AMENDED AND RESTATED DECLARATION
OF TRUST
Ingersoll-Rand Financing I
Dated as of March __, 1998
TABLE OF CONTENTS
Page
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 DEFINITIONS . . . . . . . . . . . . . . . 5
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 TRUST INDENTURE ACT; APPLICATION . . . . . 13
SECTION 2.2 LISTS OF HOLDERS OF SECURITIES . . . . . . 13
SECTION 2.3 REPORTS BY THE INSTITUTIONAL TRUSTEE . . . 14
SECTION 2.4 PERIODIC REPORTS TO INSTITUTIONAL
TRUSTEE . . . . . . . . . . . . . . . . 14
SECTION 2.5 EVIDENCE OF COMPLIANCE WITH CONDITIONS
PRECEDENT . . . . . . . . . . . . . . . 14
SECTION 2.6 EVENTS OF DEFAULT; WAIVER . . . . . . . . 14
SECTION 2.7 EVENT OF DEFAULT; NOTICE . . . . . . . . . 16
ARTICLE III
ORGANIZATION
SECTION 3.1 NAME . . . . . . . . . . . . . . . . . . . 16
SECTION 3.2 OFFICE . . . . . . . . . . . . . . . . . . 16
SECTION 3.3 PURPOSE . . . . . . . . . . . . . . . . . 17
SECTION 3.4 AUTHORITY . . . . . . . . . . . . . . . . 17
SECTION 3.5 TITLE TO PROPERTY OF THE TRUST . . . . . . 17
SECTION 3.6 POWERS AND DUTIES OF THE REGULAR
TRUSTEES . . . . . . . . . . . . . . . 17
SECTION 3.7 PROHIBITION OF ACTIONS BY THE TRUST AND
THE TRUSTEES . . . . . . . . . . . . . 20
SECTION 3.8 POWERS AND DUTIES OF THE INSTITUTIONAL
TRUSTEE . . . . . . . . . . . . . . . . 21
SECTION 3.9 CERTAIN DUTIES AND RESPONSIBILITIES OF
THE INSTITUTIONAL TRUSTEE . . . . . . . 23
SECTION 3.10 CERTAIN RIGHTS OF INSTITUTIONAL TRUSTEE . 25
SECTION 3.11 DELAWARE TRUSTEE . . . . . . . . . . . . . 27
SECTION 3.12 EXECUTION OF DOCUMENTS . . . . . . . . . . 27
SECTION 3.13 NOT RESPONSIBLE FOR RECITALS OR
ISSUANCE OF SECURITIES . . . . . . . . 27
SECTION 3.14 DURATION OF TRUST . . . . . . . . . . . . 27
SECTION 3.15 MERGERS . . . . . . . . . . . . . . . . . 27
ARTICLE IV
SPONSOR
SECTION 4.1 SPONSOR'S PURCHASE OF COMMON SECURITIES . 29
SECTION 4.2 RIGHTS AND RESPONSIBILITIES OF THE
SPONSOR . . . . . . . . . . . . . . . . 29
SECTION 4.3 RIGHT TO PROCEED . . . . . . . . . . . . . 30
SECTION 4.4 EXPENSES . . . . . . . . . . . . . . . . . 30
ARTICLE V
TRUSTEES
SECTION 5.1 NUMBER OF TRUSTEES . . . . . . . . . . . . 31
SECTION 5.2 DELAWARE TRUSTEE . . . . . . . . . . . . . 31
SECTION 5.3 INSTITUTIONAL TRUSTEE; ELIGIBILITY . . . . 31
SECTION 5.4 CERTAIN QUALIFICATIONS OF REGULAR
TRUSTEES AND DELAWARE TRUSTEE
GENERALLY . . . . . . . . . . . . . . . 32
SECTION 5.5 REGULAR TRUSTEES . . . . . . . . . . . . . 32
SECTION 5.6 APPOINTMENT, REMOVAL AND RESIGNATION OF
TRUSTEES . . . . . . . . . . . . . . . 33
SECTION 5.7 VACANCIES AMONG TRUSTEES . . . . . . . . . 34
SECTION 5.8 EFFECT OF VACANCIES . . . . . . . . . . . 34
SECTION 5.9 MEETINGS . . . . . . . . . . . . . . . . . 35
SECTION 5.10 DELEGATION OF POWER . . . . . . . . . . . 35
SECTION 5.11 MERGER, CONVERSION. CONSOLIDATION OR
SUCCESSION TO BUSINESS . . . . . . . . 35
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 DISTRIBUTIONS . . . . . . . . . . . . . . 36
ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 GENERAL PROVISIONS REGARDING SECURITIES . 36
SECTION 7.2 PAYING AGENT . . . . . . . . . . . . . . . 37
ARTICLE VIII
TERMINATION OF TRUST
SECTION 8.1 TERMINATION OF TRUST . . . . . . . . . . . 37
ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1 TRANSFER OF SECURITIES . . . . . . . . . . 38
SECTION 9.2 TRANSFER OF CERTIFICATES . . . . . . . . . 38
SECTION 9.3 DEEMED SECURITY HOLDERS . . . . . . . . . 39
SECTION 9.4 BOOK ENTRY INTERESTS . . . . . . . . . . . 39
SECTION 9.5 NOTICES TO CLEARING AGENCY . . . . . . . . 40
SECTION 9.6 APPOINTMENT OF SUCCESSOR CLEARING
AGENCY . . . . . . . . . . . . . . . . 40
SECTION 9.7 DEFINITIVE PREFERRED SECURITY
CERTIFICATES . . . . . . . . . . . . . 40
SECTION 9.8 MUTILATED, DESTROYED, LOST OR STOLEN
CERTIFICATES . . . . . . . . . . . . . 41
ARTICLE X
LIMITATION OF LIABILITY OF HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 LIABILITY . . . . . . . . . . . . . . . . 41
SECTION 10.2 EXCULPATION . . . . . . . . . . . . . . . 41
SECTION 10.3 FIDUCIARY DUTY . . . . . . . . . . . . . . 42
SECTION 10.4 INDEMNIFICATION . . . . . . . . . . . . . 43
SECTION 10.5 OUTSIDE BUSINESSES . . . . . . . . . . . . 45
ARTICLE XI
ACCOUNTING
SECTION 11.1 FISCAL YEAR . . . . . . . . . . . . . . . 46
SECTION 11.2 CERTAIN ACCOUNTING MATTERS . . . . . . . . 46
SECTION 11.3 BANKING . . . . . . . . . . . . . . . . . 46
SECTION 11.4 WITHHOLDING . . . . . . . . . . . . . . . 47
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 AMENDMENTS . . . . . . . . . . . . . . . . 47
SECTION 12.2 MEETINGS OF THE HOLDERS OF SECURITIES;
ACTION BY WRITTEN CONSENT . . . . . . . 49
ARTICLE XIII
REPRESENTATIONS OF INSTITUTIONAL TRUSTEE AND DELAWARE TRUSTEE
SECTION 13.1 REPRESENTATIONS AND WARRANTIES OF
INSTITUTIONAL TRUSTEE . . . . . . . . . 50
SECTION 13.2 REPRESENTATIONS AND WARRANTIES OF
DELAWARE TRUSTEE . . . . . . . . . . . 51
ARTICLE XIV
MISCELLANEOUS
SECTION 14.1 NOTICES . . . . . . . . . . . . . . . . . 52
SECTION 14.2 GOVERNING LAW . . . . . . . . . . . . . . 53
SECTION 14.3 INTENTION OF THE PARTIES . . . . . . . . . 53
SECTION 14.4 HEADINGS . . . . . . . . . . . . . . . . . 53
SECTION 14.5 SUCCESSORS AND ASSIGNS . . . . . . . . . . 53
SECTION 14.6 PARTIAL ENFORCEABILITY . . . . . . . . . . 53
SECTION 14.7 COUNTERPARTS . . . . . . . . . . . . . . . 53
AMENDED AND RESTATED
DECLARATION OF TRUST
OF
Ingersoll-Rand Financing I
March __, 1998
AMENDED AND RESTATED DECLARATION OF TRUST (the
"Declaration") dated and effective as of March __, 1998, by the Trustees (as
defined herein), the Sponsor (as defined herein) and by the Holders (as
defined herein), from time to time, of the securities representing undivided
beneficial interests in the assets of the Trust to be issued pursuant to this
Declaration;
WHEREAS, the Trustees and the Sponsor established Ingersoll-
Rand Financing I (the "Trust"), a trust under the Business Trust Act (as
defined herein) pursuant to a Declaration of Trust dated as of August 18,
1997 (the "Original Declaration"), and a Certificate of Trust filed with the
Secretary of State of the State of Delaware on August 18, 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 certain Debentures of the Debenture Issuer (as defined herein);
WHEREAS, as of the date hereof, no interests in the Trust
have been issued;
WHEREAS, all of the Trustees and the Sponsor, by this
Declaration, amend and restate each and every term and provision of the
Declaration; and
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 Trust and Holders, from time to time, of
the securities representing undivided beneficial interests in the assets of
the Trust issued hereunder, subject to the provisions of this Declaration.
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 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; and
(f) a reference to the singular includes the plural and
vice versa.
"Affiliate" has the same meaning as given to that term in
Rule 405 of the Securities Act or any successor rule thereunder.
"Agent" means any Paying Agent.
"Applicable Ownership Interest" has the meaning set forth in
Annex I hereto.
"Applicable Principal Amount" has the meaning set forth in
Annex I hereto.
"Authorized Newspaper" means a daily newspaper, in the
English language, customarily published on each day that is a Business Day in
The City of New York, whether or not published on days that are Legal
Holidays, and of general circulation in The City of New York. The Authorized
Newspaper for the Purposes of the Reset Spread Announcement Date, is
currently anticipated to be The Wall Street Journal.
"Authorized Officer" of a Person means any Person that is
authorized to bind such Person.
"Book Entry Interest" means a beneficial interest in a
Global Certificate, ownership and transfers of which shall be maintained and
made through book entries by a Clearing Agency as described in Section 9.4.
"Business Day" means any day other than Saturday, Sunday or
any day on which banking institutions in New York City, in the State of New
York, are permitted or required by any applicable law to close.
"Business Trust Act" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code Section 3801 et seq., as it may be amended from
time to time, or any successor legislation.
"Certificate" means a Common Security Certificate or a
Preferred Security Certificate.
"Clearing Agency" means an organization registered as a
"Clearing Agency" pursuant to Section 17A of the Exchange Act that is acting
as depositary for the Preferred Securities and in whose name or in the name
of a nominee of that organization shall be registered a Global Certificate
and which shall undertake to effect book entry transfers and pledges of the
Preferred Securities.
"Clearing Agency Participant" means a broker, dealer, bank,
other financial institution or other Person for whom from time to time the
Clearing Agency effects book entry transfers and pledges of securities
deposited with the Clearing Agency.
"Closing Date" means the "Closing Time" and each "Date of
Delivery" under the Underwriting Agreement.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time, or any successor legislation.
"Commission" means the Securities and Exchange Commission.
"Common Security" has the meaning specified in Section 7.1.
"Common Securities Guarantee" means the guarantee agreement
to be dated as of March __, 1998 of the Sponsor in respect of the Common
Securities.
"Common Security Certificate" means a definitive certificate
in fully registered form representing a Common Security substantially in the
form of Exhibit A-2.
"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, employee or agent of the Trust or its
Affiliates.
"Corporate Trust Office" means the office of the
Institutional Trustee at which the corporate trust business of the
Institutional Trustee shall, at any particular time, be principally
administered, which office at the date of execution of this Declaration is
located at
"Covered Person" means: (a) any officer, director,
shareholder, partner, member, representative, employee or agent of (i) the
Trust or (ii) the Trust's Affiliates; and (b) any Holder of Securities.
"Debenture Issuer" means Ingersoll-Rand Company, a New
Jersey corporation, in its capacity as issuer of the Debentures under the
Indenture.
"Debenture Trustee" means The First National Bank of
Chicago, as trustee under the Indenture until a successor is appointed
thereunder, and thereafter means such successor trustee.
"Debentures" means the series of ____% Debentures to be
issued by the Debenture Issuer under the Indenture, a specimen certificate
for such series of Debentures being Exhibit B.
"Debenture Repayment Price" means, with respect to any
Debentures put to the Sponsor on ____________________, 2001, an amount per
Debenture equal to $10, plus accumulated and unpaid interest (including
deferred interest, if any).
"Definitive Preferred Security Certificates" has the meaning
set forth in Section 9.4.
"Delaware Trustee" has the meaning set forth in Section 5.2.
"Direction" by a Person means a written direction signed:
(a) if the Person is a natural person, by that Person;
or
(b) in any other case, in the name of such Person by one
or more Authorized Officers of that Person.
"Direct Action" has the meaning specified in Section 3.8(e).
"Distribution" means a distribution payable to Holders of
Securities in accordance with Section 6.1.
"DTC" means The Depository Trust Company, the initial
Clearing Agency.
"Event of Default" in respect of the Securities means an
Event of Default (as defined in the Indenture) has occurred and is continuing
in respect of the Debentures.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, or any successor legislation.
"Failed Remarketing" has the meaning specified in Section
5.4(b) of the Purchase Contract Agreement.
"FELINE PRIDES"SM means (A) 24,000,000 units referred to as
Income PRIDES with a Stated Amount, per Income PRIDES, of $10 and (B)
2,000,000 units referred to as Growth PRIDES with a face amount, per Growth
PRIDES, equal to the Stated Amount.
"Fiduciary Indemnified Person" has the meaning set forth in
Section 10.4(b).
"Global Certificate" has the meaning set forth in Section
9.4.
"Holder" or "holder" means a Person in whose name a
Certificate representing a Security is registered, such Person being a
beneficial owner within the meaning of the Business Trust Act.
"Indemnified Person" means a Company Indemnified Person or a
Fiduciary Indemnified Person.
"Indenture" means the Indenture dated as of March __, 1998,
among the Debenture Issuer and the Debenture Trustee, and any indenture
supplemental thereto pursuant to which the Debentures are to be issued.
"Institutional Trustee" means the Trustee meeting the
eligibility requirements set forth in Section 5.3.
"Institutional Trustee Account" has the meaning set forth in
Section 3.8(c).
"Investment Company" means an investment company as defined
in the Investment Company Act.
"Investment Company Act" means the Investment Company Act of
1940, as amended from time to time, or any successor legislation.
"Investment Company Event" has the meaning set forth in
Annex I hereto.
"Legal Action" has the meaning set forth in Section 3.6(g).
"Majority in liquidation amount of the Securities" means,
except as provided in the terms and conditions of the Preferred Securities
set forth in Annex I hereto or by the Trust Indenture Act, Holder(s) of
outstanding Securities voting together as a single class or, as the context
may require, Holders of outstanding Preferred Securities or Holders of
outstanding Common Securities voting separately as a class, who are the
record owners of more than 50% of the aggregate liquidation amount (including
the stated amount that would be paid on redemption, liquidation or otherwise,
plus accrued and unpaid Distributions to the date upon which the voting
percentages are determined) of all outstanding Securities of the relevant
class.
"Ministerial Action" has the meaning set forth in the terms
of the Securities as set forth in Annex I.
"Officers' Certificate" means, with respect to any Person, a
certificate signed by two Authorized Officers of such Person. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Declaration shall include:
(a) a statement that the officers signing the Officers'
Certificate have read the covenant or condition and the definitions relating
thereto;
(b) a brief statement of the nature and scope of the
examination or investigation undertaken by the officer in rendering the
Officers' Certificate;
(c) a statement that such officers have made such
examination or investigation as, in such officers' opinion, is necessary to
enable such officers to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of such
officers, such condition or covenant has been complied with.
"Paying Agent" has the meaning specified in Section 7.2.
"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.
"Pledge Agreement" means the Pledge Agreement dated as of
March __, 1998 among the Sponsor, The Chase Manhattan Bank, as collateral
agent (the "Collateral Agent"), and The First National Bank of Chicago, as
purchase contract agent (the "Purchase Contract Agent").
"Preferred Securities Guarantee" means the guarantee
agreement to be dated as of March __, 1998 of the Sponsor in respect of the
Preferred Securities.
"Preferred Security" has the meaning specified in Section
7.1.
"Preferred Security Beneficial Owner" means, with respect to
a Book Entry Interest, a Person who is the beneficial owner of such Book
Entry Interest, as reflected on the books of the Clearing Agency, or on the
books of a Person maintaining an account with such Clearing Agency (directly
as a Clearing Agency Participant or as an indirect participant, in each case
in accordance with the rules of such Clearing Agency).
"Preferred Security Certificate" means a certificate
representing a Preferred Security substantially in the form of Exhibit A-1.
"Pricing Agreement" means the pricing agreement between the
Trust, the Debenture Issuer, and the underwriters designated by the Regular
Trustees with respect to the offer and sale of the Preferred Securities.
"Primary Treasury Dealer" has the meaning set forth in Annex
I hereto.
"Purchase Contract Agreement" means the Purchase Contract
Agreement dated as of March __, 1998 among The First National Bank of
Chicago, as Purchase Contract Agent, and the Sponsor.
"Purchase Contract Settlement Date" means 16,
2001.
"Put Option" has the meaning set forth in Annex I hereto.
"Quorum" means a majority of the Regular Trustees or, if
there are only two Regular Trustees, both of them.
"Quotation Agent" has the meaning set forth in Annex I
hereto.
"Redemption Amount" has the meaning set forth in Annex I
hereto.
"Redemption Price" has the meaning set forth in Annex I
hereto.
"Regular Trustee" has the meaning set forth in Section 5.1.
"Related Party" means, with respect to the Sponsor, any
direct or indirect wholly owned subsidiary of the Sponsor or any other Person
that owns, directly or indirectly, 100% of the outstanding voting securities
of the Sponsor.
"Reset Agent" means a nationally recognized investment
banking firm chosen by the Sponsor to determine the Reset Rate. It is
currently anticipated that Merrill Lynch & Co. will act in such capacity.
"Reset Announcement Date" means the tenth (10) Business Day
immediately preceding the Purchase Contract Settlement Date.
"Reset Rate" means the distribution rate per annum (to be
determined by the Reset Agent), equal to the sum of (X) the Reset Spread and
(Y) the rate of interest on the Two-Year Benchmark Treasury in effect on the
third Business Day immediately preceding the Purchase Contract Settlement
Date, that the Preferred Securities should bear in order for the Preferred
Securities to have an approximate market value of 100.5% of their aggregate
liquidation amount on the third Business Day immediately preceding the
Purchase Contract Settlement Date; provided, that the Sponsor may limit such
Reset Spread to be no higher than 200 basis points (2%).
"Reset Spread" means a spread amount to be determined by the
Reset Agent on the tenth (10) Business Day immediately preceding the Purchase
Contract Settlement Date.
