, as amended Declaration
310(a). . . . . . . . . . . . . . . . . . . 6.3(a)
310(c). . . . . . . . . . . . . . . . . . . Inapplicable
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(f). . . . . . . . . . . . . . . . . . . Inapplicable
315(a). . . . . . . . . . . . . . . . . . . 3.9(b)
315(c). . . . . . . . . . . . . . . . . . . 3.9(a)
315(d). . . . . . . . . . . . . . . . . . . 3.9(a)
316(a). . . . . . . . . . . . . . . . . . . Annex I
316(c). . . . . . . . . . . . . . . . . . . 3.6(e)
* This Cross-Reference Table does not constitute part of the Declara
tion and shall not affect the interpretation of any of its terms or
provisions.
<PAGE/>
AMENDED AND RESTATED
DECLARATION OF TRUST
OF
UDS CAPITAL I
June 25, 1997
AMENDED AND RESTATED DECLARATION OF TRUST (the "Declaration") dated
and effective as of June 25, 1997, by the Trustees (as defined herein),
by the Sponsor (as defined herein) and by the Holders, from time to
time, of undivided beneficial interests in the Trust to be issued
pursuant to this Declaration;
WHEREAS, certain of the Trustees and the Sponsor established UDS
CAPITAL I (the "Business Trust"), a trust under the Delaware Business
Trust Act (the "Trust Act"), pursuant to a Declaration of Trust dated as
of June 5, 1997 (the "Original Declaration") and a Certificate of Trust
filed with the Secretary of State of the State of Delaware on June 5,
1997, for the sole purpose of issuing and selling certain securities
representing undivided beneficial interests in the assets of the Trust
and investing the proceeds thereof in the Partnership Preferred Securi-
ties;
WHEREAS, as of the date hereof, no interests in the Trust have been
issued; and
WHEREAS, all of the Trustees and the Sponsor, by this Declaration,
amend and restate each and every term and provision of the Original
Declaration.
NOW, THEREFORE, it being the intention of the parties hereto to
continue the Trust as a business trust under the Business Trust Act and
that this Declaration constitute the governing instrument of such
business trust, the Trustees declare that all assets contributed to the
Trust will be held in trust for the benefit of the Holders, from time to
time, of the securities representing undivided beneficial ownership
interests in the assets of the Trust issued hereunder, subject to the
provisions of this Declaration.
ARTICLE 1.
INTERPRETATION AND DEFINITIONS
SECTION 1.1 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 and Annexes and Exhibits are to Articles and Sections of
and Annexes and Exhibits to 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;
(f) a reference to the singular includes the plural and vice
versa; and
(g) a term used in this Agreement and not otherwise defined
herein shall have the meaning ascribed to such term in the Partner
ship Agreement.
"Affiliate" has the same meaning as given to that term in
Rule 405 under the Securities Act of 1933, as amended, or any successor
rule thereunder.
"Affiliate Investment Instruments" has the meaning set forth
in Section 7.1 of the Limited Partnership Agreement.
"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 set forth in Section
10.4 of this Declaration.
"Business Day" means any day other than a day on which banking
institutions in The City of 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. C. Section 3801 et seq., as it may be amended
from time to time, or any successor legislation.
"Certificate" means a Trust Common Security Certificate or a
Trust Preferred Security Certificate.
"Change in 1940 Act Law" means, as a result of the occurrence
on or after the date of the issuance of the Trust Preferred Securities
of a change in law or regulation or a change in interpretation or
application of law or regulation by any legislative body, court,
governmental agency or regulatory authority, the Trust is or will be
considered an "investment company" which is required to be registered under
the 1940 Act.
"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 Trust 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 beneficial interests in the Trust 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 interest
in securities deposited with the Clearing Agency.
"Closing Date" means June 25, 1997.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time, or any successor legislation.
"Commission" means the United States Securities and Exchange
Commission.
"Common Security Holder of the Trust" means the Company in its
capacity as Holder of the Trust Common Security.
"Company" means Ultramar Diamond Shamrock Corporation.
"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 (d) any officer, director, shareholder, member,
partner, employee, representative or agent of the Trust or its Affiliates.
"Compounded Distributions" has the meaning set forth in
Section 7.1(a) of this Declaration.
"Corporate Trust Office" means the principal corporate trust
office of the Property Trustee in the Borough of Manhattan, the City of
New York, which office at the date hereof is located at 101 Barclay
Street, Floor 21 West, New York, New York 10286.
"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 Trust
Securities.
"Definitive Trust Preferred Security Certificates" has the
meaning set forth in Section 10.4 of this Declaration.
"Delaware Trustee" has the meaning set forth in Section 6.2 of
this Declaration.
"Distribution" has the meaning set forth in Section 7.1(a) of
this Declaration.
"DTC" means The Depository Trust Company, the initial Clearing
Agency.
"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 11.4(b) of this Declaration.
"Fiscal Period" has the meaning set forth in Section 1.1 of
the Limited Partnership Agreement.
"Fiscal Year" has the meaning set forth in Section 12.1 of
this Declaration.
"General Partner" means Ultramar Diamond Shamrock Corporation,
in its capacity as the general partner of the Partnership, its permitted
successors, or any successor general partner in the Partnership admitted
as such pursuant to the Limited Partnership Agreement.
"Global Certificate" has the meaning set forth in Section 10.4
of this Declaration.
"Holder" means a Person in whose name a Certificate representing
a Trust Security is registered, such Person being a beneficial owner
within the meaning of the Business Trust Act.
"Indemnified Person" means a Company Indemnified Person or a
Fiduciary Indemnified Person.
"Initial Debentures" has the meaning set forth in Section
7.1(b) of the Limited Partnership Agreement.
"Investment Affiliate" means the Company or any corporation,
partnership, limited liability company or other entity (other than the
Partnership or the Trust) that (i) is controlled by the Company and (ii)
is not an investment company by reason of Section 3(a) or 3(b) of the
1940 Act or is otherwise an eligible recipient of funds directly or
indirectly from the Trust pursuant to an order issued by the Securities
and Exchange Commission.
"Investment Company" means an investment company as defined in
the 1940 Act.
"Investment Guarantee" means any guarantee on a subordinated
basis by the Company with respect to (1) payment of interest, principal
and other payment terms of Affiliate Investment Instruments that are
debt securities of an Investment Affiliate and (2) the payment of
dividends, distributions and other payment terms of Affiliate Investment
Instruments that are preferred or preference stock of an Investment
Affiliate when, as and if declared by such Investment Affiliate.
"Legal Action" has the meaning set forth in Section 3.6(h) of
this Declaration.
"Limited Partnership Agreement" means the Amended and Restated
Agreement of Limited Partnership of UDS Funding I, L.P. dated as of June
25, 1997.
"List of Holders" has the meaning set forth in Section 2.2(a)
of this Declaration.
"Majority in liquidation amount of the Trust Securities"
means, except as provided in the terms of the Trust Preferred Securities
or by the Trust Indenture Act, Holder(s) of outstanding Trust Securities
voting together as a single class or, as the context may require,
Holders of outstanding Trust Preferred Securities or Holders of outstanding
Trust Common Securities voting separately as a class, who are
the record owners of more than 50% of the aggregate liquidation amount
of all outstanding Trust Securities of the relevant class.
"Ministerial Action" means, a ministerial action (such as
filing a form or making an election or pursuing some other similar
reasonable measure) which in the sole judgment of the Company has or
will cause no adverse effect on the Trust, the Partnership, the Company
or the holders of the Trust Securities and will involve no material
cost.
"Nasdaq" means the National Association of Securities Dealers
Automated Quotation System.
"1940 Act" means the Investment Company Act of 1940, as
amended from time to time, or any successor legislation.
"Officers' Certificate" means, with respect to any Person (who
is not an individual), a certificate signed by the Chairman of the
Board, the President, a Vice President or the Treasurer, and by an
Assistant Treasurer, the Secretary or an Assistant Secretary 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 examina
tion or investigation undertaken by each officer in rendering the
Officers' Certificate;
(c) a statement that each such officer has made such examina
tion 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.
"Partnership" means UDS Funding I, L.P., a Delaware limited
partnership.
"Partnership Enforcement Event" has the meaning set forth in
Section 6.2(h)(i) of the Limited Partnership Agreement.
"Partnership Guarantee" means the Partnership Guarantee Agree-
ment dated as of June 25, 1997, by the Company in favor of the Partnership
Preferred Security Holders with respect to the Partnership Preferred
Securities, as amended or supplemented from time to time.
"Partnership Preferred Securities" has the meaning set forth
in Section 1.1 of the Limited Partnership Agreement.
"Partnership Special Event" has the meaning set forth in
Section 1.1 of the Limited Partnership Agreement.
"Payment Amount" has the meaning set forth in Section 7.1(a)
of this Declaration.
"Paying Agent" has the meaning set forth in Section 3.8(g) of
this Declaration.
"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 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,
or each case in accordance with the rules of such Clearing
Agency).
"Property Account" has the meaning set forth in Section 3.8(c)
of this Declaration.
"Property Trustee" means the Trustee meeting the eligibility
requirements set forth in Section 6.3 of this Declaration.
"Pro Rata" means, in reference to any distributions on or
redemptions of Trust Securities or the distribution of Partnership
Preferred Securities or any other payment with respect to Trust Securi-
ties in connection with a Trust Special Event or liquidation of the
Trust, pro rata to each Holder of Trust Securities according to the
aggregate liquidation amount of the Trust Securities held by the relevant
Holder in relation to the aggregate liquidation amount of all Trust
Securities outstanding.
"Quorum" means a majority of the Regular Trustees or, if there
are only two Regular Trustees, both of them.
"Redemption Price" has the meaning set forth in Section 8.2(a)
of this Declaration.
"Regular Trustee" has the meaning set forth in Section 6.1 of
this Declaration.
"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 Trust Preferred
Guarantee Trustee, the chairman or vice-chairman of the board of
directors, the chairman or vice-chairman of the executive committee of
the board of directors, the president, any vice president (whether or
not designated by a number or a word or words added before or after the
title "vice president"), the secretary, any assistant secretary, the
treasurer, any assistant treasurer, the cashier, any assistant cashier,
any trust officer or assistant trust officer, or any other officer of
the Trust Preferred Guarantee Trustee customarily performing functions
similar to those performed by any of the above designated officers and
also means, with respect to a particular corporate trust matter, any
other officer to whom such matter is referred because of his knowledge
of and familiarity with the particular subject.
"Rule 3a-5" means Rule 3a-5 under the 1940 Act.
"Securities Act" means the Securities Act of 1933, as amended
from time to time, or any successor legislation.
"Special Representative" has the meaning set forth in Section
6.2(h)(i) of the Limited Partnership Agreement.
"Sponsor" means the Company or any successor entity in a
merger, consolidation or amalgamation, in its capacity as sponsor of the
Trust.
"Successor Delaware Trustee" has the meaning set forth in
Section 6.7(b) of this Declaration.
"Successor Entity" has the meaning set forth in Section 3.15
of this Declaration.
"Successor Property Trustee" has the meaning set forth in
Section 6.7(b) of this Declaration.
"Successor Trust Securities" has the meaning set forth in
Section 3.15 of this Declaration.
"Super Majority" has the meaning set forth in Section
2.6(a)(ii) of this Declaration.
"Tax Action" means (a) an amendment to, change in or announced
proposed change in the laws (or any regulations thereunder) of the
United States or any political subdivision or taxing authority thereof
or therein, (b) a judicial decision interpreting, applying or clarifying
such laws or regulations, (c) an administrative pronouncement or action
that represents an official position (including a clarification of an
official position) of the governmental authority or regulatory body
making such administrative pronouncement or taking such action, or (d) a
threatened challenge asserted in connection with an audit of the Company
or any of its subsidiaries, the Partnership, or the Trust, or a threatened
challenge asserted in writing against any other taxpayer that has
raised capital through the issuance of securities that are substantially
similar to the Debentures, the Partnership Preferred Securities, or the
Trust Preferred Securities, which amendment or change is adopted or
which decision, pronouncement or proposed change is announced or which
action, clarification or challenge occurs on or after the date of the
prospectus related to the issuance of the Trust Preferred Securities.
"10% in liquidation amount of the Trust Securities" means,
except as provided in the terms of the Trust Preferred Securities or by
the Trust Indenture Act, Holder(s) of outstanding Trust Securities
voting together as a single class or, as the context may require,
Holders of outstanding Trust Preferred Securities or Holders of outstanding
Trust Common Securities voting separately as a class, who are
the record owners of 10% or more of the aggregate liquidation amount of
all outstanding Trust 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 Department, as such regulations may be
amended from time to time (including corresponding provisions of succeeding
regulations).
"Trust Common Security" has the meaning set forth in Section
8.1 of this Declaration.
"Trust Common Security Certificate" means a definitive
certificate in fully registered form representing a Common Security
substantially in the form of Exhibit A-2.
"Trust Common Securities Guarantee" means the Trust Common
Securities Guarantee Agreement dated as of June 25, 1997, entered
into by the Company, as Guarantor, for the benefit of the holders of the
Trust Common Securities.
"Trust Dissolution Tax Opinion" means an opinion of independent
tax counsel experienced in such matters to the effect that there has
been a Trust Tax Event.
"Trust Enforcement Event" means the occurrence, at any time,
of (i) arrearages on distributions on the Trust Preferred Securities
that shall exist for six consecutive quarterly distribution periods,
(ii) a default by the Company in respect of any of its obligations under
the Trust Guarantee or (iii) a Partnership Enforcement Event (as defined
in the Limited Partnership Agreement).
"Trust Guarantees" means the Trust Common Securities Guarantee
and The Trust Preferred Securities Guarantee, collectively.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended from time to time, or any successor legislation.
