__________________________________________
AMENDED AND RESTATED DECLARATION
OF TRUST
of
Sempra Energy Capital Trust [_]
Dated as of [_], 200[__]
__________________________________________
SEMPRA ENERGY CAPITAL TRUST [_]
Certain Sections of this Declaration relating to
Sections 310 through 318 of the
Trust Indenture Act of 1939:
Trust Indenture Act Section Declaration Section
--------------------------- -------------------
(S)310(a)(1)....................................................... 9.4
(a)(2) 9.4
(a)(3)...................................................... 9.6
(a)(4)...................................................... 3.6
(b)......................................................... 9.5
(S)311(a).......................................................... 9.10
(b)......................................................... 9.10
(S)312(a).......................................................... 2.2
(b)......................................................... 2.2
(c)......................................................... 2.2
(S)313(a).......................................................... 2.3(a)
(a)(4)...................................................... 2.3(b)
(b)......................................................... 2.3(c)
(c)......................................................... 11.8
(d)......................................................... 2.3(c)
(S)314(a).......................................................... 2.4
(b)......................................................... Not Applicable
(c)(1)...................................................... 2.5
(c)(2)...................................................... 2.5
(c)(3)...................................................... Not Applicable
(d)......................................................... Not Applicable
(e)......................................................... 2.5
(S)315(a).......................................................... 3.6
(b)......................................................... 2.7, 11.8
(c)......................................................... 3.6
(d)......................................................... 3.6
(e)......................................................... Not Applicable
(S)316(a).......................................................... Not Applicable
(a)(1)(A)................................................... Not Applicable
(a)(1)(B)................................................... Not Applicable
(a)(2)...................................................... Not Applicable
(b)......................................................... 2.6
(c)......................................................... 7.7
(S)317(a)(1)....................................................... Not Applicable
(a)(2)...................................................... Not Applicable
(b)......................................................... 6.8
(S)318(a).......................................................... 2.1
Note: This reconciliation and tie sheet shall not, for any purpose, be deemed to
be a part of this Declaration.
2
AMENDED AND RESTATED DECLARATION
OF TRUST
OF
SEMPRA ENERGY CAPITAL TRUST [_]
Dated as of [_], 200[_]
THIS AMENDED AND RESTATED DECLARATION OF TRUST, dated and effective as
of [_], 200[__] (this "Declaration"), by and among the undersigned trustees
(together with all other Persons from time to time duly appointed and serving as
trustees in accordance with the provisions of this Declaration, the "Trustees"),
Sempra Energy, a California corporation, as trust sponsor (the "Sponsor"), and
by the holders, from time to time, of the securities representing undivided
beneficial interests in the assets of the Sempra Energy Capital Trust [_] (the
"Trust") to be issued pursuant to this Declaration;
WHEREAS, certain of the Trustees and the Sponsor established the Trust
under the Business Trust Act (as defined herein) pursuant to a Declaration of
Trust, dated as of April 22, 1999 (the "Original Declaration") and a Certificate
of Trust filed with the Secretary of State of Delaware on April 22, 1999, 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 Subordinated Debt Securities (as defined herein) of
the Subordinated Debt Securities Issuer (as defined herein);
WHEREAS, the Sponsor and the Trustees desire to amend and restate the
Original Declaration as set forth herein to provide for, among other things, (i)
the issuance of the Common Securities by the Trust to the Sponsor, (ii) the
issuance and sale of the Preferred Securities by the Trust pursuant to the
Underwriting Agreement (as defined herein), and (iii) the acquisition by the
Trust from the Sponsor of all of the right, title and interest in the
Subordinated Debt Securities (as defined herein); provided, however, that none
of the amendments hereto are intended to amend any of the provisions included in
the Declaration that are required be included in an indenture pursuant to the
Trust Indenture Act.
NOW, THEREFORE, it being the intention of the parties hereto to
continue the Trust as a business trust under the Business Trust Act and that
this Declaration constitute the governing instrument of such business trust, the
Trustees declare that all assets contributed to the Trust will be held in trust
for the benefit of the holders, from time to time, of the securities
representing undivided beneficial interests in the assets of the Trust issued
hereunder, subject to the provisions of this Declaration.
3
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 Amended and Restated Declaration of Trust, as modified, supplemented or
amended from time to time, including (i) all exhibits hereto and (ii) for all
purposes of this Declaration and any such modification, amendment or supplement,
the provisions of the Trust Indenture Act that are deemed to be a part of and
govern this Declaration and any such modification, amendment or supplement,
respectively;
(d) all references in this Declaration to "Articles" and
"Sections" and "Exhibits" are to Articles and Sections of and Exhibits to this
Declaration unless otherwise specified;
(e) the words "herein," "hereof," and "hereunder" and other words
of similar import refer to this Declaration as a whole and not to any particular
Article, Section or subdivision;
(f) a term defined in the Trust Indenture Act has the same meaning
when used in this Declaration unless otherwise defined in this Declaration; and
(g) a reference to the singular includes the plural and vice
versa.
In addition, the following terms shall have the meanings set forth
below.
"Act" has the meaning specified in Section 7.8.
"Additional Amount" means, with respect to Securities of a given
Liquidation Amount and/or a given period, the amount of Additional Interest (as
defined in the Officers' Certificate establishing the terms of the Subordinated
Debt Securities pursuant to Section 303 of the Indenture) paid by the Sponsor on
a Like Amount of Subordinated Debt Securities for such period.
"Additional Sums" has the meaning specified in Section ___ of the
Officers' Certificate establishing the terms of the Subordinated Debt Securities
pursuant to Section 303 of the Indenture.
4
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Bank" means The Bank of New York, a New York banking corporation,
other than in its capacity as Property Trustee or a Subordinated Debt Securities
Trustee.
"Bankruptcy Event" means, with respect to any Person:
(a) the entry of a decree or order by a court having jurisdiction in
the premises judging such Person a bankrupt or insolvent, or approving as
properly filed a petition seeking reorganization, arrangement, adjudication or
composition of or in respect of such Person under any applicable Federal or
State bankruptcy, insolvency, reorganization or other similar law, or appointing
a receiver, liquidator, assignee, trustee, sequestrator (or other similar
official) of such Person or of any substantial part of its property or ordering
the winding up or liquidation of its affairs, and the continuance of any such
decree or order unstayed and in effect for a period of 60 consecutive days; or
(b) the institution by such Person of proceedings to be adjudicated a
bankrupt or insolvent, or the consent by it to the institution of bankruptcy or
insolvency proceedings against it, or the filing by it of a petition or answer
or consent seeking reorganization or relief under any applicable Federal or
State bankruptcy, insolvency, reorganization or other similar law, or the
consent by it to the filing of any such petition or to the appointment of a
receiver, liquidator, assignee, trustee, sequestrator (or similar official) of
such Person or of any substantial part of its property, or the making by it of
an assignment for the benefit of creditors, or the admission by it in writing of
its inability to pay its debts generally as they become due and its willingness
to be adjudicated a bankrupt, or the taking of corporate action by such Person
in furtherance of any such action.
"Bankruptcy Laws" has the meaning specified in Section 11.9.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Sponsor to have been duly adopted by
the Sponsor's Board of Directors, or such committee of the Board of Directors or
officers of the Sponsor to which authority to act on behalf of the Board of
Directors has been delegated, and to be in full force and effect on the date of
such certification, and delivered to the Trustees.
"Book-Entry Preferred Securities Certificates" means a beneficial
interest in the Preferred Securities Certificates, ownership and transfers of
which shall be evidenced through book entries by a Clearing Agency as described
in Section 6.10.
"Business Day" means a day other than (a) a Saturday or Sunday, (b) a
day on which banking institutions in The City of New York are authorized or
required by law or executive order to remain closed, or (c) a day on which the
Property Trustee's Corporate Trust
5
Office or the Corporate Trust Office of the Subordinated Debt Securities Trustee
is closed for business.
"Business Trust Act" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. C. Sections 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, the Preferred Securities shall be registered in global form
and which shall undertake to effect book entry transfers and pledges of the
Preferred Securities. The Depository Trust Company will be the initial Clearing
Agency.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time the Clearing
Agency effects book entry transfers and pledges of securities deposited with the
Clearing Agency.
"Closing Date" means [__________], 200[_].
"Code" means the Internal Revenue Code of 1986, as amended, or any
successor legislation.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Securities Exchange Act of 1934, as
amended, or, if at any time after the execution of this instrument such
Commission is not existing and performing the duties now assigned to it under
the Trust Indenture Act, then the body performing such duties at such time.
"Common Securities Guarantee" means the guarantee agreement dated as
of [____________], 200[_] of the Sponsor in respect of the Common Securities.
"Common Security" means an undivided beneficial interest in the assets
of the Trust, having a Liquidation Amount of $___ and having the rights provided
therefor in this Declaration, including the right to receive Distributions and a
Liquidation Distribution as provided herein.
"Common Securityholder" means the Holder from time to time of the
Common Securities.
"Common Security Certificate" means a definitive certificate in fully
registered form representing a Common Security substantially in the form of
Annex II to Exhibit A.
"Corporate Trust Office" means (i) when used with respect to the
Property Trustee, the principal office of the Property Trustee located at 101
Barclay Street, Floor 21 West, New York, New York 10286, and (ii) when used
with respect to the Subordinated Debt
6
Securities Trustee, the principal office of the Subordinated Debt Securities
Trustee located at 101 Barclay Street, Floor 21 West, New York, New York 10286.
"Definitive Preferred Securities Certificates" means either or both
(as the context requires) of (a) Preferred Securities Certificates issued as
Book-Entry Preferred Securities Certificates as provided in Section 6.10(a) and
(b) Preferred Securities Certificates issued in certificated, fully registered
form as provided in Section 6.12.
"Delaware Trustee" means The Bank of New York (Delaware), a Delaware
banking corporation, solely in its capacity as Delaware Trustee of the Trust and
not in its individual capacity, or its successor in interest in such capacity,
or any successor trustee appointed as herein provided.
"Direct Action" has the meaning set forth in Section 3.6(c).
"Distribution" means a distribution payable to Securityholders in
accordance with Section 5.1.
"Distribution Date" has the meaning specified in Section 5.1(a).
"DTC" means The Depository Trust Company, the initial Clearing Agency.
"Event of Default" means any one of the following events (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(a) the occurrence of an Indenture Event of Default; or
(b) default by the Trust in the payment of any Distribution when it
becomes due and payable, and continuation of such default for a period of 30
days, provided that no Deferral Period (as defined in the Officers' Certificate
establishing the Subordinated Debt Securities pursuant to Section 303 of the
Indenture) is continuing; or
(c) default by the Trust in the payment of any Redemption Price of any
Security when it becomes due and payable; or
(d) default in the performance, or breach, in any material respect, of
any provision of this Declaration (other than a covenant or warranty a default
in the performance or breach of which is dealt with in clause (b) or (c) above)
and continuation of such default or breach for a period of 90 days after there
has been given, by registered or certified mail, to the defaulting Trustee or
Trustees by the Holders of at least 25% in aggregate Liquidation Amount of the
Outstanding Preferred Securities a written notice specifying such default or
breach and requiring it to be remedied and stating that such notice is a "Notice
of Default" hereunder; or
(e) the occurrence of a Bankruptcy Event with respect to the Property
Trustee and the failure by the Sponsor to appoint a Successor Property Trustee
within 60 days thereof.
7
"Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time, or any successor legislation.
"Guarantee" means the Guarantee Agreement executed and delivered by
the Guarantor and The Bank of New York, a New York banking corporation, as
trustee, contemporaneously with the execution and delivery of this Declaration,
for the benefit of the holders of the Preferred Securities, as amended from time
to time.
"Guarantor" means Sempra Energy, a California corporation, and its
successors and assigns.
"Indemnified Person" has the meaning specified in Section 9.3(a).
"Indenture" means the Indenture dated as of [___________], 200[_]
among the Subordinated Debt Securities Issuer and The Bank of New York, as
trustee, as supplemented by an Officers' Certificate (as defined in the
Indenture) dated as of [___________], 200[_] pursuant to Section 301 of the
Indenture.
"Indenture Event of Default" means an "Event of Default," as defined
in the Indenture, with respect to the Subordinated Debt Securities.
"Indenture Redemption Date" means, with respect to any Subordinated
Debt Securities to be redeemed under the Indenture, the date fixed for
redemption under the Indenture.
"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.
"Legal Action" means any action to bring or defend, pay, collect,
compromise, arbitrate, resort to legal action, or otherwise adjust claims or
demands of or against the Trust.
"Like Amount" means (a) with respect to a redemption of Securities,
Securities having an aggregate Liquidation Amount equal to the aggregate
principal amount of Subordinated Debt Securities to be contemporaneously
redeemed or repaid in accordance with the Indenture the proceeds of which will
be used to pay the Redemption Price of such Securities, and (b) with respect to
a distribution of Subordinated Debt Securities to Securityholders in connection
with a dissolution or liquidation of the Trust, Subordinated Debt Securities
having an aggregate principal amount equal to the aggregate Liquidation Amount
of the Securities of the Holder to whom such Subordinated Debt Securities are
distributed.
"Liquidation Amount" means the stated amount of $___ per Security.
"Liquidation Date" means the date on which Subordinated Debt
Securities are to be distributed to Securityholders in connection with a
dissolution and liquidation of the Trust pursuant to Section 10.4(a).
8
"Liquidation Distribution" has the meaning specified in Section
10.4(d).
"Majority in Liquidation Amount of the Securities" means, except as
provided in the terms of the Preferred Securities and by the Trust Indenture
Act, Holder(s) of Preferred Securities or Common Securities voting together as a
single class or, as the context may require, Holder(s) of Preferred Securities
or Common Securities voting separately as a class, who vote Securities of a
relevant class and 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 the Securities voted by such Securityholders represents more than
50% of the above stated aggregate liquidation amount of all Securities of such
class.
"Officer's Certificate" means a certificate signed by any one of the
Chairman of the Board, Chief Executive Officer, President, a Vice President, the
Treasurer, an Associate Treasurer, an Assistant Treasurer, the Controller, the
Secretary or an Assistant Secretary, of the Sponsor, and delivered to the
appropriate Trustee. The officer signing an Officer's Certificate given
pursuant to Section 3.7 shall be the principal executive, financial or
accounting officer of the Sponsor. Any Officer's Certificate delivered with
respect to compliance with a condition or covenant provided for in this
Declaration shall include:
(a) a statement that the officer signing the Officer's Certificate has
read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by such officer in rendering the Officer's Certificate;
(c) a statement that such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such officer
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(d) a statement as to whether, in the opinion of such officer, such
condition or covenant has been complied with.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Trust, the Property Trustee or the Sponsor, and who shall be
reasonably acceptable to the Property Trustee.
"Original Declaration" has the meaning specified in the recitals to
this Declaration.
"Outstanding", when used with respect to Securities, means, as of the
date of determination, all Securities theretofore executed and delivered under
this Declaration, except:
(a) Securities theretofore canceled by the Property Trustee or
delivered to the Property Trustee for cancellation;
(b) Securities for whose payment or redemption money in the necessary
amount has been theretofore deposited with the Property Trustee or any Paying
Agent for the
9
Holders of such Securities; provided that, if such Securities are to be
redeemed, notice of such redemption has been duly given pursuant to this
Declaration; and
(c) Securities which have been paid or in exchange for or in lieu of
which other Preferred Securities have been executed and delivered pursuant to
Sections 6.4, 6.5, 6.10 and 6.12; provided, however, that in determining whether
the Holders of the requisite Liquidation Amount of the Outstanding Preferred
Securities have given any request, demand, authorization, direction, notice,
consent or waiver hereunder, Preferred Securities owned by the Sponsor, any
Trustee or any Affiliate of the Sponsor or any Trustee shall be disregarded and
deemed not to be Outstanding, except that (i) in determining whether any Trustee
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Preferred Securities that such
Trustee knows to be so owned shall be so disregarded and (ii) the foregoing
proviso shall not apply at any time when all of the outstanding Preferred
Securities are owned by the Sponsor, one or more of the Trustees and/or any such
Affiliate. Preferred Securities so owned which have been pledged in good faith
may be regarded as Outstanding if the pledgee establishes to the satisfaction of
the Regular Trustees the pledgee's right so to act with respect to such
Preferred Securities and that the pledgee is not the Sponsor or any Affiliate of
the Sponsor.