"Responsible Officer" means, with respect to the
Institutional Trustee, any officer within the Corporate Trust Office of the
Institutional Trustee, including, without limitation, any vice-president, any
assistant vice-president, any assistant secretary, the treasurer, any
assistant treasurer or other officer of the Corporate Trust Office of the
Institutional Trustee assigned by the Institutional Trustee to administer its
corporate trust matters and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of that officer's knowledge of and familiarity with the particular
subject.
"Rule 3a-5" means Rule 3a-5 under the Investment Company
Act.
"Securities" means the Common Securities and the Preferred
Securities.
"Securities Guarantees" means the Common Securities
Guarantee and the Preferred Securities Guarantee.
"Securities Act" means the Securities Act of 1933, as
amended from time to time, or any successor legislation.
"Sponsor" means Ingersoll-Rand Company, a New Jersey
corporation, or any successor entity in a merger or consolidation, in its
capacity as sponsor of the Trust.
"Super Majority" has the meaning set forth in Section
2.6(a)(ii).
"Tax Event" has the meaning set forth in Annex I hereto.
"Tax Event Redemption" has the meaning set forth in Annex I
hereto.
"Tax Event Redemption Date" has the meaning set forth in
Annex I hereto.
"10% in liquidation amount of the Securities" means, except
as provided in the terms of the Preferred Securities or by the Trust
Indenture Act, Holder(s) of outstanding Securities voting together as a
single class or, as the context may require, Holders of outstanding Preferred
Securities or Holders of outstanding Common Securities voting separately as a
class, who are the record owners of 10% or more of the aggregate liquidation
amount (including the stated amount that would be paid on repayment,
liquidation or otherwise, plus accrued and unpaid Distributions to the date
upon which the voting percentages are determined) of all outstanding
Securities of the relevant class.
"Termination Event" has the meaning set forth in Section 1
of the Purchase Contract Agreement.
"Treasury Portfolio" has the meaning set forth in Annex I
hereto.
"Treasury Portfolio Purchase Price" has the meaning set
forth in Annex I hereto.
"Treasury Regulations" means the income tax regulations,
including temporary and proposed regulations, promulgated under the Code by
the United States Treasury, as such regulations may be amended from time to
time (including corresponding provisions of succeeding regulations).
"Treasury Securities" has the meaning set forth in Section 1
of the Purchase Contract Agreement.
"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.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended from time to time, or any successor legislation.
"Two-Year Benchmark Treasury" means direct obligations of
the United States (which may be obligations traded on a when-issued basis
only) having a maturity comparable to the remaining term to maturity of the
Preferred Securities, as agreed upon by the Sponsor and the Reset Agent. The
rate for the Two-Year Benchmark Treasury will be the bid side rate displayed
at 10:00 A.M., New York City time, on the third Business Day immediately
preceding the Purchase Contract Settlement Date in the Telerate system (or if
the Telerate system is (a) no longer available on the third Business Day
immediately preceding the Purchase Contract Settlement Date or (b) in the
opinion of the Reset Agent (after consultation with the Sponsor) no longer an
appropriate system from which to obtain such rate, such other nationally
recognized quotation system as, in the opinion of the Reset Agent (after
consultation with the Sponsor) is appropriate). If such rate is not so
displayed, the rate for the Two-Year Benchmark Treasury shall be, as
calculated by the Reset Agent, the yield to maturity for the Two-Year
Benchmark Treasury, expressed as a bond equivalent on the basis of a year of
365 or 366 days, as applicable, and applied on a daily basis, and computed by
taking the arithmetic mean of the secondary market bid rates, as of 10:30
A.M., New York City time, on the third Business Day immediately preceding the
Purchase Contract Settlement Date of three leading United States government
securities dealers selected by the Reset Agent (after consultation with the
Sponsor) (which may include the Reset Agent or an Affiliate thereof).
"Underwriting Agreement" means the Underwriting Agreement
for the offering and sale of Preferred Securities.
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 Institutional 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) Any application of the Trust Indenture Act to this
Declaration shall not affect the nature of the Securities as equity
securities representing undivided beneficial interests in the assets of the
Trust.
SECTION 2.2 LISTS OF HOLDERS OF SECURITIES.
(a) Each of the Sponsor and the Regular Trustees, on
behalf of the Trust, shall provide the Institutional Trustee (i) within 14
days after each record date for payment of Distributions, a list, in such
form as the Institutional Trustee may reasonably require, of the names and
addresses of the Holders of the 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 Institutional 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 by the Institutional Trustee for
a List of Holders as of a date no more than 14 days before such List of
Holders is given to the Institutional Trustee. The Institutional Trustee
shall preserve, in as current a form as is reasonably practicable, all
information contained in the Lists of Holders given to it or which it
receives in the capacity as Paying Agent (if acting in such capacity),
provided that the Institutional Trustee may destroy any List of Holders
previously given to it on receipt of a new List of Holders.
(b) The Institutional Trustee shall comply with its
obligations under Sections 311(a), 310(b) and 312(b) of the Trust Indenture
Act.
SECTION 2.3 REPORTS BY THE INSTITUTIONAL TRUSTEE.
Within 60 days after May 15 of each year, commencing May 15,
1998, the Institutional Trustee shall provide to the Holders of the Preferred
Securities such reports as are required by Section 313 of the Trust Indenture
Act, if any, in the form and in the manner provided by Section 313 of the
Trust Indenture Act. The Institutional Trustee shall also comply with the
requirements of Section 313(d) of the Trust Indenture Act.
SECTION 2.4 PERIODIC REPORTS TO INSTITUTIONAL TRUSTEE.
Each of the Sponsor and the Regular Trustees, on behalf of
the Trust, shall provide to the Institutional Trustee such documents, reports
and information as required by Section 314 (if any) and the compliance
certificate required by Section 314 of the Trust Indenture Act in the form,
in the manner and at the times required by Section 314 of the Trust Indenture
Act.
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 Institutional Trustee such evidence of
compliance with any conditions precedent, if any, provided for in this
Declaration that relate to any of the matters set forth in Section 314(c) of
the Trust Indenture Act. Any certificate or opinion required to be given by
an officer pursuant to Section 314(c) (1) may be given in the form of an
Officers' Certificate.
SECTION 2.6 EVENTS OF DEFAULT; WAIVER.
(a) The Holders of a Majority in liquidation amount of
Preferred Securities may, by vote, on behalf of the Holders of all of the
Preferred Securities, waive any past Event of Default in respect of the
Preferred Securities and its consequences, provided that, if the underlying
Event of Default under the Indenture:
(i) is not waivable under the Indenture, the Event of
Default under this Declaration shall also not be waivable; or
(ii) requires the consent or vote of greater than a
majority in principal amount of the holders of the Debentures (a
"Super Majority") to be waived under the Indenture, the Event of
Default under this Declaration may only be waived by the vote of the
Holders of at least the proportion in liquidation amount of the
Preferred Securities that the relevant Super Majority represents of
the aggregate principal amount of the Debentures outstanding.
The foregoing provisions of this Section 2.6(a) shall be in lieu of
Section 316(a) (1)(B) of the Trust Indenture Act and such Section 316(a) (1)
(B) of the Trust Indenture Act is hereby expressly excluded from this
Declaration and the Preferred Securities, as permitted by the Trust Indenture
Act. Upon such waiver, any such default shall cease to exist, and any Event
of Default with respect to the Preferred Securities arising therefrom shall
be deemed to have been cured, for every purpose of this Declaration, but no
such waiver shall extend to any subsequent or other default or an Event of
Default with respect to the Preferred Securities or impair any right
consequent thereon. Any waiver by the Holders of the Preferred Securities of
an Event of Default with respect to the Preferred Securities shall also be
deemed to constitute a waiver by the Holders of the Common Securities of any
such Event of Default with respect to the Common Securities for all purposes
of this Declaration without any further act, vote, or consent of the Holders
of the Common Securities.
(b) The Holders of a Majority in liquidation amount of
the Common Securities may, by vote, on behalf of the Holders of all of the
Common Securities, waive any past Event of Default with respect to the Common
Securities and its consequences, provided that, if the underlying Event of
Default under the Indenture:
(i) is not waivable under the Indenture, except where
the Holders of the Common Securities are deemed to have waived such
Event of Default under this Declaration as provided below in this
Section 2.6(b), the Event of Default under this Declaration shall
also not be waivable; or
(ii) requires the consent or vote of a Super Majority
to be waived, except where the Holders of the Common Securities are
deemed to have waived such Event of Default under this Declaration as
provided below in this Section 2.6(b), the Event of Default under
this Declaration may only be waived by the vote of the Holders of at
least the proportion in liquidation amount of the Common Securities
that the relevant Super Majority represents of the aggregate
principal amount of the Debentures outstanding;
provided further, each Holder of Common Securities will be deemed to have
waived any such Event of Default and all Events of Default with respect to
the Common Securities and its consequences until all Events of Default with
respect to the Preferred Securities have been cured, waived or otherwise
eliminated, and until such Events of Default have been so cured, waived or
otherwise eliminated, the Institutional Trustee will be deemed to be acting
solely on behalf of the Holders of the Preferred Securities and only the
Holders of the Preferred Securities will have the right to direct the
Institutional Trustee in accordance with the terms of the Securities. The
foregoing provisions of this Section 2.6(b) shall be in lieu of
Sections 316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act and such
Sections 316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act are hereby
expressly excluded from this Declaration and the Securities, as permitted by
the Trust Indenture Act. Subject to the foregoing provisions of this Section
2.6(b), upon such waiver, any such default shall cease to exist and any Event
of Default with respect to the Common Securities arising therefrom shall be
deemed to have been cured for every purpose of this Declaration, but no such
waiver shall extend to any subsequent or other default or Event of Default
with respect to the Common Securities or impair any right consequent thereon.
(c) A waiver of an Event of Default under the Indenture
by the Institutional Trustee at the direction of the Holders of the Preferred
Securities constitutes a waiver of the corresponding Event of Default with
respect to the Preferred Securities under this Declaration. Any waiver of an
Event of Default under the Indenture by the Institutional Trustee at the
direction of the Holders of the Preferred Securities shall also be deemed to
constitute a waiver by the Holders of the Common Securities of the
corresponding Event of Default under this Declaration with respect to the
Common Securities for all purposes of this Declaration without further act,
vote or consent of the Holders of the Common Securities. The foregoing
provisions of this Section 2.6(c) shall be in lieu of Section 316(a)(1)(B) of
the Trust Indenture Act and such Section 316(a)(1)(B) of the Trust Indenture
Act is hereby expressly excluded from this Declaration and the Securities, as
permitted by the Trust Indenture Act.
SECTION 2.7 EVENT OF DEFAULT; NOTICE.
(a) The Institutional Trustee shall, within 90 days
after the occurrence of an Event of Default, actually known to a Responsible
Officer of the Institutional Trustee, transmit by mail, first class postage
prepaid, to the Holders of the Securities, notices of all such defaults with
respect to the Securities, unless such defaults have been cured before the
giving of such notice (the term "defaults" for the purposes of this Section
2.7(a) being hereby defined to be an Event of Default as defined in the
Indenture, not including any periods of grace provided for therein and
irrespective of the giving of any notice provided therein); provided that,
except for a default in the payment of principal of (or premium, if any) or
interest on any of the Debentures, the Institutional Trustee shall be
protected in withholding such notice if and so long as a Responsible Officer
of the Institutional Trustee in good faith determines that the withholding of
such notice is in the interests of the Holders of the Securities.
(b) The Institutional Trustee shall not be deemed to
have knowledge of any default except:
(i) a default under Sections 5.1 and 5.3 of the
Indenture; or
(ii) any default as to which the Institutional Trustee
shall have received written notice or of which a Responsible Officer
of the Institutional Trustee charged with the administration of this
Declaration shall have actual knowledge.
ARTICLE III
ORGANIZATION
SECTION 3.1 NAME.
The Trust is named "Ingersoll-Rand Financing I," as such
name may be modified from time to time by the Regular Trustees following
written notice to the Holders of the 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
Ingersoll-Rand Company, 200 Chestnut Ridge Road, Woodclliff, New Jersey
07675. On ten Business Days written notice to the Institutional Trustee and
Holders of the Securities, the Regular Trustees may designate another
principal office.
SECTION 3.3 PURPOSE.
The exclusive purposes and functions of the Trust are (a) to
issue and sell the Securities and use the gross proceeds from such sale to
acquire the Debentures, and (b) except as otherwise set forth herein, to
engage in only those other activities necessary, appropriate, convenient or
incidental thereto. The Trust shall not borrow money, issue debt or reinvest
proceeds derived from investments, pledge any of its assets, or otherwise
undertake (or permit to be undertaken) any activity that would cause the
Trust not to be classified for United States federal income tax purposes as a
grantor trust. It is the intent of the parties to this Declaration for the
Trust to be classified as a grantor trust for United States federal income
tax purposes under Subpart E of Subchapter J of the Code, pursuant to which
the owners of the Preferred Securities and the Common Securities will be the
owners of the Trust for United States federal income tax purposes, and such
owners will include directly in their gross income the income, gain,
deduction or loss of the Trust as if the Trust did not exist. By the
acceptance of this Trust neither the Trustees, the Sponsor nor the Holders of
the Preferred Securities or Common Securities will take any position for
United States federal income tax purposes which is contrary to the
classification of the Trust as a grantor trust.
SECTION 3.4 AUTHORITY.
Subject to the limitations provided in this Declaration and
to the specific duties of the Institutional 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 Institutional Trustee on behalf of the Trust in accordance with
its powers shall constitute the act of and serve to bind the Trust. In
dealing with the Trustees acting on behalf of the Trust, no Person shall be
required to inquire into the authority of the Trustees to bind the Trust.
Persons dealing with the Trust are entitled to rely conclusively on the power
and authority of the Trustees as set forth in this Declaration.
SECTION 3.5 TITLE TO PROPERTY OF THE TRUST.
Except as provided in Section 3.8 with respect to the
Debentures and the Institutional Trustee Account or as otherwise provided in
this Declaration, legal title to all assets of the Trust shall be vested in
the Trust. A Holder shall not have legal title to any part of the assets of
the Trust, but shall have an undivided beneficial interest in the assets of
the Trust.
SECTION 3.6 POWERS AND DUTIES OF THE REGULAR TRUSTEES.
The Regular Trustees shall have the exclusive power, duty
and authority to cause the Trust to engage in the following activities:
(a) to issue and sell the Preferred Securities and the
Common Securities in accordance with this Declaration; provided, however,
that the Trust may issue no more than one series of Preferred Securities and
no more than one series of Common Securities, and, provided further, that
there shall be no interests in the Trust other than the Securities, and the
issuance of Securities shall be limited to a simultaneous issuance of both
Preferred Securities and Common Securities on each Closing Date;
(b) in connection with the issue and sale of the
Preferred Securities, at the direction of the Sponsor, to:
(i) execute and file with the Commission the
registration statement and the prospectus relating to the
registration statement on Form S-3 prepared by the Sponsor, including
any amendments or supplements, thereto, pertaining to the Preferred
Securities and to take any other action relating to the registration
and sale of the Preferred Securities under federal and state
securities laws;
(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 FELINE
PRIDES in any State in which the Sponsor has determined to qualify or
register such FELINE PRIDES for sale;
(iii) execute and file an application, prepared by the
Sponsor, to the New York Stock Exchange, Inc. or any other national
stock exchange or the Nasdaq Stock Market's National Market for
listing upon notice of issuance of any Preferred Securities;
(iv) execute and file with the Commission a
registration statement on Form 8-A, including any amendments thereto,
prepared by the Sponsor, relating to the registration of the
Preferred Securities under Section 12(b) of the Exchange Act; and
(v) execute and enter into the Underwriting Agreement
and Pricing Agreement providing for the sale of the FELINE PRIDES;
(c) to acquire the Debentures with the proceeds of the
sale of the Preferred Securities and the Common Securities; provided,
however, that the Regular Trustees shall cause legal title to the Debentures
to be held of record in the name of the Institutional Trustee for the benefit
of the Trust and the Holders of the Preferred Securities and the Holders of
Common Securities;
(d) to give the Sponsor and the Institutional Trustee
prompt written notice of the occurrence of a Tax Event or an Investment
Company Event; provided that the Regular Trustees shall consult with the
Sponsor before taking or refraining from taking any Ministerial Action in
relation to a Tax Event or Investment Company 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, repayments, redemptions
and exchanges, and to issue relevant notices to the Holders of Preferred
Securities and Holders of Common Securities as to such actions and applicable
record dates;
(f) to take all actions and perform such duties as may
be required of the Regular Trustees pursuant to the terms of the Securities
and this Declaration;
(g) to bring or defend, pay, collect, compromise,
arbitrate, resort to legal action, or otherwise adjust claims or demands of
or against the Trust ("Legal Action"), unless pursuant to Section 3.8(e) the
Institutional Trustee has the exclusive power to bring such Legal Action;
(h) to employ or otherwise engage employees and agents
(who may be designated as officers with titles) and managers, contractors,
advisors, and consultants and pay reasonable compensation for such services;
(i) to cause the Trust to comply with the Trust's
obligations under the Trust Indenture Act;
(j) to give the certificate required by
Section 314(a)(4) of the Trust Indenture Act to the Institutional Trustee,
which certificate may be executed by any Regular Trustee;
(k) to incur expenses that are necessary, appropriate,
convenient or incidental to carry out any of the purposes of the Trust;
(l) to act as, or appoint another Person to act as,
registrar and transfer agent for the Securities;
(m) to give prompt written notice to the Holders of the
Securities of any notice received from the Debenture Issuer of its election
to defer payments of interest on the Debentures by extending the interest
payment period under the Indenture;
(n) to take all action that may be necessary or
appropriate for the preservation and the continuation of the Trust's valid
existence, rights, franchises and privileges as a statutory business trust
under the laws of the State of Delaware and of each other jurisdiction in
which such existence is necessary to protect the limited liability of the
Holders of the Preferred Securities or to enable the Trust to effect the
purposes for which the Trust was created;
(o) to take any action, not inconsistent with this
Declaration or with applicable law, that the Regular Trustees determine in
their discretion to be necessary or desirable in carrying out the activities
of the Trust, including, but not limited to:
(i) causing the Trust not to be deemed to be an
Investment Company required to be registered under the Investment
Company Act;
(ii) causing the Trust to be classified for United
States federal income tax purposes as a grantor trust; and
(iii) cooperating with the Debenture Issuer to ensure
that the Debentures will be treated as indebtedness of the Debenture
Issuer for United States federal income tax purposes, provided that
such action relating to this clause (iii) does not adversely affect
the interests of Holders;
(p) to take all action necessary to cause all applicable
tax returns and tax information reports that are required to be filed with
respect to the Trust to be duly prepared and filed by the Regular Trustees,
on behalf of the Trust;
(q) to execute all documents or instruments, perform all
duties and powers, and do all things for and on behalf of the Trust in all
matters necessary, appropriate, convenient or incidental to the foregoing;
and
(r) if applicable, to solicit holders of Securities
which form a part of the Income PRIDES to timely instruct the Purchase
Contract Agent in order to enable the Purchase Contract Agent to vote such
Securities.