"Trust Investment Company Event" means that the Company shall
have requested and received and shall have delivered to the Regular
Trustees an opinion of nationally recognized independent legal counsel
experienced in such matters to the effect that as a result of a Change
in 1940 Act Law, the Trust is or will be considered an "investment
company" which is required to be registered under the 1940 Act.
"Trust Liquidation" has the meaning set forth in Section
9.2(a) of this Declaration.
"Trust Preferred Securities Guarantee" has the meaning set
forth in Section 1.1 of the Limited Partnership Agreement.
"Trust Liquidation Distribution" has the meaning set forth in
Section 9.2(a) of this Declaration.
"Trust Preferred Security" has the meaning set forth in
Section 8.1(a) of this Declaration.
"Trust 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).
"Trust Preferred Security Certificate" means a certificate
representing a Preferred Security substantially in the form of Exhibit
A-1.
"Trust Redemption Tax Opinion" means an opinion of independent
tax counsel experienced in such matters that there has been a Trust Tax
Event, and following such Trust Tax Event there is more than an
insubstantial risk that interest payable by one or more of the Investment
Affiliates with respect to the Debentures is not, or will not be,
deductible by such Investment Affiliate for United States federal income
tax purposes even if the Partnership Preferred Securities were distributed
to the Holders of the Trust Securities in liquidation of such
Holders' interests in the Trust.
"Trust Securities" means the Trust Common Securities and the
Trust Preferred Securities.
"Trust Special Event" means a Trust Tax Event or a Trust
Investment Company Event.
"Trust Tax Event" means that there has been a Tax Action which
relates to any of the items described in (i) through (iii) below, and
that there is more than an insubstantial risk that (i) the Trust is, or
will be subject to United States federal income tax with respect to
income accrued or received on the Partnership Preferred Securities, (ii)
the Trust is, or will be, subject to more than a de minimis amount of
other taxes, duties or other governmental charges or (iii) interest
payable by one or more of the Investment Affiliates with respect to the
Debentures is not, or will not be, deductible by such Investment Affiliate
for United States federal income tax purposes.
"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.
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 Trust Securities as
equity securities representing undivided beneficial interests in the
assets of the Trust.
SECTION 2.2 Lists of Holders of Trust Securities.
(a) Each of the Sponsor and the Regular Trustees on behalf of
the Trust shall provide the Property Trustee (i) within 14 days after
each record date for payment of Distributions, a list, in such form as
the Property Trustee may reasonably require, of the names and addresses
of the Holders of the Trust Securities ("List of Holders") as of such
record date, 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, and (ii) at any other time,
within 30 days of receipt by the Trust of a written request for a List
of Holders as of a date no more than 14 days before such List of Holders
is given to the Property Trustee. 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 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 May 15,
1998, the Property Trustee shall provide to the Holders of the Trust
Preferred Securities such reports as are required by Section 313 of the
Trust Indenture Act, if any, in the form and in the manner provided by
Section 313 of the Trust Indenture Act. The Property Trustee shall also
comply with the requirements of Section 313(d) of the Trust Indenture
Act.
SECTION 2.4 Periodic Reports to 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 are required by Section 314 of the Trust Indenture Act
(if any) and the compliance certificate required by Section 314 of the
Trust Indenture Act in the form, in the manner and at the times required
by Section 314 of the Trust Indenture Act.
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 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 Trust Enforcement Events; Waiver.
(a) The Holders of a Majority in liquidation amount of Trust
Preferred Securities may, by vote, on behalf of the Holders of all of
the Trust Preferred Securities, waive any past Trust Enforcement Event
in respect of the Trust Preferred Securities and its consequences,
provided, that if the underlying event of default or Partnership
Enforcement Event:
(i) is not waivable under the Trust Preferred Securities
Guarantee or the Limited Partnership Agreement, the Trust Enforce
ment Event under this Declaration shall also not be waivable; or
(ii) requires the consent or vote of the Holders of greater
than a Majority in liquidation amount of the Trust Preferred
Securities to be waived under the Trust Preferred Securities
Guarantee or the Partnership Preferred Securities to be waived
under the Limited Partnership Agreement (a "Super Majority"),
the Trust Enforcement Event under this Declaration may only be waived by
the vote of the Holders of at least the relevant Super Majority in
liquidation amount of the Trust Preferred Securities.
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 Trust Securities, as permitted by the
Trust Indenture Act. Upon such waiver, any such default shall cease to
exist, and any Trust Enforcement Event with respect to the Trust Preferred
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 Trust Enforcement Event with
respect to the Trust Preferred Securities or impair any right consequent
thereon. Any waiver by the Holders of the Trust Preferred Securities of
Trust Enforcement Events with respect to the Trust Preferred Securities
shall also be deemed to constitute a waiver by the Holders of the Trust
Common Securities of any such Trust Enforcement Event with respect to
the Trust Common Securities for all purposes of this Declaration without
any further act, vote, or consent of the Holders of the Trust Common
Securities.
(b) The Holders of a Majority in liquidation amount of the
Trust Common Securities may, by vote, on behalf of the Holders of all of
the Trust Common Securities, waive any past Trust Enforcement Event with
respect to the Trust Common Securities and its consequences, provided,
that if the underlying event of default or Partnership Enforcement
Event:
(i) is not waivable under the Trust Common Securities Guaran
tee or the Limited Partnership Agreement, except where the Holders
of the Trust Common Securities are deemed to have waived such Trust
Enforcement Event under this Declaration as provided below in this
Section 2.6(b), the Trust Enforcement Event under this Declaration
shall also not be waivable; or
(ii) requires the consent or vote of the Holders of a Super
Majority to be waived, except where the Holders of the Trust Common
Securities are deemed to have waived such Trust Enforcement Event
under the Declaration as provided below in this Section 2.6(b), the
Trust Enforcement Event under this Declaration may only be waived
by the vote of the Holders of at least the relevant Super Majority
in liquidation amount of the Trust Common Securities;
provided, further, each Holder of Trust Common Securities will be deemed
to have waived any such Trust Enforcement Event and all Trust Enforcement
Events with respect to the Trust Common Securities and its consequences if
all Trust Enforcement Events with respect to the Trust
Preferred Securities have been cured, waived or otherwise eliminated,
and until such Trust Enforcement Events 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 Trust Preferred Securities and
only the Holders of the Trust Preferred Securities will have the right
to direct the Property Trustee in accordance with the terms of the Trust
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
Trust 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 Trust Enforcement Event with
respect to the Trust 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 Trust Enforce-
ment Event with respect to the Trust Common Securities or impair any
right consequent thereon.
(c) A waiver of Partnership Enforcement Events under the
Limited Partnership Agreement by the Property Trustee at the direction
of the Holders of the Trust Preferred Securities constitutes a waiver of
the corresponding Trust Enforcement Event 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 Trust Securities, as permitted by
the Trust Indenture Act.
SECTION 2.7 Trust Enforcement Event; Notice.
The Property Trustee shall, within 90 days after the occurrence
of a Trust Enforcement Event, transmit by mail, first class
postage prepaid, to the Holders of the Trust Securities, notices of all
defaults with respect to the Trust 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 being hereby defined to be defaults as
defined in the Trust Guarantees or the Limited Partnership Agreement,
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 Affiliate Investment Instruments or in the payment of
any sinking fund installment established for the Affiliate Investment
Instruments, the Property Trustee shall be fully protected in withhold-
ing 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 Trust Securities.
ARTICLE III
ORGANIZATION
SECTION 3.1 Name.
The Trust is named "UDS Capital I," as such name may be modi-
fied from time to time by the Regular Trustees following written notice
to the Holders of Trust Securities. The Trust's activities may be
conducted under the name of the Trust or any other name deemed advisable
by the Regular Trustees.
SECTION 3.2 Office.
The address of the principal office of the Trust is c/o
Ultramar Diamond Shamrock Corporation, 9830 Colonnade Boulevard, San
Antonio, Texas 78230. On ten Business Days written notice to the
Holders of Trust 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 the Trust Securities, (b) investing the proceeds from such sale of
the Trust Securities to acquire the Partnership Preferred Securities,
and (c) except as otherwise limited herein, to engage in only those
other activities necessary or incidental thereto. The Trust shall not
borrow money, issue debt or reinvest proceeds derived from investments,
mortgage or 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.
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 Partnership
Preferred Securities and the Property 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
ownership 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 issue and sell the Trust Preferred Securities and the
Trust Common Securities in accordance with this Declaration;
provided, however, that the Trust may issue no more than one series
of Trust Preferred Securities and no more than one series of Trust
Common Securities, and, provided, further, that there shall be no
interests in the Trust other than the Trust Securities, and the
issuance of Trust Securities shall be limited to a one-time,
simultaneous issuance of both Trust Preferred Securities and Trust
Common Securities on the Closing Date;
(b) in connection with the issue and sale of the Trust
Preferred Securities, at the direction of the Sponsor, to:
(i) execute and file with the Commission the registra
tion statement on Form S-3 prepared by the Sponsor, including
any amendments thereto, pertaining to the Trust Preferred
Securities;
(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
Trust Preferred Securities in any State in which the Sponsor
has determined to qualify or register such Trust 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 National Market System
for listing upon notice of issuance of any Trust Preferred
Securities;
(iv) execute and file with the Commission a registration
statement, including any amendments thereto, prepared by the
Sponsor, relating to the registration of the Trust Preferred
Securities, the Partnership Preferred Securities, the Trust
Preferred Securities Guarantee and the Partnership Guarantee
under Section 12(b) of the Exchange Act; and
(v) execute and enter into an underwriting agreement
providing for the sale of the Trust Preferred Securities and
perform the duties and obligations of the Trust thereunder;
(c) to acquire the Partnership Preferred Securities with the
proceeds of the sale of the Trust Preferred Securities and the
Trust Common Securities; provided, however, that the Regular
Trustees shall cause legal title to the Partnership Preferred
Securities to be held of record in the name of the Property Trustee
for the benefit of the Holders of the Trust Preferred Securities
and the Holders of Trust Common Securities;
(d) to give the Sponsor and the Property Trustee prompt
written notice of the occurrence of a Trust Special Event; pro
vided, that the Regular Trustees shall consult with the Sponsor and
the Property Trustee before taking or refraining from taking any
Ministerial Action in relation to a Trust Special 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, redemp
tions and exchanges, and to issue relevant notices to the Holders
of Trust Preferred Securities and Holders of Trust Common Securi
ties as to such actions and applicable record dates;
(f) to give prompt written notice to the Holders of the Trust
Securities of any notice received from the Partnership of the
General Partner's election not to make a current, quarterly distri
bution on the Partnership Preferred Securities under the Limited
Partnership Agreement;
(g) to take all actions and perform such duties as may be
required of the Regular Trustees pursuant to the terms of the Trust
Securities;
(h) 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(f), the Property Trustee has the exclusive power to bring such
Legal Action;
(i) to employ or otherwise engage employees and agents (who
may be designated as officers with titles) and managers, contrac
tors, advisors, and consultants and pay reasonable compensation for
such services;
(j) to cause the Trust to comply with the Trust's obligations
under the Trust Indenture Act;
(k) 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;
(l) to incur expenses that are necessary or incidental to
carry out any of the purposes of the Trust;
(m) to act as, or appoint another Person to act as, registrar
and transfer agent for the Trust Securities;
(n) 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 incidental to the foregoing;
(o) 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 busi
ness trust under the laws of the State of Delaware and of each
other jurisdiction in which such existence is necessary to protect
the limited liability of the Holders of the Trust Preferred Securi
ties or to enable the Trust to effect the purposes for which the
Trust was created;
(p) to take any action, or to take no action, not inconsis
tent with this Declaration or with applicable law, that the Regular
Trustees determine in their discretion to be necessary or desirable
in carrying out 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 Invest
ment Company required to be registered under the 1940 Act; and
(ii) taking no action which would be reasonably likely
to cause the Trust to be classified as an association or a
publicly traded partnership taxable as a corporation for
United States federal income tax purposes;
provided, that such action does not adversely affect the interests
of Holders; and
(q) 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.
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 Partnership pursuant to Section
9.1 of the Limited Partnership Agreement.
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 particu-
lar, 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 Partnership Preferred Securities, but shall distribute all such
proceeds to Holders of Trust Securities pursuant to the terms of
this Declaration and of the Trust 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 or acquire any
securities other than the Partnership Preferred Securities;
(v) possess any power or otherwise act in such a way as to
vary the Trust assets or the terms of the Trust Securities in any
way whatsoever;
(vi) issue any securities or other evidences of beneficial
ownership of, or beneficial interest in, the Trust other than the
Trust Securities;
(vii) other than as set forth herein, (A) cause the Special
Representative to direct the time, method and place of conducting
any proceeding for any remedy available to the Special Representa
tive or exercising any trust or power conferred upon the Special
Representative with respect to the Partnership Preferred Securi
ties, the Affiliate Investment Instruments, and the Investment
Guarantees, (B) cause the Special Representative to waive any past
default that is waivable under the Limited Partnership Agreement,
the Affiliate Investment Instruments or the Investment Guarantees,
(C) cause the Special Representative to exercise any right to
rescind or annul any declaration that the principal of, or other
amounts in respect of, any Affiliate Investment Instrument is due
and payable or (D) consent to any amendment, modification or
termination of the Limited Partnership Agreement or the Partnership
Preferred Securities where such consent shall be required; and
(viii) other than in connection with the liquidation of the
Trust pursuant to a Trust Special Event or upon redemption of all
the Trust Securities, file a certificate of cancellation of the
Trust.
SECTION 3.8 Powers and Duties of the Property Trustee.
(a) The legal title to the Partnership Preferred Securities
shall be owned by and held of record in the name of the Property Trustee
in trust for the benefit of the Holders of the Trust Securities. The
right, title and interest of the Property Trustee to the Partnership
Preferred Securities shall vest automatically in each Person who may
hereafter be appointed as Property Trustee in accordance with Section
6.7. Such vesting and cessation of title shall be effective whether or
not conveyancing documents with regard to the Partnership Preferred
Securities have been executed and delivered.