"Owner" means each Person who is the beneficial owner of a Book-Entry
Preferred Securities Certificate as reflected in the records of the Clearing
Agency or, if a Clearing Agency Participant is not the Owner, then as reflected
in the records of a Person maintaining an account with such Clearing Agency
(directly or indirectly, in accordance with the rules of such Clearing Agency).
"Paying Agent" means any paying agent or co-paying agent appointed
pursuant to Section 6.8 and shall initially be the Bank.
"Payment Account" means a segregated non-interest-bearing corporate
trust account maintained by the Property Trustee with the Bank in its trust
department for the benefit of the Securityholders in which all amounts paid in
respect of the Subordinated Debt Securities will be held and from which the
Property Trustee, through the Paying Agent, shall make payments to the
Securityholders in accordance with Sections 5.1 and 5.2.
"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.
"Preferred Security" means an undivided beneficial interest in the
assets of the Trust, having a Liquidation Amount of $____ and having the rights
provided therefor in this Declaration, including the right to receive
Distributions and a Liquidation Distribution as provided herein.
"Preferred Security Certificate" means a certificate representing a
Preferred Security substantially in the form of Annex I to Exhibit A.
10
"Property Trustee" means The Bank of New York, a New York banking
corporation, solely in its capacity as Property Trustee of the Trust and not in
its individual capacity, or its successor in interest in such capacity, or any
Successor Property Trustee appointed as herein provided.
"Redemption Date" means, with respect to any Trust Security to be
redeemed, the date fixed for such redemption by or pursuant to this Declaration;
provided that each Indenture Redemption Date and the Stated Maturity (as defined
in the Indenture) of the Subordinated Debt Securities shall be a Redemption Date
for a Like Amount of Securities.
"Redemption Price" means, with respect to any Trust Security, the
Liquidation Amount of such Trust Security, plus accumulated and unpaid
Distributions to the Redemption Date, allocated on a pro rata basis (based on
Liquidation Amounts) among the Securities.
"Regular Trustees" means each of ___________, ___________ and
___________, solely in such Person's capacity as Regular Trustee of the Trust
formed and continued hereunder and not in such Person's individual capacity, or
such Regular Trustee's successor in interest in such capacity, or any successor
trustee appointed as herein provided.
"Relevant Trustee" shall have the meaning specified in Section 9.7.
"Responsible Officer" means, with respect to the Property Trustee, any
Vice-President, any Assistant Vice-President, any Assistant Secretary, any
Assistant Treasurer, any Trust Officer or Assistant Trust Officer or any other
officer of the Property Trustee customarily performing functions similar to
those performed by any of the above designated officers and also means, with
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of that officer's knowledge of and familiarity with
the particular subject.
"Securities" means the Common Securities and the Preferred Securities.
"Securities Act" means the Securities Act of 1933, as amended, or any
successor legislation.
"Securities Register" and "Securities Registrar" have the respective
meanings specified in Section 6.4.
"Securityholder" or "Holder" means a Person in whose name a Security
or Securities is registered in the Securities Register, any such Person being a
beneficial owner within the meaning of the Business Trust Act; provided,
however, that in determining whether the Holders of the requisite amount of
Preferred Securities have voted on any matter provided for in this Declaration,
then for the purpose of any such determination, so long as Definitive Preferred
Securities Certificates have not been issued, the term Securityholders or
Holders as used herein shall refer to the Owners.
"Sponsor" means Sempra Energy, a California corporation, or any
permitted successor thereof under the Indenture, in its capacity as sponsor of
the Trust.
11
"Subordinated Debt Securities" means the ___% Subordinated Deferrable
Interest Notes, Series __, due _________ to be issued by the Subordinated Debt
Securities Issuer under the Indenture and to be held by the Property Trustee
pursuant to Section 3.14. A specimen certificate for such series of
Subordinated Debt Securities is attached hereto as Exhibit B.
"Subordinated Debt Securities Issuer" means Sempra Energy, a
California corporation.
"Subordinated Debt Securities Trustee" means The Bank of New York, as
trustee under the Indenture until a successor is appointed thereunder and
thereafter means such successor trustee.
"Successor Property Trustee" means a successor Trustee possessing the
qualifications to act as Property Trustee under Section 9.4.
"Tax Event" means the receipt by the Trust of an Opinion of Counsel
from counsel experienced in such matters to the effect that, as a result of 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, or as a result of any
official administrative pronouncement or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
which pronouncement or decision is announced on or after the date of issuance of
the Preferred Securities under this Declaration, there is more than an
insubstantial risk that (i) the Trust is, or will be within 90 days after the
date of such Opinion of Counsel, subject to United States federal income tax
with respect to income received or accrued on the Subordinated Debt Securities,
(ii) interest payable by the Sponsor on the Subordinated Debt Securities is not,
or within 90 days after the date of such Opinion of Counsel, will not be,
deductible by the Sponsor, in whole or in part, for United States federal income
tax purposes or (iii) the Trust is, or will be within 90 days after the date of
such Opinion of Counsel, subject to more than a de minimis amount of other
taxes, duties, assessments or other governmental charges.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in
force at the date as of which this instrument was executed; provided, however,
that in the event the Trust Indenture Act of 1939 is amended after such date,
"Trust Indenture Act" means, to the extent required by any such amendment, the
Trust Indenture Act of 1939 as so amended.
"Trust Property" means (a) the Subordinated Debt Securities, (b) any
cash on deposit in, or owing to, the Payment Account and (c) all proceeds and
rights in respect of the foregoing and any other property and assets for the
time being held or deemed to be held by the Property Trustee pursuant to the
trusts of this Declaration.
"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.
12
"Underwriting Agreement" means the Pricing Agreement (including the
Underwriting Agreement incorporated by reference therein), dated [_________],
200[_], among the Trust, the Sponsor and the underwriters named therein.
"25% in aggregate Liquidation Amount of the Securities" means,
except as provided in the terms of the Preferred Securities and by the Trust
Indenture Act, Holder(s) of Securities voting together as a single class or, as
the context may require, Holder(s) of Preferred Securities or Common Securities,
voting separately as a class, who vote Securities of a relevant class and the
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 the Securities
voted by such Holders represents 25% of the above stated aggregate Liquidation
Amount of all Securities of such class.
ARTICLE II.
TRUST INDENTURE ACT
Section 2.1 Trust Indenture Act; Application.
(a) This Declaration is subject to the provisions of the Trust
Indenture Act that are required to be part of this Declaration and shall, to the
extent applicable, be governed by such provisions;
(b) the Property Trustee shall be the only Trustee which is a
trustee for the purposes of the Trust Indenture Act;
(c) if and to the extent that any provision of this Declaration
limits, qualifies or conflicts with the duties imposed by Sections 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control; and
(d) the application of the Trust Indenture Act to this Declaration
shall not affect the nature of the Securities as equity securities representing
undivided beneficial interests in the assets of the Trust.
Section 2.2 Lists of Securityholders.
(a) Each of the Sponsor and the Regular Trustees, on behalf of the
Trust, shall provide the Property Trustee (i) not later than 15 days after each
of ________, ________, _______ and ________ (each such date a "Regular Record
Date") of each year a list, in such form as the Property Trustee may reasonably
require, containing all the information in the possession or control of the
Sponsor, or any of its Paying Agents other than the Property Trustee, as to the
names and addresses of the Securityholders ("List of Holders") as of the
preceding respective Regular Record Date, and (ii) at such other times as the
Property Trustee may request in writing, within 30 days after the receipt by the
Trust of any such request, a list of similar form and content as of a date not
more than 15 days prior to the time such list is furnished. The Property Trustee
shall preserve, in as current a form as is reasonably practicable, all
information contained in Lists of Holders given to it or which it receives in
its capacity as Paying Agent (if
13
acting in such capacity), provided that the Property Trustee may destroy any
List of Holders previously given to it on receipt of a new List of Holders; and
(b) the Property Trustee shall comply with its obligations under
Sections 311(a), 311(b) and 312(b) of the Trust Indenture Act.
Section 2.3 Reports by the Property Trustee.
(a) Within 60 days after _________ of each year, commencing
_______, 200__, the Property Trustee shall provide to the Securityholders such
reports as are required by Section 313 of the Trust Indenture Act, if any, in
the form and in the manner provided by Section 313 of the Trust Indenture Act.
The Property Trustee shall also comply with the requirements of Section 313(d)
of the Trust Indenture Act.
(b) In addition, the Property Trustee shall transmit to all
Securityholders in accordance with Section 11.8, and to the Sponsor, a brief
report dated as of such ______ with respect to:
(i) its eligibility under Section 9.4 or, in lieu thereof, if
to the best of its knowledge it has continued to be eligible under said
Section, a written statement to such effect; and
(ii) any change in the property and funds in its possession as
Property Trustee since the date of its last report and any action taken by
the Property Trustee in the performance of its duties hereunder which it
has not previously reported and which in its opinion materially affects the
Securities.
(c) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Property Trustee with each national
stock exchange, the NASDAQ National Market or such other interdealer quotation
system or self-regulatory organization upon which the Securities are listed or
traded (information regarding each such listing to be provided to the Property
Trustee by the Sponsor), with the Commission and with the Sponsor.
Section 2.4 Periodic Reports to the Property Trustee.
Each of the Sponsor and the Regular Trustees, on behalf of the
Trust, shall provide to the Property Trustee such documents, reports and
information as required by Section 314 of the Trust Indenture Act (if any) and
the compliance certificate required by Section 314 of the Trust Indenture Act in
the form, in the manner and at the times required by Section 314 of the Trust
Indenture Act.
Section 2.5 Evidence of Compliance with Conditions Precedent.
Each of the Sponsor and the Regular Trustees, on behalf of the
Trust, shall provide to the Property Trustee such evidence of compliance with
any conditions precedent, if any, provided for in this Declaration which 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
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to Section 314(c)(1) of the Trust Indenture Act may be given in the form of an
Officers' Certificate.
Section 2.6 Rights of Securityholders; Events of Default; Waiver.
(a) The legal title to the Trust Property is vested exclusively in
the Property Trustee (in its capacity as such) in accordance with Section 3.14,
and the Securityholders shall not have any right or title therein other than the
undivided beneficial interest in the assets of the Trust conferred by their
Securities and they shall have no right to call for any partition or division of
property, profits or rights of the Trust except as described below. The
Securities shall be personal property giving only the rights specifically set
forth therein and in this Declaration. The Securities shall have no preemptive
or similar rights and when issued and delivered to Securityholders against
payment of the purchase price therefor will be fully paid and nonassessable by
the Trust. The Securityholders, in their capacities as such, shall be entitled
to the same limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the State
of Delaware.
(b) For so long as any Preferred Securities remain Outstanding,
if, upon an Indenture Event of Default, the Subordinated Debt Securities Trustee
fails or the holders of not less than 25% in principal amount of the outstanding
Subordinated Debt Securities fail to declare the principal of all of the
Subordinated Debt Securities to be immediately due and payable, the Holders of
at least 25% in aggregate Liquidation Amount of the Preferred Securities then
Outstanding shall have such right by a notice in writing to the Sponsor and the
Subordinated Debt Securities Trustee; and upon any such declaration such
principal amount of and the accrued interest on all of the Subordinated Debt
Securities shall become immediately due and payable, provided that the payment
of principal and interest on such Subordinated Debt Securities shall remain
subordinated to the extent provided in the Indenture.
(c) At any time after such a declaration of acceleration with
respect to the Subordinated Debt Securities has been made and before a judgment
or decree for payment of the money due has been obtained by the Subordinated
Debt Securities Trustee as in the Indenture provided, the Holders of a majority
in aggregate Liquidation Amount of the Outstanding Preferred Securities, by
written notice to the Property Trustee, the Sponsor and the Subordinated Debt
Securities Trustee, may rescind and annul such declaration and its consequences
if:
(i) the Sponsor has paid or deposited with the Subordinated
Debt Securities Trustee a sum sufficient to pay
(A) all overdue interest on all of the Subordinated Debt
Securities which has become due otherwise than by such declaration
of acceleration;
(B) the principal of (and premium, if any, on) any
Subordinated Debt Securities which have become due otherwise than
by such declaration of acceleration and any interest thereon at the
rate or rates prescribed therefor in the Subordinated Debt
Securities or, if no such rate or rates are so provided, at the
rate of interest borne by the Subordinated Debt Securities;
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(C) to the extent that payment of such interest is lawful,
interest upon overdue interest which has become due otherwise than by
such declaration of acceleration at the rate or rates prescribed
therefor in the Subordinated Debt Securities or, if no such rate or
rates are so provided, at the rate of interest borne by the
Subordinated Debt Securities; and
(D) all sums paid or advanced by the Subordinated Debt
Securities Trustee under the Indenture and the reasonable
compensation, expenses, disbursements and advances of the Subordinated
Debt Securities Trustee and the Property Trustee, their agents and
counsel and any amounts due the Subordinated Debt Securities Trustee
under Section 607 of the Indenture; and
(ii) all Events of Default with respect to the Subordinated Debt
Securities, other than the non-payment of the principal of the Subordinated
Debt Securities which has become due solely by such acceleration, have been
cured or waived as provided in Section 513 of the Indenture.
(d) The Holders of a majority in aggregate Liquidation Amount of the
Outstanding Preferred Securities may, on behalf of the Holders of all the
Outstanding Preferred Securities, waive any past default under the Indenture,
except a default in the payment of principal or interest on the Subordinated
Debt Securities (unless such default has been cured and a sum sufficient to pay
all matured installments of interest and principal and accrued and unpaid
interest, if any, due otherwise than by acceleration has been deposited with the
Subordinated Debt Securities Trustee) or a default in respect of a covenant or
provision which under the Indenture cannot be modified or amended without the
consent of the holder of each outstanding Subordinated Debt Security. No such
rescission shall affect any subsequent default or impair any right consequent
thereon.
(e) Upon receipt by the Property Trustee of written notice declaring
such an acceleration, or rescission and annulment thereof, by Holders of the
Preferred Securities all or part of which is represented by Book-Entry Preferred
Securities Certificates, a record date shall be established for determining
Holders of Outstanding Preferred Securities entitled to join in such notice,
which record date shall be at the close of business on the day the Property
Trustee receives such notice. The Holders on such record date, or their duly
designated proxies, and only such Persons, shall be entitled to join in such
notice, whether or not such Holders remain Holders after such record date;
provided, that, unless such declaration of acceleration, or rescission and
annulment, as the case may be, shall have become effective by virtue of the
requisite percentage having joined in such notice prior to the day which is 90
days after such record date, such notice of declaration of acceleration, or
rescission and annulment, as the case may be, shall automatically and without
further action by any Holder be canceled and of no further effect. Nothing in
this paragraph shall prevent a Holder, or a proxy of a Holder, from giving,
after expiration of such 90-day period, a new written notice of declaration of
acceleration, or rescission and annulment thereof, as the case may be, that is
identical to a written notice which has been canceled pursuant to the proviso to
the preceding sentence, in which event a new record date shall be established
pursuant to the provisions of this Section 2.6(e).
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(f) A waiver of any Event of Default under the Indenture by the
Property Trustee at the direction of the Holders of the Preferred Securities
constitutes a waiver of the corresponding Event of Default with respect to the
Preferred Securities under this Declaration. Any waiver of an Event of Default
under the Indenture by the Property 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.