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 Institutional Trustee set forth in
Section 3.8. No permissive power or authority available to the Regular
Trustees shall be construed to be a duty.
Any expenses incurred by the Regular Trustees pursuant to
this Section 3.6 shall be reimbursed by the Sponsor.
SECTION 3.7 PROHIBITION OF ACTIONS BY THE TRUST AND THE
TRUSTEES.
(a) The Trust shall not, and the Trustees (including the
Institutional Trustee) shall cause the Trust not to, engage in any activity
other than as required or authorized by this Declaration. In particular, the
Trust shall not and the Trustees (including the Institutional Trustee) shall
cause the Trust not to:
(i) invest any proceeds received by the Trust from
holding the Debentures, but shall distribute all such proceeds to
Holders of Securities pursuant to the terms of this Declaration and
of the Securities;
(ii) acquire any assets other than as expressly
provided herein;
(iii) possess Trust property for other than a Trust
purpose;
(iv) make any loans or incur any indebtedness for
borrowed money, other than loans represented by the Debentures;
(v) possess any power or otherwise act in such a way
as to vary the Trust assets or the terms of the Securities in any way
whatsoever;
(vi) issue any securities or other evidences of
beneficial ownership of, or beneficial interest in, the Trust other
than the Securities; or
(vii) other than as provided in this Declaration or
Annex I, (A) direct the time, method and place of exercising any
trust or power conferred upon the Debenture Trustee with respect to
the Debentures, (B) waive any past default that is waivable under the
Indenture, (C) exercise any right to rescind or annul any declaration
that the principal of all the Debentures shall be due and payable, or
(D) consent to any amendment, modification or termination of the
Indenture or the Debentures where such consent shall be required
unless the Trust shall have received an opinion of counsel to the
effect that such modification will not cause more than an
insubstantial risk that for United States federal income tax purposes
the Trust will not be classified as a grantor trust.
SECTION 3.8 POWERS AND DUTIES OF THE INSTITUTIONAL
TRUSTEE.
(a) The legal title to the Debentures shall be owned by
and held of record in the name of the Institutional Trustee in trust for the
benefit of the Trust and the Holders of the Securities. The right, title and
interest of the Institutional Trustee to the Debentures shall vest
automatically in each Person who may hereafter be appointed as Institutional
Trustee in accordance with Section 5.6. Such vesting and cessation of title
shall be effective whether or not conveyancing documents with regard to the
Debentures have been executed and delivered.
(b) The Institutional Trustee shall not transfer its
right, title and interest in the Debentures to the Regular Trustees or to the
Delaware Trustee (if the Institutional Trustee does not also act as Delaware
Trustee).
(c) The Institutional Trustee shall:
(i) establish and maintain a segregated non-interest
bearing trust account (the "Institutional Trustee Account") in the
name of and under the exclusive control of the Institutional Trustee
on behalf of the Trust and the Holders of the Securities and, upon
the receipt of payments of funds made in respect of the Debentures
held by the Institutional Trustee, deposit such funds into the
Institutional Trustee Account and make payments to the Holders of the
Preferred Securities and Holders of the Common Securities from the
Institutional Trustee Account in accordance with Section 6.1. Funds
in the Institutional Trustee Account shall be held uninvested until
disbursed in accordance with this Declaration. The Institutional
Trustee Account shall be an account that is maintained with a banking
institution the rating on whose long-term unsecured indebtedness is
rated at least "A" or above by a "nationally recognized statistical
rating organization", as that term is defined for purposes of Rule
436(g)(2) under the Securities Act;
(ii) engage in such ministerial activities as shall be
necessary, appropriate, convenient or incidental to effect the
repayment of the Preferred Securities and the Common Securities to
the extent the Debentures mature or are redeemed or the Put Option is
exercised; and
(iii) upon written notice of distribution issued by the
Regular Trustees in accordance with the terms of the Securities,
engage in such ministerial activities as shall be necessary,
appropriate, convenient or incidental to effect the distribution of
the Debentures to Holders of Securities upon the occurrence of
certain special events (as may be defined in the terms of the
Securities) arising from a change in law or a change in legal
interpretation or other specified circumstances pursuant to the terms
of the Securities.
(d) The Institutional Trustee shall take all actions and
perform such duties as may be specifically required of the Institutional
Trustee pursuant to the terms of the Securities and this Declaration.
(e) The Institutional Trustee shall take any Legal
Action which arises out of or in connection with an Event of Default of which
a Responsible Officer of the Institutional Trustee has actual knowledge or
the Institutional Trustee's duties and obligations under this Declaration,
the Business Trust Act or the Trust Indenture Act; provided, however, that if
the Institutional Trustee fails to enforce its rights under the Debentures
after a Holder of Preferred Securities has made a written request, such
Holder of Preferred Securities may, to the fullest extent permitted by
applicable law, institute a legal proceeding against the Debenture Issuer
without first instituting any legal proceeding against the Institutional
Trustee or any other person or entity. Notwithstanding the foregoing, if an
Event of Default has occurred and is continuing and such event is
attributable to the failure of the Debenture Issuer to pay interest on or
principal of the Debentures on the date such interest or principal is
otherwise payable (or in the case of redemption, on the redemption date),
then a Holder of Preferred Securities may directly institute a proceeding for
enforcement of payment to such Holder of the principal of or interest on the
Debentures having a principal amount equal to the aggregate liquidation
amount of the Preferred Securities of such holder (a "Direct Action") on or
after the respective due date specified in the Debentures. In connection
with such Direct Action, the rights of the Holders of Common Securities will
be subrogated to the rights of such Holders of Preferred Securities. In
connection with such Direct Action, the Debenture Issuer shall be subrogated
to the rights of such Holder of Preferred Securities with respect to payments
on the Preferred Securities under this Declaration to the extent of any
payment made by the Debenture Issuer to such Holder of Preferred Securities
in such Direct Action. Except as provided in the preceding sentences, the
Holders of Preferred Securities will not be able to exercise directly any
other remedy available to the Holders of the Debentures.
(f) The Institutional Trustee shall continue to serve as
a Trustee until either:
(i) the Trust has been completely liquidated and the
proceeds of the liquidation distributed to the Holders of Securities
pursuant to the terms of the Securities; or
(ii) a Successor Institutional Trustee has been
appointed and has accepted that appointment in accordance with
Section 5.6.
(g) The Institutional Trustee shall have the legal power
to exercise all of the rights, powers and privileges of a holder of
Debentures under the Indenture and, if an Event of Default actually known to
a Responsible Officer of the Institutional Trustee occurs and is continuing,
the Institutional Trustee shall, for the benefit of Holders of the
Securities, enforce its rights as holder of the Debentures subject to the
rights of the Holders pursuant to the terms of such Securities and this
Declaration.
(h) Subject to this Section 3.8, the Institutional
Trustee shall have none of the duties, liabilities, powers or the authority
of the Regular Trustees set forth in Section 3.6.
The Institutional 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 Institutional 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
INSTITUTIONAL TRUSTEE.
(a) The Institutional Trustee, before the occurrence of
any Event of Default and after the curing or waiver of all Events of Default
that may have occurred, shall undertake to perform only such duties as are
specifically set forth in this Declaration and no implied covenants shall be
read into this Declaration against the Institutional Trustee. In case an
Event of Default has occurred (that has not been cured or waived pursuant to
Section 2.6) of which a Responsible Officer of the Institutional Trustee has
actual knowledge, the Institutional 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 Institutional Trustee from liability for its own negligent
action, its own negligent failure to act, or its own willful misconduct,
except that:
(i) prior to the occurrence of an Event of Default and
after the curing or waiving of all such Events of Default that may
have occurred:
(A) the duties and obligations of the
Institutional Trustee shall be determined solely by the
express provisions of this Declaration and the Institutional
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
Institutional Trustee; and
(B) in the absence of bad faith on the part of
the Institutional Trustee, the Institutional 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 Institutional
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 Institutional Trustee, the
Institutional 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 Institutional Trustee shall not be liable for
any error of judgment made in good faith by a Responsible Officer of
the Institutional Trustee, unless it shall be proved that the
Institutional Trustee was negligent in ascertaining the pertinent
facts;
(iii) the Institutional Trustee shall not be liable with
respect to any action taken or omitted to be taken by it in good
faith in accordance with the direction of the Holders of not less
than a Majority in liquidation amount of the Securities relating to
the time, method and place of conducting any proceeding for any
remedy available to the Institutional Trustee, or exercising any
trust or power conferred upon the Institutional Trustee under this
Declaration;
(iv) no provision of this Declaration shall require the
Institutional Trustee to expend or risk its own funds or otherwise
incur personal financial liability in the performance of any of its
duties or in the exercise of any of its rights or powers, if it shall
have reasonable grounds for believing that the repayment of such
funds or liability is not reasonably assured to it under the terms of
this Declaration or indemnity reasonably satisfactory to the
Institutional Trustee against such risk or liability is not
reasonably assured to it;
(v) the Institutional Trustee's sole duty with respect
to the custody, safe keeping and physical preservation of the
Debentures and the Institutional Trustee Account shall be to deal
with such property in a similar manner as the Institutional Trustee
deals with similar property for its fiduciary accounts generally,
subject to the protections and limitations on liability afforded to
the Institutional Trustee under this Declaration, the Business Trust
Act and the Trust Indenture Act;
(vi) the Institutional Trustee shall have no duty or
liability for or with respect to the value, genuineness, existence or
sufficiency of the Debentures or the payment of any taxes or
assessments levied thereon or in connection therewith;
(vii) the Institutional Trustee shall not be liable for
any interest on any money received by it except as it may otherwise
agree with the Sponsor. Money held by the Institutional Trustee need
not be segregated from other funds held by it except in relation to
the Institutional Trustee Account maintained by the Institutional
Trustee pursuant to Section 3.8(c)(i) and except to the extent
otherwise required by law; and
(viii) the Institutional 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
Institutional Trustee be liable for any default or misconduct of the
Regular Trustees or the Sponsor.
SECTION 3.10 CERTAIN RIGHTS OF INSTITUTIONAL TRUSTEE.
(a) Subject to the provisions of Section 3.9:
(i) the Institutional Trustee may conclusively rely
and shall be fully protected in acting or refraining from acting upon
any resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document believed by
it to be genuine and to have been signed, sent or presented by the
proper party or parties;
(ii) any direction or act of the Sponsor or the Regular
Trustees contemplated by this Declaration shall be sufficiently
evidenced by a Direction or an Officers' Certificate;
(iii) whenever in the administration of this
Declaration, the Institutional Trustee shall deem it desirable that a
matter be proved or established before taking, suffering or omitting
any action hereunder, the Institutional Trustee (unless other
evidence is herein specifically prescribed) may, in the absence of
bad faith on its part, request and conclusively rely upon an
Officers' Certificate which, upon receipt of such request, shall be
promptly delivered by the Sponsor or the Regular Trustees;
(iv) the Institutional 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 Institutional Trustee may consult with counsel
or other experts and the advice or opinion of such counsel and
experts with respect to legal matters or advice within the scope of
such experts' area of expertise shall be full and complete
authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in accordance with such
advice or opinion. Such counsel may be counsel to the Sponsor or any
of its Affiliates, and may include any of its employees. The
Institutional Trustee shall have the right at any time to seek
instructions concerning the administration of this Declaration from
any court of competent jurisdiction;
(vi) the Institutional Trustee shall be under no
obligation to exercise any of the rights or powers vested in it by
this Declaration at the request or direction of any Holder, unless
such Holder shall have provided to the Institutional Trustee security
and indemnity, reasonably satisfactory to the Institutional Trustee,
against the costs, expenses (including attorneys' fees and expenses
and the expenses of the Institutional 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 Institutional Trustee provided, that, nothing
contained in this Section 3.10(a)(vi) shall be taken to relieve the
Institutional Trustee, upon the occurrence of an Event of Default, of
its obligation to exercise the rights and powers vested in it by this
Declaration;
(vii) the Institutional Trustee shall be under no
obligation to conduct an 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 Institutional Trustee, in its discretion, may make
such further inquiry or investigation into such facts or matters as
it may see fit;
(viii) the Institutional 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 Institutional 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 Institutional Trustee or
its agents hereunder shall bind the Trust and the Holders of the
Securities, and the signature of the Institutional 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 Institutional 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 Institutional
Trustee's or its agent's taking such action;
(x) whenever in the administration of this Declaration
the Institutional Trustee shall deem it desirable to receive
instructions with respect to enforcing any remedy or right or taking
any other action hereunder, the Institutional Trustee (i) may request
instructions from the Holders of the Securities which instructions
may only be given by the Holders of the same proportion in
liquidation amount of the Securities as would be entitled to direct
the Institutional Trustee under the terms of the Securities in
respect of such remedy, right or action, (ii) may refrain from
enforcing such remedy or right or taking such other action until such
instructions are received, and (iii) shall be protected in
conclusively relying on or acting in or accordance with such
instructions; and
(xi) except as otherwise expressly provided by this
Declaration, the Institutional 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 Institutional 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
Institutional 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 Institutional Trustee shall be construed to be a duty.
SECTION 3.11 DELAWARE TRUSTEE.
Notwithstanding any other provision of this Declaration
other than Section 5.2, the Delaware Trustee shall not be entitled to
exercise any powers, nor shall the Delaware Trustee have any of the duties
and responsibilities of the Trustees (except as required under the Business
Trust Act) described in this Declaration. Except as set forth in Section 5.2,
the Delaware Trustee shall be a Trustee for the sole and limited purpose of
fulfilling the requirements of Section 3807 of the Business Trust Act.
SECTION 3.12 EXECUTION OF DOCUMENTS.
Unless otherwise determined by the Regular Trustees, and
except as otherwise required by the Business Trust Act, a majority of or, if
there are only two, any Regular Trustee or, if there is only one, such
Regular Trustee is authorized to execute on behalf of the Trust any documents
that the Regular Trustees have the power and authority to execute pursuant to
Section 3.6; provided that, the registration statement referred to in Section
3.6(b)(i), including any amendments thereto, shall be signed by all of the
Regular Trustees.
SECTION 3.13 NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF
SECURITIES.
The recitals contained in this Declaration 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 Securities.
SECTION 3.14 DURATION OF TRUST.
The Trust, unless terminated pursuant to the provisions of
Article VIII hereof, shall dissolve on March , 2005.
SECTION 3.15 MERGERS.
(a) The Trust may not consolidate, amalgamate, merge
with or into, or be replaced by, or convey, transfer or lease its properties
and assets substantially as an entirety to any corporation or other body,
except as described in Section 3.15(b) and (c).
(b) The Trust may, with the consent of the Regular
Trustees or, if there are more than two, a majority of the Regular Trustees
and without the consent of the Holders of the Securities, the Delaware
Trustee or the Institutional Trustee, consolidate, amalgamate, merge with or
into, or be replaced by a trust organized as such under the laws of any
State; provided that if the Trust is not the surviving entity:
(i) such successor entity (the "Successor Entity")
either:
(A) expressly assumes all of the obligations of
the Trust under the Securities; or
(B) substitutes for the Preferred Securities
other securities having substantially the same terms as the
Preferred Securities (the "Successor Securities"), so long
as the Successor Securities rank the same as the Preferred
Securities rank with respect to Distributions and payments
upon liquidation, redemption, repayment and otherwise and
substitutes for the Common Securities other securities
having substantially the same terms as the Common Securities
(the "Successor Common Securities"), so long as the
Successor Common Securities rank the same as the Common
Securities rank with respect to Distributions and payments
upon liquidation, redemption, repayment and otherwise;
(ii) the Debenture Issuer expressly acknowledges a
trustee of the Successor Entity that possesses the same powers and
duties as the Institutional Trustee as the holder of the Debentures;
(iii) if necessary, the Preferred Securities or any
Successor Securities will be listed, or any Successor Securities will
be listed upon notification of issuance, on any national securities
exchange or with another organization on which the Preferred
Securities are then listed or quoted;
(iv) such merger, consolidation, amalgamation or
replacement does not cause the Preferred Securities (including any
Successor Securities) to be downgraded by any nationally recognized
statistical rating organization;
(v) such merger, consolidation, amalgamation or
replacement does not adversely affect the rights, preferences and
privileges of the Holders of the Securities (including any Successor
Securities and any Successor Common Securities) in any material
respect (other than with respect to any dilution of such Holders'
interests in the new entity);
(vi) such Successor Entity has a purpose identical to
that of the Trust;
(vii) prior to such merger, consolidation, amalgamation
or replacement, the Sponsor has received an opinion of a nationally
recognized independent counsel to the Trust experienced in such
matters to the effect that:
(A) such merger, consolidation, amalgamation or
replacement does not adversely affect the rights,
preferences and privileges of the Holders of the Securities
(including any Successor Securities) in any material respect
(other than with respect to any dilution of the Holders'
interest in the new entity);
(B) following such merger, consolidation,
amalgamation or replacement, neither the Trust nor the
Successor Entity will be required to register as an
Investment Company; and
(C) following such merger, consolidation,
amalgamation or replacement, the Trust (or the Successor
Entity) will continue to be classified as a grantor trust
for United States federal income tax purposes; and
(viii) the Sponsor guarantees the obligations of such
Successor Entity under the Successor Securities at least to the
extent provided by the Securities Guarantees.
(c) Notwithstanding Section 3.15(b), the Trust shall
not, except with the consent of Holders of 100% in liquidation amount of the
Securities, consolidate, amalgamate, merge with or into, or be replaced by
any other entity or permit any other entity to consolidate, amalgamate, merge
with or into, or replace it if such consolidation, amalgamation, merger or
replacement would cause the Trust or Successor Entity to be classified as
other than a grantor trust for United States federal income tax purposes.
ARTICLE IV
SPONSOR
SECTION 4.1 SPONSOR'S PURCHASE OF COMMON SECURITIES.
On the Closing Date the Sponsor will purchase all of the
Common Securities issued by the Trust, in an amount at least equal to 3.0% of
the capital of the Trust, at the same time as the Preferred Securities are
sold.
SECTION 4.2 RIGHTS AND RESPONSIBILITIES OF THE SPONSOR.