(b) The Property Trustee shall not transfer its right, title
and interest in the Partnership Preferred Securities 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 Account") in the name of and under the
exclusive control of the Property Trustee on behalf of the Holders
of the Trust Securities and, upon the receipt of payments of funds
made in respect of the Partnership Preferred Securities held by the
Property Trustee, deposit such funds into the Property Account and
make payments to the Holders of the Trust Preferred Securities and
Holders of the Trust Common Securities from the Property Account in
accordance with Section 7.1. Funds in the Property Account shall
be held uninvested until disbursed in accordance with this Declara
tion. The Property Account shall be an account that is maintained
with a banking institution (including the Property Trustee if it
qualifies hereunder) authorized to exercise corporate trust powers
and having a combined capital and surplus of at least $50,000,000
and subject to supervision or examination by Federal or state
authority;
(ii) engage in such ministerial activities as shall be
necessary or appropriate to effect the redemption of the Trust
Preferred Securities and the Trust Common Securities to the extent
the Partnership Preferred Securities are redeemed; and
(iii) upon written notice of distribution issued by the
Regular Trustees in accordance with the terms of the Trust Securi
ties, engage in such ministerial activities as shall be necessary
or appropriate to effect the distribution of the Partnership
Preferred Securities to Holders of Trust Securities upon the
occurrence of a Trust Special Event.
(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 Trust Securities.
(e) The Property Trustee shall take any Legal Action which
arises out of or in connection with a Trust Enforcement Event 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 have the legal power to
exercise all of the rights, powers and privileges of a Holder of
Partnership Preferred Securities and, if a Trust Enforcement Event occurs
and is continuing, the Property Trustee shall, for the benefit of
Holders of the Trust Securities, enforce its rights as Holder of the
Partnership Preferred Securities subject to the rights of the Holders
pursuant to the terms of such Trust Securities.
(g) 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 Trust
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.
(h) 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 Trust Securities
pursuant to the terms of the Trust Securities; or
(ii) a Successor Property Trustee has been appointed and has
accepted that appointment in accordance with Section 6.7.
(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 Trust
Enforcement Event and after the curing or waiver of all Trust Enforcement
Events 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 a Trust Enforcement Event 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 a Trust Enforcement Event and
after the curing or waiving of all such Trust Enforcement Events
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) subject to the requirement of the Property Trustee
receiving a tax opinion as set forth in Section 8.4(d) or 8.5(c),
as the case may be, the Property Trustee shall not be liable with
respect to any action taken or omitted to be taken by it in good
faith in accordance with the direction of the Holders of not less
than a Majority in liquidation amount of the Trust Securities
relating to the time, method and place of conducting any proceeding
for any remedy available to the Property Trustee, or exercising any
trust or power conferred upon the Property Trustee under this
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 protection from such 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 Partnership
Preferred Securities and the Property Account shall be to deal with
such property in a similar manner as the Property Trustee deals
with similar property for its own account, subject to the
protections and limitations on liability afforded to the Property
Trustee under this 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 Partnership Preferred Securities or the payment of any taxes
or assessments levied thereon or in connection therewith;
(vii) money held by the Property Trustee need not be segre
gated from other funds held by it except in relation to the Prop
erty 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 acting on behalf of the Trust contemplated by this Decla
ration shall be sufficiently evidenced by an Officers' 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 hereun
der, the Property Trustee (unless other evidence is herein specifi
cally 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 of its
selection or other experts and the advice or opinion of such coun
sel 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 Declara
tion 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 Declara
tion at the request or direction of any Holder, unless (a) 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 and (b) the Property Trustee has
obtained the legal opinions, if any, required by Section 8.4(d) or
8.5(c), as the case may be, of this Agreement; provided, that,
nothing contained in this Section 3.10(a)(vi) shall be taken to
relieve the Property Trustee, upon the occurrence of a Trust
Enforcement Event, 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 Trust Securi-
ties, 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 Trust Securities which instructions may
only be given by the Holders of the same proportion in liquidation
amount of the Trust Securities as would be entitled to direct the
Property Trustee under the terms of the Trust Securities in respect
of such remedy, right or action, (ii) may refrain from enforcing
such remedy or right or taking such other action until such in
structions are received, and (iii) shall be fully protected in
conclusively relying on or acting in or accordance with such
instructions; provided, however, that the Property Trustee shall
not be required to take any action unless it shall have obtained
such legal opinions, if any, required by Sections 8.4(d) or 8.5(c),
as the case may be, of this Agreement; and
(xi) except as otherwise expressly provided by this Declara
tion, 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 provision of this Declaration other than
Section 6.2, 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 6.2, 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, any Regular
Trustee is authorized to execute on behalf of the Trust any documents
that the Regular Trustees have the power and authority to cause the
Trust 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 or on behalf of a majority of the
Regular Trustees.
SECTION 3.13 Not Responsible for Recitals or Issuance of Trust Securi
ties.
The recitals contained in this Declaration and the Trust
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 or
the Trust Securities.
SECTION 3.14 Duration of Trust.
The Trust, unless terminated pursuant to the provisions of
Article VIII hereof, shall have perpetual existence.
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 Person, 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 Trust Securities, the Delaware
Trustee or the Property Trustee, consolidate, amalgamate, merge with or
into, or be replaced by, or convey, transfer or lease its properties and
assets as an entirety or substantially as an entirety to a trust orga-
nized as such under the laws of any State of the United States; provid-
ed, that:
(i) if the Trust is not the survivor, such successor entity
(the "Successor Entity") either:
(A) expressly assumes all of the obligations of the
Trust under the Trust Securities; or
(B) substitutes for the Trust Preferred Securities other
securities having substantially the same terms as the Trust
Preferred Securities (the "Successor Trust Securities") so
long as the Successor Trust Securities rank the same as the
Trust Preferred Securities rank with respect to Distributions,
assets and payments upon liquidation, redemption and other
wise;
(ii) the Company expressly acknowledges a trustee of the
Successor Entity that possesses the same powers and duties as the
Property Trustee as the Holder of the Partnership Preferred Securi
ties;
(iii) the Successor Trust Securities are listed, or any
Successor Trust Securities will be listed upon notification of
issuance, on any national securities exchange or with another
organization on which the Trust Preferred Securities are then
listed or quoted;
(iv) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not cause the Trust Preferred
Securities (including any Successor Trust Securities) to be down
graded by any nationally recognized statistical rating organiza
tion;
(v) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights,
preferences and privileges of the Holders of the Trust Preferred
Securities (including any Successor Trust Securities) in any
material respect;
(vi) such Successor Entity has a purpose identical to that of
the Trust;
(vii) the Company guarantees the obligations of such Succes
sor Entity under the Successor Trust Securities at least to the
extent provided by the Trust Guarantees; and
(viii) prior to such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, the Sponsor has re
ceived an opinion of independent counsel to the Trust experienced
in such matters to the effect that:
(A) such merger, consolidation, amalgamation, replace
ment, conveyance, transfer or lease will not adversely affect
the rights, preferences and privileges of the Holders of the
Trust Preferred Securities (including any Successor Trust
Securities) in any material respect (other than with respect
to any dilution of the Holders' interest in the new entity);
(B) following such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, neither the Trust
nor the Successor Entity will be required to register as an
Investment Company under the 1940 Act;
(C) following such merger, consolidation, amalgamation
or replacement, the Trust (or the Successor Entity) will not
be classified as an association or a publicly traded partner
ship taxable as a corporation for United States federal income
tax purposes; and
(D) following such merger, consolidation, amalgamation
or replacement, the Partnership will not be classified as an
association or a publicly traded partnership taxable as a
corporation for United States federal income tax purposes.
(c) Notwithstanding Section 3.15(b), the Trust shall not,
except with the consent of Holders of 100% in liquidation amount of the
Trust Preferred 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 or the Partnership to be classified as an association
or a publicly traded partnership taxable as a corporation for United
States federal income tax purposes.
ARTICLE IV
SPONSOR
SECTION 4.1 Responsibilities of the Sponsor.
In connection with the issue and sale of the Trust 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 in relation to the Trust Pre
ferred Securities, including any amendments thereto;
(b) to determine the States in which to take appropriate
action to qualify or register for sale all or part of the Trust
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 or any other national stock exchange or the
Nasdaq National Market System for listing upon notice of issuance
of any Trust Preferred Securities, Partnership Preferred Securi
ties, the Trust Preferred Securities Guarantee and the Partnership
Guarantee;
(d) to prepare for filing by the Trust with the Commission a
registration statement relating to the registration of the Trust
Preferred Securities, the Partnership Preferred Securities, the
Trust Preferred Securities Guarantee, and the Partnership Guarantee
under Section 12(b) of the Exchange Act, including any amendments
thereto; and
(e) to negotiate the terms of an underwriting agreement and
any pricing agreement providing for the sale of the Trust Preferred
Securities.
SECTION 4.2 Indemnification and Expenses of the Trustee
The Partnership agrees, and to the extent the Partnership
fails to do so, the Sponsor agrees to indemnify the Property Trustee and
the Delaware Trustee for, and to hold each of them harmless against, any
loss, liability or expense incurred without negligence or bad faith on
the part of the Property Trustee or the Delaware Trustee, as the case
may be, arising out of or in connection with the acceptance or adminis-
tration of the trust or trusts hereunder, including the costs and
expenses of defending either of them against any claim or liability in
connection with the exercise or performance of any of their respective
powers or duties hereunder; the provisions of this Section 4.2 shall
survive the resignation or removal of the Delaware Trustee or the Prop-
erty Trustee or the termination of this Declaration.
ARTICLE V
TRUST COMMON SECURITIES HOLDER
SECTION 5.1 Company's Purchase of Trust Common Securities.
On the Closing Date the Company will purchase all of the Trust
Common Securities issued by the Trust, for an amount at least equal to
3% of the capital of the Trust, at the same time as the Trust Preferred
Securities are sold.
SECTION 5.2 Covenants of the Trust Common Securities Holder.
For so long as the Trust Preferred Securities remain out-
standing, the Company will covenant (i) to maintain directly 100 percent
ownership of the Trust Common Securities, (ii) to cause the Trust to
remain a statutory business trust and not to voluntarily dissolve, wind
up, liquidate, or be terminated, except as permitted by this Declaration,
(iii) to use its commercially reasonable efforts to ensure that
the Trust will not be an investment company for purposes of the 1940
Act, and (iv) to take no action which would be reasonably likely to
cause the Trust to be classified as an association or a publicly traded
partnership taxable as a corporation for United States federal income
tax purposes.
ARTICLE VI
TRUSTEES
SECTION 6.1 Number of Trustees.
The number of Trustees initially shall be five (5), and:
(a) at any time before the issuance of any Trust Securities,
the Sponsor may, by written instrument, increase or decrease the
number of Trustees; and
(b) after the issuance of any Trust Securities, the number of
Trustees may be increased or decreased by vote of the Holders of a
Majority in liquidation amount of the Trust Common Securities
voting as a class at a meeting of the Holders of the Trust Common
Securities; provided, however, that the number of Trustees shall in
no event be less than three (3); provided, further, that (1) if
required by the Business Trust Act, one Trustee is the Delaware
Trustee; (2) there shall be at least one Trustee who is an employee
or officer of, or is affiliated with the Company (each, a "Regular
Trustee"); and (3) one Trustee shall be the Property Trustee for so
long as this Declaration is required to qualify as an indenture
under the Trust Indenture Act, and such Property Trustee may also
serve as Delaware Trustee if it meets the applicable requirements.
SECTION 6.2 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 may also be the Delaware
Trustee (in which case Section 3.11 shall have no application).
SECTION 6.3 Property Trustee; Eligibility.
(a) There shall at all times be one Trustee (the "Property
Trustee") which shall act as Property Trustee which shall:
(i) not be an Affiliate of the Sponsor; and
(ii) be a corporation organized and doing business under the
laws of the United States of America or any State or Territory
thereof or of the District of Columbia, or a corporation or Person
permitted by the 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, Territo
rial 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
6.3(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.
(b) If at any time the Property Trustee shall cease to be
eligible to so act under Section 6.3(a), the Property Trustee shall
immediately resign in the manner and with the effect set forth in
Section 6.7(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 Trust Common
Securities (as if it were the obligor 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 Trust 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.
(e) The initial Property Trustee shall be:
The Bank of New York
SECTION 6.4 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 6.5 Regular Trustees.
The initial Regular Trustees shall be:
H. Pete Smith
Steve Blank
Patti K. Meisetschleager
(a) Except as expressly set forth in this Declaration and
except if a meeting of the Regular Trustees is called with respect to
any matter over which the Regular Trustees have power to act, any power
of the Regular Trustees may be exercised by, or with the consent of, any
one such Regular Trustee.
(b) Unless otherwise determined by the Regular Trustees, and
except as otherwise required by the Business Trust Act or applicable
law, any Regular Trustee is authorized to execute on behalf of the Trust
any documents which the Regular Trustees have the power and authority to
cause the Trust 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 or on behalf of a majority of the
Regular Trustees.
SECTION 6.6 Delaware Trustee.
The initial Delaware Trustee shall be:
The Bank of New York (Delaware)
SECTION 6.7 Appointment, Removal and Resignation of Trustees.
(a) Subject to Section 6.7(b), Trustees may be appointed or
removed without cause at any time:
(i) until the issuance of any Trust Securities, by written
instrument executed by the Sponsor; and
(ii) after the issuance of any Trust Securities, by vote of
the Holders of a Majority in liquidation amount of the Trust Common
Securities voting as a class at a meeting of the Holders of the
Trust Common Securities.