(g) The foregoing provisions of Sections 2.6(b) through (f) 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.
The Property Trustee shall, within 90 days after the occurrence of
an Event of Default with respect to the Securities known to the Property
Trustee, transmit by mail, first class postage prepaid, to the Securityholders,
the Regular Trustees and the Sponsor, notices of all such defaults unless such
defaults have been cured or waived before the giving of such notice (the term
"defaults" for the purposes of this Section 2.7 being hereby defined to be an
Event of Default as, not including any periods of grace provided for herein or
in the Indenture and irrespective of the giving of any notice provided herein or
in the Indenture); provided, that, except for a default in the payment of
principal of (or premium, if any) or interest on any of the Subordinated Debt
Securities or Preferred Securities, the Property Trustee shall be protected in
withholding such notice if and so long as the board of directors, the executive
committee, or a trust committee of directors and/or Responsible Officers, of the
Property Trustee in good faith determine that the withholding of such notice is
in the interests of the Securityholders.
ARTICLE III.
ESTABLISHMENT OF THE TRUST
Section 3.1 Name.
The Trust is named "Sempra Energy Capital Trust [ ]," as such name
may be modified from time to time by the Regular Trustees following written
notice to the Securityholders. 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 of the Delaware Trustee; Principal Place of Business.
The address of the Delaware Trustee in the State of Delaware is
White Clay Center, Route 273, Newark, Delaware 19711, or such other address in
the State of Delaware as the Delaware Trustee may designate by written notice to
the Sponsor. The address of the principal office of the Trust is c/o Sempra
Energy, 101 Ash Street, San Diego, California, 92101.
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On ten (10) Business Days written notice to the Property Trustee and
Securityholders, the Regular Trustees may designate another principal office.
Section 3.3 Declaration of Trust; Purpose.
The exclusive purposes and functions of the Trust are (i) to issue
and sell Securities and use the proceeds from such sale to acquire the
Subordinated Debt Securities, (ii) to distribute the cash payments it receives
on the Subordinated Debt Securities it owns to the Securityholders, and (iii) to
engage in only those activities necessary, appropriate, convenient or incidental
thereto. The Sponsor hereby appoints the Trustees as trustees of the Trust, to
have all the rights, powers and duties to the extent set forth herein, and the
Trustees hereby accept such appointment. The Property Trustee hereby declares
that it will hold the Trust Property in trust upon and subject to the conditions
set forth herein for the benefit of the Trust and the Securityholders. The
Regular Trustees shall have all rights, powers and duties set forth herein and
in accordance with applicable law with respect to accomplishing the purposes of
the Trust. The Delaware Trustee shall not be entitled to exercise any powers,
nor shall the Delaware Trustee have any of the duties and responsibilities, of
the Trustees set forth herein. The Delaware Trustee shall be one of the Trustees
of the Trust for the sole and limited purpose of fulfilling the requirements of
Section 3807(a) of the Delaware Business Trust Act.
Section 3.4 Authority of Trustees.
The Trustees shall conduct the affairs of the Trust in accordance
with the terms of this Declaration. Subject to the limitations set forth in
Section 3.8, and in accordance with the following Sections 3.5 and 3.6, the
Trustees shall have the authority to enter into all transactions and agreements
determined by the Trustees to be appropriate in exercising the authority,
express or implied, otherwise granted to the Trustees under this Declaration,
and to perform all acts in furtherance thereof.
Section 3.5 Power and Authority of Regular Trustees.
(a) Without limiting Section 3.4, each Regular Trustee, acting
singly or collectively, shall have the power and authority to act on behalf of
the Trust, including, without limitation, with respect to the following matters:
(i) the issuance and sale of the Securities;
(ii) to cause the Trust to enter into, and to execute,
deliver and perform on behalf of the Trust such other agreements as may be
necessary or desirable in connection with the purposes and function of the
Trust;
(iii) assisting in the registration of the Preferred
Securities under the Securities Act of 1933, as amended, and under state
securities or blue sky laws, and the qualification of this Declaration as a
trust indenture under the Trust Indenture Act;
(iv) assisting in the listing of the Preferred Securities
upon such securities exchange or exchanges as shall be determined by the
Sponsor and the registration of the Preferred Securities under the
Securities Exchange Act of 1934, as
18
amended, and the preparation and filing of all periodic and other reports
and other documents pursuant to the foregoing;
(v) assisting in the sending of notices (other than notices
of default) and other information regarding the Securities and the
Subordinated Debt Securities to the Securityholders in accordance with this
Declaration;
(vi) consenting to the appointment of a Paying Agent in
accordance with this Declaration;
(vii) execution of the Securities on behalf of the Trust in
accordance with this Declaration;
(viii) execution and delivery of closing certificates pursuant
to the Underwriting Agreement and application for a taxpayer identification
number for the Trust;
(ix) unless otherwise determined by the Sponsor, the Property
Trustee or the Holders of Preferred Securities representing more than 50%
of the aggregate Liquidation Amount of the Outstanding Preferred
Securities, or as otherwise required by the Delaware Business Trust Act or
the Trust Indenture Act, to execute on behalf of the Trust (either acting
alone or together with any or all of the Regular Trustees) any documents
that the Regular Trustees have the power to execute pursuant to this
Declaration; and
(x) the taking of any action incidental to the foregoing as
the Trustees may from time to time determine is necessary or advisable to
give effect to the terms of this Declaration for the benefit of the
Securityholders (without consideration of the effect of any such action on
any particular Securityholder).
(b) Notwithstanding anything herein to the contrary, the Trustees are
authorized, and the Regular Trustees are directed, to conduct the affairs of the
Trust and to operate the Trust so that (i) the Trust will not be deemed to be an
"investment company" required to be registered under the 1940 Act, (ii) the
Trust will be classified as a grantor trust for United States Federal income tax
purposes and (iii) so that the Subordinated Debt Securities will be treated as
indebtedness of the Sponsor for United States Federal income tax purposes and
shall not take any action which is inconsistent with or contrary to these
purposes. In this connection, the Sponsor and the Trustees are authorized to
take any action, not inconsistent with applicable law, the Certificate of Trust
or this Declaration, that each of the Sponsor and the Trustees determines in its
discretion to be necessary or desirable for such purposes, as long as such
action does not adversely affect in any material respect the interests of the
Holders of the Preferred Securities.
(c) Subject to this Section 3.5, the Regular Trustees shall have none
of the powers or the authority of the Property Trustee set forth in Section 3.6.
(d) The Trust initially appoints the Property Trustee as transfer
agent and registrar for the Preferred Securities.
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Section 3.6 Powers and Duties of the Property Trustee.
(a) The Property Trustee shall have the power, duty and authority
to act on behalf of the Trust with respect to the following matters:
(i) the establishment of the Payment Account;
(ii) the receipt of the Subordinated Debt Securities;
(iii) the collection of interest, principal and any other
payments made in respect of the Subordinated Debt Securities in the Payment
Account;
(iv) the distribution through the Paying Agent of amounts
owed to the Securityholders in respect of the Securities;
(v) the exercise of all of the rights, powers and
privileges of a holder of the Subordinated Debt Securities;
(vi) the sending of notices of default and other information
regarding the Securities and the Subordinated Debt Securities to the
Securityholders in accordance with this Declaration;
(vii) the distribution of the Trust Property in accordance
with the terms of this Declaration;
(viii) to the extent provided in this Declaration, assisting
in the winding up of the affairs of and liquidation of the Trust and the
preparation, execution and filing of the certificate of cancellation with
the Secretary of State of the State of Delaware;
(ix) after an Event of Default (other than under paragraph
(b), (c), (d) or (e) of the definition of such term if such Event of
Default is by or with respect to the Property Trustee) the taking of any
action incidental to the foregoing as the Property Trustee may from time to
time determine is necessary or advisable to give effect to the terms of
this Declaration and protect and conserve the Trust Property for the
benefit of the Securityholders (without consideration of the effect of any
such action on any particular Securityholder);
(x) any Legal Action which arises out of or in connection
with an Event of Default or the Property Trustee's duties and obligations
under this Declaration, the Business Trust Act or the Trust Indenture Act;
and
(xi) any of the duties, liabilities, powers or the authority
of the Regular Trustees set forth in Section 3.5(a)(v), (vi) and (x);
and in the event of a conflict between the actions of the Regular
Trustees and those of the Property Trustee, the actions of the Property Trustee
shall prevail.
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(b) The Property Trustee shall take all actions and perform such
duties as may be specifically required of the Property Trustee pursuant to the
terms of the Securities and this Declaration.
(c) If the Property Trustee fails to enforce its rights under the
Subordinated Debt Securities after a Holder of Preferred Securities has made a
written request, such Holder may, to the fullest extent permitted by law,
institute a legal proceeding against the Subordinated Debt Securities Issuer, to
enforce the Property Trustee's rights under the Subordinated Debt Securities,
without first instituting any legal proceeding against the Property 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
Subordinated Debt Securities Issuer to pay interest, premium, if any, or
principal on the Subordinated Debt Securities on the date such interest,
premium, if any, or principal is otherwise payable (or in the case of
redemption, on the redemption date), then Holders of at least 25% in aggregate
Liquidation Amount of the Preferred Securities may directly institute a
proceeding for enforcement of payment to such Holder of the principal of,
premium, if any, or interest on, the Subordinated Debt Securities having a
principal amount equal to the aggregate liquidation amount of the Preferred
Securities of such Holder (a "Direct Action"). Notwithstanding any payments made
to any Holders of Preferred Securities by the Subordinated Debt Securities
Issuer in connection with a Direct Action, the Subordinated Debt Securities
Issuer shall remain obligated to pay the principal of, premium, if any, or
interest on the Subordinated Debt Securities held by the Trust or the Property
Trustee of the Trust, and the Subordinated Debt Securities Issuer shall be
subrogated to the rights of the Holders of such Preferred Securities with
respect to payments on the Preferred Securities. Except as provided in the
preceding sentences and in the Preferred Securities Guarantee, the Holders of
Preferred Securities will not be able to exercise directly any other remedy
available to the holders of the Subordinated Debt Securities.
(d) No resignation of the Property Trustee shall be effective unless
either:
(i) the Trust has been completely liquidated and the proceeds of
the liquidation distributed to the Securityholders pursuant to the terms of
the Securities; or
(ii) a Successor Property Trustee has been appointed and accepted
that appointment in accordance with Section 9.8.
(e) The Property Trustee shall have the legal power to exercise all
of the rights, powers and privileges of a holder of Subordinated Debt Securities
under the Indenture and, if an Event of Default occurs and is continuing, the
Property Trustee shall, for the benefit of Securityholders, enforce its rights
as holder of the Subordinated Debt Securities subject to the rights of the
Holders pursuant to the terms of such Securities and this Declaration.
(f) The Property Trustee may authorize one or more Paying Agents to
pay Distributions, redemption payments or liquidation payments on behalf of the
Trust with respect to the Preferred Securities and any such Paying Agent shall
comply with Section 317(b) of the Trust Indenture Act. Any Paying Agent may be
removed by the Property Trustee at any time and a successor Paying Agent or
additional Paying Agents may be appointed at any time by the Property Trustee.
21
(g) Subject to this Section 3.6, the Property Trustee shall have none
of the powers or the authority of the Regular Trustees set forth in Section 3.5
of this Declaration.
(h) The Property Trustee must exercise the powers set forth in this
Section 3.6 in a manner which is consistent with the purposes, functions and
characterization for United States federal income tax purposes of the Trust set
forth in Section 3.5(b) and the Property Trustee shall not take any action which
is inconsistent with or contrary to the purposes, functions and characterization
for United States federal income tax purposes of the Trust set out in Section
3.5(b) of this Declaration.
(i) The Property Trustee, before the occurrence of any Event of
Default and after the curing or waiver of all Events of Default that may have
occurred:
(i) shall undertake to perform only such duties as are
specifically set forth in this Declaration and in the terms of the
Securities, and no implied covenants, duties or obligations shall be read
into this Declaration against the Property Trustee; and
(ii) in the absence of bad faith on the part of the Property
Trustee, the Property Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Property Trustee and conforming
to the requirements of this Declaration; but in the case of any such
certificates or opinions that by any provision hereof are specifically
required to be furnished to the Property Trustee, the Property Trustee
shall be under a duty to examine the same to determine whether or not they
conform to the requirements of this Declaration.
In case an Event of Default has occurred (that has not been cured or
waived pursuant to Section 2.6), the Property Trustee shall exercise such of the
rights and powers vested in it by this Declaration, and use the same degree of
care and skill in their exercise or use, as a prudent person would exercise or
use under the circumstances in the conduct of his or her own affairs;
(j) no provision of this Declaration shall be construed to relieve
the Property Trustee from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that:
(i) this Subsection shall not be construed to limit Subsection
(i) of this Section;
(ii) the Property Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer of the Property
Trustee, unless it shall be proved that the Property Trustee was negligent
in ascertaining the pertinent facts;
(iii) the Property Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith in accordance
with the direction of the Holders of not less than a Majority in
liquidation amount of the Securities at the time outstanding relating to
the time, method and place of conducting any proceeding for any remedy
available to the Property Trustee, or exercising any trust or power
conferred upon
22
the Property Trustee under this Declaration including, without limitation,
with respect to the Securities;
(iv) the Property Trustee shall not be liable for any
interest on any money received by it except as it may otherwise agree with
the Sponsor; and money held by the Property Trustee need not be segregated
from other funds held by it except in relation to the Payment Account
maintained by the Property Trustee pursuant to Section 3.1 and except to
the extent otherwise required by law;
(v) the Property Trustee shall not be responsible for
monitoring the compliance by the Regular Trustees or the Sponsor with their
respective duties under this Declaration, nor shall the Property Trustee be
liable for the default or misconduct of the Regular Trustees or the
Sponsor; and
(vi) no provision of this Declaration shall require the
Property Trustee to expend or risk its own funds or otherwise incur
financial liability in the performance of any of its duties hereunder or in
the exercise of any of its rights or powers, if it shall have reasonable
ground for believing that the repayment of such funds or adequate indemnity
against such risk or liability is not reasonably assured to it.
(k) Whether or not therein expressly so provided, every
provision of this Declaration relating to the conduct or affecting the liability
of or affording protection to the Property Trustee shall be subject to the
provisions of this Section.
Section 3.7 Certain Rights of the Property Trustee.