In connection with the issue, sale and, if necessary, the
remarketing of the Preferred Securities, the Sponsor shall have the exclusive
right and responsibility to engage in the following activities:
(a) to prepare for filing by the Trust with the
Commission a registration statement on Form S-3 in relation to the Preferred
Securities, including any amendments thereto;
(b) if necessary, to determine the States in which to
take appropriate action to qualify or register for sale all or part of the
FELINE PRIDES 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) if necessary, to prepare for filing by the Trust of
an application to the New York Stock Exchange or any other national stock
exchange or the Nasdaq National Market for listing upon notice of issuance of
any Preferred Securities;
(d) if necessary, to prepare for filing by the Trust
with the Commission of a registration statement on Form 8-A relating to the
registration of the Preferred Securities under Section 12(b) of the Exchange
Act, including any amendments thereto; and
(e) to negotiate the terms of the Remarketing Agreement,
the Remarketing Underwriting Agreement, the Underwriting Agreement and the
Pricing Agreement providing for the sale of the FELINE PRIDES.
SECTION 4.3 RIGHT TO PROCEED.
The Sponsor acknowledges the rights of Holders to institute
a Direct Action as set forth in Section 3.8(e) hereto.
SECTION 4.4 EXPENSES.
In connection with the offering, sale and issuance of the
Debentures to the Institutional Trustee and in connection with the sale of
the Securities by the Trust, the Sponsor, in its capacity as borrower with
respect to the Debentures, shall:
(a) pay all costs and expenses relating to the offering,
sale and issuance of the Debentures, including commissions to the
underwriters payable pursuant to the Underwriting Agreement and Pricing
Agreement and compensation of the Trustee under the Indenture in accordance
with the provisions of the Indenture;
(b) be responsible for and shall pay all debts and
obligations (other than with respect to the Securities) and all costs and
expenses of the Trust (including, but not limited to, costs and expenses
relating to the organization, maintenance and dissolution of the Trust, the
offering, sale and issuance of the Securities (including commissions to the
underwriters in connection therewith), the fees and expenses (including
reasonable counsel fees and expenses) of the Institutional Trustee, the
Delaware Trustee and the Regular Trustees (including any amounts payable
under Article X of this Declaration), the costs and expenses relating to the
operation of the Trust, including, without limitation, costs and expenses of
accountants, attorneys, statistical or bookkeeping services, expenses for
printing and engraving and computing or accounting equipment, paying
agent(s), registrar(s), transfer agent(s), duplicating, travel and telephone
and other telecommunications expenses and costs and expenses incurred in
connection with the acquisition, financing, and disposition of Trust assets
and the enforcement by the Institutional Trustee of the rights of the Holders
of the Securities;
(c) be primarily liable for any indemnification
obligations arising under Section 10.4 with respect to this Declaration; and
(d) pay any and all taxes (other than United States
withholding taxes attributable to the Trust or its assets) and all
liabilities, costs and expenses with respect to such taxes of the Trust.
The Sponsor's obligations under this Section 4.4 shall be
for the benefit of, and shall be enforceable by, any person to whom such
debts, obligations, costs, expenses and taxes are owed (a "Creditor") whether
or not such Creditor has received notice hereof. Any such Creditor may
enforce the Sponsor's obligations under this Section 4.4 directly against the
Sponsor and the Sponsor irrevocably waives any right or remedy to require
that any such Creditor take any action against the Trust or any other Person
before proceeding against the Sponsor. The Debenture Issuer agrees to execute
such additional agreements as may be necessary or desirable in order to give
full effect to the provisions of this Section 4.4.
ARTICLE V
TRUSTEES
SECTION 5.1 NUMBER OF TRUSTEES.
The number of Trustees initially shall be four (4), and:
(a) at any time before the issuance of any Securities,
the Sponsor may, by written instrument, increase or decrease the number of
Trustees; and
(b) after the issuance of any Securities, the number of
Trustees may be increased or decreased by vote of the holders of a majority
in liquidation amount of the Common Securities voting as a class at a meeting
of the Holders of the Common Securities; provided, however, that, the number
of Trustees shall in no event be less than two (2), provided further that (1)
one Trustee, shall meet the requirements of Section 5.2 (a) and (b); (2)
there shall be at least one Trustee who is an employee or officer of, or is
affiliated with the Sponsor (a "Regular Trustee"); and (3) one Trustee shall
be the Institutional Trustee for so long as this Declaration is required to
qualify as an indenture under the Trust Indenture Act, and such Institutional
Trustee may also serve as Delaware Trustee if it meets the applicable
requirements.
SECTION 5.2 DELAWARE TRUSTEE.
If required by the Business Trust Act, one Trustee (the
"Delaware Trustee") shall be:
(a) a natural person who is a resident of the State of
Delaware; or
(b) if not a natural person, an entity which has its
principal place of business in the State of Delaware, and otherwise meets the
requirements of applicable law, provided that, if the Institutional Trustee
has its principal place of business in the State of Delaware and otherwise
meets the requirements of applicable law, then the Institutional Trustee
shall also be the Delaware Trustee and Section 3.11 shall have no
application.
(c) The initial Delaware Trustee shall be:
" "
SECTION 5.3 INSTITUTIONAL TRUSTEE; ELIGIBILITY.
(a) There shall at all times be one Trustee which shall
act as Institutional Trustee for so long as this Declaration is required to
qualify as an Indenture under the Trust Indenture Act, 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 750 million U.S. dollars ($750,000,000), and subject to
supervision or examination by Federal, State, Territorial or District
of Columbia authority. If such corporation publishes reports of
condition at least annually, pursuant to law or to the requirements
of the supervising or examining authority referred to above, then for
the purposes of this Section 5.3(a)(ii), the combined capital and
surplus of such corporation shall be deemed to be its combined
capital and surplus as set forth in its most recent report of
condition so published.
(b) If at any time the Institutional Trustee shall cease
to be eligible to so act under Section 5.3(a), the Institutional Trustee
shall immediately resign in the manner and with the effect set forth in
Section 5.6(c).
(c) If the Institutional Trustee has or shall acquire
any "conflicting interest" within the meaning of Section 310(b) of the Trust
Indenture Act, the Institutional Trustee and the Holder of the 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 Preferred Securities Guarantee and the Indenture
shall be deemed to be specifically described in this Declaration and the
Indenture for purposes of clause (i) of the first proviso contained in
Section 310(b) of the Trust Indenture Act.
(e) The initial Institutional Trustee shall be:
" "
SECTION 5.4 CERTAIN QUALIFICATIONS OF REGULAR TRUSTEES
AND DELAWARE TRUSTEE GENERALLY.
Each Regular Trustee and the Delaware Trustee (unless the
Institutional Trustee also acts as Delaware Trustee) shall be either a
natural person who is at least 21 years of age or a legal entity that shall
act through one or more Authorized Officers.
SECTION 5.5 REGULAR TRUSTEES.
The initial Regular Trustees shall be:
_____________________________
_____________________________
(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, including any amendments
thereto, shall be signed by all of the Regular Trustees; and
(c) a 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 purposes of signing any documents that the
Regular Trustees have power and authority to cause the Trust to execute
pursuant to Section 3.6.
SECTION 5.6 APPOINTMENT, REMOVAL AND RESIGNATION OF
TRUSTEES.
(a) Subject to Section 5.6(b), Trustees may be appointed
or removed without cause at any time:
(i) until the issuance of any Securities, by written
instrument executed by the Sponsor; and
(ii) after the issuance of any Securities, by vote of
the Holders of a Majority in liquidation amount of the Common
Securities voting as a class at a meeting of the Holders of the
Common Securities.
(b) (i) The Trustee that acts as
Institutional Trustee shall not be removed in
accordance with Section 5.6(a) until a successor
Institutional Trustee possessing the qualifications
to act as Institutional Trustee under Sections 5.2
and 5.3 (a "Successor Institutional Trustee") has
been appointed and has accepted such appointment by
written instrument executed by such Successor
Institutional 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 5.6(a) until a successor
Trustee possessing the qualifications to act as Delaware Trustee
under Sections 5.2 and 5.4 (a "Successor Delaware Trustee") has been
appointed and has accepted such appointment by written instrument
executed by such Successor Delaware Trustee and delivered to the
Regular Trustees and the Sponsor.
(c) A Trustee appointed to office shall hold office
until such Trustee's successor shall have been appointed or until such
Trustee's 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 Institutional Trustee shall be effective:
(A) until a Successor Institutional Trustee has
been appointed and has accepted such appointment by
instrument executed by such Successor Institutional Trustee
and delivered to the Trust, the Sponsor and the resigning
Institutional Trustee; or
(B) until the assets of the Trust have been
completely liquidated and the proceeds thereof distributed
to the holders of the Securities; and
(ii) no such resignation of the Trustee that acts as
the Delaware Trustee shall be effective until a Successor Delaware
Trustee has been appointed and has accepted such appointment by
instrument executed by such Successor Delaware Trustee and delivered
to the Trust, the Sponsor and the resigning Delaware Trustee.
(d) The Holders of the Common Securities shall use all
reasonable efforts to promptly appoint a Successor Delaware Trustee or
Successor Institutional Trustee, as the case may be, if the Institutional
Trustee or the Delaware Trustee delivers an instrument of resignation in
accordance with this Section 5.6.
(e) If no Successor Institutional Trustee or Successor
Delaware Trustee shall have been appointed and accepted appointment as
provided in this Section 5.6 within 60 days after delivery to the Sponsor and
the Trust of an instrument of resignation, the resigning Institutional
Trustee or Delaware Trustee, as applicable, may petition any court of
competent jurisdiction for appointment of a Successor Institutional 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
Institutional Trustee or Successor Delaware Trustee, as the case may be.
(f) No Institutional Trustee or Delaware Trustee shall
be liable for the acts or omissions to act of any Successor Institutional
Trustee or Successor Delaware Trustee, as the case may be.
SECTION 5.7 VACANCIES AMONG TRUSTEES.
If a Trustee ceases to hold office for any reason and the
number of Trustees is not reduced pursuant to Section 5.1, or if the number
of Trustees is increased pursuant to Section 5.1, a vacancy shall occur. A
resolution certifying the existence of such vacancy by the Regular Trustees
or, if there are more than two Regular Trustees, a majority of the Regular
Trustees shall be conclusive evidence of the existence of such vacancy. The
vacancy shall be filled with a Trustee appointed in accordance with Section
5.6.
SECTION 5.8 EFFECT OF VACANCIES.
The death, resignation, retirement, removal, bankruptcy,
dissolution, liquidation, incompetence or incapacity to perform the duties of
a Trustee shall not operate to annul the Trust. Whenever a vacancy among the
Regular Trustees shall occur, until such vacancy is filled by the appointment
of a Regular Trustee in accordance with Section 5.6, the Regular Trustees in
office, regardless of their number, shall have all the powers granted to the
Regular Trustees and shall discharge all the duties imposed upon the Regular
Trustees by this Declaration.
SECTION 5.9 MEETINGS.
If there is more than one Regular Trustee, meetings of the
Regular Trustees shall be held from time to time upon the call of any Regular
Trustee. Regular meetings of the Regular Trustees may be held at a time and
place fixed by resolution of the Regular Trustees. Notice of any in-person
meetings of the Regular Trustees shall be hand delivered or otherwise
delivered in writing (including by facsimile, with a hard copy by overnight
courier) not less than 48 hours before such meeting. Notice of any telephonic
meetings of the Regular Trustees 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 (i) 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 (ii) without a meeting by the
unanimous written consent of the Regular Trustees. In the event there is only
one Regular Trustee, any and all action of such Regular Trustee shall be
evidenced by a written consent of such Regular Trustee.
SECTION 5.10 DELEGATION OF POWER.
(a) Any Regular Trustee may, by power of attorney
consistent with applicable law, delegate to any 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 5.11 MERGER, CONVERSION. CONSOLIDATION OR
SUCCESSION TO BUSINESS.
Any corporation into which the Institutional 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 Institutional 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
Institutional Trustee or the Delaware Trustee, as the case may be, shall be
the successor of the Institutional Trustee or the Delaware Trustee, as the
case may be, hereunder, provided such corporation shall be otherwise
qualified and eligible under this Article, without the execution or filing of
any paper or any further act on the part of any of the parties hereto.
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 DISTRIBUTIONS.
Holders shall receive Distributions (as defined herein) in
accordance with the applicable terms of the relevant Holder's Securities.
Distributions shall be made on the Preferred Securities and the Common
Securities in accordance with the preferences set forth in their respective
terms. If and to the extent that the Debenture Issuer makes a payment of
interest (including Compounded Interest (as defined in the Indenture) and
Additional Interest (as defined in the Indenture)), premium and/or principal
on the Debentures held by the Institutional Trustee (the amount of any such
payment being a "Payment Amount"), the Institutional Trustee shall and is
directed, to the extent funds are available for that purpose, to make a
distribution (a "Distribution") of the Payment Amount to Holders.
ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 GENERAL PROVISIONS REGARDING SECURITIES.
(a) The Regular Trustees shall, on behalf of the Trust,
issue one class of preferred securities representing undivided beneficial
interests in the assets of the Trust having such terms as are set forth in
Annex I (the "Preferred Securities") and one class of common securities
representing undivided beneficial interests in the assets of the Trust having
such terms as are set forth in Annex I (the "Common Securities"). The Trust
shall issue no securities or other interests in the assets of the Trust other
than the Preferred Securities and the Common Securities.
(b) The Certificates shall be signed on behalf of the
Trust by a Regular Trustee. Such signature shall be the manual or facsimile
signature of any present or any future Regular Trustee. In case any Regular
Trustee who shall have signed any of the Securities shall cease to be such
Regular Trustee before the Certificates so signed shall be delivered by the
Trust, such Certificates nevertheless may be delivered as though the person
who signed such Certificates had not ceased to be such Regular Trustee; and
any Certificate may be signed on behalf of the Trust by such persons who, at
the actual date of execution of such Certificate, shall be the Regular
Trustees of the Trust, although at the date of the execution and delivery of
the Declaration any such person was not such a Regular Trustee. Certificates
shall be printed, lithographed or engraved or may be produced in any other
manner as is reasonably acceptable to the Regular Trustees, as evidenced by
their execution thereof, and may have such letters, numbers or other marks of
identification or designation and such legends or endorsements as the Regular
Trustees may deem appropriate, or as may be required to comply with any law
or with any rule or regulation of any stock exchange on which Securities may
be listed, or to conform to usage.
(c) The consideration received by the Trust for the
issuance of the Securities shall constitute a contribution to the capital of
the Trust and shall not constitute a loan to the Trust.
(d) Upon issuance of the Securities as provided in this
Declaration, the Securities so issued shall be deemed to be validly issued,
fully paid and non-assessable.
(e) Every Person, by virtue of having become a Holder or
a Preferred Security Beneficial Owner in accordance with the terms of this
Declaration, shall be deemed to have expressly assented and agreed to the
terms of, and shall be bound by, this Declaration.
SECTION 7.2 PAYING AGENT.
In the event that the 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 Preferred
Securities may be presented for payment ("Paying Agent"), and any such Paying
Agent shall comply with Section 317(b) of the Trust Indenture Act. 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 Institutional
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 Institutional Trustee shall act as such. The Trust or any
of its Affiliates (including the Sponsor) may act as Paying Agent. The
Institutional Trustee shall initially act as Paying Agent for the Preferred
Securities and the Common Securities.
ARTICLE VIII
TERMINATION OF TRUST
SECTION 8.1 TERMINATION OF TRUST.
(a) The Trust shall terminate:
(i) upon a Termination Event;
(ii) upon the filing of a certificate of dissolution or
its equivalent with respect to the Sponsor; 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 Holder of the Common Securities, the Sponsor or the Trust;
(iv) upon the occurrence and continuation of an
Investment Company Event pursuant to which the Trust shall have been
dissolved in accordance with the terms of the Securities and all of
the Debentures endorsed thereon shall have been distributed to the
Holders of Securities in exchange for all of the Securities;
(v) when all the Securities shall have been called for
redemption and the amounts necessary for redemption thereof shall
have been paid to the Holders in accordance with the terms of the
Securities; or
(vi) 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 8.1(a) and upon completion of the winding-up of
the Trust and its termination, the Trustees shall file a certificate of
cancellation with the Secretary of State of the State of Delaware.
(c) The provisions of Section 4.4 and Article X shall
survive the termination of the Trust.
ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1 TRANSFER OF SECURITIES.
(a) Securities may only be transferred, in whole or in
part, in accordance with the terms and conditions set forth in this
Declaration and in the terms of the Securities. Any transfer or purported
transfer of any Security not made in accordance with this Declaration shall
be null and void.
(b) Subject to this Article IX, Preferred Securities
shall be freely transferable.
(c) Subject to this Article IX, the Sponsor and any
Related Party may only transfer Common Securities to the Sponsor or a Related
Party of the Sponsor; provided that, any such transfer is subject to the
condition precedent that the transferor obtain the written opinion of
nationally recognized independent counsel experienced in such matters that
such transfer would not cause more than an insubstantial risk that:
(i) the Trust would not be classified for United
States federal income tax purposes as a grantor trust; and
(ii) the Trust would be an Investment Company or the
transferee would become an Investment Company.
SECTION 9.2 TRANSFER 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 9.3 DEEMED SECURITY HOLDERS.
The Trustees may treat the Person in whose name any
Certificate shall be registered on the books and records of the Trust as the
sole holder of such Certificate and of the Securities represented by such
Certificate for purposes of receiving Distributions and for all other
purposes whatsoever and, accordingly, shall not be bound to recognize any
equitable or other claim to or interest in such Certificate or in the
Securities represented by such Certificate on the part of any Person, whether
or not the Trust shall have actual or other notice thereof.
SECTION 9.4 BOOK ENTRY INTERESTS.
The Preferred Securities Certificates, on original issuance,
in addition to being issued in the form of one or more definitive, fully
registered Preferred Securities Certificate (each a "Definitive Preferred
Securities Certificate") registered initially in the books and records of the
Trust in the name of The First National Bank of Chicago, as Purchase Contract
Agent, will be issued in the form of one or more, fully registered, global
Preferred Security Certificates (each a "Global Certificate"), to be
delivered to DTC, the initial Clearing Agency, by, or on behalf of, the
Trust. Such Global Certificate(s) shall initially be registered on the books
and records of the Trust in the name of Cede & Co., the nominee of DTC, and
no Preferred Security Beneficial Owner will receive a definitive Preferred
Security Certificate representing such Preferred Security Beneficial Owner's
interests in such Global Certificate(s), except as provided in Section 9.7.