(b) (i) The Trustee that acts as Property Trustee shall not
be removed in accordance with Section 6.7(a) until a successor Trustee
possessing the qualifications to act as Property Trustee under Section
6.3 (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;
and
(ii) the Trustee that acts as Delaware Trustee shall not be
removed in accordance with Section 6.7(a) until a successor Trustee
possessing the qualifications to act as Delaware Trustee under
Sections 6.2 and 6.4 (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
successor shall have been appointed or until his death, 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 ap
pointed 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 Trust 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 deliv
ered to the Trust, the Sponsor and the resigning Delaware Trustee.
(d) The Holders of the Trust 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 6.7.
(e) If no Successor Property Trustee or Successor Delaware
Trustee shall have been appointed and accepted appointment as provided
in this Section 6.7 within 60 days after delivery to the Sponsor and the
Trust of an instrument of resignation or removal, the retiring 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. Such court may thereupon, after prescribing
such notice, if any, as it may deem proper and prescribe,
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 6.8 Vacancies among Trustees.
If a Trustee ceases to hold office for any reason and the
number of Trustees is not reduced pursuant to Section 6.1, or if the
number of Trustees is increased pursuant to Section 6.1, 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 6.7.
SECTION 6.9 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 6.7, 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 6.10 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 or
any committee thereof 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. Notwithstanding
the foregoing, any and all actions of the Regular Trustees may be taken
by the unanimous written consent of all Regular Trustees.
SECTION 6.11 Delegation of Power.
(a) Any Regular Trustee may, by power of attorney consistent
with applicable law, delegate to any other natural person over the age
of 21 his or her power for the purpose of executing any documents
contemplated in Section 3.6, including any registration statement or
amendment thereto filed with the Commission, or making any other
governmental filing; and
(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 6.12 Merger, Conversion, Consolidation or Succession to Busi
ness.
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, that 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 VII
DISTRIBUTIONS
SECTION 7.1 Distributions.
(a) Holders of Trust Securities shall be entitled to receive
cumulative cash distributions at the rate per annum of
8.32% of the stated liquidation amount of $25 per Trust Security,
calculated on the basis of a 360-day year consisting of twelve 30-day
months. For any period shorter than a full 90-day quarter, distributions
will be computed on the basis of the actual number of days elapsed
in such 90-day quarter. Distributions shall be made on the Trust
Preferred Securities and the Trust Common Securities on a Pro Rata
basis. Distributions on the Trust Securities shall, from the date of
original issue, accumulate and be cumulative and shall be payable
quarterly only to the extent that the Trust has funds available for the
payment of such Distributions in the Property Account. Distributions
not paid on the scheduled payment date will accumulate and compound
quarterly at the rate of 8.32% per annum ("Compounded Distributions").
"Distributions" shall mean ordinary cumulative distributions in respect
of each Fiscal Period together with any Compounded Distributions. If
and to the extent that the Partnership makes a distribution on the Part-
nership Preferred Securities held by the Property Trustee or the Company
makes a payment under the Partnership Guarantee (the amount of any such
partnership distribution, including any compounded partnership
distributions, or guarantee payment being a "Payment Amount"), the Trust
shall and the Property Trustee is directed, to the extent funds are available
for that purpose, to make a Pro Rata Distribution of the Payment Amount
to Holders.
(b) Distributions on the Trust Securities will be cumulative,
will accumulate from the date of initial issuance and will be payable
quarterly in arrears on each March 31, June 30, September 30 and December
31, commencing June 30, 1997, when, as and if available for payment,
by the Property Trustee, except as otherwise described below. If
Distributions are not paid when scheduled, the accumulated Distributions
shall be paid to the Holders of record of Trust Securities as they
appear on the books and records of the Trust on the record date as
determined under Section 7.1(d) below.
(c) Amounts available to the Trust for distribution to the
Holders of the Trust Securities will be limited to payments received by
the Trust from the Partnership on the Partnership Preferred Securities
or from the Company on the Partnership Guarantees paid by the Company to
the Trust. If the Property Trustee, as the holder of the Partnership
Preferred Securities for the benefit of the Holders of the Trust
Securities, receives notice of any determination by the Partnership not to
pay distributions on such Partnership Preferred Securities, the Property
Trustee shall give notice of such determination to the Holders.
(d) Distributions on the Trust Securities will be payable to
the Holders thereof as they appear on the books and records of the Trust
on the relevant record dates, which relevant record dates, as long as
the Trust Preferred Securities remain in book-entry only form, will be
one Business Day prior to the relevant payment dates. Such distributions
will be paid through the Property Trustee who will hold amounts
received in respect of the Partnership Preferred Securities in the
Property Account for the benefit of the Holders of the Trust Securities.
In the event that the Trust Preferred Securities do not remain in
book-entry only form, the relevant record dates shall be the 15th day of
the month of the relevant payment dates. In the event that any date on
which distributions are payable on the Trust Securities is not a Busi-
ness Day, payment of the distribution payable on such date will be made
on the next succeeding day which is a Business Day (without any interest
or other payment in respect of any such delay) except that, if such
Business Day is in the next succeeding calendar year, such payment shall
be made on the immediately preceding Business Day, in each case with the
same force and effect as if made on such date.
ARTICLE VII
ISSUANCE OF TRUST SECURITIES
SECTION 8.1 Designation and General Provisions Regarding Trust Securi
ties.
(a) The Regular Trustees shall on behalf of the Trust issue
one class of preferred securities representing undivided beneficial
ownership interests in the assets of the Trust and one class of common
securities representing undivided beneficial ownership interests in the
assets of the Trust as follows:
(i) Trust Preferred Securities. 8,000,000 Trust Preferred
Securities of the Trust with an aggregate liquidation amount with
respect to the assets of the Trust of two hundred million dollars
($200,000,000) and a liquidation amount with respect to the assets
of the Trust of $25 per preferred security, are hereby designated
for the purpose of identification only as 8.32% Trust Originated
Preferred Securities (SM 1) (the "Trust Preferred Securities").
The Trust Preferred Security Certificates evidencing the Trust Pre
ferred Securities shall be substantially in the form of Exhibit A-1
to the Declaration, with such changes and additions thereto or
deletions therefrom as may be required by ordinary usage, custom or
practice or to conform to the rules of any stock exchange on which
the Trust Preferred Securities are listed.
(ii) Trust Common Securities. 247,440 Trust Common Securi
ties of the Trust with an aggregate liquidation amount with respect
to the assets of the Trust of six million one hundred eighty-six
thousand dollars ($6,186,000) and a liquidation amount with respect
to the assets of the Trust of $25 per common security, are hereby
designated for the purposes of identification only as 8.32% Trust
Common Securities (the "Trust Common Securities" and, together with
the Trust Preferred Securities, the "Trust Securities"). The Trust
Common Security Certificates evidencing the Trust Common Securities
shall be substantially in the form of Exhibit A-2 to the Declara
tion, with such changes and additions thereto or deletions there
from as may be required by ordinary usage, custom or practice.
(b) Except as provided in Section 9.2(b) of this Declaration,
the Trust Preferred Securities rank pari passu and payment thereon shall
be made Pro Rata with the Trust Common Securities. The Trust shall
issue no securities or other interests in the assets of the Trust other
than the Trust Preferred Securities and the Trust Common Securities.
(c) Any Regular Trustee shall sign the Trust Securities for
the Trust by manual or facsimile signature. In case any Regular Trustee
of the Trust who shall have signed any of the Trust Securities shall
cease to be a 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 Trust
Security, 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 Trust Securities may be listed, or to conform to usage.
(SM 1) "Trust Originated Preferred Securities" and "TOPrS" are service
marks of Merrill Lynch & Co., Inc.
A Trust Security shall not be valid until authenticated by the
manual signature of an authorized officer of the Property Trustee. Such
signature shall be conclusive evidence that the Trust Security has been
authenticated under this Declaration.
Upon a written order of the Trust signed by one Regular
Trustee, the Property Trustee shall authenticate the Trust Securities
for original issue. The aggregate number of Trust Securities outstanding
at any time shall not exceed the number set forth in the Terms of
the Trust Securities.
The Property Trustee may appoint an authenticating agent
acceptable to the Trust to authenticate Trust Securities. An
authenticating agent may authenticate Trust Preferred Securities whenever
the Property Trustee may do so. Each reference in this Declaration to
authentication by the Property Trustee includes authentication by such
agent. An authenticating agent has the same rights as the Property
Trustee to deal with the Sponsor or an Affiliate of the Sponsor.
(d) The consideration received by the Trust for the issuance
of the Trust Securities shall constitute a contribution to the capital
of the Trust and shall not constitute a loan to the Trust.
(e) Upon issuance of the Trust Securities as provided in this
Declaration, the Trust Securities so issued shall be deemed to be
validly issued, fully paid and non-assessable, subject to Section 11.1
with respect to the Trust Common Securities.
(f) Every Person, by virtue of having become a Holder or a
Trust 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.
SECTION 8.2 Redemption of Trust Securities.
(a) Upon a purchase of the Partnership Preferred Securities
by the Partnership upon redemption or otherwise, the proceeds from such
purchase shall be simultaneously applied Pro Rata to redeem Trust
Securities having an aggregate liquidation amount equal to the Partnership
Preferred Securities so purchased or redeemed at an amount equal to
$25 per Partnership Preferred Security plus an amount equal to accumulated
and unpaid Distributions, including any Compounded Distributions
thereon through the date of the redemption or such lesser amount as
shall be received by the Trust in respect of the Partnership Preferred
Securities so purchased or redeemed (the "Redemption Price"). Holders
will be given not less than 30 nor more than 60 days notice of such
redemption.
(b) If fewer than all the outstanding Trust Securities are to
be so redeemed, the Trust Common Securities and the Trust Preferred
Securities will be redeemed Pro Rata and the Trust Preferred Securities
to be redeemed will be redeemed as described in Section 8.3 below;
provided, that fewer than all of the outstanding Trust Preferred Securities
may not be redeemed unless all accumulated and unpaid Distributions
have been paid on all Trust Preferred Securities for all quarterly
distribution periods terminating on or prior to the date of redemption.
(c) If, at any time, a Trust Special Event shall occur and be
continuing, the Regular Trustees shall, unless the Partnership Preferred
Securities are redeemed in the limited circumstances described below,
within 90 days following the occurrence of such Trust Special Event
elect to either (i) dissolve the Trust upon not less than 30 nor more
than 60 days notice with the result that, after satisfaction of credi-
tors, if any, of the Trust, Partnership Preferred Securities would be
distributed on a Pro Rata basis to the Holders of the Trust Preferred
Securities and the Trust Common Securities in liquidation of such
Holders' interests in the Trust; provided, however, that if at the time
there is available to the Trust the opportunity to eliminate, within
such 90-day period, the Trust Special Event by taking some ministerial
action, such as filing a form or making an election, or pursuing some
other similar reasonable measure which in the sole judgment of the
Sponsor has or will cause no adverse effect on the Trust, the Partnership,
the Sponsor or the Holders of the Trust Securities and will
involve no material cost, the Trust will pursue such measure in lieu of
dissolution or (ii) cause the Trust Preferred Securities to remain
outstanding; provided, that in the case of this clause (ii), the Sponsor
shall pay any and all expenses incurred by or payable by the Trust
attributable to the Trust Special Event. Furthermore, if in the case of
the occurrence of a Trust Tax Event, the Regular Trustees have received
a Trust Redemption Tax Opinion, then the General Partner shall have the
right, within 90 days following the occurrence of such Trust Tax Event,
to elect to cause the Partnership to redeem the Partnership Preferred
Securities in whole (but not in part) for cash upon not less than 30 nor
more than 60 days notice and promptly following such redemption, the
Trust Securities will be redeemed by the Trust at the Redemption Price.
(d) If the Partnership Preferred Securities are distributed
to the Holders of the Trust Preferred Securities, the Sponsor will use
its best efforts to cause the Partnership Preferred Securities to be
listed on the New York Stock Exchange or on such other national securities
exchange or similar organization as the Trust Preferred Securities
are then listed or quoted.
(e) On the date fixed for any distribution of Partnership
Preferred Securities, upon dissolution of the Trust, (i) the Trust
Preferred Securities and the Trust Common Securities will no longer be
deemed to be outstanding and (ii) certificates representing Trust
Securities will be deemed to represent the Partnership Preferred Securities
having a liquidation preference equal to the stated liquidation
amount of such Trust Securities until such certificates are presented to
the Sponsor or its agent for transfer or reissuance.
SECTION 8.3 Redemption Procedures.
(a) Notice of any redemption of, or notice of distribution of
Partnership Preferred Securities in exchange for, the Trust Securities
(a "Redemption/Distribution Notice") will be given by the Trust by mail
to each Holder of Trust Securities to be redeemed or exchanged not fewer
than 30 nor more than 60 days before the date fixed for redemption or
exchange thereof which, in the case of a redemption, will be the date
fixed for redemption of the Partnership Preferred Securities. For pur-
poses of the calculation of the date of redemption or exchange and the
dates on which notices are given pursuant to this Section 8.3, a
Redemption/ Distribution Notice shall be deemed to be given on the day such
notice is first mailed by first-class mail, postage prepaid, to Holders
of Trust Securities. Each Redemption/Distribution Notice shall be
addressed to the Holders of Trust Securities at the address of each such
Holder appearing in the books and records of the Trust. No defect in
the Redemption/Distribution Notice or in the mailing of either thereof
with respect to any Holder shall affect the validity of the redemption
or exchange proceedings with respect to any other Holder.
(b) In the event that fewer than all the outstanding Trust
Securities are to be redeemed, the Trust Securities to be redeemed shall
be redeemed Pro Rata from each Holder of Trust Securities, provided,
that in respect of Preferred Securities registered in the name of and
held of record by DTC or its nominee (or any successor Clearing Agency
or its nominee) or any nominee, the distribution of the proceeds of such
redemption will be made to each Clearing Agency Participant (or Person
on whose behalf such nominee holds such securities) in accordance with
the procedures applied by such agency or nominee. In the event that the
Trust Securities do not remain in book-entry only form and fewer than
all of the outstanding Trust Securities are to be redeemed, the Trust
Securities shall be redeemed Pro Rata or pursuant to the rules of any
securities exchange on which the Trust Securities are listed.