Subject to the provisions of Section 3.6:
(a) if (i) in performing its duties under this Declaration the
Property Trustee is required to decide between alternative courses of action or
(ii) in construing any of the provisions of this Declaration the Property
Trustee finds the same ambiguous or inconsistent with any other provisions
contained herein or (iii) the Property Trustee is unsure of the application of
any provision of this Declaration, then, except as to any matter as to which the
Preferred Securityholders are entitled to vote under the terms of this
Declaration, the Property Trustee shall take such action, or refrain from taking
such action, not inconsistent with this Declaration as it shall deem advisable
and in the best interests of the Securityholders, in which event the Property
Trustee shall have no liability except for its own bad faith, negligence or
willful misconduct;
(b) any direction or act of the Sponsor or the Regular Trustees
contemplated by this Declaration shall be sufficiently evidenced by an Officer's
Certificate;
(c) whenever in the administration of this Declaration, the
Property Trustee shall deem it desirable that a matter be established before
undertaking, suffering or omitting any action hereunder, the Property Trustee
(unless other evidence is herein specifically prescribed) may, in the absence of
bad faith on its part, request and rely upon an Officer's Certificate which,
upon receipt of such request, shall be promptly delivered by the Sponsor or the
Regular Trustees;
23
(d) the Property Trustee shall have no duty to see to any
recording, filing or registration of any instrument (including any financing or
continuation statement or any filing under tax or securities laws) or any
rerecording, refiling or reregistration thereof;
(e) the Property Trustee may consult with counsel of its
selection (which counsel may be counsel to the Sponsor or any of its Affiliates,
and may include any of its employees) and the advice of such counsel or any
Opinion of Counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in good faith
and in reliance thereon and in accordance with such advice, such counsel may be
counsel to the Sponsor or any of its Affiliates, and may include any of its
employees; the Property Trustee shall have the right at any time to seek
instructions concerning the administration of this Declaration from any court of
competent jurisdiction at the expense of the Sponsor;
(f) the Property Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Declaration at the
request or direction of any of the Securityholders pursuant to this Declaration,
unless such Securityholders shall have offered to the Property Trustee security
or indemnity satisfactory to it against the costs, expenses and liabilities
which might be incurred by it in compliance with such request or direction;
(g) the Property Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order,
approval, bond, debenture, note or other evidence of indebtedness or other paper
or document, but the Property Trustee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it may see fit, and if
the Property Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records and premises
of the Trust, personally or by agent or attorney at the expense of the Sponsor
and shall incur no liability or additional liability of any kind by reason of
such inquiry or investigation;
(h) the Property Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through its
agents or attorneys;
(i) whenever in the administration of this Declaration the
Property Trustee shall deem it desirable to receive instructions with respect to
enforcing any remedy or right or taking any other action hereunder the Property
Trustee:
(i) may request written instructions from the
Securityholders which written instructions may only be given by the Holders
of the same proportion in aggregate Liquidation Amount of the Securities as
would be entitled to direct the Property Trustee under the terms of the
Securities in respect of such remedy, right or action;
(ii) may refrain from enforcing such remedy or right or
taking such other action until such written instructions are received; and
(iii) shall be protected in acting in accordance with such
written instructions; and
24
(j) except as otherwise expressly provided by this Declaration,
the Property Trustee shall not be under any obligation to take any action that
is discretionary under the provisions of this Declaration.
No provision of this Declaration shall be deemed to impose any
duty or obligation on the Property Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it, in any
jurisdiction in which it shall be illegal, or in which the Property Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts, or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Property Trustee
shall be construed to be a duty.
Section 3.8 Prohibition of Actions by the Trust and the Trustees.
(a) So long as this Declaration remains in effect, the Trust (or
the Trustees acting on behalf of the Trust) shall not undertake any business,
activities or transaction except as expressly provided herein or contemplated
hereby. In particular, the Trustees (acting on behalf of he Trust) shall not:
(i) acquire any investments other than the Subordinated
Debt Securities,
(ii) engage in any activities not authorized by this
Declaration,
(iii) sell, assign, transfer, exchange, mortgage, pledge,
set-off or otherwise dispose of any of the Trust Property or interests
therein, including to Securityholders, except as expressly provided herein,
(iv) take any action that would cause the Trust to fail or
cease to qualify as a "grantor trust" for United States federal income tax
purposes,
(v) incur any indebtedness for borrowed money or issue
any other debt or
(vi) take or consent to any action that would result in
the placement of a Lien on any of the Trust Property.
(b) The Property Trustee shall defend all claims and demands of
all Persons at any time claiming any Lien on any of the Trust Property adverse
to the interest of the Trust or the Securityholders in their capacity as
Securityholders; provided, however, that (x) all expenses relating to such
defense shall be borne by the Sponsor and (y) the Property Trustee shall be
fully indemnified by the Sponsor for all costs incurred in connection with such
defense.
Section 3.9 Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Certificates shall be
taken as the statements of the Sponsor, and the Trustees do not assume any
responsibility for their correctness. The Trustees shall not be accountable for
the use or application by the Sponsor of the proceeds of the Subordinated Debt
Securities.
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Section 3.10 Organizational Expenses.
The Sponsor shall pay organizational expenses of the Trust as
they arise or shall, upon request of any Trustee, promptly reimburse such
Trustee for any such expenses paid by such Trustee. The Sponsor shall make no
claim upon the Trust Property for the payment of such expenses.
Section 3.11 Rights and Responsibilities of Sponsor.
In connection with the issue and sale of the Preferred
Securities, the Sponsor shall have the right and responsibility to assist the
Trust with respect to, or effect on behalf of the Trust, the following (and any
actions taken by the Sponsor in furtherance of the following prior to the date
of this Declaration are hereby ratified and confirmed in all respects):
(i) the preparation and filing by the Trust with the
Commission of prospectus supplements and the execution on behalf of the
Trust of post-effective amendments to the registration statement relating
to the Preferred Securities on the appropriate form in relation to the
Preferred Securities;
(ii) the determination of the States in which to take
appropriate action to qualify or register for sale all or part of the
Preferred Securities and the determination of any and all such acts, other
than actions which must be taken by or on behalf of the Trust, and the
advice to the Trustees of actions they must take on behalf of the Trust,
and the preparation for execution and filing of any documents to be
executed and filed by the Trust or on behalf of the Trust, as the Sponsor
deems necessary or advisable in order to comply with the applicable laws of
any such States;
(iii) the preparation for filing by the Trust and execution
on behalf of 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;
(iv) the preparation for filing by the Trust with the
Commission and the execution on behalf of the Trust of a registration
statement on Form 8-A relating to the registration of the Preferred
Securities under Section 12(b) or 12(g) of the Securities Exchange Act of
1934, as amended, including any amendments thereto, if required;
(v) the negotiation of the terms of, and the execution
and delivery of, the Underwriting Agreement providing for the sale of the
Preferred Securities; and
(vi) the taking of any other actions necessary or
desirable to carry out any of the foregoing activities.
Section 3.12 Issuance of Preferred Securities.
The Sponsor and the Trust have executed and delivered the
Underwriting Agreement. On the Closing Date, a Regular Trustee, on behalf of the
Trust, shall execute in accordance with Section 6.2, and upon written direction
the Property Trustee shall make
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available to the Underwriters named in the Underwriting Agreement, Preferred
Securities Certificates, registered in the name of the nominee of the initial
Clearing Agency, evidencing an aggregate of ___________ Preferred Securities
having an aggregate Liquidation Amount of $____________, against receipt by the
Property Trustee of the aggregate purchase price of such Preferred Securities of
$_____________, less applicable discounts and commissions.
Section 3.13 Issuance of Common Securities.
On the Closing Date, a Regular Trustee, on behalf of the Trust,
shall execute in accordance with Section 6.2, and the Property Trustee shall
deliver to the Sponsor, Common Securities Certificates, registered in the name
of the Sponsor, evidencing an aggregate of __________ Common Securities having
an aggregate Liquidation Amount of $________ against receipt by the Property
Trustee from the Sponsor of such amount. Contemporaneously therewith, a Regular
Trustee, on behalf of the Trust, shall subscribe to and purchase from the
Sponsor the Subordinated Debt Securities, registered in the name of the Property
Trustee (in its capacity as such) and having an aggregate principal amount equal
to $___________, and, in satisfaction of the purchase price for such
Subordinated Debt Securities, the Property Trustee, on behalf of the Trust,
shall deliver to the Sponsor the sum of $___________ (being the sum of the
amounts delivered to the Property Trustee pursuant to (i) the second sentence of
Section 3.12 and (ii) the first sentence of this Section 3.13).
Section 3.14 Title to Property of the Trust.
Except as provided in Section 3.6 with respect to the
Subordinated Debt Securities and the Payment Account or as otherwise provided in
this Declaration, legal title to all Trust Property shall be vested at all times
in the Property Trustee (in its capacity as such) and shall be held and
administered by the Property Trustee for the benefit of the Trust and the
Securityholders in accordance with this Declaration.
ARTICLE IV.
PAYMENT ACCOUNT
Section 4.1 Payment Account.
(a) On or prior to the Closing Date, the Property Trustee shall
establish the Payment Account. The Property Trustee and any agent of the
Property Trustee shall have exclusive control and sole right of withdrawal with
respect to the Payment Account for the purpose of making deposits in and
withdrawals from the Payment Account in accordance with this Declaration. All
monies and other property deposited or held from time to time in the Payment
Account shall be held by the Property Trustee in the Payment Account for the
exclusive benefit of the Securityholders and for distribution as herein
provided, including (and subject to) any priority of payments provided for
herein.
(b) The Property Trustee shall deposit in the Payment Account,
promptly upon receipt, all payments of principal of or interest on, and any
other payments or proceeds with
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respect to, the Subordinated Debt Securities. Amounts held in the Payment
Account shall not be invested by the Property Trustee pending distribution
thereof.
ARTICLE V.
DISTRIBUTIONS; REDEMPTION
Section 5.1 Distributions.
(a) The Securities represent undivided beneficial interests in
the Trust Property, and Distributions (including of Additional Amounts) will be
made on the Securities at the rate and on the dates that payments of interest
(including of Additional Interest, as defined in the Officers' Certificate
establishing the terms of the Subordinated Debt Securities pursuant to Section
303 of the Indenture) are made on the Subordinated Debt Securities. Accordingly:
(i) Distributions on the Securities shall be cumulative,
and will accumulate whether or not there are funds of the Trust available
for the payment of Distributions. Distributions shall accrue from
_________, 200__, and, except in the event (and to the extent) that the
Sponsor exercises its right to defer the payment of interest on the
Subordinated Debt Securities pursuant to the Indenture, shall be payable
quarterly in arrears on March 31, June 30, September 30 and December 31 of
each year, commencing on _________, 200[ ]. If any date on which a
Distribution is otherwise payable on the Securities is not a Business Day,
then the payment of such Distribution shall 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, payment of such Distribution shall be made on the
immediately preceding Business Day, in each case with the same force and
effect as if made on such date (each date on which distributions are
payable in accordance with this Section 5.1(a), a "Distribution Date").
(ii) Assuming payments of interest on the Subordinated
Debt Securities are made when due (and before giving effect to Additional
Amounts, if applicable), Distributions on the Securities shall be payable
at a rate ______% per annum of the Liquidation Amount of the Securities.
The amount of Distributions payable for any full period shall be computed
on the basis of a 360-day year of twelve 30-day months. The amount of
Distributions for any partial period shall be computed on the basis of the
number of days elapsed in a 360-day year of twelve 30-day months. The
amount of Distributions payable for any period shall include the Additional
Amounts, if any.
(iii) Distributions on the Securities shall be made by the
Property Trustee from the Payment Account and shall be payable on each
Distribution Date only to the extent that the Trust has funds then on hand
and available in the Payment Account for the payment of such Distributions.
(b) Distributions on the Securities with respect to a
Distribution Date shall be payable to the Holders thereof as they appear on the
Securities Register for the Securities on the
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relevant record date, which shall be one Business Day prior to such Distribution
Date; provided, however, that in the event that the Preferred Securities do not
remain in book-entry-only form, the relevant record date shall be the date 15
days prior to the relevant Distribution Date.
Section 5.2 Redemption.
(a) On each Indenture Redemption Date and on the stated maturity
of the Subordinated Debt Securities, the Trust will be required to redeem a Like
Amount of Securities at the Redemption Price.
(b) Notice of redemption shall be given by the Property Trustee
at the expense of the Sponsor by first-class mail, postage prepaid, mailed not
less than 30 nor more than 60 days prior to the Redemption Date (or, in the
event that the redemption results from acceleration after the occurrence of an
Indenture Event of an Indenture Event of Default and the Property Trustee is
unable to give such notice within such period, as soon as practicable) to each
Securityholder to be redeemed, at such Holder's address appearing in the
Security Register. All notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price;
(iii) the CUSIP number;
(iv) if less than all the Outstanding Securities are to be
redeemed, the identification and the total Liquidation Amount of the
particular Securities to be redeemed; and
(v) that on the Redemption Date the Redemption Price will
become due and payable upon each such Trust Security to be redeemed and
that Distributions thereon will cease to accrue on and after said date,
except as provided in Section 5.2(d).
(c) The Securities redeemed on each Redemption Date shall be
redeemed at the Redemption Price with the proceeds from the contemporaneous
redemption of Subordinated Debt Securities. Redemptions of the Securities shall
be made and the Redemption Price shall be payable on each Redemption Date only
to the extent that the Trust has funds then on hand and available in the Payment
Account for the payment of such Redemption Price.
(d) If the Property Trustee gives a notice of redemption in
respect of any Preferred Securities, then, by 2:00 p.m., New York City time, on
the Redemption Date, subject to Section 5.2(c), the Property Trustee will, so
long as the Preferred Securities are in book-entry-only form, irrevocably
deposit with the Clearing Agency for the Preferred Securities funds sufficient
to pay the applicable Redemption Price and will give such Clearing Agency
instructions with respect to payment of the Redemption Price to the holders of
the Preferred Securities in accordance with the procedures set forth in the
applicable agreement between the Property Trustee and such Clearing Agency. If
the Preferred Securities are no longer in book-entry-only form, the Property
Trustee, subject to Section 5.2(c), will irrevocably deposit with the Paying
Agent funds sufficient to pay the applicable Redemption Price and will give the
Paying
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Agent instructions and authority to pay the Redemption Price to the Holders
thereof upon surrender of their Preferred Securities Certificates in accordance
with the notice of redemption. Notwithstanding the foregoing, Distributions
payable on or prior to the Redemption Date for any Securities called for
redemption shall be payable to the Holders of such Securities as they appear on
the Securities Register on the relevant record dates for the related
Distribution Dates. If notice of redemption shall have been given and funds
deposited as required, then upon the date of such deposit, all rights of
Securityholders holding Securities so called for redemption will cease, except
the right of such Securityholders to receive the Redemption Price and any
Distribution payable on or prior to the Redemption Date, but without interest,
and such Securities will cease to be outstanding. In the event that any date on
which any Redemption Price is payable is not a Business Day, then payment of the
Redemption Price payable on such date will be made on the next succeeding day
that is a Business Day (and without any interest or other payment in respect of
any such delay), except that, if such Business Day falls in the next calendar
year, such payment will be made on the immediately preceding Business Day, in
each case, with the same force and effect as if made on such date. In the event
that payment of the Redemption Price in respect of any Securities called for
redemption is improperly withheld or refused and not paid either by the Trust or
by the Guarantor pursuant to the Guarantee, Distributions on such Securities
will continue to accrue, at the then applicable rate, from the Redemption Date
originally established by the Trust for such Securities to the date such
Redemption Price is actually paid, in which case the actual payment date will be
the date fixed for redemption for purposes of calculating the Redemption Price.
(e) Payment of the Redemption Price on the Securities shall be
made to the recordholders thereof as they appear on the Securities Register for
the Securities on the relevant record date, which shall be one Business Day
prior to the relevant Redemption Date; provided, however, that in the event that
the Preferred Securities do not remain in book-entry-only form, the relevant
record date shall be the date 15 days prior to the relevant Redemption Date .
(f) Subject to Section 5.3(a), if less than all the Outstanding
Securities are to be redeemed on a Redemption Date, then the aggregate
Liquidation Amount of Securities to be redeemed shall be allocated on a pro rata
basis (based on Liquidation Amounts) among the Common Securities and the
Preferred Securities. The particular Preferred Securities and Common Securities
to be redeemed shall be selected on a pro rata basis (based upon Liquidation
Amounts) not more than 60 days prior to the Redemption Date by the Property
Trustee from the Outstanding Preferred Securities and Common Securities,
respectively, not previously called for redemption, by such method (including,
without limitation, by lot) as the Property Trustee shall deem fair and
appropriate and which may provide for the selection for redemption of portions
(equal to $___ or an integral multiple of $___ in excess thereof) of the
Liquidation Amount of Preferred Securities and Common Securities, respectively,
of a denomination larger than $___. The Property Trustee shall promptly notify
the Security Registrar in writing of the Preferred Securities and Common
Securities selected for redemption and, in the case of any Preferred Securities
or Common Securities selected for partial redemption, the Liquidation Amount
thereof to be redeemed. For all purposes of this Declaration, unless the context
otherwise requires, all provisions relating to the redemption of Preferred
Securities or Preferred Securities shall relate, in the case of any Preferred
Securities or Common Securities, as applicable, redeemed or to be redeemed only
in part, to the portion of the Liquidation Amount of Preferred Securities or
Common Securities, as applicable, that has been or is to be redeemed.