Except for the Definitive Preferred Security Certificates as specified herein
and the definitive, fully registered Preferred Securities Certificates that
have been issued to the Preferred Security Beneficial Owners pursuant to
Section 9.7:
(a) the provisions of this Section 9.4 shall be in full
force and effect;
(b) the Trust and the Trustees shall be entitled to deal
with the Clearing Agency for all purposes of this Declaration (including the
payment of Distributions on the Global Certificate(s) and receiving
approvals, votes or consents hereunder) as the Holder of the Preferred
Securities and the sole holder of the Global Certificate(s) and shall have no
obligation to the Preferred Security Beneficial Owners;
(c) to the extent that the provisions of this Section
9.4 conflict with any other provisions of this Declaration, the provisions of
this Section 9.4 shall control; and
(d) the rights of the Preferred Security Beneficial
Owners shall be exercised only through the Clearing Agency and shall be
limited to those established by law and agreements between such Preferred
Security Beneficial Owners and the Clearing Agency and/or the Clearing Agency
Participants to receive and transmit payments of Distributions on the Global
Certificates to such Clearing Agency Participants. DTC 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
Preferred Securities have voted on any matter provided for in this
Declaration, so long as Definitive Preferred Security Certificates have not
been issued, the Trustees may conclusively rely on, and shall be protected in
relying on, any written instrument (including a proxy) delivered to the
Trustees by the Clearing Agency setting forth the 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 9.5 NOTICES TO CLEARING AGENCY.
Whenever a notice or other communication to the Preferred
Security Holders is required under this Declaration, unless and until
definitive fully registered Preferred Security Certificates shall have been
issued to the Preferred Security Beneficial Owners pursuant to Section 9.7 or
otherwise, the Regular Trustees shall give all such notices and
communications specified herein to be given to the Preferred Security Holders
to the Clearing Agency, and shall have no notice obligations to the Preferred
Security Beneficial Owners.
SECTION 9.6 APPOINTMENT OF SUCCESSOR CLEARING AGENCY.
If any Clearing Agency elects to discontinue its services as
securities depositary with respect to the Preferred Securities, the Regular
Trustees may, in their sole discretion, appoint a successor Clearing Agency
with respect to such Preferred Securities.
SECTION 9.7 DEFINITIVE PREFERRED SECURITY CERTIFICATES.
If:
(a) a Clearing Agency elects to discontinue its services
as securities depositary with respect to the Preferred Securities and a
successor Clearing Agency is not appointed within 90 days after such
discontinuance pursuant to Section 9.6; or
(b) the Regular Trustees elect after consultation with
the Sponsor to terminate the book entry system through the Clearing Agency
with respect to the Preferred Securities, then:
(c) definitive fully registered Preferred Security
Certificates shall be prepared by the Regular Trustees on behalf of the Trust
with respect to such Preferred Securities; and
(d) upon surrender of the Global Certificate(s) by the
Clearing Agency, accompanied by registration instructions, the Regular
Trustees shall cause definitive fully registered Preferred Securities
Certificates to be delivered to Preferred Security Beneficial Owners in
accordance with the instructions of the Clearing Agency. Neither the Trustees
nor the Trust shall be liable for any delay in delivery of such instructions
and each of them may conclusively rely on and shall be protected in relying
on, said instructions of the Clearing Agency. The definitive fully registered
Preferred Security Certificates shall be printed, lithographed or engraved or
may be produced in any other manner as is reasonably acceptable to the
Regular Trustees, as evidenced by their execution thereof, and may have such
letters, numbers or other marks of identification or designation and such
legends or endorsements as the Regular Trustees may deem appropriate, or as
may be required to comply with any law or with any rule or regulation made
pursuant thereto or with any rule or regulation of any stock exchange on
which Preferred Securities may be listed, or to conform to usage.
SECTION 9.8 MUTILATED, DESTROYED, LOST OR STOLEN
CERTIFICATES.
If:
(a) any mutilated Certificate 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
and the Trust harmless,
then, in the absence of notice that such Certificate shall have been acquired
by a bona fide purchaser, any Regular Trustee on behalf of the Trust shall
execute and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Certificate, a new Certificate of like
denomination. In connection with the issuance of any new Certificate under
this Section 9.8, the Regular Trustees may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed
in connection therewith. Any duplicate Certificate issued pursuant to this
Section shall constitute conclusive evidence of an ownership interest in the
relevant Securities, as if originally issued, whether or not the lost, stolen
or destroyed Certificate shall be found at any time.
ARTICLE X
LIMITATION OF LIABILITY OF HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 LIABILITY.
(a) Except as expressly set forth in this Declaration,
the Debentures, the Securities Guarantees and the terms of the Securities,
the Sponsor shall not be:
(i) personally liable for the return of any portion of
the capital contributions (or any return thereon) of the Holders of
the Securities, which shall be made solely from assets of the Trust;
or
(ii) required to pay to the Trust or to any Holder of
Securities any deficit upon dissolution of the Trust or otherwise.
(b) The Holder of the Common Securities shall be liable
for all of the debts and obligations of the Trust (other than with respect to
the Securities) to the extent not satisfied out of the Trust's assets.
(c) Pursuant to Section 3803(a) of the Business Trust
Act, the Holders of the Preferred Securities shall be entitled to the same
limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the
State of Delaware.
SECTION 10.2 EXCULPATION.
(a) No Indemnified Person shall be liable, responsible
or accountable in damages or otherwise to the Trust or any Covered Person for
any loss, damage or claim incurred by reason of any act or omission performed
or omitted by such Indemnified Person in good faith on behalf of the Trust
and in a manner such Indemnified Person reasonably believed to be within the
scope of the authority conferred on such Indemnified Person by this
Declaration or by law, except that an Indemnified Person shall be liable for
any such loss, damage or claim incurred by reason of such Indemnified
Person's gross negligence or willful misconduct with respect to such acts or
omissions.
(b) An Indemnified Person shall be fully protected in
relying in good faith upon the records of the Trust and upon such
information, opinions, reports or statements presented to the Trust by any
Person as to matters the Indemnified Person reasonably believes are within
such other Person's professional or expert competence and who has been
selected with reasonable care by or on behalf of the Trust, including
information, opinions, reports or statements as to the value and amount of
the assets, liabilities, profits, losses, or any other facts pertinent to the
existence and amount of assets from which Distributions to Holders of
Securities might properly be paid.
SECTION 10.3 FIDUCIARY DUTY.
(a) To the extent that, at law or in equity, an
Indemnified Person has duties (including fiduciary duties) and liabilities
relating thereto to the Trust or to any other Covered Person, an Indemnified
Person acting under this Declaration shall not be liable to the Trust or to
any other Covered Person for its good faith reliance on the provisions of
this Declaration. The provisions of this Declaration, to the extent that they
restrict the duties and liabilities of an Indemnified Person otherwise
existing at law or in equity (other than the duties imposed on the
Institutional Trustee under the Trust Indenture Act), are agreed by the
parties hereto to replace such other duties and liabilities of such
Indemnified Person.
(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises
between any Covered Persons; or
(ii) whenever this Declaration or any other agreement
contemplated herein or therein provides that an Indemnified Person
shall act in a manner that is, or provides terms that are, fair and
reasonable to the Trust or any Holder of Securities,
the Indemnified Person shall resolve such conflict of interest, take such
action or provide such terms, considering in each case the relative interest
of each party (including its own interest) to such conflict, agreement,
transaction or situation and the benefits and burdens relating to such
interests, any customary or accepted industry practices, and any applicable
generally accepted accounting practices or principles. In the absence of bad
faith by the Indemnified Person, the resolution, action or term so made,
taken or provided by the Indemnified Person shall not constitute a breach of
this Declaration or any other agreement contemplated herein or of any duty or
obligation of the Indemnified Person at law or in equity or otherwise.
(c) Whenever in this Declaration an Indemnified Person
is permitted or required to make a decision:
(i) in its "discretion" or under a grant of similar
authority, the Indemnified Person shall be entitled to consider such
interests and factors as it desires, including its own interests, and
shall have no duty or obligation to give any consideration to any
interest of or factors affecting the Trust or any other Person; or
(ii) in its "good faith" or under another express
standard, the Indemnified Person shall act under such express
standard and shall not be subject to any other or different standard
imposed by this Declaration or by applicable law.
SECTION 10.4 INDEMNIFICATION.
(a)
(i) The Sponsor shall indemnify, to the full extent
permitted by law, any Company Indemnified Person who was or is a
party or is threatened to be made a party to any threatened, pending
or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the
right of the Trust) by reason of the fact that he is or was a Company
Indemnified Person against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such action, suit or
proceeding if he acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of the Trust,
and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The termination
of any action, suit or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that the Company
Indemnified Person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests of
the Trust, and, with respect to any criminal action or proceeding,
had reasonable cause to believe that his conduct was unlawful.
(ii) The Sponsor shall indemnify, to the full extent
permitted by law, any Company Indemnified Person who was or is a
party or is threatened to be made a party to any threatened, pending
or completed action or suit by or in the right of the Trust to
procure a judgment in its favor by reason of the fact that he is or
was a Company Indemnified Person against expenses (including
attorneys' fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if
he acted in good faith and in a manner he reasonably believed to be
in or not opposed to the best interests of the Trust and except that
no such indemnification shall be made in respect of any claim, issue
or matter as to which such Company Indemnified Person shall have been
adjudged to be liable to the Trust unless and only to the extent that
the Court of Chancery of Delaware or the court in which such action
or suit was brought shall determine upon application that, despite
the adjudication of liability but in view of all the circumstances of
the case, such person is fairly and reasonably entitled to indemnity
for such expenses which such Court of Chancery or such other court
shall deem proper.
(iii) Any indemnification under paragraphs (i) and (ii)
of this Section 10.4(a) (unless ordered by a court) shall be made by
the Sponsor only as authorized in the specific case upon a
determination that indemnification of the Company Indemnified Person
is proper in the circumstances because he has met the applicable
standard of conduct set forth in paragraphs (i) and (ii). Such
determination shall be made (1) by the Regular Trustees by a majority
vote of a quorum consisting of such Regular Trustees who were not
parties to such action, suit or proceeding, (2) if such a quorum is
not obtainable, or, even if obtainable, if a quorum of disinterested
Regular Trustees so directs, by independent legal counsel in a
written opinion, or (3) by the Common Security Holder of the Trust.
(iv) Expenses (including attorneys' fees) incurred by a
Company Indemnified Person in defending a civil, criminal,
administrative or investigative action, suit or proceeding referred
to in paragraphs (i) and (ii) of this Section 10.4(a) shall be paid
by the Debenture Issuer in advance of the final disposition of such
action, suit or proceeding upon receipt of an undertaking by or on
behalf of such Company Indemnified Person to repay such amount if it
shall ultimately be determined that such person is not entitled to
be indemnified by the Debenture Issuer as authorized in this Section
10.4(a). Notwithstanding the foregoing, no advance shall be made by
the Debenture Issuer if a determination is reasonably and promptly
made (i) by the Regular Trustees by a majority vote of a quorum of
disinterested Regular Trustees, (ii) if such a quorum is not
obtainable, or, even if obtainable, if a quorum of disinterested
Regular Trustees so directs, by independent legal counsel in a
written opinion or (iii) the Common Security Holder of the Trust,
that, based upon the facts known to the Regular Trustees, independent
legal counsel or Common Security Holder at the time such
determination is made, such person acted in bad faith or in a manner
that such person did not believe to be in or not opposed to the best
interests of the Trust, or, with respect to any criminal proceeding,
that such Company Indemnified Person believed or had reasonable cause
to believe his conduct was unlawful. In no event shall any advance be
made in instances where the Regular Trustees, independent legal
counsel or Common Security Holder reasonably determine that such
person deliberately breached such person's duty to the Trust or its
Common or Preferred Security Holders.
(v) The indemnification and advancement of expenses
provided by, or granted pursuant to, the other paragraphs of this
Section 10.4(a) shall not be deemed exclusive of any other rights to
which those seeking indemnification and advancement of expenses may
be entitled under any agreement, vote of shareholders or
disinterested directors of the Sponsor or Preferred Security Holders
of the Trust or otherwise, both as to action in his official capacity
and as to action in another capacity while holding such office. All
rights to indemnification under this Section 10.4(a) shall be deemed
to be provided by a contract between the Sponsor and each Company
Indemnified Person who serves in such capacity at any time while this
Section 10.4(a) is in effect. Any repeal or modification of this
Section 10.4(a) shall not affect any rights or obligations then
existing.
(vi) The Sponsor or the Trust may purchase and maintain
insurance on behalf of any person who is or was a Company Indemnified
Person against any liability asserted against him and incurred by him
in any such capacity, or arising out of his status as such, whether
or not the Sponsor would have the power to indemnify him against such
liability under the provisions of this Section 10.4(a).
(vii) For purposes of this Section 10.4(a), references
to "the Trust" shall include, in addition to the resulting or
surviving entity, any constituent entity (including any constituent
of a constituent) absorbed in a consolidation or merger, so that any
person who is or was a director, trustee, officer or employee of such
constituent entity, or is or was serving at the request of such
constituent entity as a director, trustee, officer, employee or agent
of another entity, shall stand in the same position under the
provisions of this Section 10.4(a) with respect to the resulting or
surviving entity as such person would have with respect to such
constituent entity if its separate existence had continued.
(viii) The indemnification and advancement of expenses
provided by, or granted pursuant to, this Section 10.4(a) shall,
unless otherwise provided when authorized or ratified, continue as to
a person who has ceased to be a Company Indemnified Person and shall
inure to the benefit of the successors, heirs, executors and
administrators of such a person.
(b) The Sponsor agrees to indemnify the (i)
Institutional Trustee, (ii) the Delaware Trustee, (iii) any Affiliate of the
Institutional Trustee or the Delaware Trustee, and (iv) any officers,
directors, shareholders, members, partners, employees, representatives,
custodians, nominees or agents of the Institutional Trustee or the Delaware
Trustee (each of the Persons in (i) through (iv) being referred to as a
"Fiduciary Indemnified Person") for, and to hold each Fiduciary Indemnified
Person harmless against, any loss, liability or expense incurred without
gross negligence and, in the case of the Institutional Trustee, pursuant to
Section 3.9, negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of the trust or trusts
hereunder, including the costs and expenses (including reasonable legal fees
and expenses) of defending itself against or investigating any claim or
liability in connection with the exercise or performance of any of its powers
or duties hereunder. The provisions of this Section 10.4(b) shall survive the
satisfaction and discharge of this Declaration or the resignation or removal
of the Institutional Trustee or the Delaware Trustee, as the case may be.
SECTION 10.5 OUTSIDE BUSINESSES.
Any Covered Person, the Sponsor, the Delaware Trustee and
the Institutional Trustee may engage in or possess an interest in other
business ventures of any nature or description, independently or with others,
similar or dissimilar to the business of the Trust, and the Trust and the
Holders of Securities shall have no rights by virtue of this Declaration in
and to such independent ventures or the income or profits derived therefrom,
and the pursuit of any such venture, even if competitive with the business of
the Trust, shall not be deemed wrongful or improper. No Covered Person, the
Sponsor, the Delaware Trustee or the Institutional 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 Institutional 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 Institutional Trustee may engage or be
interested in any financial or other transaction with the Sponsor or any
Affiliate of the Sponsor, or may act as depositary for, trustee or agent for,
or act on any committee or body of holders of, securities or other
obligations of the Sponsor or its Affiliates.
ARTICLE XI
ACCOUNTING
SECTION 11.1 FISCAL YEAR.
The fiscal year ("Fiscal Year") of the Trust shall be the
calendar year, or such other year as is required by the Code.
SECTION 11.2 CERTAIN ACCOUNTING MATTERS.
(a) At all times during the existence of the Trust, the
Trust 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 Trust shall use the accrual
method of accounting for United States federal income tax purposes. The books
of account and the records of the Trust shall be examined by and reported
upon as of the end of each Fiscal Year of the Trust by a firm of independent
certified public accountants selected by the Regular Trustees.
(b) The Trust shall cause to be duly prepared and
delivered to each of the Holders of Securities, any annual United States
federal income tax information statement required by the Code, containing
such information with regard to the Securities held by each Holder as is
required by the Code and the Treasury Regulations. Notwithstanding any right
under the Code to deliver any such statement at a later date, the Trust shall
endeavor to deliver all such statements within 30 days after the end of each
Fiscal Year of the Trust.
(c) The Trust 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 Trust on behalf of the Trust with any state or local taxing
authority.
SECTION 11.3 BANKING.
The Trust shall maintain one or more bank accounts in the
name and for the sole benefit of the Trust; provided however, that all
payments of funds in respect of the Debentures held by the Institutional
Trustee shall be made directly to the Institutional Trustee Account and no
other funds of the Trust shall be deposited in the Institutional Trustee
Account. The sole signatories for such accounts shall be designated by the
Regular Trustees; provided, however, that the Institutional Trustee shall
designate the signatories for the Institutional Trustee Account.
SECTION 11.4 WITHHOLDING.
The Trust 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 Trust shall file required forms with applicable
jurisdictions and, unless an exemption from withholding is properly
established by a Holder, shall remit amounts withheld with respect to the
Holder to applicable jurisdictions. To the extent that the Trust is required
to withhold and pay over any amounts to any authority with respect to
distributions or allocations to any Holder, the amount withheld shall be
deemed to be a distribution in the amount of the withholding to the Holder.
In the event of any claimed over withholding, Holders shall be limited to an
action against the applicable jurisdiction. If the amount required to be
withheld was not withheld from actual Distributions made, the Trust may
reduce subsequent Distributions by the amount of such withholding.
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 AMENDMENTS.