(c) If Trust Securities are to be redeemed and the Trust
gives a Redemption/Distribution Notice, which notice may only be issued
if the Partnership Preferred Securities are redeemed as set out in this
Section 8.3 (which notice will be irrevocable), then (A) while the Trust
Preferred Securities are in book-entry only form, by 12:00 noon, New
York City time, on the redemption date, the Property Trustee will depos-
it irrevocably with the DTC or its nominee (or successor Clearing Agency
or its nominee) funds sufficient to pay the applicable Redemption Price
with respect to the Trust Preferred Securities and will give the DTC
irrevocable instructions and authority to pay the Redemption Price to
the Holders of the Trust Preferred Securities, and (B) with respect to
Trust Preferred Securities issued in definitive form and Trust Common
Securities, the Property Trustee will pay the relevant Redemption Price
to the Holders of such Trust Securities by check mailed to the address
of the relevant Holder appearing on the books and records of the Trust
on the redemption date. If a Redemption/Distribution Notice shall have
been given and funds deposited as required, if applicable, then immedi-
ately prior to the close of business on the date of such deposit, or on
the redemption date, as applicable, distributions will cease to accumulate
on the Trust Securities so called for redemption and all rights of
Holders of such Trust Securities will cease, except the right of the
Holders of such Trust Securities to receive the Redemption Price, but
without interest on such Redemption Price. If any date fixed for
redemption of Trust Securities is not a Business Day, then payment of
the Redemption Price payable on such date will be made on the next suc-
ceeding day that is a Business Day (and without any interest or other
payment in respect of the amount payable subject to such delay) except
that, if such Business Day falls in the next calendar year, such payment
will be made on the immediately preceding Business Day, in each case
with the same force and effect as if made on such date fixed for re-
demption. If payment of the Redemption Price in respect of any Trust
Securities is improperly withheld or refused and not paid either by the
Property Trustee or by the Sponsor as guarantor pursuant to the relevant
Trust Guarantee, Distributions on such Trust Securities will continue to
accumulate at the then applicable rate from the original redemption date
to the actual date of payment, in which case the actual payment date
will be considered the date fixed for redemption for purposes of calcu-
lating the Redemption Price. For these purposes, the applicable Redemption
Price shall not include Distributions which are being paid to
Holders who were Holders on a relevant record date. Upon satisfaction
of the foregoing conditions, then immediately prior to the close of
business on the date of such deposit or payment, all rights of Holders
of such Trust Preferred Securities so called for redemption will cease,
except the right of the Holders to have received the Redemption Price,
but without interest on such Redemption Price, and from and after the
date fixed for redemption, such Trust Preferred Securities will not
accumulate distributions or bear interest.
Neither the Regular Trustees nor the Trust shall be required
to register or cause to be registered the transfer of any Trust Securi-
ties that have been called for redemption.
(d) Subject to the foregoing and applicable law (including,
without limitation, United States federal securities laws), the Company
or its subsidiaries may at any time and from time to time purchase
outstanding Trust Preferred Securities by tender, in the open market or
by private agreement.
SECTION 8.4 Voting Rights of Trust Preferred Securities.
(a) Except as provided under Sections 6.1(b) and this Article
VIII and as otherwise required by the Business Trust Act, the Trust
Indenture Act and other applicable law, the Holders of the Trust Pre-
ferred Securities will have no voting rights.
(b) Subject to the requirement of the Property Trustee
obtaining a tax opinion in certain circumstances set forth in Section
8.4(d) below, the Holders of a Majority in liquidation amount of the
Trust Preferred Securities have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the
Property Trustee, or direct the exercise of any trust or power conferred
upon the Property Trustee under the Declaration, including the right to
direct the Property Trustee, as Holder of the Partnership Preferred
Securities, to (i) exercise the remedies available to it under the
Limited Partnership Agreement as a Holder of the Partnership Preferred
Securities, including the right to direct the Special Representative of
the Partnership as elected by the Holders of the Partnership Preferred
Securities in accordance with the Limited Partnership Agreement (A) to
enforce the Partnership's creditors rights and other rights with respect
to the Affiliate Investment Instruments and any Investment Guarantees,
(B) to enforce the rights of the Holders of the Partnership Preferred
Securities under the Partnership Guarantee, and (C) to enforce the
rights of the Holders of the Partnership Preferred Securities to receive
distributions (if and to the extent such distributions have been declared
out of funds legally available therefor by the General Partner in
its sole discretion) on the Partnership Preferred Securities or (ii)
consent to any amendment, modification, or termination of the Limited
Partnership Agreement or the Partnership Preferred Securities where such
consent shall be required; provided, however, that where a consent or
action under the Limited Partnership Agreement would require the consent
or act of the Holders of more than a majority of the aggregate liquidation
preference of Partnership Preferred Securities affected thereby,
only the Holders of the percentage of the aggregate stated liquidation
amount of the Trust Preferred Securities which is at least equal to the
percentage of aggregate liquidation preference required under the
Limited Partnership Agreement may direct the Property Trustee to give
such consent or take such action.
(c) If the Property Trustee fails to enforce its rights under
the Partnership Preferred Securities after a Holder of record of Trust
Preferred Securities has made a written request, such Holder of record
of Trust Preferred Securities may institute a legal proceeding directly
against the General Partner or the Special Representative, to enforce
the Property Trustee's rights under the Limited Partnership Agreement
without first instituting any legal proceeding against the Property
Trustee or any other person or entity. Notwithstanding the foregoing,
if a Trust Enforcement Event has occurred and is continuing and such
event is attributable to the failure of an Investment Affiliate to make
any required payment when due on any Affiliate Investment Instrument,
then a Holder of Trust Preferred Securities may directly institute a
proceeding against such Investment Affiliate for enforcement of payment
with respect to such Affiliate Investment Instrument.
(d) The Property Trustee shall notify all Holders of the
Trust Preferred Securities of any notice of any Partnership Enforcement
Event received from the General Partner with respect to the Partnership
Preferred Securities and the Affiliate Investment Instruments. Such
notice shall state that such Partnership Enforcement Event also consti-
tutes a Trust Enforcement Event. Except with respect to directing the
time, method, and place of conducting a proceeding for a remedy, the
Property Trustee shall be under no obligation to take any of the actions
described in clause 8.4(b)(i) and (ii) above unless the Property Trustee
has obtained an opinion of independent tax counsel to the effect that as
a result of such action, the Trust will not fail to be classified as a
grantor trust for United States federal income tax purposes and that
after such action each Holder will continue to be treated as owning an
undivided beneficial ownership interest in the Partnership Preferred
Securities.
(e) In the event the consent of the Property Trustee, as the
Holder of the Partnership Preferred Securities, is required under the
Limited Partnership Agreement with respect to any amendment, modification
or termination of the Limited Partnership Agreement, the Property
Trustee shall request the direction of the Holders of the Trust Securities
with respect to such amendment, modification or termination and
shall vote with respect to such amendment, modification or termination
as directed by a Majority in liquidation amount of the Trust Securities
voting together as a single class; provided, however, that where a
consent under the Limited Partnership Agreement would require the
consent of the Holders of more than a majority of the aggregate liquidation
preference of the Partnership Preferred Securities, the Property
Trustee may only give such consent at the direction of the Holders of at
least the same proportion in aggregate stated liquidation amount of the
Trust Securities. The Property Trustee shall not take any such action
in accordance with the directions of the Holders of the Trust Securities
unless the Property Trustee has obtained an opinion of tax counsel to
the effect that, as a result of such action, the Trust will not be
classified as other than a grantor trust for United States federal
income tax purposes.
(f) A waiver of a Partnership Enforcement Event with respect
to the Partnership Preferred Securities will constitute a waiver of the
corresponding Trust Enforcement Event.
(g) Any required approval or direction of Holders of Trust
Preferred Securities may be given at a separate meeting of Holders of
Trust Preferred Securities convened for such purpose, at a meeting of
all of the Holders of Trust Securities or pursuant to written consent.
The Regular Trustees will cause a notice of any meeting at which Holders
of Trust Preferred Securities are entitled to vote, or of any matter
upon which action by written consent of such Holders is to be taken, to
be mailed to each Holder of record of Trust Preferred Securities. Each
such notice will include a statement setting forth the following
information: (i) the date of such meeting or the date by which such action
is to be taken; (ii) a description of any resolution proposed for
adoption at such meeting on which such Holders are entitled to vote or
of such matter upon which written consent is sought; and (iii) instructions
for the delivery of proxies or consents.
(h) No vote or consent of the Holders of Trust Preferred
Securities will be required for the Trust to redeem and cancel Trust
Preferred Securities or distribute Partnership Preferred Securities in
accordance with the Declaration.
(i) Notwithstanding that Holders of Trust Preferred Securities
are entitled to vote or consent under any of the circumstances
described above, any of the Trust Securities that are beneficially owned
at such time by the Company or any entity directly or indirectly controlled
by, or under direct or indirect common control with, the Company, shall not
be entitled to vote or consent and shall, for purposes
of such vote or consent, be treated as if such Trust Securities were not
outstanding, except for Trust Preferred Securities purchased or acquired
by the Company or its affiliates in connection with transactions effect-
ed by or for the account of customers of the Company or any of its
subsidiaries or in connection with the distribution or trading of such
Trust Securities; provided, however, that persons (other than affiliates
of the Company) to whom the Company or any of its subsidiaries have
pledged Trust Preferred Securities may vote or consent with respect to
such pledged Trust Preferred Securities pursuant to the terms of such
pledge.
(j) Holders of the Trust Preferred Securities will have no
rights to appoint or remove the Regular Trustees, who may be appointed,
removed or replaced solely by the Company, as the Holder of all of the
Trust Common Securities.
SECTION 8.5 Voting Rights of Trust Common Securities.
(a) Except as provided under this Section 8.5 or as otherwise
required by the Business Trust Act, the Trust Indenture Act or other
applicable law or provided by the Declaration, the Holders of the Trust
Common Securities will have no voting rights.
(b) The Holders of the Trust Common Securities are entitled,
in accordance with Article V of the Declaration, to vote to appoint,
remove or replace any Trustee or to increase or decrease the number of
Trustees.
(c) Subject to Section 2.6 of the Declaration and only after
all Trust Enforcement Events with respect to the Trust Preferred Securities
have been cured, waived, or otherwise eliminated and subject to the
requirement of the Property Trustee obtaining a tax opinion in certain
circumstances set forth in this paragraph (c), the Holders of a Majority
in liquidation amount of the Trust Common Securities have the right to
direct the time, method and place of conducting any proceeding for any
remedy available to the Property Trustee, or direct the exercise of any
trust or power conferred upon the Property Trustee under the Declara-
tion, including the right to direct the Property Trustee, as Holder of
the Partnership Preferred Securities, to (i) exercise the remedies
available to it under the Limited Partnership Agreement as a Holder of
the Partnership Preferred Securities, including the right to direct the
Special Representative of the Partnership as elected by the Holders of
the Partnership Preferred Securities in accordance with the Limited
Partnership Agreement (A) to enforce the Partnership's creditors rights
and other rights with respect to the Affiliate Investment Instruments
and any Investment Guarantees, (B) to enforce the rights of the Holders
of the Partnership Preferred Securities under the Partnership Guarantee,
and (C) to enforce the rights of the Holders of the Partnership Pre-
ferred Securities to receive distributions (if and to the extent such
distributions have been declared out of funds legally available therefor
by the General Partner in its sole discretion) on the Partnership
Preferred Securities or (ii) consent to any amendment, modification, or
termination of the Limited Partnership Agreement or the Partnership
Preferred Securities where such consent shall be required; provided,
however, that where a consent or action under the Limited Partnership
Agreement would require the consent or act of the Holders of more than a
majority of the aggregate liquidation preference of Partnership Preferred
Securities affected thereby, only the Holders of the percentage
of the aggregate stated liquidation amount of the Trust Common Securities
which is at least equal to the percentage required under the
Limited Partnership Agreement may direct the Property Trustee to give
such consent or take such action. Except with respect to directing the
time, method, and place of conducting a proceeding for a remedy, the
Property Trustee shall be under no obligation to take any of the actions
described in clause 8.5(c)(i) and (ii) above unless the Property Trustee
has obtained an opinion of independent tax counsel to the effect that,
as a result of such action, for United States federal income tax pur-
poses the Trust will not fail to be classified as a grantor trust and
each Holder will be treated as owning an undivided beneficial ownership
interest in the Partnership Preferred Securities.
(d) If the Property Trustee fails to enforce its rights under
the Partnership Preferred Securities after a Holder of record of Trust
Common Securities has made a written request, such Holder of record of
Trust Common Securities may directly institute a legal proceeding
directly against the Company, as General Partner of the Partnership or
the Special Representative, to enforce the Property Trustee's rights
under the Partnership Preferred Securities without first instituting any
legal proceeding against the Property Trustee or any other person or
entity. Notwithstanding the foregoing, if a Trust Enforcement Event has
occurred and is continuing and such event is attributable to the failure
of an Investment Affiliate to make any required payment when due on any
Affiliate Investment Instrument, then a Holder of Trust Common Securities
may directly institute a proceeding against such Investment Affiliate for
enforcement of payment with respect to such Affiliate Investment
Instrument.
(e) A waiver of a Partnership Enforcement Event with respect
to the Partnership Preferred Securities will constitute a waiver of the
corresponding Trust Enforcement Event.
(f) Any required approval or direction of Holders of Trust
Common Securities may be given at a separate meeting of Holders of Trust
Common Securities convened for such purpose, at a meeting of all of the
Holders of Trust Securities or pursuant to written consent. The Regular
Trustees will cause a notice of any meeting at which Holders of Trust
Common Securities are entitled to vote, or of any matter upon which
action by written consent of such Holders is to be taken, to be mailed
to each Holder of record of Trust Common Securities. Each such notice
will include a statement setting forth the following information: (i)
the date of such meeting or the date by which such action is to be
taken; (ii) a description of any resolution proposed for adoption at
such meeting on which such Holders are entitled to vote or of such
matter upon which written consent is sought; and (iii) instructions for
the delivery of proxies or consents.