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Section 5.3 Subordination of Common Securities.
(a) Payment of Distributions (including Additional Amounts, if
applicable) on, and the Redemption Price of, the Securities, as applicable,
shall be made, subject to Section 5.2(f), pro rata among the Common Securities
and the Preferred Securities based on the Liquidation Amount of the Securities;
provided, however, that if on any Distribution Date or Redemption Date any Event
of Default resulting from an Indenture Event of Default shall have occurred and
be continuing, no payment of any Distribution (including Additional Amounts, if
applicable) on, or Redemption Price of, any Common Security, and no other
payment on account of the redemption, liquidation or other acquisition of Common
Securities, shall be made unless payment in full in cash of all accumulated and
unpaid Distributions (including Additional Amounts, if applicable) on all
Outstanding Preferred Securities for all Distribution periods terminating on or
prior thereto, or in the case of payment of the Redemption Price the full amount
of such Redemption Price on all Outstanding Preferred Securities, shall have
been made or provided for, and all funds immediately available to the Property
Trustee shall first be applied to the payment in full in cash of all
Distributions (including Additional Amounts, if applicable) on, or the
Redemption Price of, Preferred Securities then due and payable.
(b) In the case of the occurrence of any Event of Default
resulting from any Indenture Event of Default, the Holder of Common Securities
will be deemed to have waived any right to act with respect to any such Event of
Default under this Declaration until the effect of all such Events of Default
with respect to the Preferred Securities have been cured, waived or otherwise
eliminated. Until any such Event of Default under this Declaration with respect
to the Preferred Securities has been so cured, waived or otherwise eliminated,
the Property Trustee shall act solely on behalf of the Holders of the Preferred
Securities and not the Holder of the Common Securities, and only the Holders of
the Preferred Securities will have the right to direct the Property Trustee to
act on their behalf.
Section 5.4 Payment Procedures.
Payments of Distributions (including Additional Amounts, if
applicable) in respect of the Preferred Securities shall be made by check mailed
to the address of the Person entitled thereto as such address shall appear on
the Securities Register or, if the Preferred Securities are held by a Clearing
Agency, such Distributions shall be made to the Clearing Agency in immediately
available funds, which shall credit the relevant Persons' accounts at such
Clearing Agency on the applicable Distribution Dates. Payments in respect of
the Common Securities shall be made in such manner as shall be mutually agreed
between the Property Trustee and the Common Securityholder. Any Distributions
in respect of Preferred Securities that remain unclaimed for a period of two
years following the applicable Distribution Date shall be paid to the Holder of
the Common Securities.
Section 5.5 Tax Returns and Reports.
The Regular Trustees shall prepare (or cause to be prepared), at
the Sponsor's expense, and file all United States federal, state and local tax
and information returns, payee statements and reports required to be filed by or
in respect of the Trust. In this regard, the Regular Trustees shall (a) prepare
and file (or cause to be prepared and filed) the appropriate
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Internal Revenue Service form required to be filed in respect of the Trust in
each taxable year of the Trust and (b) prepare and furnish (or cause to be
prepared and furnished) to each Securityholder the appropriate Internal Revenue
Service form required to be provided. The Regular Trustees shall provide the
Sponsor and the Property Trustee with a copy of all such returns and reports
promptly after such filing or furnishing. The Trustees and the Paying Agent
shall comply with United States federal withholding and backup withholding tax
laws and information reporting requirements with respect to any payments to
Securityholders under the Securities.
Section 5.6 Payment of Taxes, Duties, Etc. of the Trust.
Upon receipt under the Subordinated Debt Securities of Additional
Sums, the Property Trustee, pursuant to written instructions from the Sponsor
detailing the payments to be made, shall promptly pay at the expense of the
Sponsor any taxes, duties or governmental charges of whatsoever nature (other
than withholding taxes) imposed on the Trust by the United States or any other
taxing authority.
Section 5.7 Payments under Indenture or Pursuant to Direct Actions.
Any amount payable hereunder to any Holder of Preferred
Securities shall be reduced by the amount of any corresponding payment such
Holder has directly received pursuant to [Section 2.19] of the Officers'
Certificate establishing the Subordinated Debt Securities pursuant to Section
303 of the Indenture or Section 3.6(c) of this Declaration.
ARTICLE VI.
TRUST SECURITIES CERTIFICATES
Section 6.1 Initial Ownership.
Upon the formation of the Trust and until the issuance of the
Securities, and at any time during which no Securities are outstanding, the
Sponsor shall be the sole beneficial owner of the Trust.
Section 6.2 Certificates.
The Preferred Securities Certificates shall be issued in minimum
denominations of $___ Liquidation Amount and integral multiples of $___ in
excess thereof, and the Common Securities Certificates shall be issued in
minimum denominations of $___ Liquidation Amount and integral multiples thereof.
The Certificates shall be executed on behalf of the Trust by manual signature of
at least one Regular Trustee. Certificates bearing the manual signatures of
individuals who were, at the time when such signatures shall have been affixed,
authorized to sign on behalf of the Trust, shall be validly issued and entitled
to the benefits of this Declaration, notwithstanding that such individuals or
any of them shall have ceased to be so authorized prior to the delivery of such
Certificates or did not hold such offices at the date of delivery of such
Certificates. A transferee of a Certificate shall become a Securityholder, and
shall be entitled to the rights and subject to the obligations of a
Securityholder hereunder, upon due registration of such Certificate in such
transferee's name pursuant to Sections 6.4, 6.10 and 6.12.
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Section 6.3 Execution and Delivery of Certificates.
At the Closing Date the Regular Trustees shall cause Certificates
to be executed on behalf of the Trust and delivered by the Property Trustee as
provided in Sections 3.12 and 3.13.
Section 6.4 Registration and Transfer and Exchange of Preferred Securities
Certificates.
(a) The Sponsor shall keep or cause to be kept, at the office or
agency maintained pursuant to Section 6.7, a register or registers for the
purpose of registering Certificates and transfers and exchanges of Preferred
Securities Certificates (the "Securities Register") in which the registrar
designated by the Sponsor (the "Securities Registrar"), subject to such
reasonable regulations as it may prescribe, shall provide for the registration
of Preferred Securities Certificates and Common Securities Certificates (subject
to Section 6.9 in the case of the Common Securities Certificates) and
registration of transfers and exchanges of Preferred Securities Certificates as
herein provided. The Bank shall be the initial Securities Registrar.
(b) Upon surrender for registration of transfer of any Preferred
Securities Certificate at the office or agency maintained pursuant to Section
6.7, the Regular Trustees or any one of them shall execute and deliver to the
Property Trustee, and the Property Trustee shall deliver, in the name of the
designated transferee or transferees, one or more new Preferred Securities
Certificates in authorized denominations of a like aggregate Liquidation Amount
dated the date of execution by such Regular Trustee or Trustees.
(c) The Securities Registrar shall not be required to register
the transfer of any Preferred Securities that have been called for redemption.
At the option of a Holder, Preferred Securities Certificates may be exchanged
for other Preferred Securities Certificates in authorized denominations of the
same class and of a like aggregate Liquidation Amount upon surrender of the
Preferred Securities Certificates to be exchanged at the office or agency
maintained pursuant to Section 6.7.
(d) Every Preferred Securities Certificate presented or
surrendered for registration of transfer or exchange shall be accompanied by a
written instrument of transfer in form satisfactory to the Securities Registrar
duly executed by the Holder or his attorney duly authorized in writing. Each
Preferred Securities Certificate surrendered for registration of transfer or
exchange shall be canceled and subsequently disposed of by the Property Trustee
in accordance with such Person's customary practice. No service charge shall be
made for any registration of transfer or exchange of Preferred Securities
Certificates, but the Securities Registrar may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Preferred Securities Certificates.
Section 6.5 Mutilated, Destroyed, Lost or Stolen Trust Certificates.
If (a) any mutilated Certificate shall be surrendered to the
Securities Registrar, or if the Securities Registrar shall receive evidence to
its satisfaction of the destruction, loss or theft of any Certificate and (b)
there shall be delivered to the Securities Registrar and the Regular Trustees
such security or indemnity as may be required by them to save each of them
harmless,
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then in the absence of notice that such Certificate shall have been acquired by
a bona fide purchaser, the Regular Trustees, or any one of them, on behalf of
the Trust shall execute and make available for delivery, in exchange for or in
lieu of any such mutilated, destroyed, lost or stolen Certificate, a new
Certificate of like class, tenor and denomination. In connection with the
issuance of any new Certificate under this Section, the Regular Trustees or the
Securities Registrar may require the payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in connection therewith.
Any duplicate Certificate issued pursuant to this Section shall constitute
conclusive evidence of an undivided beneficial interest in the assets of the
Trust, as if originally issued, whether or not the lost, stolen or destroyed
Certificate shall be found at any time.
Section 6.6 Persons Deemed Securityholders.
The Trustees or the Securities Registrar shall treat the Person
in whose name any Certificate shall be registered in the Securities Register as
the owner of such Certificate for the purpose of receiving Distributions and for
all other purposes whatsoever, and neither the Trustees nor the Securities
Registrar shall be bound by any notice to the contrary.
Section 6.7 Maintenance of Office or Agency.
The Property Trustee shall designate, with the consent of the
Regular Trustees (which consent shall not be unreasonably withheld), an office
or offices or agency or agencies where Preferred Securities Certificates may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Trustees in respect of the Certificates may be served.
The Property Trustee initially designates its Corporate Trust Office as its
office and agency for such purposes. The Property Trustee shall give prompt
written notice to the Sponsor and to the Securityholders of any change in the
location of the Securities Register or any such office or agency.
Section 6.8 Appointment of Paying Agent.
The Paying Agent shall make distributions to Securityholders from
the Payment Account and shall report the amounts of such distributions to the
Property Trustee and the Regular Trustees. Any Paying Agent shall have the
revocable power to withdraw funds from the Payment Account for the purpose of
making the distributions referred to above. The Property Trustee may revoke such
power and remove the Paying Agent in its sole discretion. The Paying Agent shall
initially be the Bank, and any co-paying agent chosen by the Bank, and
reasonably acceptable to the Regular Trustees. Any Person acting as Paying Agent
shall be permitted to resign as Paying Agent upon 30 days' written notice to the
Regular Trustees and the Property Trustee. In the event that the Bank shall no
longer be the Paying Agent or a successor Paying Agent shall resign or its
authority to act be revoked, the Property Trustee shall appoint a successor that
is acceptable to the Regular Trustees to act as Paying Agent (which shall be a
bank or trust company). The Property Trustee shall cause such successor Paying
Agent or any additional Paying Agent appointed by the Property Trustee to
execute and deliver to the Trustees an instrument in which such successor Paying
Agent or additional Paying Agent shall agree with the Trustees that as Paying
Agent, such successor Paying Agent or additional Paying Agent will hold all
sums, if any, held by it for payment to the Securityholders in trust for the
benefit of the
34
Securityholders entitled thereto until such sums shall be paid to such
Securityholders. The Paying Agent shall return all unclaimed funds to the
Property Trustee and upon removal of a Paying Agent such Paying Agent shall also
return all funds in its possession to the Property Trustee. The provisions of
Sections 3.6, 3.7 and 9.3 shall apply to the Bank also in its role as Paying
Agent, for so long as the Bank shall act as Paying Agent and, to the extent
applicable, to any other paying agent appointed hereunder. Any reference in this
Agreement to the Paying Agent shall include any co-paying agent unless the
context requires otherwise.
Section 6.9 Ownership of Common Securities by Sponsor.
On the Closing Date the Sponsor shall acquire and retain
beneficial and record ownership of the Common Securities. To the fullest extent
permitted by law, other than a transfer in connection with a consolidation or
merger of the Sponsor into another corporation, or any conveyance, transfer or
lease by the Sponsor of its properties and assets substantially as an entirety
to any Person, pursuant to Section 801 of the Indenture, any attempted transfer
of the Common Securities shall be void. The Regular Trustees shall cause each
Common Securities Certificate issued to the Sponsor to contain a legend stating
"THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT IN CERTAIN LIMITED CIRCUMSTANCES
SET FORTH IN THE DE CLARATION (AS DEFINED BELOW)."
Section 6.10 Book-Entry Preferred Securities Certificates; Common Securities
Certificate.
(a) The Preferred Securities Certificates, upon original
issuance, will be issued in the form of a typewritten Preferred Securities
Certificate or Certificates representing Book-Entry Preferred Securities
Certificates, to be delivered to The Depository Trust Company, the initial
Clearing Agency, by, or on behalf of, the Trust. Such Preferred Securities
Certificate or Certificates shall initially be registered on the Securities
Register in the name of Cede & Co., the nominee of the initial Clearing Agency,
and no Owner will receive a Definitive Preferred Securities Certificate
representing such Owner's interest in such Preferred Securities, except as
provided in Section 6.12. Unless and until Definitive Preferred Securities
Certificates have been issued to Owners pursuant to Section 6.12:
(i) the provisions of this Section 6.10(a) shall be in full
force and effect;
(ii) the Securities Registrar, the Sponsor and the Trustees
shall be entitled to deal with the Clearing Agency for all purposes of this
Declaration relating to the Book-Entry Preferred Securities Certificates
(including the payment of the Liquidation Amount of and Distributions or
Redemption Price on the Preferred Securities evidenced by Book-Entry
Preferred Securities Certificates and the giving of instructions or
directions to Owners of Preferred Securities evidenced by Book-Entry
Preferred Securities Certificates) as the sole Holder of Preferred
Securities evidenced by Book-Entry Preferred Securities Certificates and
shall have no obligations to the Owners thereof;
35
(iii) to the extent that the provisions of this Section 6.10
conflict with any other provisions of this Declaration, the provisions of
this Section 6.10 shall control; and
(iv) the rights of the Owners of the Book-Entry Preferred
Securities Certificates shall be exercised only through the Clearing Agency
and shall be limited to those established by law and agreements between
such Owners and the Clearing Agency and/or the Clearing Agency
Participants. Pursuant to the Trust's agreement with the DTC, unless and
until Definitive Preferred Securities Certificates are issued pursuant to
Section 6.12, the initial Clearing Agency will make book-entry transfers
among the Clearing Agency Participants and receive and transmit payments on
the Preferred Securities to such Clearing Agency Participants.
(b) A single Common Securities Certificate representing the Common
Securities shall be issued to the Sponsor in the form of a definitive Common
Securities Certificate.
Section 6.11 Notices to Clearing Agency.
To the extent that a notice or other communication to the Owners is
required under this Declaration, unless and until Definitive Preferred
Securities Certificates shall have been issued to Owners pursuant to Section
6.12, the Trustees shall give all such notices and communications specified
herein to be given to Owners to the Clearing Agency, and shall have no
obligations to the Owners.
Section 6.12 Definitive Preferred Securities Certificates.