(a) Except as otherwise provided in this Declaration or
by any applicable terms of the Securities, this Declaration may only be
amended by a written instrument approved and executed by the Regular Trustees
(or, if there are more than two Regular Trustees, a majority of the Regular
Trustees); and
(i) if the amendment affects the rights, powers,
duties, obligations or immunities of the Institutional Trustee, also
by the Institutional Trustee; and
(ii) if the amendment affects the rights, powers,
duties, obligations or immunities of the Delaware Trustee, also by
the Delaware Trustee;
(b) no amendment shall be made:
(i) unless, in the case of any proposed amendment, the
Institutional Trustee shall have first received an Officer's
Certificate from each of the Trust and the Sponsor that such
amendment is permitted by, and conforms to, the terms of this
Declaration (including the terms of the Securities);
(ii) unless, in the case of any proposed amendment
which affects the rights, powers, duties, obligations or immunities
of the Institutional Trustee, the Institutional Trustee shall have
first received:
(A) an Officer's Certificate from each of the
Trust and the Sponsor that such amendment is permitted by,
and conforms to, the terms of this Declaration (including
the terms of the Securities); and
(B) an opinion of counsel (who may be counsel
to the Sponsor or the Trust) that such amendment is
permitted by, and conforms to, the terms of this Declaration
(including the terms of the Securities); and
(iii) to the extent the result of such amendment would
be to:
(A) cause the Trust to fail to continue to be
classified for purposes of United States federal income
taxation as a grantor trust;
(B) reduce or otherwise adversely affect the
powers of the Institutional Trustee in contravention of the
Trust Indenture Act; or
(C) cause the Trust to be deemed to be an
Investment Company required to be registered under the
Investment Company Act;
(c) at such time after the Trust has issued any
Securities that remain outstanding, any amendment that would materially and
adversely affect the rights, privileges or preferences of any Holder of
Securities may be effected only with such additional requirements as may be
set forth in the terms of such Securities;
(d) Section 9.1(c) and this Section 12.1 shall not be
amended without the consent of all of the Holders of the Securities;
(e) Article IV shall not be amended without the consent
of the Holders of a Majority in liquidation amount of the Common Securities;
(f) the rights of the holders of the Common Securities
under Article V to increase or decrease the number of, and appoint and remove
Trustees shall not be amended without the consent of the Holders of a
Majority in liquidation amount of the Common Securities; and
(g) notwithstanding Section 12.1(c), this Declaration
may be amended without the consent of the Holders of the Securities to:
(i) cure any ambiguity;
(ii) correct or supplement any provision in this
Declaration that may be defective or inconsistent with any other
provision of this Declaration;
(iii) add to the covenants, restrictions or obligations
of the Sponsor;
(iv) to conform to any change in Rule 3a-5 or written
change in interpretation or application of Rule 3a-5 by any
legislative body, court, government agency or regulatory authority
which amendment does not have a material adverse effect on the right,
preferences or privileges of the Holders;
(v) to modify, eliminate and add to any provision of
the Declaration to such extent as may be necessary; and
(vi) cause the Trust to continue to be classified for
United States federal income tax purposes as a grantor trust.
SECTION 12.2 MEETINGS OF THE HOLDERS OF SECURITIES;
ACTION BY WRITTEN CONSENT.
(a) Meetings of the Holders of any class of Securities
may be called at any time by the Regular Trustees (or as provided in the
terms of the Securities) to consider and act on any matter on which Holders
of such class of Securities are entitled to act under the terms of this
Declaration, the terms of the Securities or the rules of any stock exchange
on which the Preferred Securities are listed or admitted for trading. The
Regular Trustees shall call a meeting of the Holders of such class if
directed to do so by the Holders of at least 10% in liquidation amount of
such class of Securities. Such direction shall be given by delivering to the
Regular Trustees one or more calls in a writing stating that the signing
Holders of Securities wish to call a meeting and indicating the general or
specific purpose for which the meeting is to be called. Any Holders of
Securities calling a meeting shall specify in writing the Security
Certificates held by the Holders of Securities exercising the right to call a
meeting and only those Securities specified shall be counted for purposes of
determining whether the required percentage set forth in the second sentence
of this paragraph has been met.
(b) Except to the extent otherwise provided in the terms
of the Securities, the following provisions shall apply to meetings of
Holders of Securities:
(i) notice of any such meeting shall be given to all
the Holders of Securities having a right to vote thereat at least 7
days and not more than 60 days before the date of such meeting.
Whenever a vote, consent or approval of the Holders of Securities is
permitted or required under this Declaration, the terms of the
Securities or the rules of any stock exchange on which the Preferred
Securities are listed or admitted for trading, such vote, consent or
approval may be given at a meeting of the Holders of Securities. Any
action that may be taken at a meeting of the Holders of Securities
may be taken without a meeting if a consent in writing setting forth
the action so taken is signed by the Holders of Securities owning not
less than the minimum amount of Securities in liquidation amount that
would be necessary to authorize or take such action at a meeting at
which all Holders of Securities having a right to vote thereon were
present and voting. Prompt notice of the taking of action without a
meeting shall be given to the Holders of Securities entitled to vote
who have not consented in writing. The Regular Trustees may specify
that any written ballot submitted to the Security 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 Security may authorize any Person
to act for it by proxy on all matters in which a Holder of Securities
is entitled to participate, including waiving notice of any meeting,
or voting or participating at a meeting. No proxy shall be valid
after the expiration of 11 months from the date thereof unless
otherwise provided in the proxy. Every proxy shall be revocable at
the pleasure of the Holder of Securities executing 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 Securities were stockholders of a
Delaware corporation;
(iii) each meeting of the Holders of the Securities
shall be conducted by the Regular Trustees or by such other Person
that the Regular Trustees may designate; and
(iv) unless the Business Trust Act, this Declaration,
the terms of the Securities, the Trust Indenture Act or the listing
rules of any stock exchange on which the Preferred Securities are
then listed or trading otherwise provides, the Regular Trustees, in
their sole discretion, shall establish all other provisions relating
to meetings of Holders of Securities, including notice of the time,
place or purpose of any meeting at which any matter is to be voted on
by any Holders of Securities, waiver of any such notice, action by
consent without a meeting, the establishment of a record date, quorum
requirements, voting in person or by proxy or any other matter with
respect to the exercise of any such right to vote.
ARTICLE XIII
REPRESENTATIONS OF INSTITUTIONAL TRUSTEE AND DELAWARE TRUSTEE
SECTION 13.1 REPRESENTATIONS AND WARRANTIES OF
INSTITUTIONAL TRUSTEE.
The Trustee that acts as initial Institutional Trustee
represents and warrants to the Trust and to the Sponsor at the date of this
Declaration, and each Successor Institutional Trustee represents and warrants
to the Trust and the Sponsor at the time of the Successor Institutional
Trustee's acceptance of its appointment as Institutional Trustee, that:
(a) the Institutional Trustee is a national banking
association with trust powers, duly organized, validly existing and in good
standing under the laws of the United States of America, with trust power and
authority to execute and deliver, and to carry out and perform its
obligations under the terms of, the Declaration;
(b) the Institutional Trustee satisfies the requirements
set forth in Section 5.3(a);
(c) the execution, delivery and performance by the
Institutional Trustee of the Declaration has been duly authorized by all
necessary corporate action on the part of the Institutional Trustee. The
Declaration has been duly executed and delivered by the Institutional
Trustee, and it constitutes a legal, valid and binding obligation of the
Institutional Trustee, enforceable against it in accordance with its terms,
subject to applicable bankruptcy, reorganization, moratorium, insolvency, and
other similar laws affecting creditors' rights generally and to general
principles of equity and the discretion of the court (regardless of whether
the enforcement of such remedies is considered in a proceeding in equity or
at law);
(d) the execution, delivery and performance of the
Declaration by the Institutional Trustee does not conflict with or constitute
a breach of the Articles of Organization or By-laws of the Institutional
Trustee; and
(e) no consent, approval or authorization of, or
registration with or notice to, any State or Federal banking authority is
required for the execution, delivery or performance by the Institutional
Trustee, of the Declaration.
SECTION 13.2 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, 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 execution, delivery and performance by the
Delaware Trustee of the Declaration has been duly authorized by all necessary
corporate action on the part of the Delaware Trustee. The Declaration has
been duly executed and delivered by the Delaware Trustee, and it 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 execution, delivery and performance of the
Declaration by the Delaware Trustee does not conflict with or constitute a
breach of the Articles of Organization or By-laws of the Delaware Trustee;
and
(e) The Delaware Trustee is a natural person who is a
resident of the State of Delaware or, if not a natural person, an entity
which has its principal place of business in the State of Delaware.
ARTICLE XIV
MISCELLANEOUS
SECTION 14.1 NOTICES.
All notices provided for in this Declaration shall be in
writing, duly signed by the party giving such notice, and shall be delivered,
telecopied or mailed by registered or certified mail, as follows:
(a) if given to the Trust, in care of the Regular
Trustees at the Trust's mailing address set forth below (or such other
address as the Trust may give notice of to the Holders of the Securities):
Ingersoll-Rand Financing I
c/o Ingersoll-Rand Company
200 Chestnut Ridge Road
Woodcliff, New Jersey 07675
(b) if given to the Delaware Trustee, at the mailing
address set forth below (or such other address as Delaware Trustee may give
notice of to the Holders of the Securities):
" "
(c) if given to the Institutional Trustee, at its
Corporate Trust Office to the attention of Corporate Trust Administration (or
such other address as the Institutional Trustee may give notice of to the
Holders of the Securities):
" "
(d) if given to the Holder of the Common Securities, at
the mailing address of the Sponsor set forth below (or such other address as
the Holder of the Common Securities may give notice to the Trust):
Ingersoll-Rand Company
200 Chestnut Ridge Road
Woodcliff, New Jersey 07675
Attn: Corporate Secretary
(e) if given to any other Holder, at the address set
forth on the books and records of the Trust.
All such notices shall be deemed to have been given when
received in person, telecopied with receipt confirmed, or mailed by first
class mail, postage prepaid except that if a notice or other document is
refused delivery or cannot be delivered because of a changed address of which
no notice was given, such notice or other document shall be deemed to have
been delivered on the date of such refusal or inability to deliver.
SECTION 14.2 GOVERNING LAW.
This Declaration and the rights of the parties hereunder
shall be governed by and interpreted in accordance with the laws of the State
of Delaware and all rights and remedies shall be governed by such laws
without regard to principles of conflict of laws.
SECTION 14.3 INTENTION OF THE PARTIES.
It is the intention of the parties hereto that the Trust be
classified for United States federal income tax purposes as a grantor trust.
The provisions of this Declaration shall be interpreted to further this
intention of the parties.
SECTION 14.4 HEADINGS.
Headings contained in this Declaration are inserted for
convenience of reference only and do not affect the interpretation of this
Declaration or any provision hereof.
SECTION 14.5 SUCCESSORS AND ASSIGNS.
Whenever in this Declaration any of the parties hereto is
named or referred to, the successors and assigns of such party shall be
deemed to be included, and all covenants and agreements in this Declaration
by the Sponsor and the Trustees shall bind and inure to the benefit of their
respective successors and assigns, whether so expressed.
SECTION 14.6 PARTIAL ENFORCEABILITY.
If any provision of this Declaration, or the application of
such provision to any Person or circumstance, shall be held invalid, the
remainder of this Declaration, or the application of such provision to
persons or circumstances other than those to which it is held invalid, shall
not be affected thereby.
SECTION 14.7 COUNTERPARTS.
This Declaration may contain more than one counterpart of
the signature page and this Declaration may be executed by the affixing of
the signature of each of the Trustees to one of such counterpart signature
pages. All of such counterpart signature pages shall be read as though one,
and they shall have the same force and effect as though all of the signers
had signed a single signature page.
IN WITNESS WHEREOF, the undersigned has caused these
presents to be executed as of the day and year first above written.
_____________________________________
, as Regular Trustee
_____________________________________
, as Regular Trustee
" ",
as Delaware Trustee
By___________________________________
Name_________________________________
Title________________________________
" ",
as Institutional Trustee
By___________________________________
Name_________________________________
Title________________________________
INGERSOLL-RAND COMPANY,
as Sponsor
By___________________________________
Name_________________________________
Title________________________________
ANNEX I
TERMS AND CONDITIONS OF
____% TRUST ORIGINATED PREFERRED SECURITIES
____% TRUST ORIGINATED COMMON SECURITIES
Pursuant to Section 7.1 of the Amended and Restated
Declaration of Trust, dated as of March __, 1998 (as amended from time to
time, the "Declaration"), the designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Preferred Securities and
the Common Securities are set out below (each capitalized term used but not
defined herein has the meaning set forth in the Declaration or, if not
defined in the Declaration, as defined in the Prospectus referred to below):
1. Designation and Number.
(a) Preferred Securities. 3,500,000 Preferred
Securities of the Trust, with an aggregate liquidation amount with respect to
the assets of the Trust of Three Hundred Fifty Million Dollars ($350,000,000)
and a liquidation amount with respect to the assets of the Trust of $10 per
preferred security, are hereby designated for the purposes of identification
only as "____% Trust Originated Preferred Securities" (the "Preferred
Securities"). The Preferred Security Certificates evidencing the Preferred
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 applicable law or the rules of any stock exchange on
which the Preferred Securities are listed or to conform to ordinary usage,
custom or practice.
(b) Common Securities. Common Securities of the Trust,
with an aggregate liquidation amount with respect to the assets of the Trust
of One Million Eighty-Two Thousand Five Hundred Dollars ($1,082,500) and a
liquidation amount with respect to the assets of the Trust of $10 per common
security, are hereby designated for the purposes of identification only as
"____% Trust Originated Common Securities" (the "Common Securities"). The
Common Security Certificates evidencing the Common Securities shall be
substantially in the form of Exhibit A-2 to the Declaration, with such
changes and additions thereto or deletions therefrom as may be required by
applicable law or to conform to ordinary usage, custom or practice.
2. Distributions.
(a) Distributions payable on each Security will be fixed
initially at a rate per annum of ____% (the "Coupon Rate") of the stated
liquidation amount of $10 per Security until ________ 15, 2001, and at the
Reset Rate thereafter, such rates being the rates of interest payable on the
Debentures to be held by the Institutional Trustee. Distributions in arrears
for more than one quarter will bear interest thereon compounded quarterly at
the rate of ____% until February 15, 2001, and at the Reset Rate thereafter
(to the extent permitted by applicable law). The term "Distributions" as used
herein includes such cash distributions and any such interest payable unless
otherwise stated. A Distribution is payable only to the extent that payments
are made in respect of the Debentures held by the Institutional Trustee and
to the extent the Institutional Trustee has funds available therefor. 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 consisting of
twelve 30-day months, and for any period shorter than a full quarterly
Distribution period for which Distributions are computed, Distributions will
be computed on the basis of the actual number of days elapsed per 30-day
month.
(b) Distributions on the Securities will be cumulative,
will accrue from March __, 1998, and will be payable quarterly in arrears, on
February 16, May 16, August 16 and November 16 of each year, commencing on
16, 1998, except as otherwise described below. The Debenture
Issuer has the right under the Indenture to defer payments of interest by
extending the interest payment period from time to time on the Debentures for
a period not extending, in the aggregate, beyond the maturity date of the
Debentures (each an "Extension Period"). During such Extension Period no
interest shall be due and payable on the Debentures. As a consequence of such
deferral, Distributions will also be deferred. Despite such deferral,
quarterly Distributions will continue to accrue with interest thereon at the
rate of ____% until February 15, 2001, and at the Reset Rate thereafter,
compounded quarterly during any such Extension Period (to the extent
permitted by applicable law). Payments of accrued Distributions will be
payable to Holders as they appear on the books and records of the Trust on
the first record date after the end of the Extension Period. Upon the
termination of any Extension Period and the payment of all amounts then due,
the Debenture Issuer may commence a new Extension Period; provided that such
Extension Period together with all such previous and further extensions
thereof may not exceed beyond the maturity date of the Debentures.
(c) Distributions on the Securities will be payable to
the Holders thereof as they appear on the books and records of the Trust at
the close of business on the Business Day immediately preceding each of the
relevant payment dates on the Securities. Subject to any applicable laws and
regulations and the provisions of the Declaration, each such payment in
respect of the Preferred Securities will be made as described under the
heading "Description of the Trust Preferred Securities -- Book Entry Only
Issuance -The Depository Trust Company" in the Prospectus Supplement dated
March __, 1998 to the Prospectus dated January __, 1998 (collectively, the
"Prospectus") of the Trust relating to the Registration Statement on Form S-3
(file no. 333- __________) of the Sponsor and the Trust. The relevant record
dates for the Common Securities shall be the same record date as for the
Preferred Securities. If the Preferred Securities shall not continue to
remain in book-entry only form or are not in book-entry only form at
issuance, the relevant record dates for the Preferred Securities, shall
conform to the rules of any securities exchange on which the securities are
listed and, if none, as shall be selected by the Regular Trustees, which
dates shall be at least more than one, but less than 60 Business Days before
the relevant payment dates, which payment dates correspond to the interest
payment dates on the Debentures. Distributions payable on any Securities that
are not punctually paid on any Distribution payment date, as a result of the
Debenture Issuer having failed to make a payment under the Debentures, will
cease to be payable to the Person in whose name such Securities are
registered on the relevant record date, and such defaulted Distribution will
instead be payable to the Person in whose name such Securities are registered
on the special record date or other specified date determined in accordance
with the Indenture. If any date on which Distributions are payable on the
Securities is not a Business Day, then payment of the Distribution payable on
such date will be made on the next succeeding day that is a Business Day (and
without any interest or other payment in respect of any such delay) except
that, if such Business Day is in the next succeeding calendar year, 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. So long as the Holder
of any Preferred Securities is the Collateral Agent, the payment of
Distributions on such Preferred Securities held by the Collateral Agent will
be made at such place and to such account as may be designated by the
Collateral Agent.
(d) The Coupon Rate on the Securities (as well as the
interest rate on the Debentures) will be reset on the third Business Day
immediately preceding the Purchase Contract Settlement Date to the Reset Rate
(which reset Rate will be in effect on and after the Purchase Contract
Settlement Date). On the Reset Announcement Date, the Reset Spread and the
Two-Year Benchmark Treasury to be used to determine the Reset Rate will be
announced by the Sponsor. On the Business Day immediately following the
Reset Announcement Date, the Holders of Securities will be notified of such
Reset Spread and Two-Year Benchmark Treasury by the Sponsor. Such notice
shall be sufficiently given to Holders of Securities if published in an
Authorized Newspaper.
(e) Not later than 7 calendar days nor more than 15
calendar days prior to the Reset Announcement Date, the Sponsor will notify
DTC (as defined herein) or its nominee (or any successor Clearing Agency or
its nominee) by first-class mail, postage prepaid, to notify the Preferred
Security Beneficial Owner or Clearing Agency Participants holding Preferred
Securities, Income PRIDES or Growth PRIDES, of such Reset Announcement Date
and the procedures to be followed by such Holders of Income PRIDES who intend
to settle their obligation under the Purchase Contract with separate cash.
(f) In the event that there is any money or other
property held by or for the Trust that is not accounted for hereunder, such
property shall be distributed Pro Rata (as defined herein) among the Holders
of the Securities.
3. Liquidation Distribution Upon Dissolution.
In the event of any voluntary or involuntary dissolution of
the Trust (unless a Tax Event Redemption has occurred), the Holders of the
Securities on the date of the dissolution will be entitled to receive out of
the assets of the Trust, after satisfaction of liabilities to creditors,
Debentures in an aggregate principal amount equal to the aggregate stated
liquidation amount of such Securities, with an interest rate equal to the
rate of ____%, if on or prior to 15, 2001, and the Reset Rate
thereafter, and bearing accrued and unpaid interest in an amount equal to the
accrued and unpaid Distributions on such Securities and which shall be
distributed on a Pro Rata basis to the Holders of the Securities in exchange
for such Securities (such amount being "Liquidation Distribution").
If, upon any such dissolution, the Liquidation Distribution
can be paid only in part because the Trust has insufficient assets available
to pay in full the aggregate Liquidation Distribution, then the amounts
payable directly by the Trust on the Securities shall be paid on a Pro Rata
basis.