(g) No vote or consent of the Holders of the Trust Common
Securities shall be required for the Trust to redeem and cancel Trust
Common Securities or to distribute Partnership Preferred Securities in
accordance with the Declaration and the terms of the Trust Securities.
SECTION 8.6 Paying Agent.
In the event that the Trust Preferred Securities are not in
book-entry only form, the Trust shall maintain in the Borough of Manhattan,
City of New York, State of New York, an office or agency where the
Trust Preferred Securities may be presented for payment ("Paying
Agent"). The Trust may appoint the Paying Agent and may appoint one or
more additional paying agents in such other locations as it shall
determine. The term "Paying Agent" includes any additional paying
agent. The Trust may change any Paying Agent without prior notice to
any Holder. The Trust shall notify the Property Trustee of the name and
address of any Paying Agent not a party to this Declaration. If the
Trust fails to appoint or maintain another entity as Paying Agent, the
Property Trustee shall act as such. The Trust or any of its Affiliates
may act as Paying Agent. The Bank of New York shall initially act as
Paying Agent for the Trust Preferred Securities and the Trust Common
Securities.
SECTION 8.7 Listing
The Sponsor shall use its best efforts to cause the Trust
Preferred Securities to be listed for quotation on the New York Stock
Exchange.
SECTION 8.8 Acceptance of Guarantee and Agreements, Limited Partnership
Agreement.
Each Holder of Trust Preferred Securities and Trust Common
Securities, by the acceptance thereof, agrees to the provisions of the
applicable Trust Guarantee, the Partnership Guarantee, and the Investment
Guarantee, respectively, including the subordination provisions
therein.
ARTICLE IX
TERMINATION AND LIQUIDATION OF THE TRUST
SECTION 9.1 Termination of Trust.
(a) The Trust shall terminate:
(i) upon the bankruptcy of the Holder of Trust Common Securi
ties or the Sponsor;
(ii) upon the filing of a certificate of dissolution or its
equivalent with respect to the Sponsor, the filing of a certificate
of cancellation with respect to the Trust after having obtained the
consent of at least a Majority in Liquidation Amount of the Trust
Securities, voting together as a single class, to file such certif
icate of cancellation, or the revocation of 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 Sponsor or the Trust;
(iv) when all of the Trust 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 Trust Securities;
(v) upon the election of the Regular Trustees, following the
occurrence and continuation of a Trust Special Event, pursuant to
which the Trust shall have been dissolved in accordance with the
terms of the Trust Securities and all of the Partnership Preferred
Securities shall have been distributed to the Holders of Trust
Securities in exchange for all of the Trust Securities; or
(vi) before the issuance of any Trust Securities, with the
consent of all of the Regular Trustees and the Sponsor.
(b) As soon as is practicable after the occurrence of an
event referred to in Section 9.1(a), 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 XI shall
survive the termination of the Trust.
SECITON 9.2 Liquidation Distribution Upon Termination and Dissolution
of the Trust.
(a) In the event of any voluntary or involuntary liquidation,
dissolution, winding-up or termination of the Trust (each a "Trust
Liquidation"), the Holders of the Trust Preferred Securities on the date
of the Trust Liquidation will be entitled to receive, out of the assets
of the Trust available for distribution to Holders of Trust Securities
after satisfaction of the Trusts' liabilities and creditors, distributions
in cash or other immediately available funds in an amount equal to
the aggregate of the stated liquidation amount of $25 per Trust Security
plus accumulated and unpaid Distributions thereon to the date of payment
(such amount being the "Trust Liquidation Distribution"), unless, in
connection with such Trust Liquidation, Partnership Preferred Securities
shall be distributed on a Pro Rata basis to the Holders of the Trust
Securities in exchange for such Trust Securities.
(b) If, upon any such Trust Liquidation, the Trust Liquidation
Distribution can be paid only in part because the Trust has
insufficient assets available to pay in full the aggregate Trust
Liquidation Distribution, then the amounts payable directly by the Trust
on the Trust Securities shall be paid on a Pro Rata basis. The Holders of
the Trust Common Securities will be entitled to receive distributions
upon any such Trust Liquidation Pro Rata with the Holders of the Trust
Preferred Securities except that if the Company is in default on any of
its obligations under the Trust Preferred Securities Guarantee, the
Partnership Guarantee, or any Investment Guarantee, or any Investment
Event of Default has occurred and is continuing with respect to an
Affiliate Investment Instrument, the Trust Preferred Securities shall
have a preference over the Trust Common Securities with regard to such
distributions as provided below. Such preference is effectuated by the
Holder of the Trust Common Securities hereby agreeing to provide limited
recourse guarantees as follows: (i) to the Holders of the Trust Preferred
Securities, of the Company's obligations under the Trust Pre-
ferred Securities Guarantee; (ii) to the Trust and the Holders of the
Trust Preferred Securities, of the Company's obligations under the Part-
nership Guarantee; and (iii) to the Partnership and the Holders of the
Trust Preferred Securities, of the Company's obligations under any
Investment Guarantee and/or the obligations of any Investment Affiliate
under an Affiliate Investment Instrument. In the case of the limited
recourse guarantee given by the Holder of the Trust Common Securities to
the Partnership and the Holder of the Trust Preferred Securities in
respect of the Company's obligations under any Investment Guarantee
and/or any Investment Affiliate's obligations under an Affiliate Investment
Instrument, (i) the Trust Common Securities Holder will be deemed
to have pledged the amount due in respect of its Trust Common Securities
upon a liquidation of the Trust to the Partnership and the Holders of
Trust Preferred Securities; (ii) the Trust Common Securities Holder will
be deemed to have paid such amount to the Partnership in respect of such
defaulted Investment Guarantee and/or Affiliate Investment Instrument,
as the case may be; (iii) the Partnership will be deemed to have paid
such amount to the Trust; and (iv) the Property Trustee is hereby
authorized to distribute such amount to the Holders of Trust Preferred
Securities (on a pro rata basis among such Trust Preferred Securities
Holders) in respect of the Trust Common Securities Holder's pledge of
such amounts to such Trust Preferred Securities Holders. In the case of
a limited recourse guarantee given by the Holder of the Trust Common
Securities to the Trust and the Holders of the Trust Preferred Securities
in respect of the Company's obligations under the Partnership
Guarantee, (i) the Holder of the Trust Common Securities will be deemed
to have pledged the amount due in respect of its Trust Common Securities
upon a liquidation of the Trust to the Trust and the Holders of the
Trust Preferred Securities; (ii) the Holder of the Trust Common Securities
will be deemed to have paid such amount to the Trust in respect of
its obligations under the Partnership Guarantee; and (iii) the Property
Trustee is hereby authorized to distribute such amount to the Holders of
the Trust Preferred Securities (on a pro rata basis among such Trust
Preferred Securities Holders) in respect of the Trust Common Securities
Holder's pledge of such amount to such Trust Preferred Securities
Holders.
ARTICLE X
TRANSFER OF INTERESTS
SECTION 10.1 Transfer of Trust Securities.
(a) Trust 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 Trust Securities. Any transfer or
purported transfer of any Trust Security not made in accordance with
this Declaration shall be null and void.
(b) Subject to this Article X, Trust Preferred Securities
shall be freely transferable.
SECTION 10.2 Transfer of Certificates.
The Regular Trustees shall provide for the registration of
Certificates and of transfers 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. Every Certificate surrendered for registration of
transfer 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 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 10.3 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 Trust 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 Trust Securities represented by such Certificate on the
part of any Person, whether or not the Trust shall have actual or other
notice thereof.
SECTION 10.4 Book Entry Interests.
Unless otherwise specified in the terms of the Trust Preferred
Securities, the Trust Preferred Securities Certificates, on original
issuance, will be issued in the form of one or more fully registered,
global Trust 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 Trust Preferred Security Beneficial
Owner will receive a definitive Trust Preferred Security Certificate
representing such Trust Preferred Security Beneficial Owner's interests
in such Global Certificates, except as provided in Section 10.7. Unless
and until definitive, fully registered Trust Preferred Security Certifi-
cates (the "Definitive Trust Preferred Security Certificates") have been
issued to the Trust Preferred Security Beneficial Owners pursuant to
Section 10.7:
(a) the provisions of this Section 10.4 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 receiv
ing approvals, votes or consents hereunder) as the Holder of the
Trust Preferred Securities and the sole Holder of the Global
Certificates and shall have no obligation to the Trust Preferred
Security Beneficial Owners;
(c) to the extent that the provisions of this Section 10.4
conflict with any other provisions of this Declaration, the provi
sions of this Section 10.4 shall control; and
(d) the rights of the Trust 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 Trust Preferred Security Beneficial Owners and the Clearing
Agency and/or the Clearing Agency Participants and the Clearing
Agency shall receive and transmit payments of Distributions on the
Global Certificates to such Clearing Agency Participants. The
Clearing Agency will make book entry transfers among the Clearing
Agency Participants; provided, that solely for the purposes of
determining whether the Holders of the requisite amount of Trust
Preferred Securities have voted on any matter provided for in this
Declaration, so long as Definitive Trust Preferred Security Certif
icates have not been issued, the Trustees may conclusively rely on,
and shall be fully protected in relying on, any written instrument
(including a proxy) delivered to the Trustees by the Clearing
Agency setting forth the Trust Preferred Security Beneficial
Owners' votes or assigning the right to vote on any matter to any
other Persons either in whole or in part.
SECTION 10.5 Notices to Clearing Agency.
Whenever a notice or other communication to the Trust Pre-
ferred Security Holders is required under this Declaration, unless and
until Definitive Trust Preferred Security Certificates shall have been
issued to the Trust Preferred Security Beneficial Owners pursuant to
Section 10.7, the Regular Trustees shall give all such notices and
communications specified herein to be given to the Trust Preferred
Security Holders to the Clearing Agency, and shall have no notice
obligations to the Trust Preferred Security Beneficial Owners.
SECTION 10.6 Appointment of Successor Clearing Agency.
If any Clearing Agency elects to discontinue its services as
securities depositary with respect to the Trust Preferred Securities,
the Regular Trustees may, in their sole discretion, appoint a successor
Clearing Agency with respect to such Trust Preferred Securities.
SECTION 10.7 Definitive Trust Preferred Security Certificates.
If:
(a) a Clearing Agency elects to discontinue its services as
securities depositary with respect to the Trust Preferred Securi
ties and a successor Clearing Agency is not appointed within 90
days after such discontinuance pursuant to Section 10.6 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 Trust Preferred Securities,
(c) there is a Trust Enforcement Event,
then:
(d) Definitive Trust Preferred Security Certificates shall be
prepared by the Regular Trustees on behalf of the Trust with
respect to such Trust Preferred Securities; and
(e) upon surrender of the Global Certificates by the Clearing
Agency, accompanied by registration instructions, the Regular
Trustees shall cause Definitive Trust Preferred Security Certifi
cates to be delivered to Trust 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 fully protected in relying on, said instruc
tions of the Clearing Agency. The Definitive Trust 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 Trust
ees 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 Trust Pre
ferred Securities may be listed, or to conform to usage.
SECTION 10.8 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 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 10.8, 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 Trust Securities, as
if originally issued, whether or not the lost, stolen or destroyed
Certificate shall be found at any time.
ARTICLE XI
LIMITATION OF LIABILITY OF
HOLDERS OF TRUST SECURITIES, TRUSTEES OR OTHERS
SECTION 11.1 Liability.
(a) Except as expressly set forth in this Declaration, the
Trust Guarantees and the terms of the Trust Securities, the Sponsor and
the Trustees 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
Trust Securities which shall be made solely from assets of the
Trust; and
(ii) required to pay to the Trust or to any Holder of Trust
Securities any deficit upon dissolution of the Trust or otherwise.
(b) Pursuant to Section 3803(a) of the Business Trust Act,
the Holders of the Trust Securities shall be entitled to the same
limitation of personal liability extended to shareholders of private
corporations for profit organized under the General Corporation Law of
the State of Delaware.
SECTION 11.2 Exculpation.
(a) No Company Indemnified Person shall be liable, responsi-
ble 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 Company Indemnified Person in good
faith on behalf of the Trust and in a manner such Company Indemnified
Person reasonably believed to be within the scope of the authority
conferred on such Company Indemnified Person by this Declaration or by
law, except that a Company Indemnified Person shall be liable for any
such loss, damage or claim incurred by reason of such Company Indemnified
Person's gross negligence (or, in the case of the Property Trustee,
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 perti-
nent to the existence and amount of assets from which Distributions to
Holders of Trust Securities might properly be paid.
SECTION 11.3 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 liabili-
ties of such Indemnified Person.
(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises between
an Indemnified Person and any Covered Person; or
(ii) whenever this Declaration or any other agreement contem
plated herein or therein provides that an Indemnified Person shall
act in a manner that is, or provides terms that are, fair and
reasonable to the Trust or any Holder of Trust Securities,
the Indemnified Person shall resolve such conflict of interest, take
such action or provide such terms, considering in each case the relative
interest of each party (including its own interest) to such conflict,
agreement, transaction or situation and the benefits and burdens relating
to such interests, any customary or accepted industry practices, and
any applicable generally accepted accounting practices or principles.
In the absence of bad faith by the Indemnified Person, the resolution,
action or term so made, taken or provided by the Indemnified Person
shall not 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 author
ity, 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 11.4 Indemnification.
(a) (i) To the fullest extent permitted by applicable law,
the Sponsor shall indemnify and hold harmless any Company Indem
nified Person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action, suit or pro
ceeding, 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 con
nection 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 Sponsor shall indemnify, to the fullest 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 connec
tion 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 Chan
cery or such other court shall deem proper.