If (a) the Sponsor advises the Trustees in writing that the
Clearing Agency is no longer willing or able to properly discharge its
responsibilities with respect to the Preferred Securities Certificates, and the
Sponsor is unable to locate a qualified successor, (b) the Sponsor at its option
advises the Trustees in writing that it elects to terminate the book-entry
system through the Clearing Agency or (c) after the occurrence of an Indenture
Event of Default, Owners of Preferred Securities Certificates representing
beneficial interests aggregating at least a majority of the aggregate
Liquidation Amount of the Outstanding Preferred Securities advise the Regular
Trustees in writing that the continuation of a book-entry system through the
Clearing Agency is no longer in the best interest of the Owners of Preferred
Securities Certificates, then the Regular Trustees shall notify the Clearing
Agency and the Clearing Agency shall notify all Owners of Preferred Securities
Certificates and the other Trustees of the occurrence of any such event and of
the availability of the Definitive Preferred Securities Certificates to Owners
of such class or classes, as applicable, requesting the same. Upon surrender to
the Regular Trustees or the Securities Registrar of the typewritten Preferred
Securities Certificate or Certificates representing the Book Entry Preferred
Securities Certificates by the Clearing Agency, accompanied by registration
instructions, the Regular Trustees, or any one of them, shall execute the
Definitive Preferred Securities Certificates in accordance with the instructions
of the Clearing Agency. Neither the Securities Registrar nor the Trustees shall
be liable for any delay in delivery of such instructions and may conclusively
rely on, and shall be protected in relying on, such instructions. Upon the
issuance of Definitive Preferred Securities Certificates, the Trustees
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shall recognize the Holders of the Definitive Preferred Securities Certificates
as Securityholders. The Definitive Preferred Securities Certificates shall be
printed, lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to the Regular Trustees, as evidenced by the execution
thereof by the Regular Trustees or any one of them.
ARTICLE VII.
ACTS OF SECURITYHOLDERS; MEETINGS; VOTING
Section 7.1 Limitation on Voting Rights.
(a) Except as provided in this Section, in Sections 3.6, 9.7 and
11.2 and in the Indenture and as otherwise required by law, no Holder of
Preferred Securities shall have any right to vote or in any manner otherwise
control the administration, operation and management of the Trust or the
obligations of the parties hereto, nor shall anything herein set forth, or
contained in the terms of the Certificates, be construed so as to constitute the
Securityholders from time to time as partners or members of an association.
(b) So long as any Subordinated Debt Securities are held by the
Property Trustee, the Trustees shall not (i) direct the time, method and place
of conducting any proceeding for any remedy available to the Subordinated Debt
Securities Trustee, or executing any trust or power conferred on the Property
Trustee with respect to such Subordinated Debt Securities, (ii) waive any past
default which is waivable under Section 513 of the Indenture, (iii) exercise any
right to rescind or annul a declaration that the principal of all the
Subordinated Debt Securities shall be due and payable or (iv) consent to any
amendment, modification or termination of the Indenture or the Subordinated Debt
Securities, where such consent shall be required, without, in each case,
obtaining the prior approval of the Holders of a majority in aggregate
Liquidation Amount of all Outstanding Preferred Securities, provided, however,
that where a consent under the Indenture would require the consent of each
Holder of Subordinated Debt Securities affected thereby, no such consent shall
be given by the Property Trustee without the prior written consent of each
Holder of Preferred Securities. The Trustees shall not revoke any action
previously authorized or approved by a vote of the Holders of Preferred
Securities, except by a subsequent vote of the Holders of Preferred Securities.
The Property Trustee shall notify all Holders of the Preferred Securities of any
notice of default received from the Subordinated Debt Securities Trustee with
respect to the Subordinated Debt Securities. In addition to obtaining the
foregoing approvals of the Holders of the Preferred Securities, prior to taking
any of the foregoing actions, the Trustees shall, at the expense of the Sponsor,
obtain an Opinion of Counsel experienced in such matters to the effect that such
action shall not cause the Trust to fail to be classified as a grantor trust for
United States Federal income tax purposes.
(c) If any proposed amendment to this Declaration provides for, or
the Trustees otherwise propose to effect, (i) any action that would adversely
affect in any material respect the powers, preferences or special rights of the
Preferred Securities, whether by way of amendment to this Declaration or
otherwise, or (ii) the dissolution, winding-up or termination of the Trust,
other than pursuant to the terms of this Declaration, then the Holders of
Outstanding Preferred Securities as a class will be entitled to vote on such
amendment or proposal and such amendment or proposal shall not be effective
except with the approval of the Holders of at least a
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majority in aggregate Liquidation Amount of the Outstanding Preferred
Securities. Notwithstanding any other provision of this Declaration, no
amendment to this Declaration may be made if, as a result of such amendment, it
would cause the Trust to fail to be classified as a grantor trust for United
States Federal income tax purposes.
Section 7.2 Notice of Meetings.
Notice of all meetings of the Preferred Securityholders, stating
the time, place and purpose of the meeting, shall be given by the Property
Trustee pursuant to Section 11.8 to each Preferred Securityholder of record, at
his registered address, at least 15 days and not more than 90 days before the
meeting. At any such meeting, any business properly before the meeting may be so
considered whether or not stated in the notice of the meeting. Any adjourned
meeting may be held as adjourned without further notice.
Section 7.3 Meetings of Preferred Securityholders.
(a) No annual meeting of Securityholders is required to be held.
The Property Trustee, however, shall call a meeting of Preferred Securityholders
to vote on any matter upon the written request of the Preferred Securityholders
of record of 25% or more of the Preferred Securities (based upon their aggregate
Liquidation Amount) and the Regular Trustees or the Property Trustee may, at any
time in their discretion, call a meeting of Preferred Securityholders to vote on
any matters as to which Preferred Securityholders are entitled to vote.
(b) Preferred Securityholders of record of 50% of the Outstanding
Preferred Securities (based upon their aggregate Liquidation Amount), present in
person or by proxy, shall constitute a quorum at any meeting of Securityholders.
(c) If a quorum is present at a meeting, an affirmative vote by
the Preferred Securityholders of record present, in person or by proxy, holding
a majority of the Preferred Securities (based upon their aggregate Liquidation
Amount) held by the Preferred Securityholders of record present, either in
person or by proxy, at such meeting shall constitute the action of the Preferred
Securityholders, unless this Declaration requires a greater number of
affirmative votes.
Section 7.4 Voting Rights.
Securityholders shall be entitled to one vote for each $___ of
Liquidation Amount represented by their Securities in respect of any matter as
to which such Securityholders are entitled to vote.
Section 7.5 Proxies, Etc.
At any meeting of Securityholders, any Securityholder entitled to
vote thereat may vote by proxy, provided that no proxy shall be voted at any
meeting unless it shall have been placed on file with the Property Trustee, or
with such other officer or agent of the Trust as the Property Trustee may
direct, for verification prior to the time at which such vote shall be taken.
Pursuant to a resolution of the Property Trustee, proxies may be solicited in
the name of the Property Trustee or one or more officers of the Property
Trustee. Only Securityholders of
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record shall be entitled to vote. When Securities are held jointly by several
persons, any one of them may vote at any meeting in person or by proxy in
respect of such Securities, but if more than one of them shall be present at
such meeting in person or by proxy, and such joint owners or their proxies so
present disagree as to any vote to be cast, such vote shall not be received in
respect of such Securities. A proxy purporting to be executed by or on behalf of
a Securityholder shall be deemed valid unless challenged at or prior to its
exercise, and the burden of proving invalidity shall rest on the challenger. No
proxy shall be valid more than three years after its date of execution.
Section 7.6 Securityholder Action by Written Consent.
Any action which may be taken by Securityholders at a meeting may
be taken without a meeting and without prior notice if Securityholders holding a
majority of all Outstanding Securities (based upon their Liquidation Amount)
entitled to vote in respect of such action (or such larger proportion thereof as
shall be required by any express provision of this Declaration) shall consent to
the action in writing.
Section 7.7 Record Date for Voting and Other Purposes.
For the purposes of determining the Securityholders who are
entitled to notice of and to vote at any meeting or to act by written consent,
or to participate in any distribution on the Securities in respect of which a
record date is not otherwise provided for in this Declaration, or for the
purpose of any other action, the Regular Trustees or the Property Trustee may
from time to time fix a date, not more than 90 days prior to the date of any
meeting of Securityholders or the payment of a distribution or other action, as
the case may be, as a record date for the determination of the identity of the
Securityholders of record for such purposes.
Section 7.8 Acts of Securityholders.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Declaration to be
given, made or taken by Securityholders or Owners may be embodied in and
evidenced by one or more written instruments of substantially similar tenor
signed by such Securityholders or Owners in person or by an agent duly appointed
in writing; and, except as otherwise expressly provided herein, such action
shall become effective when such written instrument or instruments are delivered
to the Property Trustee. Such written instrument or instruments (and the action
embodied therein and evidenced thereby) are herein sometimes referred to as the
"Act" of the Securityholders or Owners signing such written instrument or
instruments. Proof of execution of any such written instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this
Declaration and (subject to Section 8.1) conclusive in favor of the Trustees, if
made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
39
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which any Trustee receiving the same deems sufficient.
(c) The ownership of Preferred Securities shall be proved by the
Securities Register.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Securityholder of any Trust Security shall bind every
future Securityholder of the same Trust Security and the Securityholder of every
Trust Security issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted or suffered to
be done by the Trustees or the Trust in reliance thereon, whether or not
notation of such action is made upon such Trust Security.
(e) Without limiting the foregoing, a Securityholder entitled
hereunder to take any action hereunder with regard to any particular Trust
Security may do so with regard to all or any part of the Liquidation Amount of
such Trust Security or by one or more duly appointed agents each of which may do
so pursuant to such appointment with regard to all or any part of such
liquidation amount.
(f) If any dispute arises between the Securityholders and the
Property Trustee or among such Securityholders or the Trustees with respect to
the authenticity, validity or binding nature of any request, demand,
authorization, direction, consent, waiver or other Act of such Securityholder or
Trustee under this Article VII, then the determination of such matter by the
Property Trustee shall be conclusive and binding with respect to such matter.
Section 7.9 Inspection of Records.
Upon reasonable notice to the Regular Trustees and the Property
Trustee, the records of the Trust shall be open to inspection by Securityholders
during normal business hours for any purpose reasonably related to such
Securityholder's interest as a Securityholder.
ARTICLE VIII.
REPRESENTATIONS AND WARRANTIES
Section 8.1 Representations and Warranties of the Property Trustee.
The Property Trustee and the Delaware Trustee, each severally on
behalf of and as to itself, hereby represents and warrants for the benefit of
the Sponsor and the Securityholders that:
(a) the Property Trustee is a New York banking corporation validly
existing and in good standing under the laws of the State of New York;
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(b) the Property Trustee has the requisite power and authority to
execute, deliver and perform its obligations under this Declaration and has
taken all necessary action to authorize the execution, delivery and performance
by it of this Declaration;
(c) the Delaware Trustee is a Delaware banking corporation duly
organized, validly existing and in good standing in the State of Delaware;
(d) the Delaware Trustee has full corporate power, authority and
legal right to execute, deliver and perform its obligations under this
Declaration and has taken all necessary action to authorize the execution,
delivery and performance by it of this Declaration;
(e) this Declaration has been duly authorized, executed and
delivered by the Property Trustee and the Delaware Trustee and constitutes the
valid and legally binding agreement of each of the Property Trustee and the
Delaware Trustee enforceable against each of them in accordance with its terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles; and
(f) the execution, delivery and performance of this Declaration
has been duly authorized by all necessary corporate or other action on the part
of the Property Trustee and the Delaware Trustee and does not require any
approval of stockholders of the Property Trustee or the Delaware Trustee.
Section 8.2 Representations and Warranties of Sponsor.
The Sponsor hereby represents and warrants that:
(a) this Declaration has been duly authorized, executed and
delivered by the Sponsor and constitutes the valid and legally binding agreement
of the Sponsor enforceable against it in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors' rights
and to general equity principles;
(b) the Certificates issued on the Closing Date on behalf of the
Trust have been duly authorized and will have been duly and validly executed,
issued and delivered by the Trustees pursuant to the terms and provisions of,
and in accordance with the requirements of, this Declaration and the
Securityholders will be, as of each such date, entitled to the benefits of this
Declaration; and
(c) there are no taxes, fees or other governmental charges payable
by the Trust (or the Trustees on behalf of the Trust) under the laws of the
State of Delaware or any political subdivision thereof in connection with the
execution, delivery and performance by the Property Trustee or the Delaware
Trustee, as the case may be, of this Declaration.
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ARTICLE IX.
OTHER PROVISIONS WITH RESPECT TO THE TRUSTEES
Section 9.1 Certain Notices.
Within ten Business Days after the receipt of notice of the
Sponsor's exercise of its right to defer the payment of interest on the
Subordinated Debt Securities pursuant to the Indenture, the Property Trustee
shall transmit, in the manner and to the extent provided in Section 11.8, notice
of such exercise to the Securityholders and the Regular Trustees, unless such
exercise shall have been revoked.
Section 9.2 May Hold Securities.
Any Trustee or any other agent of any Trustee or the Trust, in its
individual or any other capacity, may become the owner or pledgee of Securities
and, subject to Sections 9.5 and 9.10 and except as provided in the definition
of the term "Outstanding" in Article I, may otherwise deal with the Trust with
the same rights it would have if it were not a Trustee or such other agent.
Section 9.3 Compensation; Indemnity; Fees.
(a) The Sponsor agrees:
(i) to pay to the Trustees from time to time such
compensation as shall be agreed to in writing between the Sponsor and
each Trustee for all services rendered by them hereunder (which
compensation shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust);
(ii) except as otherwise expressly provided herein, to
reimburse the Trustees upon request for all reasonable expenses,
disbursements and advances incurred or made by the Trustees in
accordance with any provision of this Declaration (including the
reasonable compensation and the expenses and disbursements of its agents
and counsel), except any such expense, disbursement or advance as may be
attributable to its negligence or willful misconduct; and
(iii) to the fullest extent permitted by applicable law, to
indemnify and hold harmless (i) each Trustee, (ii) any Affiliate of any
Trustee, (iii) any officer, director, shareholder, employee,
representative or agent of any Trustee and (iv) any employee or agent of
the Trust or its Affiliates, (referred to herein as an "Indemnified
Person") from and against any loss, damage, liability, tax, penalty,
expense or claim of any kind or nature whatsoever incurred by such
Indemnified Person by reason of the creation, operation or termination
of the Trust or 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
authority conferred on such Indemnified Person by this Declaration,
except that no Indemnified Person shall be entitled to be indemnified in
respect of any loss, damage or claim incurred by such
42
Indemnified Person by reason of negligence or willful misconduct with
respect to such acts or omissions.
(b) The provisions of this Section 9.3 shall survive the
termination of this Declaration or the resignation or removal of any Trustee.
(c) No Trustee may claim any lien or charge on any Trust Property
as a result of any amount due pursuant to this Section 9.3.
(d) The Sponsor and any Trustee (subject to Section 9.5) 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 Securityholders 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. Neither the Sponsor, nor any 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 the Sponsor or any 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 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 depository 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.
Section 9.4 Corporate Property Trustee Required; Eligibility of Trustees.
(a) There shall at all times be a Property Trustee hereunder. The
Property Trustee shall be a Person that is eligible pursuant to the Trust
Indenture Act to act as such and has a combined capital and surplus of at least
$50,000,000. If any such Person publishes reports of condition at least
annually, pursuant to law or to the requirements of its supervising or examining
authority, then for the purposes of this Section, the combined capital and
surplus of such Person shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time
the Property Trustee with respect to the Securities shall cease to be eligible
in accordance with the provisions of this Section, it shall resign immediately
in the manner and with the effect hereinafter specified in this Article.
(b) There shall at all times be one or more Regular Trustees
hereunder. Each Regular Trustee shall be a natural person at least 21 years of
age who is an officer of the Sponsor.
(c) There shall at all times be a Delaware Trustee. The Delaware
Trustee shall either be (i) a natural person who is at least 21 years of age and
a resident of the State of Delaware or (ii) a legal entity with its principal
place of business in the State of Delaware and that otherwise meets the
requirements of applicable Delaware law that shall act through one or more
persons authorized to bind such entity.
Section 9.5 Conflicting Interests.
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If the Property Trustee has or shall acquire a conflicting interest
within the meaning of the Trust Indenture Act, the Property Trustee shall either
eliminate such interest or resign, to the extent and in the manner provided by,
and subject to the provisions of, the Trust Indenture Act and this Trust
Agreement. The Indenture and the Guarantee are hereby excluded for purposes of
Section 310(b)(1) of the Trust Indenture Act.