4. Redemption and Distribution.
(a) Upon the redemption of the Debentures in whole (but
not in part), at maturity, the proceeds from such redemption shall, after
satisfaction of liabilities to creditors, be simultaneously applied to redeem
Securities having an aggregate liquidation amount equal to the aggregate
principal amount of the Debentures so redeemed at a redemption price of $10
per Security plus an amount equal to accrued and unpaid Distributions thereon
at the date of the repayment, payable in cash.
(b) If an Investment Company Event (as defined herein)
shall occur and be continuing the Regular Trustees shall dissolve the Trust
and, after satisfaction of liabilities to creditors, cause Debentures held by
the Institutional Trustee, having an aggregate principal amount equal to the
aggregate stated liquidation amount of, with an interest rate the rate of
____%, if on or prior to 15, 2001, and the Reset Rate thereafter,
and accrued and unpaid interest equal to accrued and unpaid Distributions on,
and having the same record date for payment as the Securities, to be
distributed to the Holders of the Securities in liquidation of such Holders'
interests in the Trust on a Pro Rata basis, within 90 days following the
occurrence of such Investment Company Event (the "90 Day Period"); provided,
however, that, if at the time there is available to the Trust the opportunity
to eliminate, within the 90 Day Period, the Investment Company Event by
taking some ministerial action, such as filing a form or making an election,
or pursuing some other similar reasonable measure that will have no adverse
effect on the Trust, the Debenture Issuer, the Sponsor or the Holders of the
Securities and will involve no material cost ("Ministerial Action"), the
Regular Trustees will pursue such Ministerial Action in lieu of dissolution.
"Investment Company Event" means that the Regular Trustees
shall have received an opinion of independent counsel experienced in practice
under the Investment Company Act (an "Investment Company Event Opinion") to
the effect that, as a result of the occurrence of a change in law or
regulation or a written change in interpretation or application of law or
regulation by any legislative body, court, governmental agency or regulatory
authority (a "Change in 1940 Act Law"), which Change in 1940 Act Law becomes
effective on or after the date of the Prospectus, there is a more than an
insubstantial risk that the Trust is or will be considered an Investment
Company which is required to be registered under the Investment Company Act.
(c) If a Tax Event shall occur and be continuing, the
Debentures are redeemable at the option of the Debenture Issuer, in whole but
not in part, on not less than 30 days nor more than 60 days notice ("Tax
Event Redemption"). If the Debenture Issuer redeems the Debentures upon the
occurrence and continuance of a Tax Event, the proceeds from such redemption
shall simultaneously be applied by the Institutional Trustee to redeem the
Securities having an aggregate stated liquidation amount equal to the
aggregate principal amount of the Debentures so redeemed at a redemption
price (the "Redemption Price"), per Security, equal to the Redemption Amount
plus any accumulated and unpaid distributions thereon to the date of such
redemption. If, following the occurrence of a Tax Event, the Debenture
Issuer exercises its option to redeem the Debentures, the Debenture Issuer
shall appoint the Quotation Agent to assemble the Treasury Portfolio in
consultation with the Company. The Institutional Trustee will distribute, to
the record Holder of the Securities the Redemption Price payable in
liquidation of such Holder's interests in the Trust.
"Tax Event" means the receipt by the Regular Trustees of an
opinion of a nationally recognized independent tax counsel experienced in
such matters to the effect that, as a result of (a) any amendment to, or
change (including any announced prospective change) in, the laws (or any
regulations thereunder) of the United States or any political subdivision or
taxing authority thereof or therein affecting taxation, (b) any amendment to
or change in an interpretation or application of such laws or regulations by
any legislative body, court, governmental agency or regulatory authority or
(c) any interpretation or pronouncement that provides for a position with
respect to such laws or regulations that differs from the generally accepted
position on the date the Securities are issued, which amendment or change is
effective or which interpretation or pronouncement is announced on or after
the date of issuance of the Securities under the Declaration, there is more
than an insubstantial risk that (i) interest payable by the Debenture Issuer
on the Debentures would not be deductible, in whole or in part, by the
Debenture Issuer for federal income tax purposes or (ii) the Trust would be
subject to more than a de minimis amount of other taxes, duties or other
governmental charges.
"Treasury Portfolio" means, with respect to the Applicable
Principal Amount of Debentures (a) if the Tax Event Redemption Date occurs
prior to 16, 2001, a portfolio of zero-coupon U.S. Treasury
Securities consisting of (i) principal or interest strips of U.S. Treasury
Securities which mature on or prior to 15, 2001 in an
aggregate amount equal to the Applicable Principal Amount and (ii) with
respect to each scheduled interest payment date on the Debentures that occurs
after the Tax Event Redemption Date, principal or interest strips of U.S.
Treasury Securities which mature on or prior to such date in an aggregate
amount equal to the aggregate interest payment that would be due on the
Applicable Principal Amount of the Debentures on such date, and (b) if the
Tax Event Redemption Date occurs after February 16, 2001, a portfolio of
zero-coupon U.S. Treasury Securities consisting of (i) principal or interest
strips of U.S. Treasury Securities which mature on or prior to
15, 2003 in an aggregate amount equal to the Applicable
Principal Amount and (ii) with respect to each scheduled interest payment
date on the Debentures that occurs after the Tax Event Redemption Date,
principal or interest strips of such U.S. Treasury Securities which mature on
or prior to such date in an aggregate amount equal to the aggregate interest
payment that would be due on the Applicable Principal Amount of the Deben-
tures on such date.
"Applicable Ownership Interest" means, with respect to an
Income PRIDES and the U.S. Treasury Securities in the Treasury Portfolio, (A)
a 1/100, or 1%, undivided beneficial ownership interest in a $1,000 principal
or interest amount of a principal or interest strip in a U.S. Treasury
Security included in such Treasury Portfolio which matures on or prior to
15, 2001 and (B) for each scheduled interest payment date on
the Debentures that occurs after the Tax Event Redemption Date, a _________%
undivided beneficial ownership interest in a $1,000 face amount of such U.S.
Treasury Security which is a principal or interest strip maturing on such
date.
"Applicable Principal Amount" means either (i) if the Tax
Event Redemption Date occurs prior to 16, 2001, the aggregate
principal amount of the Debentures corresponding to the aggregate stated
liquidation amount of the Preferred Securities which are components of Income
PRIDES on the Tax Event Redemption Date or (ii) if the Tax Event Redemption
occurs on or after 16, 2001, the aggregate principal amount of
the Debentures corresponding to the aggregate stated liquidation amount of
the Preferred Securities outstanding on such Tax Event Redemption Date.
"Redemption Amount" means for each Debenture, the product of
(i) the principal amount of such Debenture and (ii) a fraction whose
numerator is the Treasury Portfolio Purchase Price and whose denominator is
the Applicable Principal Amount.
"Treasury Portfolio Purchase Price" means the lowest
aggregate price quoted by a primary U.S. government securities dealer in New
York City (a "Primary Treasury Dealer") to the Quotation Agent on the third
Business Day immediately preceding the Tax Event Redemption Date for the
purchase of the Treasury Portfolio for settlement on the Tax Event Redemption
Date.
"Quotation Agent" means (i) Merrill Lynch Government
Securities, Inc. and its respective successors, provided, however, that if
the foregoing shall cease to be a Primary Treasury Dealer, the Sponsor shall
substitute therefor another Primary Treasury Dealer and (ii) any other
Primary Treasury Dealer selected by the Sponsor.
On and from the date fixed by the Regular Trustees for a Tax
Event Redemption or any distribution of Debentures and dissolution of the
Trust: (i) the Securities will no longer be deemed to be outstanding, (ii)
The Depository Trust Company ("DTC") or its nominee (or any successor
Clearing Agency or its nominee) or the record Holder of the Preferred
Securities, will receive a registered global certificate or certificates
representing the Debentures to be delivered upon such distribution and any
certificates representing Securities, except for certificates representing
Preferred Securities held by DTC or its nominee (or any successor Clearing
Agency or its nominee), will be deemed to represent beneficial interests in
the Debentures having an aggregate principal amount equal to the aggregate
stated liquidation amount of $10, with an interest rate of ____% if on or
prior to 15, 2001, and at the Reset Rate thereafter, and
accrued and unpaid interest equal to accrued and unpaid Distributions on such
Securities until such certificates are presented to the Debenture Issuer or
its agent for transfer or reissue.
5. Redemption or Distribution Procedures.
(a) Notice of any redemption (other then in connection
with the maturity of the Debentures) of, or notice of distribution of
Debentures in exchange for, the Securities (a "Redemption/Distribution
Notice") will be given by the Trust by mail to each Holder of 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 Tax Event Redemption Date. For purposes of the
calculation of the date of redemption or exchange and the dates on which
notices are given pursuant to this Section 5(a), 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 Securities. Each
Redemption/Distribution Notice shall be addressed to the Holders of
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) If Securities are to be redeemed and the Trust gives
a Redemption/Distribution Notice, which notice may only be issued if the
Debentures are redeemed as set out in this Section 5 (such notice will be
irrevocable), then (A) while the Preferred Securities are in book-entry only
form, with respect to the Preferred Securities, by 12:00 noon, New York City
time, on the redemption date, provided that the Debenture Issuer has paid the
Institutional Trustee a sufficient amount of cash in connection with the
related redemption or maturity of the Debentures, the Institutional Trustee
will deposit irrevocably with DTC or its nominee (or any successor Clearing
Agency or its nominee) funds sufficient to pay the applicable Redemption
Price with respect to the Preferred Securities and will give DTC irrevocable
instructions and authority to pay the Redemption Price to the Holders of the
Preferred Securities so called for redemption, and (B) with respect to
Preferred Securities issued in definitive form and Common Securities,
provided that the Debenture Issuer has paid the Institutional Trustee a
sufficient amount of cash in connection with the related redemption or
maturity of the Debentures, the Institutional Trustee will pay the relevant
Redemption Price to the Holders of such Securities by check mailed to the
address of the relevant Holder appearing on the books and records of the
Trust. Notwithstanding the foregoing, so long as the Holder of any Preferred
Securities is the Collateral Agent or the Purchase Contract Agent, the
payment of the Redemption Price in respect of such Preferred Securities held
by the Collateral Agent or the Purchase Contract Agent shall be made no later
than 12:00 noon, New York City time, on the Tax Event Redemption Date by
check or wire transfer in immediately available funds at such place and to
such account as may be designated by the Collateral Agent or the Purchase
Contract Agent. If a Redemption/Distribution Notice shall have been given
and funds deposited as required, if applicable, then immediately prior to the
close of business on the date of such deposit, or on the redemption date, as
applicable, distributions will cease to accrue on the Securities so redeemed
and all rights of Holders of such Securities so called for redemption will
cease, except the right of the Holders of such Securities to receive the
Redemption Price, but without interest on such Redemption Price. Neither the
Regular Trustees nor the Trust shall be required to register or cause to be
registered the transfer of any Securities that have been so called for
redemption. If any date fixed for redemption of Securities is not a Business
Day, then payment of the Redemption Price payable on such date will be made
on the next succeeding day that 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 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 repayment. If payment of the Redemption Price in
respect of any Securities is improperly withheld or refused and not paid
either by the Institutional Trustee or by the Sponsor as guarantor pursuant
to the relevant Securities Guarantee, Distributions on such Securities will
continue to accrue 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 repayment for purposes of calculating the Redemption Price.
(c) Redemption/Distribution Notices shall be sent by the
Trust to (A) in respect of the Preferred Securities, the DTC or its nominee
(or any successor Clearing Agency or its nominee) if the Global Certificates
have been issued or, if Definitive Preferred Security Certificates have been
issued, to the Holder thereof, and (B) in respect of the Common Securities,
to the Holder thereof.
(d) Subject to the foregoing and applicable law
(including, without limitation, United States federal securities laws) the
Sponsor or any of its subsidiaries may at any time and from time to time
purchase outstanding Preferred Securities by tender, in the open market or by
private agreement.
6. Repayment at Option of Holders.
(a) If a Failed Remarketing (as described in Section
5.4(b) of the Purchase Contract Agreement and incorporated herein by
reference) has occurred, each holder of Securities who holds such Securities
on the day immediately following the Purchase Contract Settlement Date, shall
have the right on or after the Business Day immediately following
16, 2001 to require the Trust to repay all or a portion of
such Securities owned by such holder (the "Put Option") on ,
2001 (the "Put Option Exercise Date"), upon at least three Business Days'
prior notice, at a repayment price of $10 per Security plus an amount equal
to the accrued and unpaid Distributions (including deferred distributions if
any) thereon to the date of payment (the "Put Option Repayment Price").
(b) The Trust shall obtain funds to pay the Put Option
Repayment Price of Securities being repaid under the Put Option through
presentation by the Institutional Trustee, on behalf of the Trust, to the
Debenture Issuer, pursuant to the right of the holder of the Debentures to
require the Debenture Issuer to repay all or a portion of the Debentures on
the Put Option Exercise Date, Debentures in an aggregate principal amount
equal to the aggregate stated liquidation amount of such Securities for
repayment on the Put Option Exercise Date at the Debenture Repayment Price.
(c) In order for the Securities to be repaid on the Put
Option Exercise Date, the Trust must receive on or prior to 4:00 p.m. on the
third Business Day immediately preceding the Put Option Exercise Date, at the
Corporate Trust Office of the Institutional Trustee, the Securities to be
repaid with the form entitled "Option to Elect Repayment" on the reverse
thereof or otherwise accompanying such Security duly completed. Any such
notice received by the Trust shall be irrevocable. All questions as to the
validity, eligibility (including time of receipt) and acceptance of the
Securities for repayment shall be determined by the Trust, whose
determination shall be final and binding.
(d) Payment of the Put Option Repayment Price to Holders
of Securities shall be made at the Corporate Trust Office of the
Institutional Trustee, provided that the Debenture Issuer has paid the
Institutional Trustee a sufficient amount of cash in connection with the
related repayment of the Debenture no later than 1:00 p.m., New York City
time, on the Put Option Exercise Date by check or wire transfer in
immediately available funds at such place and to such account as may be
designated by such Holders. If the Institutional Trustee holds immediately
available funds sufficient to pay the Put Option Repayment Price of such
Securities, then, immediately prior to the close of business on the Put
Option Exercise Date, such Securities will cease to be outstanding and
distributions thereon will cease to accrue, whether or not Securities are
delivered to the Institutional Trustee, and all other rights of the Holder in
respect of the Securities, including the Holder's right to require the Trust
to repay such Securities, shall terminate and lapse (other than the right to
receive the Put Option Repayment Price but without interest on such Put
Option Repayment Price). Neither the Regular Trustees nor the Trust shall be
required to register or cause to be registered the transfer of any Securities
for which repayment has been elected. If payment of the Put Option Repayment
Price in respect of Securities is (i) improperly withheld or refused and not
paid either by the Institutional Trustee or by the Sponsor as guarantor
pursuant to the Securities Guarantee, or (ii) not paid by the Institutional
Trustee as the result of an Event of Default with respect to the Debentures
presented for repayment as described in paragraph 6(b), Distributions on such
Securities will continue to accrue, from the original Put Option Exercise
Date to the actual date of payment, in which case the actual payment date
will be considered the Put Option Exercise Date for purposes of calculating
the Put Option Repayment Price.
(e) The Debenture Issuer will request, not later than
seven nor more than 15 calendar days prior to 13, 2001 (the
date on which some or all of the Preferred Securities could be remarketed in
the manner described in Section 5.4(b) of the Purchase Contract Agreement and
incorporated herein by reference) that DTC notify the Preferred Securities
Holders as well as the Income PRIDES and Growth PRIDES holders of such
remarketing and of the procedures that must be followed if a Holder of
Preferred Securities wishes to exercise such Holder's rights with respect to
the Put Option.
7. Voting Rights - Preferred Securities.
(a) Except as provided under Sections 7(b) and 9 and as
otherwise required by law and the Declaration, the Holders of the Preferred
Securities will have no voting rights.
(b) Subject to the requirements set forth in this
paragraph, the Holders of a Majority in liquidation amount of the Preferred
Securities, voting separately as a class may direct the time, method, and
place of conducting any proceeding for any remedy available to the
Institutional Trustee, or the exercise of any trust or power conferred upon
the Institutional Trustee under the Declaration, including (i) directing the
time, method and place of conducting any proceeding for any remedy available
to the Debenture Trustee, or exercising any trust or power conferred on the
Debenture Trustee with respect to the Debentures, (ii) waiving any past
default and its consequences that is waivable under the Indenture, (iii)
exercising any right to rescind or annul a declaration that the principal of
all the Debentures shall be due and payable, or (iv) consenting to any
amendment, modification or termination of the Indenture or the Debentures
where such consent shall be required, provided, however, that, where a
consent under the Indenture would require the consent or act of the Holders
of greater than a majority of the Holders in principal amount of Debentures
affected thereby (a "Super Majority"), the Institutional Trustee may only
give such consent or take such action at the written direction of the Holders
of at least the proportion in liquidation amount of the Preferred Securities
which the relevant Super Majority represents of the aggregate principal
amount of the Debentures outstanding. The Institutional Trustee shall not
revoke any action previously authorized or approved by a vote of the Holders
of the Preferred Securities. Other than with respect to directing the time,
method and place of conducting any remedy available to the Institutional
Trustee or the Debenture Trustee as set forth above, the Institutional
Trustee shall not take any action in accordance with the directions of the
Holders of the Preferred Securities under this paragraph unless the
Institutional Trustee has obtained an opinion of tax counsel to the effect
that for the purposes of United States federal income tax the Trust will not
be classified as other than a grantor trust on account of such action. If the
Institutional Trustee fails to enforce its rights under the Debentures after
a Holder of Preferred Securities has made a written request, such Holder of
Preferred Securities may, to the fullest extent permitted by applicable law,
institute a legal proceeding directly against the Debenture Issuer to enforce
the Institutional Trustee's rights under the Debentures without first
instituting a legal proceeding against the Institutional Trustee or any other
Person. Notwithstanding the foregoing, if an Event of Default has occurred
and is continuing and such event is attributable to the failure of the
Debenture Issuer to pay interest or principal on the Debentures on the date
such interest or principal is otherwise payable (or in the case of
redemption, on the redemption date), then a Holder of Preferred Securities
may directly institute a proceeding for enforcement of payment to such Holder
of the principal of or interest on the Debentures having a principal amount
equal to the aggregate liquidation amount of the Preferred Securities of such
Holder on or after the respective due date specified in the Debentures.
Except as provided in the preceding sentence, the Holders of Preferred
Securities shall not exercise directly any other remedy available to the
holders of the Debentures.