(iii) To the extent that a Company Indemnified Person shall
be successful on the merits or otherwise (including dismissal of an
action without prejudice or the settlement of an action without
admission of liability) in defense of any action, suit or proceed
ing referred to in paragraphs (i) and (ii) of this Section 11.4(a),
or in defense of any claim, issue or matter therein, he shall be
indemnified, to the fullest extent permitted by law, against
expenses (including attorneys' fees) actually and reasonably
incurred by him in connection therewith.
(iv) Any indemnification under paragraphs (i) and (ii) of
this Section 11.4(a) (unless ordered by a court) shall be made by
the Sponsor only as authorized in the specific case upon a determi
nation 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 major
ity 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 Holder of the Trust
Common Securities.
(v) Expenses (including attorneys' fees) incurred by a
Company Indemnified Person in defending a civil, criminal, adminis
trative or investigative action, suit or proceeding referred to in
paragraphs (i) and (ii) of this Section 11.4(a) shall be paid by
the Sponsor 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 Sponsor as authorized in this Section 11.4(a). Notwith
standing the foregoing, no advance shall be made by the Sponsor 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 Holder of the Trust Common Securities, that, based upon the
facts known to the Regular Trustees, counsel or the Holder of the
Trust Common Securities 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 Holder of the Trust Common Securities
reasonably determine that such person deliberately breached his
duty to the Trust or Holders of Trust Common Securities.
(vi) The indemnification and advancement of expenses provided
by, or granted pursuant to, the other paragraphs of this Section
11.4(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 shareholders or disinterested
directors of the Sponsor or Holders of the Trust Preferred Securi
ties 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 11.4(a) shall be
deemed to be provided by a contract between the Sponsor and each
Company Indemnified Person who serves in such capacity at any time
while this Section 11.4(a) is in effect. Any repeal or modifica
tion of this Section 11.4(a) shall not affect any rights or obliga
tions then existing.
(vii) The Sponsor or the Trust may purchase and maintain
insurance on behalf of any person who is or was a Company Indemni
fied 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 Sponsor would have the power to indemnify him
against such liability under the provisions of this Section
11.4(a).
(viii) For purposes of this Section 11.4(a), references to
"the Trust" shall include, in addition to the resulting or surviv
ing 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 11.4(a) with respect to the result
ing or surviving entity as he would have with respect to such
constituent entity if its separate existence had continued.
(ix) The indemnification and advancement of expenses provided
by, or granted pursuant to, this Section 11.4(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.
(b) The Sponsor 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, damage, claim, liability or expense including
taxes (other than taxes based on the income of the Trustee) incurred
without negligence or bad faith on the part of the Trustee 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 investi-
gating any claim or liability in connection with the exercise or perfor-
mance of any of its powers or duties hereunder. The obligation to
indemnify as set forth in this Section 11.4(b) shall survive the
satisfaction and discharge of this Declaration.
SECTION 11.5 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 Trust 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, nor 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 XII
ACCOUNTING
SECTION 12.1 Fiscal Year.
The fiscal year ("Fiscal Year") of the Trust shall be the
calendar year.
SECTION 12.2 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, consistently applied. 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) Within 60 days after May 15 of each year commencing May
15, 1998, the Property Trustee shall provide to the Holders of the Trust
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.
(c) The Regular Trustees shall cause to be duly prepared and
delivered to each of the Holders of Trust Securities, any annual United
States federal income tax information statement, required by the Code,
containing such information with regard to the Trust 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 12.3 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 Partnership Preferred Securities
held by the Property Trustee shall be made directly to the Property
Account and no other funds of the Trust shall be deposited in the
Property 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 Account.
SECTION 12.4 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. Notwithstanding
anything herein to the contrary, the Trust and the Regular Trustees
shall, absent receipt of an opinion of tax counsel substantially to the
effect that withholding is not required, withhold thirty percent (30%)
(or such other rate as may be imposed as a result of an amendment to the
Code or such lower rate as may be imposed under an applicable income tax
treaty) on the gross amount of any Distributions on Trust Preferred
Securities held by a Holder that is not a "United States person" within
the meaning of section 7701(a)(30) of the Code.
ARTICLE XIII
AMENDMENTS AND MEETINGS
SECTOIN 13.1 Amendments.
(a) Except as otherwise provided in this Declaration or by
any applicable terms of the Trust Securities, this Declaration may only
be amended by a written instrument approved and executed by:
(i) the Regular Trustees (or, if there are more than two
Regular Trustees, a majority of the Regular Trustees);
(ii) if the amendment affects the rights, powers, duties,
obligations or immunities of the Property Trustee, the Property
Trustee; and
(iii) if the amendment affects the rights, powers, duties,
obligations or immunities of the Delaware Trustee, 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 Trust 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 re
ceived 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 Trust
Securities); and
(iii) to the extent the result of such amendment would:
(A) cause the Trust to fail to continue to be classified
for purposes of United States federal income taxation as a
grantor trust;
(B) cause the Partnership to be classified for purposes
of United States federal income tax as an association or
publicly traded partnership taxable as a corporation;
(C) reduce or otherwise adversely affect the powers of
the Property Trustee in contravention of the Trust Indenture
Act; or
(D) cause the Trust to be deemed to be an Investment
Company required to be registered under the 1940 Act.
(c) In the event the consent of the Property Trustee, as the
Holder of the Partnership Preferred Securities is required under the
Limited Partnership Agreement with respect to any amendment, modifica-
tion or termination of the Limited Partnership Agreement or the Partner-
ship Preferred Securities the Property Trustee shall request the direc-
tion of the Holders of the Trust Securities with respect to such amend-
ment, modification or termination and shall vote with respect to such
amendment, modification or termination as directed by a Majority in
liquidation amount of the Trust Securities voting together as a single
class; provided, however, that where a consent under the Limited
Partnership Agreement would require the consent of a Super Majority of
the Holders of Partnership Preferred Securities the Property Trustee may
only give such consent at the direction of the Holders of at least the
proportion in liquidation amount of the Trust Securities which the rele-
vant Super Majority represents of the aggregate liquidation preference
of the Partnership Preferred Securities outstanding; provided, further,
that the Property Trustee shall not be obligated to take any action in
accordance with the directions of the Holders of the Trust Securities
under this Section 13.1(c) unless the Property Trustee has obtained an
opinion of independent tax counsel to the effect that for United States
federal income tax purposes the Trust will continue to be classified as
a grantor trust after consummation of such action and each Holder will
be treated as owning an undivided beneficial ownership interest in the
Partnership Preferred Securities.
(d) At such time after the Trust has issued any Trust Securities
that remain outstanding, any amendment that would (I) adversely
affect the powers, preferences or special rights of the Trust Securities
or (II) provide for the dissolution, winding-up or termination of the
Trust other than pursuant to the terms of this Declaration, may be
effected only with the approval of the Holders of at least a Majority in
liquidation amount of the Trust Securities affected thereby; provided,
that if any amendment or proposal referred to in clause (I) hereof would
adversely affect only the Trust Preferred Securities or the Trust Common
Securities, then only the affected class will be entitled to vote on
such amendment or proposal and such amendment or proposal shall not be
effective except with the approval of a Majority in liquidation amount
of such class of Trust Securities;
(e) Section 11.1(c) and this Section 13.1 shall not be
amended without the consent of all of the Holders of the Trust Securities;
(f) Article IV shall not be amended without the consent of
the Holders of a Majority in liquidation amount of the Trust Common
Securities and;
(g) The rights of the Holders of the Trust 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 Trust Common Securities; and
(h) Notwithstanding Section 13.1(c), this Declaration may be
amended without the consent of the Holders of the Trust Securities:
(i) to cure any ambiguity;
(ii) to correct or supplement any provision in this Declara
tion that may be defective or inconsistent with any other provision
of this Declaration;
(iii) to add to the covenants, restrictions or obligations of
the Sponsor;
(iv) to conform to any change in the 1940 Act or written
change in interpretation or application of the rules and regula
tions promulgated thereunder by any legislative body, court, gov
ernment agency or regulatory authority;
(v) to conform to any change in the Trust Indenture Act or
written change in interpretation or application of the rules and
regulations promulgated thereunder by any legislative body, court,
government agency or regulatory authority; and
(vi) to modify, eliminate and add to any provision of this
Declaration to such extent as may be necessary;
provided, that such amendments do not have a material adverse effect on
the rights, preferences or privileges of the Holders.
SECTION 13.2 Meetings of the Holders of Trust Securities;
Action by Written Consent.
(a) Meetings of the Holders of any class of Trust Securities
may be called at any time by the Regular Trustees (or as provided in the
terms of the Trust Securities) to consider and act on any matter on
which Holders of such class of Trust Securities are entitled to act
under the terms of this Declaration, the terms of the Trust Securities,
the Limited Partnership Agreement, the rules of any stock exchange on
which the Trust Preferred Securities are listed or admitted for trading,
the Business Trust Act or other applicable law. 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
Trust Securities. Such direction shall be given by delivering to the
Regular Trustees one or more notices in a writing stating that the
signing Holders of Trust Securities wish to call a meeting and indicating
the general or specific purpose for which the meeting is to be
called. Any Holders of Trust Securities calling a meeting shall specify
in writing the Certificates held by the Holders of Trust Securities
exercising the right to call a meeting and only those Trust 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 Trust Securities, the following provisions shall apply to meetings
of Holders of Trust Securities:
(i) notice of any such meeting shall be given to all the
Holders of Trust Securities having a right to vote thereat at least
7 days and not more than 60 days before the date of such meeting.
Any action that may be taken at a meeting of the Holders of Trust
Securities may be taken without a meeting if a consent in writing
setting forth the action so taken is signed by the Holders of Trust
Securities owning not less than the minimum amount of Trust Securi
ties in liquidation amount that would be necessary to authorize or
take such action at a meeting at which all Holders of Trust Securi
ties 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 Trust Securities entitled to vote who have
not consented in writing. The Regular Trustees may specify that
any written ballot submitted to the Holder 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 Trust Security may authorize any Person
to act for it by proxy on all matters in which a Holder of Trust
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 Trust Securities
executing it. 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 Trust
Securities were shareholders of a Delaware corporation;
(iii) each meeting of the Holders of the Trust 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 Trust Securities, the Trust Indenture Act or the
listing rules of any stock exchange on which the Trust 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 Trust Securi
ties, including notice of the time, place or purpose of any meeting
at which any matter is to be voted on by any Holders of Trust
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 XIV
REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE
SECTION 14.1 Representations and Warranties of 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 New York banking corporation
with trust powers, duly organized, validly existing and in good
standing under the laws of New York, with trust power and authority
to execute and deliver, and to carry out and perform its obliga
tions under the terms of, the Declaration;
(b) The execution, delivery and performance by the Property
Trustee of the Declaration has been duly authorized by all neces
sary corporate action on the part of the Property Trustee. The
Declaration has been duly executed and delivered by the Property
Trustee and constitutes a legal, valid and binding obligation of
the Property Trustee, enforceable against it in accordance with its
terms, subject to applicable bankruptcy, reorganization, morato
rium, insolvency, and other similar laws affecting creditors'
rights generally and to general principles of equity and the dis
cretion of the court (regardless of whether the enforcement of such
remedies is considered in a proceeding in equity or at law);
(c) The execution, delivery and performance of the Declara
tion by the Property Trustee does not conflict with or constitute a
breach of the Articles of Organization or By-laws of the Property
Trustee;
(d) 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; and
(e) The Property Trustee agrees that, except as expressly
provided or contemplated by this Agreement, it will not create,
incur or assume, or suffer to exist any mortgage, pledge,
hypothecation, encumbrance, lien or other charge or security
interest upon the Partnership Preferred Securities.
SECTION 14.2 Representations and Warranties of 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 is a Delaware corporation with, duly
organized, validly existing and in good standing under the laws of
the State of Delaware, with power and authority to execute and
deliver, and to carry out and perform its obligations under the
terms of, the Declaration;
(b) The Delaware Trustee has been authorized to perform its
obligations under the Certificate of Trust and the Declaration.
The 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);
(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 the Declaration; and
(d) The Delaware Trustee is an entity which has its principal
place of business in the State of Delaware.
ARTICLE XV
MISCELLANEOUS
SECTION 15.1 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 Holders of the Trust Securi
ties):
UDS CAPITAL I
c/o Ultramar Diamond Shamrock
Corporation
9830 Colonnade Boulevard
San Antonio, Texas 78230
Attention: Treasurer.
(b) if given to the Delaware Trustee, at the mailing address
set forth below (or such other address as the Delaware Trustee may
give notice of to the other Trustees):
The Bank of New York (Delaware)
White Clay Center
Route 273
Newark, Delaware 19711
Attention: Corporate Trust Administration
(c) if given to the Property Trustee, at its Corporate Trust
Office to the attention of Walter N. Gitlin, Vice President (or
such other address as the Property Trustee may give notice of to
the Holders of the Trust Securities and the other Trustee).
(d) if given to the Holder of the Trust Common Securities, at
the mailing address of the Sponsor set forth below (or such other
address as the Holder of the Trust Common Securities may give
notice of to the Trust):
UDS CAPITAL I
c/o Ultramar Diamond Shamrock
Corporation
9830 Colonnade Boulevard
San Antonio, Texas 78230
Attention: Treasurer.
(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 15.2 Governing Law.
This Declaration and the rights of the parties hereunder shall
be governed by and construed in accordance with the internal 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 15.3 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 15.4 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 15.5 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 15.6 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 15.7 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 and a duly authorized officer of
the Sponsor 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, each of the undersigned has caused these
presents to be executed as of the day and year first above written.