Section 9.6 Co-Trustees and Separate Trustee.
(a) Unless an Event of Default shall have occurred and be
continuing, at any time or times, for the purpose of meeting the legal
requirements of the Trust Indenture Act or of any jurisdiction in which any part
of the Trust Property may at the time be located, the Sponsor and the Regular
Trustees, by agreed action of the majority of such Trustees, shall have power to
appoint, and upon the written request of the Regular Trustees, the Sponsor shall
for such purpose join with the Regular Trustees in the execution, delivery, and
performance of all instruments and agreements necessary or proper to appoint,
one or more Persons approved by the Property Trustee either to act as co-
trustee, jointly with the Property Trustee, of all or any part of such Trust
Property, or to the extent required by law to act as separate trustee of any
such property, in either case with such powers as may be provided in the
instrument of appointment, and to vest in such Person or Persons in the capacity
aforesaid, any property, title, right or power deemed necessary or desirable,
subject to the other provisions of this Section. If the Sponsor does not join in
such appointment within 15 days after the receipt by it of a request so to do,
or in case an Indenture Event of Default has occurred and is continuing, the
Property Trustee alone shall have power to make such appointment. Any co-trustee
or separate trustee appointed pursuant to this Section shall either be (i) a
natural person who is at least 21 years of age and a resident of the United
States or (ii) a legal entity with its principal place of business in the United
States that shall act through one or more persons authorized to bind such
entity.
(b) Should any written instrument from the Sponsor be required by
any co-trustee or separate trustee so appointed for more fully confirming to
such co-trustee or separate trustee such property, title, right, or power, any
and all such instruments shall, on request, be executed, acknowledged and
delivered by the Sponsor.
(c) Every co-trustee or separate trustee shall, to the extent
permitted by law, but to such extent only, be appointed subject to the following
terms, namely:
(i) The Securities shall be executed and delivered and all
rights, powers, duties, and obligations hereunder in respect of the
custody of securities, cash and other personal property held by, or
required to be deposited or pledged with, the Trustees specified hereunder
shall be exercised solely by such Trustees and not by such co-trustee or
separate trustee.
(ii) The rights, powers, duties, and obligations hereby
conferred or imposed upon the Property Trustee in respect of any property
covered by such appointment shall be conferred or imposed upon and
exercised or performed by the Property Trustee or by the Property Trustee
and such co-trustee or separate trustee jointly, as shall be provided in
the instrument appointing such co-trustee or separate trustee, except to
the extent that under any law of any jurisdiction in which any particular
44
act is to be performed, the Property Trustee shall be incompetent or
unqualified to perform such act, in which event such rights, powers, duties
and obligations shall be exercised and performed by such co-trustee or
separate trustee.
(iii) The Property Trustee at any time, by an instrument in
writing executed by it, with the written concurrence of the Sponsor, may
accept the resignation of or remove any co-trustee or separate trustee
appointed under this Section, and, in case an Indenture Event of Default
has occurred and is continuing, the Property Trustee shall have power to
accept the resignation of, or remove, any such co-trustee or separate
trustee without the concurrence of the Sponsor. Upon the written request of
the Property Trustee, the Sponsor shall join with the Property Trustee in
the execution, delivery and performance of all instruments and agreements
necessary or proper to effectuate such resignation or removal. A successor
to any co-trustee or separate trustee so resigned or removed may be
appointed in the manner provided in this Section.
(iv) No co-trustee or separate trustee hereunder shall be
personally liable by reason of any act or omission of the Property Trustee
or any other trustee hereunder.
(v) The Property Trustee shall not be liable by reason of
any act of a co-trustee or separate trustee.
(vi) Any Act of Holders delivered to the Property Trustee
shall be deemed to have been delivered to each such co-trustee and separate
trustee.
Section 9.7 Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of any Trustee (the "Relevant
Trustee") and no appointment of a successor Trustee pursuant to this Article
shall become effective until the acceptance of appointment by the successor
Trustee in accordance with the applicable requirements of Section 9.8.
(b) Subject to the immediately preceding paragraph, the Relevant
Trustee may resign at any time by giving written notice thereof to the
Securityholders and the other Trustees. If the instrument of acceptance by the
successor Trustee required by Section 9.8 shall not have been delivered to the
Relevant Trustee within 30 days after the giving of such notice of resignation,
the Relevant Trustee may petition, at the expense of the Sponsor, any court of
competent jurisdiction for the appointment of a successor Relevant Trustee.
(c) Unless an Indenture Event of Default shall have occurred and
be continuing, any Trustee may be removed at any time by Act of the Common
Securityholder. If an Indenture Event of Default shall have occurred and be
continuing, the Property Trustee or the Delaware Trustee, or both of them, may
be removed at such time by Act of the Holders of a majority in aggregate
Liquidation Amount of the Outstanding Preferred Securities, delivered to the
Relevant Trustee (in its individual capacity and on behalf of the Trust). A
Regular Trustee may be removed by the Common Securityholder at any time.
45
(d) If any Trustee shall resign, be removed or become incapable of
acting as Trustee, or if a vacancy shall occur in the office of any Trustee for
any cause, at a time when no Indenture Event of Default shall have occurred and
be continuing, the Common Securityholder, by Act of the Common Securityholder
delivered to the retiring Trustee, shall promptly appoint a successor Trustee or
Trustees, which successor Trustee shall be domiciled outside of the State of
California, and the retiring Trustee shall comply with the applicable
requirements of Section 9.8. If the Property Trustee or the Delaware Trustee
shall resign, be removed or become incapable of continuing to act as the
Property Trustee or the Delaware Trustee, as the case may be, at a time when an
Indenture Event of Default shall have occurred and be continuing, the Preferred
Securityholders, by Act of the Securityholders of a majority in aggregate
Liquidation Amount of the Preferred Securities then Outstanding delivered to the
retiring Relevant Trustee, shall promptly appoint a successor Relevant Trustee
or Trustees, and such successor Trustee shall comply with the applicable
requirements of Section 9.8. If a Regular Trustee shall resign, be removed or
become incapable of acting as Regular Trustee, at a time when an Indenture Event
of Default shall have occurred and be continuing, the Common Securityholder by
Act of the Common Securityholder delivered to the Regular Trustee shall promptly
appoint a successor Regular Trustee and such successor Regular Trustee shall
comply with the applicable requirements of Section 9.8. If no successor Relevant
Trustee shall have been so appointed by the Common Securityholder or the
Preferred Securityholders and accepted appointment in the manner required by
Section 9.8, any Securityholder who has been a Securityholder of Securities for
at least six months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the appointment of a successor
Relevant Trustee.
(e) The Property Trustee shall, at the expense of the Sponsor,
give notice of each resignation and each removal of a Trustee and each
appointment of a successor Trustee to all Securityholders in the manner provided
in Section 11.8 and shall give notice to the Sponsor. Each notice shall include
the name of the successor Relevant Trustee and the address of its Corporate
Trust Office if it is the Property Trustee.
(f) Notwithstanding the foregoing or any other provision of this
Declaration, in the event any Regular Trustee or a Delaware Trustee who is a
natural person dies or becomes, in the opinion of the Sponsor, incompetent or
incapacitated, the vacancy created by such death, incompetence or incapacity may
be filled by (a) the unanimous act of the remaining Regular Trustees if there
are at least two of them or (b) otherwise by the Sponsor (with the successor in
each case being a Person who satisfies the eligibility requirement for Regular
Trustee or Delaware Trustee, as the case may be, set forth in Section 9.4).
Section 9.8 Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor Relevant
Trustee, the retiring Relevant Trustee and each successor Relevant Trustee with
respect to the Securities shall execute and deliver an amendment hereto wherein
each successor Relevant Trustee shall accept such appointment and which (a)
shall contain such provisions as shall be necessary or desirable to transfer and
confirm to, and to vest in, each successor Relevant Trustee all the rights,
powers, trusts and duties of the retiring Relevant Trustee with respect to the
Securities and the Trust and (b) shall add to or change any of the provisions of
this Declaration as shall be necessary to provide for or facilitate the
administration of the Trust by more than one Relevant Trustee, it
46
being understood that nothing herein or in such amendment shall constitute such
Relevant Trustees co-trustees and upon the execution and delivery of such
amendment the resignation or removal of the retiring Relevant Trustee shall
become effective to the extent provided therein and each such successor Relevant
Trustee, without any further act, deed or conveyance, shall become vested with
all the rights, powers, trusts and duties of the retiring Relevant Trustee; but,
on request of the Trust or any successor Relevant Trustee such retiring Relevant
Trustee shall duly assign, transfer and deliver to such successor Relevant
Trustee all Trust Property, all proceeds thereof and money held by such retiring
Relevant Trustee hereunder with respect to the Securities and the Trust.
(b) Upon request of any such successor Relevant Trustee, the
Trust shall execute any and all instruments for more fully and certainly vesting
in and confirming to such successor Relevant Trustee all such rights, powers and
trusts referred to in the first or second preceding paragraph, as the case may
be.
(c) No successor Relevant Trustee shall accept its appointment
unless at the time of such acceptance such successor Relevant Trustee shall be
qualified and eligible under this Article.
Section 9.9 Merger, Conversion Consolidation or Succession to Business.
Any corporation into which the Property Trustee or the Delaware
Trustee may be merged or converted or with which it may be consolidated, or any
corporation resulting from any merger, conversion or consolidation to which such
Trustee shall be a party, or any corporation succeeding to all or substantially
all the corporate trust business of such Trustee, shall be the successor of such
Trustee hereunder, provided such corporation shall be otherwise qualified and
eligible under this Article, without the execution or filing of any paper or any
further act on the part of any of the parties hereto.
Section 9.10 Preferential Collection of Claims against Sponsor or Trust.
In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other similar judicial proceeding relative to the Trust or any other obligor
upon the Securities or the property of the Trust or of such other obligor or
their creditors, the Property Trustee (irrespective of whether any Distributions
on the Securities shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the Property Trustee shall
have made any demand on the Trust for the payment of any past due Distributions)
shall be entitled and empowered, to the fullest extent permitted by law, by
intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount of any
Distributions owing and unpaid in respect of the Securities and to file such
other papers or documents as may be necessary or advisable in order to have the
claims of the Property Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Property Trustee, its
agents and counsel) and of the Holders allowed in such judicial proceeding, and
47
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same; and any custodian,
receiver, assignee, trustee, liquidator, sequestrator or other similar official
in any such judicial proceeding is hereby authorized by each Holder to make such
payments to the Property Trustee and, in the event the Property Trustee shall
consent to the making of such payments directly to the Holders, to pay to the
Property Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Property Trustee, its agents and counsel, and
any other amounts due the Property Trustee.
Nothing herein contained shall be deemed to authorize the Property Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement adjustment or compensation affecting the Securities
or the rights of any Holder thereof or to authorize the Property Trustee to vote
in respect of the claim of any Holder in any such proceeding.
Section 9.11 Number of Trustees.
(a) The number of Trustees shall initially be five, provided that the
Holder of all of the Common Securities by written instrument may increase or
decrease the number of Regular Trustees. The Property Trustee and the Delaware
Trustee may be the same Person.
(b) If a Trustee ceases to hold office for any reason and, if such
Trustee is a Regular Trustee, the number of Regular Trustees is not reduced
pursuant to Section 9.11(a), or if the number of Trustees is increased pursuant
to Section 9.11(a), a vacancy shall occur. The vacancy shall be filled with a
Trustee appointed in accordance with Section 9.7.
(c) The death, resignation, retirement, removal, bankruptcy,
incompetence or incapacity to perform the duties of a Trustee shall not operate
to annul, dissolve or terminate the Trust. Whenever a vacancy in the number of
Regular Trustees shall occur, until such vacancy is filled by the appointment of
a Regular Trustee or Regular Trustees in accordance with Section 9.7, the
Regular Trustees in office, regardless of their number (and notwithstanding any
other provision of this Agreement), 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 9.12 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
3.5; and
(b) The Regular Trustees shall have power to delegate from time to
time to such of their number or to the Sponsor 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 this Declaration, as set forth herein.
Section 9.13 Delaware Trustee.
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It is expressly understood and agreed by the parties hereto that, in
fulfilling its obligations as Delaware Trustee hereunder on behalf of the Trust,
(i) any agreements or instruments executed and delivered by The Bank of New York
(Delaware) are executed and delivered not in its individual capacity but solely
as Delaware Trustee under this Declaration in exercise of the powers and
authority conferred and vested in it, (ii) each of the representations,
undertakings and agreements herein made by The Bank of New York (Delaware) on
the part of the Trust is made and intended not as representations, warranties,
covenants, undertakings and agreements by The Bank of New York (Delaware) in its
individual capacity but is made and intended for the purpose of binding only the
Trust, and (iii) under no circumstances shall The Bank of New York (Delaware) in
its individual capacity be personally liable for the payment of any indebtedness
or expenses of the Trust or be liable for the breach or failure of any
obligation, representation, warranty or covenant made or undertaken by the Trust
under this Declaration, except if such breach or failure is due to any
negligence or willful misconduct of the Delaware Trustee.
ARTICLE X.
TERMINATION, LIQUIDATION AND MERGER
Section 10.1 Termination upon Expiration Date.
Unless earlier dissolved, the Trust shall automatically dissolve
on __________ (the "Expiration Date"), and the Trust Property shall be
distributed in accordance with Section 10.4.
Section 10.2 Early Termination.
The first to occur of any of the following events is an "Early
Termination Event," upon the occurrence of which the Trust shall be dissolved:
(a) a Bankruptcy Event in respect of, or the dissolution or
liquidation of, the Sponsor;
(b) the filing of a certificate of dissolution or its equivalent
with respect to the Sponsor;
(c) the date that is 90 days after the revocation of the articles
of incorporation of the Sponsor (but only if the articles of incorporation are
not reinstated during such 90-day period);
(d) the written direction to the Property Trustee from the
Sponsor at any time to dissolve the Trust and distribute Subordinated Debt
Securities to Securityholders in exchange for the Preferred Securities (which
direction is optional and wholly within the discretion of the Sponsor);
(e) the redemption of all of the Preferred Securities in
connection with the redemption of all the Subordinated Debt Securities; and
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(f) the entry of an order for dissolution of the Trust by a court
of competent jurisdiction.
Section 10.3 Termination.
The respective obligations and responsibilities of the Trustees
and the Trust created and continued hereby shall terminate upon the latest to
occur of the following: (a) the distribution by the Property Trustee to
Securityholders upon the liquidation of the Trust pursuant to Section 10.4, or
upon the redemption of all of the Securities pursuant to Section 5.2, of all
amounts required to be distributed hereunder upon the final payment of the
Securities; (b) the payment of any expenses owed by the Trust; and (c) the
discharge of all administrative duties of the Regular Trustees, including the
performance of any tax reporting obligations with respect to the Trust or the
Securityholders.
Section 10.4 Liquidation.
(a) If an Early Termination Event specified in clause (a), (b) or
(d) of Section 10.2 occurs or upon the Expiration Date, the Trust shall be
liquidated by the Trustees as expeditiously as the Trustees determine to be
possible by distributing, after satisfaction of liabilities to creditors of the
Trust as provided by applicable law, to each Securityholder a Like Amount of
Subordinated Debt Securities, subject to Section 10.4(d). Notice of liquidation
shall be given by the Property Trustee at the expense of the Sponsor by first-
class mail, postage prepaid mailed not later than 30 nor more than 60 days prior
to the Liquidation Date to each Securityholder at such Holder's address
appearing in the Securities Register. All notices of liquidation shall :
(i) state the Liquidation Date;
(ii) state that from and after the Liquidation Date, the
Securities will no longer be deemed to be Outstanding and any Certificates
not surrendered for exchange will be deemed to represent a Like Amount of
Subordinated Debt Securities; and
(iii) provide such information with respect to the mechanics
by which Holders may exchange Certificates for Subordinated Debt
Securities, or if Section 10.4(d) applies, receive a Liquidation
Distribution.