Any approval or direction of Holders of Preferred Securities
may be given at a separate meeting of Holders of Preferred Securities
convened for such purpose, at a meeting of all of the Holders of Securities
in the Trust or pursuant to written consent. The Regular Trustees will cause
a notice of any meeting at which Holders of 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 Preferred
Securities. Each such notice will include a statement setting forth (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.
No vote or consent of the Holders of the Preferred
Securities will be required for the Trust to repay and cancel Preferred
Securities or to distribute the Debentures in accordance with the Declaration
and the terms of the Securities. Notwithstanding that Holders of Preferred
Securities are entitled to vote or consent under any of the circumstances
described above, any of the Preferred Securities that are owned by the
Sponsor or any Affiliate of the Sponsor shall not be entitled to vote or
consent and shall, for purposes of such vote or consent, be treated as if
they were not outstanding.
8. Voting Rights - Common Securities.
(a) Except as provided under Sections 7(b) and (c) and
Section 9 and as otherwise required by law and the Declaration, the Holders
of the Common Securities will have no voting rights.
(b) The Holders of the 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 any Event of Default with respect to the Preferred Securities has been
cured, waived, or otherwise eliminated and subject to the requirements of the
second to last sentence of this paragraph, the Holders of a Majority in
liquidation amount of the Common Securities, voting separately as a class,
may direct the time, method, and place of conducting any proceeding for any
remedy available to the Institutional Trustee, or exercising any trust or
power conferred upon the Institutional Trustee under the Declaration,
including (i) directing the time, method, and place of conducting any
proceeding for any remedy available to the Debenture Trustee, or exercising
any trust or power conferred on the Debenture Trustee with respect to the
Debentures, (ii) waive any past default and its consequences that is waivable
under the Indenture, or (iii) exercise any right to rescind or annul a
declaration that the principal of all the Debentures shall be due and
payable, provided that, where a consent or action under the Indenture would
require the consent or act of the Holders of a Super Majority, the
Institutional Trustee may only give such consent or take such action at the
written direction of the Holders of at least the proportion in liquidation
amount of the Common Securities which the relevant Super Majority represents
of the aggregate principal amount of the Debentures outstanding. Pursuant to
this Section 7(c), the Institutional Trustee shall not revoke any action
previously authorized or approved by a vote of the Holders of the Preferred
Securities. Other than with respect to directing the time, method and place
of conducting any remedy available to the Institutional Trustee or the
Debenture Trustee as set forth above, the Institutional Trustee shall not
take any action in accordance with the directions of the Holders of the
Common Securities under this paragraph unless the Institutional Trustee has
obtained an opinion of tax counsel to the effect that for the purposes of
United States federal income tax the Trust will not be classified as other
than a grantor trust on account of such action. If the Institutional Trustee
fails to enforce its rights under the Declaration, any Holder of Common
Securities may institute a legal proceeding directly against any Person to
enforce the Institutional Trustee's rights under the Declaration, without
first instituting a legal proceeding against the Institutional Trustee or any
other Person.
Any approval or direction of Holders of Common Securities
may be given at a separate meeting of Holders of Common Securities convened
for such purpose, at a meeting of all of the Holders of Securities in the
Trust or pursuant to written consent. The Regular Trustees will cause a
notice of any meeting at which Holders of 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 Common Securities.
Each such notice will include a statement setting forth (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.
No vote or consent of the Holders of the Common Securities
will be required for the Trust to redeem and cancel Common Securities or to
distribute the Debentures in accordance with the Declaration and the terms of
the Securities.
9. Amendments to Declaration and Indenture.
(a) In addition to any requirements under Section 12.1
of the Declaration, if any proposed amendment to the Declaration provides
for, or the Regular Trustees otherwise propose to effect, (i) any action that
would materially adversely affect the powers, preferences or special rights
of the Securities, whether by way of amendment to the Declaration or
otherwise, or (ii) the dissolution of the Trust, other than as described in
Section 8.1 of the Declaration, then the Holders of outstanding Securities as
a class will be entitled to vote on such amendment or proposal (but not on
any other amendment or proposal) and such amendment or proposal shall not be
effective except with the approval of the Holders of at least a Majority in
liquidation amount of the Securities, voting together as a single class;
provided, however, if any amendment or proposal referred to in clause (i)
above would adversely affect only the Preferred Securities or only the 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
Securities.
(b) In the event the consent of the Institutional
Trustee as the holder of the Debentures is required under the Indenture with
respect to any amendment, modification or termination on the Indenture or the
Debentures, the Institutional Trustee shall request the written direction of
the Holders of the 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 Securities
voting together as a single class; provided, however, that where a consent
under the Indenture would require a Super Majority, the Institutional Trustee
may only give such consent at the direction of the Holders of at least the
proportion in liquidation amount of the Securities which the relevant Super
Majority represents of the aggregate principal amount of the Debentures
outstanding; provided, further, that the Institutional Trustee shall not take
any action in accordance with the directions of the Holders of the Securities
under this Section 8(b) unless (i) the Institutional Trustee has obtained an
opinion of tax counsel to the effect that for the purposes of United States
federal income tax the Trust will not be classified as other than a grantor
trust on account of such action or (ii) such action would not reduce or
otherwise adversely affect powers of the Institutional Trustee or cause the
Trust to be deemed an "investment company" which is required to be registered
under the Investment Company Act of 1940.
10. Pro Rata.
A reference in these terms of the Securities to any payment,
distribution or treatment as being "Pro Rata" shall mean pro rata to each
Holder of Securities according to the aggregate liquidation amount of the
Securities held by the relevant Holder in relation to the aggregate
liquidation amount of all Securities outstanding unless, in relation to a
payment, an Event of Default under the Declaration has occurred and is
continuing, in which case any funds available to make such payment shall be
paid first to each Holder of the Preferred Securities pro rata according to
the aggregate liquidation amount of Preferred Securities held by the relevant
Holder relative to the aggregate liquidation amount of all Preferred
Securities outstanding, and only after satisfaction of all amounts owed to
the Holders of the Preferred Securities, to each Holder of Common Securities
pro rata according to the aggregate liquidation amount of Common Securities
held by the relevant Holder relative to the aggregate liquidation amount of
all Common Securities outstanding.
11. Ranking.
The Preferred Securities rank pari passu and payment thereon
shall be made Pro Rata with the Common Securities except that, where an Event
of Default occurs and is continuing under the Indenture in respect of the
Debentures held by the Institutional Trustee, the rights of Holders of the
Common Securities to payment in respect of Distributions and payments upon
liquidation, redemption and otherwise are subordinated to the rights to
payment of the Holders of the Preferred Securities.
12. Acceptance of Securities Guarantee and Indenture.
Each Holder of Preferred Securities and Common Securities by
the acceptance thereof, agrees to the provisions of the Preferred Securities
Guarantee and the Common Securities Guarantee, respectively.
13. No Preemptive Rights.
The Holders of the Securities shall have no preemptive
rights to subscribe for any additional securities.
14. Miscellaneous.
These terms constitute a part of the Declaration.
The Sponsor will provide a copy of the Declaration, the
Preferred Securities Guarantee or the Common Securities Guarantee (as may be
appropriate), and the Indenture to a Holder without charge on written request
to the Sponsor at its principal place of business.
EXHIBIT A-1
FORM OF PREFERRED SECURITY CERTIFICATE
[IF THE PREFERRED SECURITY IS TO BE A GLOBAL CERTIFICATE
INSERT - This 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 Preferred Security is exchangeable for 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 Preferred Security (other than a transfer of this 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
Depositary) may be registered except in limited circumstances.
Unless this Preferred Security is presented by an authorized
representative of The Depository Trust Company (55 Water Street, New York,
New York) to the Trust or its agent for registration of transfer, exchange or
payment, and any Preferred Security issued is registered in the name of Cede
& Co. or such other name as requested by an authorized representative of The
Depository Trust Company and any payment hereon is made to Cede & Co., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS
WRONGFUL since the registered owner hereof, Cede & Co., has an interest
herein.]
Certificate Number _______________ Number of Preferred Securities ____________
CUSIP NO. ___________
Certificate Evidencing Preferred Securities
of
Ingersoll-Rand Financing I
____% Trust Originated Preferred Securities
(liquidation amount $10 per Preferred Security)
Ingersoll-Rand Financing I, a statutory business trust
formed under the laws of the State of Delaware (the "Trust"), hereby
certifies that __________ (the "Holder") is the registered owner of
____________ preferred securities of the Trust representing preferred
undivided beneficial interests in the assets of the Trust designated as the
____% Trust Originated Preferred Securities (liquidation amount $10 per
preferred security) (the "Preferred Securities"). The Preferred Securities
are transferable on the books and records of the Trust, in person or by a
duly authorized attorney, upon surrender of this certificate duly endorsed
and in proper form for transfer. The designation, rights, privileges,
restrictions, preferences and other terms and provisions of the Preferred
Securities represented hereby are issued and shall in all respects be subject
to the provisions of the Amended and Restated Declaration of Trust of the
Trust dated as of March __, 1998, as the same may be amended from time to
time (the "Declaration"), including the designation of the terms of the
Preferred Securities as set forth in Annex I to 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 Preferred
Securities Guarantee to the extent provided therein. The Sponsor will provide
a copy of the Declaration, the Preferred Securities Guarantee and the
Indenture 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.
By acceptance, the Holder agrees to treat, for United States
federal income tax purposes, the Debentures as indebtedness and the Preferred
Securities as evidence of indirect beneficial ownership in the Debentures.
IN WITNESS WHEREOF, the Trust has executed this certificate
this ______ day of March, 1998.
INGERSOLL-RAND FINANCING I
By:__________________________________
Name:________________________________
Title: Regular Trustee
By:__________________________________
Name:________________________________
Title: Regular Trustee
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Preferred Security will be
fixed at a rate per annum of ____% (the "Coupon Rate") of the stated
liquidation amount of $10 per Preferred Security, such rate being the rate of
interest payable on the Debentures to be held by the Institutional Trustee.
Distributions in arrears for more than one quarter will bear interest thereon
compounded quarterly at the rate of ____% until 15, 2001, and
at the Reset Rate thereafter (to the extent permitted by applicable law). The
term "Distributions" as used herein includes such cash distributions and any
such interest payable unless otherwise stated. A Distribution is payable only
to the extent that payments are made in respect of the Debentures held by the
Institutional Trustee and to the extent the Institutional Trustee has funds
available therefor. 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 consisting of twelve 30-day months, and for any period shorter
than a full quarterly Distribution period for which Distributions are
computed, Distributions will be computed on the basis of the actual number of
days elapsed per 30-day month.
Except as otherwise described below, Distributions on the
Preferred Securities will be cumulative, will accrue from the date of
original issuance and will be payable quarterly in arrears, on February 16,
May 16, August 16 and November 16 of each year, commencing on
16, 1998, to holders of record, if in book-entry only form,
one Business Day prior to such payment date, which payment dates shall
correspond to the interest payment dates on the Debentures. In the event that
the Preferred Securities are not in book-entry form, the Regular Trustees
will have the right to select relevant record dates, which will be more than
one Business Day but less than 60 Business Days prior to the relevant payment
dates. The Debenture Issuer has the right under the Indenture to defer
payments of interest by extending the interest payment period from time to
time on the Debentures for a period not exceeding beyond the date of maturity
of the Debentures (each an "Extension Period") and, as a consequence of such
deferral, Distributions will also be deferred. Despite such deferral,
quarterly Distributions will continue to accrue with interest thereon at the
rate of ____% until 15, 2001, and at the Reset Rate
thereafter, compounded quarterly during any such Extension Period (to the
extent permitted by applicable law). Payments of accrued Distributions will
be payable to Holders as they appear on the books and records of the Trust on
the first record date after the end of the Extension Period. Upon the
termination of any Extension Period and the payment of all amounts then due,
the Debenture Issuer may commence a new Extension Period; provided that such
Extension Period together with all such previous and further extensions
thereof may not exceed beyond the maturity date of the Debenture.
The Preferred Securities shall be redeemable as provided in
the Declaration.
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably requests and instructs
the Trust to repay $_____ stated liquidation amount of the within Preferred
Security, pursuant to its terms, on the "Put Option Exercise Date," together
with distributions thereon accrued but unpaid to the date of repayment, to
the undersigned at:
_____________________________________________________________
(Please print or type Name and Address of the Undersigned)
and to issue to the undersigned, pursuant to the terms of the Declaration, a
new Preferred Security or Preferred Securities representing the remaining
stated liquidation amount of this Preferred Security.
For this Option to Elect Repayment to be effective, the within Preferred
Security with this Option to Elect Repayment duly completed must be received
by the Trust at the Corporate Trust Office of the Institutional Trustee at "
", __________________
_________________________________________, Attention: Corporate Trust
Administration.
Dated: Signature: _______________________________
Signature Guarantee: _____________________
Note: The signature to this Option to Elect Repayment must correspond with
the name as written upon the face of the within Preferred Security in every
particular without alternation or enlargement or any change whatsoever.
___________________
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this 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 transfer this Preferred Security Certificate on the books of the
Trust. The agent may substitute another to act for him or her.
Date: ____________________________________
Signature: _______________________________
Signature Guarantee: _____________________
(Sign exactly as your name appears on the other side of this Preferred
Security Certificate)
EXHIBIT A-2
FORM OF COMMON SECURITY CERTIFICATE
The Common Securities may only be transferred by the
Debenture Issuer and any Related Party to the Debenture Issuer or a Related
Party of the Debenture Issuer; provided that, any such transfer is subject to
the condition precedent that the transferor obtain the written opinion of
nationally recognized independent counsel experienced in such matters that
such transfer would not cause more than an insubstantial risk that:
(i) the Trust would not be classified for United
States federal income tax purposes as a grantor Trust; and
(ii) the Trust would be an Investment Company or the
transferee would become an Investment Company.
Certificate Number ______________ Number of Common Securities ______________
Certificate Evidencing Common Securities
of
Ingersoll-Rand Financing I
____% Trust Originated Common Securities
(liquidation amount $10 per Common Security)
Ingersoll-Rand Financing I, a statutory business trust
formed under the laws of the State of Delaware (the "Trust"), hereby
certifies that Ingersoll-Rand Company (the "Holder") is the registered owner
of __________ common securities of the Trust representing common undivided
beneficial interests in the assets of the Trust designated as the ____% Trust
Originated Common Securities (liquidation amount $10 per common security)
(the "Common Securities"). The Common Securities are transferable on the
books and records of the Trust, in person or by a duly authorized attorney,
upon surrender of this certificate duly endorsed and in proper form for
transfer. The designation, rights, privileges, restrictions, preferences and
other terms and provisions of the Common Securities represented hereby are
issued and shall in all respects be subject to the provisions of the Amended
and Restated Declaration of Trust of the Trust dated as of March __, 1998, as
the same may be amended from time to time (the "Declaration"), including the
designation of the terms of the Common Securities as set forth in Annex I to
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 Common Securities Guarantee to the extent provided therein. The
Sponsor will provide a copy of the Declaration, the Common Securities
Guarantee and the Indenture to a Holder without charge upon written request
to the Sponsor at its principal place of business.
Upon receipt of this certificate, the Sponsor is bound by
the Declaration and is entitled to the benefits thereunder.
By acceptance, the Holder agrees to treat, for United States
federal income tax purposes, the Debentures as indebtedness and the Common
Securities as evidence of indirect beneficial ownership in the Debentures.
IN WITNESS WHEREOF, the Trust has executed this certificate
this _______ day of March, 1998.
INGERSOLL-RAND FINANCING I
By:__________________________________
Name:________________________________
Title: Regular Trustee
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Common Security will be fixed
at a rate per annum of ____% (the "Coupon Rate") of the stated liquidation
amount of $10 per Common Security, such rate being the rate of interest
payable on the Debentures to be held by the Institutional Trustee.
Distributions in arrears for more than one quarter will bear interest thereon
compounded quarterly at the rate of ____% until 15, 2001, and
at the Reset Rate thereafter (to the extent permitted by applicable law). The
term "Distributions" as used herein includes such cash distributions and any
such interest payable unless otherwise stated. A Distribution is payable only
to the extent that payments are made in respect of the Debentures held by the
Institutional Trustee and to the extent the Institutional Trustee has funds
available therefor. 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 for which Distributions are computed,
Distributions will be computed on the basis of the actual number of days
elapsed per 30-day month.
Except as otherwise described below, distributions on the
Common Securities will be cumulative, will accrue from the date of original
issuance and will be payable quarterly in arrears, on February 16, May 16,
August 16 and November 16 of each year, commencing on 16,
1998, to Holders of record one Business Day prior to such payment dates,
which payment dates shall correspond to the interest payment dates on the
Debentures. The Debenture Issuer has the right under the Indenture to defer
payments of interest by extending the interest payment period from time to
time on the Debentures for a period not exceeding beyond the date of maturity
of the Debentures (each an "Extension Period") and, as a consequence of such
deferral, Distributions will also be deferred. Despite such deferral,
quarterly Distributions will continue to accrue with interest thereon (to the
extent permitted by applicable law) at the rate of ____% until
15, 2001, and at the Reset Rate thereafter, compounded
quarterly during any such Extension Period. Payments of accrued Distributions
will be payable to Holders as they appear on the books and records of the
Trust on the first record date after the end of the Extension Period. Upon
the termination of any Extension Period and the payment of all amounts then
due, the Debenture Issuer may commence a new Extension Period; provided, that
such Extension Period together with all such previous and further extensions
thereof may not exceed beyond the maturity date of the Debentures.
The Common Securities shall be redeemable as provided in the
Declaration.
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably requests and instructs the Trust
to repay $_____ stated liquidation amount of the within Common Security,
pursuant to its terms, on the "Put Option Exercise Date," together with
distributions thereon accrued and unpaid to the date of repayment, to the
undersigned at:
_________________________________________________
(Please print or type Name and Address of the Undersigned)
and to issue to the undersigned, pursuant to the terms of the Declaration, a
new Common Security or Common Securities representing the remaining stated
liquidation amount of this Common Security.
For this Option to Elect Repayment to be effective, the within Common
Security with this Option to Elect Repayment duly completed must be received
by the Trust at the Corporate Trust Office of the Institutional Trustee at "
", _______________
__________________________________________, Attention: Corporate Trust
Administration.
Dated: Signature: _______________________________
Signature Guarantee: _____________________
Note: The signature to this Option to Elect Repayment must correspond with
the name as written upon the face of the within Common Security in every
particular without alternation or enlargement or any change whatsoever.
___________________
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers
this 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 Common Security Certificate on the books of the Trust.
The agent may substitute another to act for him or her.
Date: ____________________________________
Signature: _______________________________
Signature Guarantee: _____________________
(Sign exactly as your name appears on the other side of this Common Security
Certificate)
EXHIBIT B
SPECIMEN OF DEBENTURE
EXHIBIT C
Underwriting Agreement