/s/ H. PETE SMITH
H. Pete Smith, as Regular Trustee
/s/ STEVE BLANK
Steve Blank, as Regular Trustee
/s/ PATTI K. MEISETSCHLEAGER
Patti K. Meisetschleager, as
Regular Trustee
THE BANK OF NEW YORK (DELAWARE),
as Delaware Trustee
By: /s/ WALTER GITLIN
Name: Walter Gitlin
Title: Vice President
THE BANK OF NEW YORK,
as Property Trustee
By: /s/ WALTER GITLIN
Name: Walter Gitlin
Title: Vice President
ULTRAMAR DIAMOND SHAMROCK
CORPORATION,
as Sponsor
By: /s/ STEVE BLANK
Name: Steve Blank
Title: Vice President and Treasurer
EXHIBIT A1
FORM OF PREFERRED SECURITY CERTIFICATE
This Trust Preferred Security is a Global Certificate within the
meaning of the Declaration hereinafter referred to and is registered in
the name of The Depository Trust Company (the "Depositary") or a nominee
of the Depositary. This Trust Preferred Security is exchangeable for
Trust Preferred Securities registered in the name of a person other than
the Depositary or its nominee only in the limited circumstances described
in the Declaration and no transfer of this Trust Preferred
Security (other than a transfer of this Trust Preferred Security as a
whole by the Depositary to a nominee of the Depositary or by a nominee
of the Depositary to the Depositary or another nominee of the Deposi-
tary) may be registered except in limited circumstances.
Unless this Trust Preferred Security is presented by an authorized
representative of The Depository Trust Company (55 Water Street, New
York, New York), a New York corporation, to the Trust or its agent for
registration of transfer, exchange or payment, and any Trust Preferred
Security issued is registered in the name of Cede & Co. or such other
name as requested by an authorized representative of the Depositary and
any payment hereon is made to Cede & Co. or such other entity as is re-
quested by an authorized representative of the Depositary, ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an
interest herein.
<PAGE/>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Trust
Preferred Security Certificate to:
(Insert assignee's social security or tax identification number)
(Insert address and zip code of assignee)
and irrevocably appoints
agent to trans-
fer this Trust Preferred Security Certificate on the books of the Trust.
The agent may substitute another to act for him or her.
Date:
Signature:
(Sign exactly as your name appears on the other side of this Trust
Preferred Security Certificate)
Signature Guarantee (2):
(2) Signature must be guaranteed by an "eligible guarantor institution"
that is a bank, stockbroker, savings and loan association or credit
union meeting the requirements of the Registrar, which requirements
include membership or participation in the Securities Transfer
Agents Medallion Program ("STAMP") or such other "signature guaran
tee program" as may be determined by the Registrar in addition to,
or in substitution for, STAMP, all in accordance with the Securi
ties and Exchange Act of 1934, as amended.
****
<PAGE/>
TP-1 Aggregate Liquidation
Amount: $200,000,000
CUSIP NO.
Certificate Evidencing Trust Preferred Securities
of
UDS CAPITAL I
8.32% Trust Preferred Securities
(liquidation amount $25 per Trust Preferred Security)
UDS CAPITAL I, a statutory business trust formed under the
laws of the State of Delaware (the "Trust"), hereby certifies that Cede
& Co. (the "Holder") is the registered owner of 8,000,000 preferred
securities of the Trust representing undivided beneficial ownership
interests in the assets of the Trust designated the 8.32% Trust Preferred
Securities (liquidation amount $25 per Trust Preferred Security)
(the "Trust Preferred Securities"). The Trust Preferred Securities are
freely transferable on the books and records of the Trust, in person or
by a duly authorized attorney, upon surrender of this certificate duly
endorsed and in proper form for transfer. The designation, rights,
powers, privileges, restrictions, preferences and other terms and provi-
sions of the Trust Preferred Securities represented hereby are set forth
in, issued under and shall in all respects be subject to the provisions
of the Amended and Restated Declaration of Trust dated as of June 25,
1997, as the same may be amended from time to time (the "Declaration").
Capitalized terms used herein but not defined shall have the meaning
given them in the Declaration. The Holder is entitled to the benefits
of the Trust Preferred Securities Guarantee to the extent provided
therein. Each Holder of a Trust Preferred Security, by acceptance of
this Certificate and each Certificate owner, by acquisition of a beneficial
interest in a Certificate, agrees to treat the Debentures, and any
other Affiliate Investment Instruments that are treated as debt instru-
ments by the relevant Investment Affiliate and by the Partnership, as
indebtedness for United States federal income tax purposes. The Sponsor
will provide a copy of the Declaration, the Trust Preferred Securities
Guarantee and the Limited Partnership Agreement to a Holder without
charge upon written request to the Trust at its principal place of
business.
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.
IN WITNESS WHEREOF, the Trust has executed this certificate
this 25th day of June, 1997.
UDS CAPITAL I
Steve Blank,
as Regular Trustee
CERTIFICATE OF AUTHENTICATION
This is the Trust Preferred Security described in the
within-mentioned Declaration.
THE BANK OF NEW YORK,
as Trustee
By:
Authorized Signatory
Dated: June 25, 1997
(See reverse for additional terms)
<PAGE/>
[FORM OF REVERSE OF SECURITY]
Holders of Trust Preferred Securities shall be entitled to receive
cumulative cash distributions at a rate per annum of 8.32% of the stated
liquidation amount of $25 per Trust Preferred Security. Distributions
on the Trust Preferred Securities shall, from the date of original
issue, accumulate and be cumulative and shall be payable quarterly only
to the extent that the Trust has funds available for the payment of such
distributions in the Property Account. Distributions not paid on the
scheduled payment date will accumulate and compound quarterly (to the
extent permitted by applicable law) at the rate of 8.32% per annum. The
term "Distributions" as used herein shall mean ordinary cumulative
distributions in respect of each Fiscal Period together with any such
Compounded Distributions. Amounts available to the Trust for distribution
to the holders of the Trust Preferred Securities will be limited to
payments received by the Trust from the Partnership on the Partnership
Preferred Securities or from the Company on the Partnership Guarantee.
Distributions on the Partnership Preferred Securities will be paid only
if, as and when declared in the sole discretion of the Company, as the
General Partner of the Partnership. If and to the extent that the Part-
nership makes a distribution on the Partnership Preferred Securities
held by the Property Trustee or the Company makes a payment under the
Partnership Guarantee (the amount of any such partnership distribution,
including any compounded partnership distributions or guarantee payment
being a "Payment Amount"), the Trust shall and the Property Trustee is
directed, to the extent funds are available for that purpose, to make a
Pro Rata Distribution of the Payment Amount to Holders.
The amount of Distributions payable for any period will be computed
for any full quarterly Distribution period on the basis of a 360-day
year of twelve 30-day months, and for any period shorter than a full
quarterly Distribution period on the basis of the actual number of days
elapsed in a 90-day quarter.
Except as otherwise described herein, distributions on the Trust
Preferred Securities will be cumulative, will accumulate from the date
of initial issuance and will be payable quarterly in arrears, on March
31, June 30, September 30 and December 31 of each year, commencing on
June 30, 1997, if, as and when available for payment by the Property
Trustee. If the Trust Preferred Securities (or, if the Trust is
liquidated, the Partnership Preferred Securities) are in book-entry-only
form, Distributions will be payable to the Holders of record of Trust
Preferred Securities as they appear on the books and records of the
Trust on the relevant record dates, which will be one Business Day prior
to the relevant payment dates. If the Trust Preferred Securities (or,
if the Trust is liquidated, the Partnership Preferred Securities) do not
remain in book-entry-only form, the relevant record dates shall be the
15th day of the month of the relevant payment dates. In the event that
any date on which distributions are payable is not a Business Day,
payment of such Distribution shall be made on the next succeeding day
which is a Business Day (without any interest or other payment in
respect of any such delay) except that, if such Business Day falls in
the next succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, with the same force and effect as if
made on such date. Payments of accumulated Distributions will be
payable to Holders of record of Trust Preferred Securities as they
appear on the books and records of the Trust on the record date with
respect to the payment date for the Trust Preferred Securities which
corresponds to the payment date fixed by the Partnership with respect to
the payment of cumulative distributions on the Partnership Preferred
Securities.
The Trust Preferred Securities shall be redeemable as provided
in the Declaration.
EXHIBIT A2
FORM OF COMMON SECURITY CERTIFICATE
TC-1 Aggregate Liquidation
Amount: $6,186,000
Certificate Evidencing Trust Common Securities
of
UDS CAPITAL I
8.32% Trust Common Securities
(liquidation amount $25 per Trust Common Security)
UDS CAPITAL I, a statutory business trust formed under the
laws of the State of Delaware (the "Trust"), hereby certifies that
Ultramar Diamond Shamrock Corporation, a Delaware corporation (the
"Holder") is the registered owner of 247,440 common securities of the
Trust representing undivided beneficial ownership interests in the
assets of the Trust designated the 8.32% Trust Common Securities (liqui-
dation amount $25 per Trust Common Security) (the "Trust Common Securi-
ties"). The designation, rights, powers, privileges, restrictions,
preferences and other terms and provisions of the Trust Common Securi-
ties represented hereby are set forth in, issued under and shall in all
respects be subject to the provisions of the Amended and Restated Decla-
ration of Trust dated as of June 25, 1997, as the same may be amended
from time to time (the "Declaration"). Capitalized terms used herein
but not defined shall have the meaning given them in the Declaration.
The Holder is entitled to the benefits of the Trust Common Securities
Guarantee to the extent provided therein. Each Holder of a Trust Common
Security, by acceptance of this Certificate, agrees to treat the Deben-
tures, and any other Affiliate Investment Instruments that are treated
as debt instruments by the relevant Investment Affiliate and by the
Partnership, as indebtedness for United States federal income tax
purposes. The Sponsor will provide a copy of the Declaration, the Trust
Common Securities Guarantee and the Limited Partnership Agreement to a
Holder without charge upon written request to the Sponsor at its princi-
pal place of business. THE TRUST COMMON SECURITIES ARE TRANSFERABLE ON
THE BOOKS AND RECORDS OF THE TRUST ONLY IN ACCORDANCE WITH THE TERMS OF
THE DECLARATION.
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.
IN WITNESS WHEREOF, the Trust has executed this certificate
this 25th day of June, 1997.
UDS CAPITAL I
Steve Blank,
as Regular Trustee
(See reverse for additional terms)
<PAGE/>
[FORM OF REVERSE OF SECURITY]
Holders of Trust Common Securities shall be entitled to receive
cumulative cash distributions at a rate per annum of 8.32% of the stated
liquidation amount of $25 per Trust Common Security. Distributions on
the Trust Common Securities shall, from the date of original issue,
accumulate and be cumulative and shall be payable quarterly only to the
extent that the Trust has funds available for the payment of such
distributions in the Property Account. Distributions not paid on the
scheduled payment date will accumulate and compound quarterly (to the
extent permitted by applicable law) at the rate of 8.32% per annum. The
term "Distributions" as used herein shall mean ordinary cumulative
distributions in respect of each Fiscal Period together with any such
Compounded Distributions. Amounts available to the Trust for distribu-
tion to the holders of the Trust Common Securities will be limited to
payments received by the Trust from the Partnership on the Partnership
Preferred Securities or from the Company on the Partnership Guarantee.
Distributions on the Partnership Preferred Securities will be paid only
if, as and when declared in the sole discretion of the Company, as the
General Partner of the Partnership. If and to the extent that the
Partnership makes a distribution on the Partnership Preferred Securities
held by the Property Trustee or the Company makes a payment under the
Partnership Guarantee (the amount of any such partnership distribution,
including any compounded partnership distributions or guarantee payment
being a "Payment Amount"), the Trust shall and the Property Trustee is
directed, to the extent funds are available for that purpose, to make a
Pro Rata Distribution of the Payment Amount to Holders.
The amount of Distributions payable for any period will be computed
for any full quarterly Distribution period on the basis of a 360-day
year of twelve 30-day months, and for any period shorter than a full
quarterly Distribution period, on the basis of the actual number of days
elapsed in a 90-day quarter.
Except as otherwise described herein, distributions on the Trust
Common Securities will be cumulative, will accumulate from the date of
initial issuance and will be payable quarterly in arrears, on March 31,
June 30, September 30 and December 31 of each year, commencing on June
30, 1997 if, as and when available for payment by the Property Trustee.
Distributions will be payable to the Holders of record of Trust Common
Securities as they appear on the books and records of the Trust on the
relevant record dates, which will be one Business Day prior to the rele-
vant payment dates. In the event that any date on which distributions
are payable is not a Business Day, payment of the Distribution shall be
made on the next succeeding day which is a Business Day (without any
interest or other payment in respect of any such delay) except that, if
such Business Day falls in the next succeeding calendar year, such
payment shall be made on the immediately preceding Business Day, in each
case with the same force and effect as if made on such date. Payments
of accumulated Distributions will be payable to Holders of record of
Trust Common Securities as they appear on the books and records of the
Trust on the record date with respect to the payment date for the Trust
Common Securities which corresponds to the payment date fixed by the
Partnership with respect to the payment of cumulative distributions on
the Partnership Preferred Securities.
The Trust Common Securities shall be redeemable as provided in
the Declaration.
<PAGE/>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Trust
Common Security Certificate to:
(Insert assignee's social security or tax identification number)
(Insert address and zip code of assignee)
and irrevocably appoints
agent to transfer this Trust
Common Security Certificate on the books of the Trust. The agent may
substitute another to act for him or her.
Date:
Signature:
(Sign exactly as your name appears on the other side of this Trust
Common Security Certificate)
Signature Guarantee (3):
(3) Signature must be guaranteed by an "eligible guarantor institution"
that is a bank, stockbroker, savings and loan association or credit
union meeting the requirements of the Registrar, which requirements
include membership or participation in the Securities Transfer
Agents Medallion Program ("STAMP") or such other "signature guaran
tee program" as may be determined by the Registrar in addition to,
or in substitution for, STAMP, all in accordance with the Securi
ties and Exchange Act of 1934, as amended.
<PAGE/>