(b) Except where Section 10.2(c) or 10.4(d) applies, in order to
effect the liquidation of the Trust and distribution of the Subordinated Debt
Securities to Securityholders, the Property Trustee shall establish a record
date for such distribution (which shall be (i) one Business Day prior to the
Liquidation Date or (ii) in the event that the Preferred Securities are not in
book-entry form, the date 15 days prior to the Liquidation Date) and, either
itself acting as exchange agent or through the appointment of a separate
exchange agent, shall establish such procedures as it shall deem appropriate to
effect the distribution of Subordinated Debt Securities in exchange for the
Outstanding Certificates.
(c) Except where Section 10.2(c) or 10.4(d) applies, after the
Liquidation Date, (i) the Securities will no longer be deemed to be Outstanding,
(ii) certificates representing a Like Amount of Subordinated Debt Securities
will be issued to holders of Certificates, upon
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surrender of such certificates to the Property Trustee or its agent for
exchange, (iii) the Sponsor shall use its best efforts to have the Subordinated
Debt Securities listed on the New York Stock Exchange or on such other exchange,
interdealer quotation system or self-regulatory organization as the Preferred
Securities are then listed, (iv) any Certificates not so surrendered for
exchange will be deemed to represent a Like Amount of Subordinated Debt
Securities, accruing interest at the rate provided for in the Subordinated Debt
Securities from the last Distribution Date on which a Distribution was made on
such Certificates until such certificates are so surrendered (and until such
certificates are so surrendered, no payments of interest or principal will be
made to Holders of Certificates with respect to such Subordinated Debt
Securities) and (v) all rights of Securityholders holding Securities will cease,
except the right of such Securityholders to receive Subordinated Debt Securities
upon surrender of Certificates.
(d) In the event that, notwithstanding the other provisions of
this Section 10.4, whether because of an order for dissolution entered by a
court of competent jurisdiction or otherwise, distribution of the Subordinated
Debt Securities in the manner provided herein is determined by the Property
Trustee not to be practical, the Trust Property shall be liquidated, and the
Trust shall be wound-up by the Property Trustee in such manner as the Property
Trustee determines. In such event, Securityholders will be entitled to receive
out of the assets of the Trust available for distribution to Securityholders,
after satisfaction of liabilities to creditors of the Trust as provided by
applicable law, an amount equal to the Liquidation Amount per Trust Security
plus accumulated and unpaid Distributions thereon to the date of payment (such
amount being the "Liquidation Distribution"). If, upon any such winding up, the
Liquidation Distribution can be paid only in part because the Trust has
insufficient assets available to pay in full the aggregate Liquidation
Distribution, then, subject to the next succeeding sentence, the amounts payable
by the Trust on the Securities shall be paid on a pro rata basis (based upon
Liquidation Amounts). The Holder of the Common Securities will be entitled to
receive Liquidation Distributions upon any such winding-up pro rata (determined
as aforesaid) with Holders of Preferred Securities, except that, if an Indenture
Event of Default has occurred and is continuing, the Preferred Securities shall
have a priority over the Common Securities.
Section 10.5 Mergers, Consolidations, Amalgamations or Replacements of Trust.
The Trust may not merge with or into, consolidate, amalgamate, or
be replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, except pursuant to this Section 10.5
or Section 10.4. At the request of the Sponsor, with the consent of the Holders
of at least a majority in aggregate Liquidation Amount of the Outstanding
Preferred Securities, the Trust may merge with or into, consolidate, amalgamate,
or be replaced by or convey, transfer or lease its properties and assets
substantially as an entirety to a trust organized as such under the laws of any
State; provided, that:
(i) such successor entity either (x) expressly assumes all of
the obligations of the Trust with respect to the Preferred Securities or
(y) substitutes for the Preferred Securities other securities having
substantially the same terms as the Preferred Securities (the "Successor
Securities") so long as the Successor Securities rank the same as the
Preferred Securities rank in priority with respect to distributions and
payments upon liquidation, redemption and otherwise;
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(ii) the Sponsor expressly appoints a trustee of such successor
entity possessing the same powers and duties as the Property Trustee as the
holder of the Subordinated Debt Securities;
(iii) the Preferred Securities are listed or traded, or any
Successor Securities will be listed upon notification of issuance, on any
national securities exchange or other organization on which the Preferred
Securities are then listed or traded, if any;
(iv) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not cause the Preferred Securities
(including any Successor Securities) to be downgraded by any nationally
recognized statistical rating organization;
(v) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights,
preferences and privileges of the holders of the Preferred Securities
(including any Successor Securities) in any material respect;
(vi) such successor entity has a purpose substantially
identical to that of the Trust;
(vii) prior to such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, the Sponsor has received an
Opinion of Counsel to the effect that (x) such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease does not adversely
affect the rights, preferences and privileges of the Holders of the
Preferred Securities (including any Successor Securities) in any material
respect, and (y) following such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, neither the Trust nor such
successor entity will be required to register as an investment company
under the 1940 Act; and
(viii) the Sponsor owns all of the common securities of such
successor entity and the Guarantor guarantees the obligations of such
successor entity under the Successor Securities at least to the extent
provided by the Guarantee.
Notwithstanding the foregoing, the Trust shall not, except with the consent of
holders of 100% in Liquidation Amount of the Preferred Securities, consolidate,
amalgamate, merge with or into, or be replaced by or convey, transfer or lease
its properties and assets substantially as an entirety to any other entity or
permit any other entity to consolidate, amalgamate, merge with or into, or
replace it if such consolidation, amalgamation, merger, replacement, conveyance,
transfer or lease would cause the Trust or the successor entity to be classified
as other than a grantor trust for United States Federal income tax purposes.
ARTICLE XI.
MISCELLANEOUS PROVISIONS
Section 11.1 Limitation of Rights of Securityholders.
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Except as otherwise provided in Section 10.2, the death,
dissolution, termination, bankruptcy or incapacity of any Person having an
interest, beneficial or otherwise, in Securities shall not operate to terminate
this Declaration, nor dissolve, terminate or annul the Trust, nor entitle the
legal successors, representatives or heirs of such Person or any Securityholder
for such Person, to claim an accounting, take any action or bring any proceeding
in any court for a partition or winding up of the arrangements contemplated
hereby, nor otherwise affect the rights, obligations and liabilities of the
parties hereto or any of them.
Section 11.2 Amendment.
(a) This Declaration may be amended from time to time by the
Property Trustee, the Regular Trustees and the Sponsor, without the consent of
any Securityholders, (i) to cure any ambiguity, correct or supplement any
provision herein which may be inconsistent with any other provision herein, or
to make any other provisions with respect to matters or questions arising under
this Declaration, which shall not be inconsistent with the other provisions of
this Declaration, or (ii) to modify, eliminate or add to any provisions of this
Declaration to such extent as shall be necessary to ensure that the Trust will
be classified for United States Federal income tax purposes as a grantor trust
at all times that any Securities are outstanding or to ensure that the Trust
will not be required to register as an investment company under the 1940 Act;
provided, however, that in the case of clause (i), such action shall not
adversely affect in any material respect the interests of any Securityholder,
and any such amendments of this Declaration shall become effective when notice
thereof is given to the Securityholders.
(b) Except as provided in Section 11.2(c) hereof, any provision
of this Declaration may be amended by the Trustees and the Sponsor with (i) the
consent of Securityholders representing a majority (based upon aggregate
Liquidation Amount) of the Securities then Outstanding and (ii) receipt by the
Trustees of an Opinion of Counsel to the effect that such amendment or the
exercise of any power granted to the Trustees in accordance with such amendment
will not affect the Trust's status as a grantor trust for United States Federal
income tax purposes or the Trust's exemption from status of an investment
company under the 1940 Act.
(c) In addition to and notwithstanding any other provision in
this Declaration, without the consent of each affected Securityholder, this
Declaration may not be amended to (i) change the amount or timing of any
Distribution on the Securities or otherwise adversely affect the amount of any
Distribution required to be made in respect of the Securities as of a specified
date or (ii) restrict the right of a Securityholder to institute suit for the
enforcement of any such payment on or after such date; notwithstanding any other
provision herein, without the unanimous consent of the Securityholders, this
paragraph (c) of this Section 11.2 may not be amended.
(d) Notwithstanding any other provisions of this Declaration, no
Trustee shall enter into or consent to any amendment to this Declaration which
would cause the Trust to fail or cease to qualify for the exemption from status
of an investment company under the 1940 Act or fail or cease to be classified as
a grantor trust for United States Federal income tax purposes.
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(e) Notwithstanding anything in this Declaration to the
contrary, this Declaration may not be amended in a manner which imposes any
additional obligation on the Sponsor, the Property Trustee or the Delaware
Trustee without the consent of the Sponsor, the Property Trustee or the Delaware
Trustee, as the case may be.
(f) In the event that any amendment to this Declaration is made,
the Regular Trustees shall promptly provide to the Sponsor a copy of such
amendment.
(g) Neither the Property Trustee nor the Delaware Trustee shall
be required to enter into any amendment to this Declaration which affects its
own rights, duties or immunities under this Declaration. The Property Trustee
shall be entitled to receive an Opinion of Counsel and an Officer's Certificate
stating that any amendment to this Declaration is in compliance with this
Declaration and that all conditions precedent, if any, to such amendment have
been complied with.
Section 11.3 Separability.
In case any provision in this Declaration or in the Certificates
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
Section 11.4 Governing Law.
THIS DECLARATION AND THE RIGHTS AND OBLIGATIONS OF EACH OF THE
SECURITYHOLDERS, THE TRUST AND THE TRUSTEES WITH RESPECT TO THIS DECLARATION AND
THE TRUST SECURITIES SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE
LAWS OF THE STATE OF DELAWARE WITHOUT REGARD TO THE CONFLICT OF LAWS PRINCIPLES
THEREOF.
Section 11.5 Payments Due on Non-Business Day.
If the date fixed for any payment on any Trust Security shall be
a day that is not a Business Day, then such payment need not be made on such
date but may be made on the next succeeding day that is a Business Day (except
as otherwise provided in Sections 5.1(a) and 5.2(d)), with the same force and
effect as though made on the date fixed for such payment, and no interest shall
accrue thereon for the period after such date.
Section 11.6 Successors.
This Declaration shall be binding upon and shall inure to the
benefit of any successor to the Sponsor, the Trust or the Relevant Trustee,
including any successor by operation of law. Except in connection with a
consolidation, merger, sale or other transaction involving the Sponsor that is
permitted under Article Eight of the Indenture and pursuant to which the
assignee agrees in writing to perform the Sponsor's obligations hereunder, the
Sponsor shall not assign its obligations hereunder.
Section 11.7 Headings.
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The Article and Section headings are for convenience only and
shall not affect the construction of this Declaration.
Section 11.8 Reports, Notices and Demands
(a) Any report, notice, demand or other communication which by
any provision of this Declaration is required or permitted to be given or served
to or upon any Securityholder or the Sponsor may be given or served in writing
by deposit thereof, first-class postage prepaid, in the United States mail, hand
delivery or facsimile transmission, in each case, addressed, (a) in the case of
a Preferred Securityholder, to such Preferred Securityholder as such
Securityholder's name and address may appear on the Securities Register; and (b)
in the case of the Common Securityholder or the Sponsor, to Sempra Energy, 101
Ash Street, San Diego, California 92101, Attention __________, facsimile number
(619) _____________. Any notice to Preferred Securityholders shall also be given
to such owners as have, within two years preceding the giving of such notice,
filed their names and addresses with the Property Trustee for that purpose. Such
notice, demand or other communication to or upon a Securityholder shall be
deemed to have been sufficiently given or made, for all purposes, upon hand
delivery, mailing or transmission.
(b) Any notice, demand or other communication which by any
provision of this Declaration is required or permitted to be given or served to
or upon the Trust, the Property Trustee, the Delaware Trustee or the Regular
Trustees shall be given in writing addressed (until another address is published
by the Trust) as follows: (a) with respect to the Property Trustee to The Bank
of New York, at its Corporate Trust Office, Attention: Corporate Trust
Administration; (b) with respect to the Delaware Trustee, to The Bank of New
York (Delaware), White Clay Center, Route 273, Newark, Delaware 19711,
Attention: Corporate Trust Administration; (c) with respect to the Regular
Trustees, to them c/o Sempra Energy, 101 Ash Street, San Diego, California
92101, marked "Attention Regular Trustees of Sempra Energy Capital Trust I"; and
(d) with respect to the Trust, to its principal office specified in Section 3.2,
with a copy to the Property Trustee. Such notice, demand or other communication
to or upon the Trust or the Property Trustee shall be deemed to have been
sufficiently given or made only upon actual receipt of the writing by the Trust
or the Property Trustee.
Section 11.9 Agreement not to Petition.
Each of the Trustees and the Sponsor agree for the benefit of the
Securityholders that, until at least one year and one day after the Trust has
been terminated in accordance with Article X, they shall not file, or join in
the filing of, a petition against the Trust under any bankruptcy, insolvency,
reorganization or other similar law (including, without limitation, the United
States Bankruptcy Code) (collectively, "Bankruptcy Laws") or otherwise join in
the commencement of any proceeding against the Trust under any Bankruptcy Law.
In the event the Sponsor takes action in violation of this Section 11.9, the
Property Trustee agrees, for the benefit of Securityholders, that at the expense
of the Sponsor, it shall file an answer with the bankruptcy court or otherwise
properly contest the filing of such petition by the Sponsor against the Trust or
the commencement of such action and raise the defense that the Sponsor has
agreed in writing not to take such action and should be stopped and precluded
therefrom and such other defenses,
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if any, as counsel for the Trustee or the Trust may assert. The provisions of
this Section 11.9 shall survive the termination of this Declaration.
Section 11.10 Acceptance of Terms of Declaration; Guarantee and Indenture.
THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST
THEREIN BY OR ON BEHALF OF A SECURITYHOLDER OR ANY BENEFICIAL OWNER, WITHOUT ANY
SIGNATURE OR FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL
ACCEPTANCE BY THE SECURITYHOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN
SUCH TRUST SECURITY OF ALL THE TERMS AND PROVISIONS OF THIS DECLARATION AND
AGREEMENT TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND
THE INDENTURE, AND SHALL CONSTITUTE THE AGREEMENT OF THE TRUST, SUCH
SECURITYHOLDER AND SUCH OTHERS THAT THE TERMS AND PROVISIONS OF THIS DECLARATION
SHALL BE BINDING, OPERATIVE AND EFFECTIVE AS BETWEEN THE TRUST AND SUCH
SECURITYHOLDER AND SUCH OTHERS. THE DEPOSITOR, THE TRUST AND EACH HOLDER AND
BENEFICIAL OWNER OF A PREFERRED SECURITY (BY ITS ACCEPTANCE OF AN INTEREST
THEREIN) SHALL BE DEEMED TO HAVE AGREED TO TREAT THE NOTES AS INDEBTEDNESS FOR
ALL U.S. TAX PURPOSES AND THE PREFERRED SECURITY AS EVIDENCE OF AN INDIRECT
BENEFICIAL OWNERSHIP INTEREST IN THE NOTES.
(Signature Pages Follow)
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IN WITNESS WHEREOF, the parties hereto have caused this Declaration to
be duly executed, as of the day and year first written above.
SEMPRA ENERGY
By:
__________________________________________
Name:
Title:
THE BANK OF NEW YORK, as Property Trustee
By:
__________________________________________
Name
Title:
THE BANK OF NEW YORK (DELAWARE),
as Delaware
Trustee
By:
__________________________________________
Name
Title:
S-1
REGULAR TRUSTEES
By:_______________________________________
Name:
Title:
By:_______________________________________
Name:
Title:
By:_______________________________________
Name:
Title:
S-2