EXHIBIT 4.18
----------------------------------------------------
FORM OF
AMENDED AND RESTATED
TRUST AGREEMENT
among
SNH CAPITAL TRUST HOLDINGS
as Sponsor,
STATE STREET BANK AND TRUST COMPANY
as Property Trustee,
and
THE REGULAR TRUSTEES NAMED HEREIN
Relating to
SNH CAPITAL TRUST I
Dated as of June 21, 2001
----------------------------------------------------
Certain Sections of this Trust Agreement relating to Sections 310 through 318,
inclusive, of the Trust Indenture Act of 1939:
Trust Indenture Trust
Act Section Agreement Section
ss.310(a)(1).................................................................8.7
(a)(2).................................................................8.7
(a)(3)......................................................Not Applicable
(a)(4).................................................................2.7
(a)(5).................................................................8.7
(b)....................................................................8.8
(c).........................................................Not Applicable
ss.311(a)...................................................................8.12
(b)...................................................................8.12
(c).........................................................Not Applicable
ss.312.......................................................................5.7
ss.313(a)...................................................................8.13
(b).........................................................Not Applicable
(c)...................................................................8.13
(d)...................................................................8.13
ss.314(a)...................................................................8.14
(b).........................................................Not Applicable
(c)...................................................................8.15
(d).........................................................Not Applicable
(e)..............................................................1.1, 8.15
ss.315(a)...............................................................8.1, 8.3
(b)....................................................................8.2
(c)....................................................................8.1
(d)...............................................................8.1, 8.3
(e).........................................................Not Applicable
ss.316(a)...............................................................6.1, 8.2
(b)....................................................................6.8
(c)....................................................................6.7
ss.317(a)...............................................................2.7, 8.1
(b)....................................................................5.9
ss.318(a)..................................................................10.10
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NOTE: This reconciliation and tie shall not, for any purpose, be deemed to be
part of the Trust Agreement.
Table of Contents
Page
ARTICLE 1 DEFINED TERMS.........................................................................................1
SECTION 1.1 Definitions.................................................................................1
ARTICLE 2 ESTABLISHMENT OF THE TRUST............................................................................9
SECTION 2.1 Name........................................................................................9
SECTION 2.2 Principal Place of Business; Registered Agent...............................................9
SECTION 2.3 Organizational Expenses....................................................................10
SECTION 2.4 Issuance of the Preferred Securities.......................................................10
SECTION 2.5 Subscription and Purchase of Debt Securities; Issuance of the Common Securities............10
SECTION 2.6 Declaration of Trust.......................................................................11
SECTION 2.7 Authorization to Enter into Certain Transactions...........................................11
SECTION 2.8 Assets of Trust............................................................................15
SECTION 2.9 Title to Trust Property....................................................................15
ARTICLE 3 PAYMENT ACCOUNT......................................................................................15
SECTION 3.1 Payment Account............................................................................15
ARTICLE 4 DISTRIBUTIONS; REDEMPTION; EXCHANGE..................................................................16
SECTION 4.1 Distributions..............................................................................16
SECTION 4.2 Redemption.................................................................................16
SECTION 4.3 Intentionally Omitted......................................................................19
SECTION 4.4 Special Event Exchange or Redemption.......................................................19
SECTION 4.5 Subordination of Common Securities.........................................................21
SECTION 4.6 Payment Procedures.........................................................................22
SECTION 4.7 Tax Returns and Reports....................................................................22
SECTION 4.8 Payment of Taxes, Duties, Etc., of the Trust...............................................22
SECTION 4.9 Payments under Indenture...................................................................22
ARTICLE 5 TRUST SECURITIES CERTIFICATES..................................................................22
SECTION 5.1 Initial Ownership..........................................................................22
SECTION 5.2 The Trust Securities Certificates..........................................................22
SECTION 5.3 Delivery of Trust Securities Certificates..................................................23
SECTION 5.4 Registration of Transfer and Exchange of Preferred Securities; Restrictions on Transfer....23
SECTION 5.5 Mutilated, Destroyed, Lost or Stolen Trust Securities Certificates.........................24
SECTION 5.6 Persons Deemed Securityholders.............................................................24
SECTION 5.7 Access to List of Securityholders' Names and Addresses.....................................25
SECTION 5.8 Maintenance of Office or Agency............................................................25
SECTION 5.9 Appointment of Paying Agent................................................................25
SECTION 5.10 Ownership of Common Securities by Sponsor.................................................26
SECTION 5.11 Global Securities; Non-Global Securities; Common Securities Certificate...................26
Table of Contents
(continued)
Page
SECTION 5.12 Notices to Clearing Agency................................................................27
SECTION 5.13 Definitive Preferred Securities Certificates..............................................27
SECTION 5.14 Rights of Securityholders.................................................................28
ARTICLE 6 ACT OF SECURITYHOLDERS; MEETINGS; VOTING.............................................................28
SECTION 6.1 Limitations on Voting Rights...............................................................28
SECTION 6.2 Notice of Meetings.........................................................................30
SECTION 6.3 Meetings of Preferred Securityholders......................................................30
SECTION 6.4 Voting Rights..............................................................................31
SECTION 6.5 Proxies, Etc...............................................................................31
SECTION 6.6 Securityholder Action by Written Consent...................................................31
SECTION 6.7 Record Date for Voting and Other Purposes..................................................31
SECTION 6.8 Acts of Securityholders....................................................................32
SECTION 6.9 Inspection of Records......................................................................33
ARTICLE 7 REPRESENTATIONS AND WARRANTIES.......................................................................33
SECTION 7.1 Representations and Warranties of the Property Trustee.....................................33
SECTION 7.2 Representations and Warranties of Sponsor..................................................34
ARTICLE 8 THE TRUSTEES.........................................................................................34
SECTION 8.1 Certain Duties and Responsibilities........................................................34
SECTION 8.2 Notice of Defaults.........................................................................36
SECTION 8.3 Certain Rights of Property Trustee.........................................................38
SECTION 8.4 Not Responsible for Recitals or Issuance of Securities.....................................40
SECTION 8.5 May Hold Securities........................................................................41
SECTION 8.6 Compensation; Indemnity; Fees..............................................................41
SECTION 8.7 Property Trustee Required; Eligibility of Trustees.........................................42
SECTION 8.8 Conflicting Interests......................................................................42
SECTION 8.9 Resignation and Removal; Appointment of Successor..........................................42
SECTION 8.10 Acceptance of Appointment by Successor....................................................43
SECTION 8.11 Merger, Conversion, Consolidation or Succession to Business...............................44
SECTION 8.12 Preferential Collection of Claims Against Sponsor or Trust................................44
SECTION 8.13 Reports by Property Trustee...............................................................44
SECTION 8.14 Reports to the Property Trustee...........................................................44
SECTION 8.15 Evidence of Compliance with Conditions Precedent..........................................45
SECTION 8.16 Number of Trustees........................................................................45
SECTION 8.17 Delegation of Power.......................................................................45
ARTICLE 9 DISSOLUTION, LIQUIDATION AND MERGER..................................................................45
SECTION 9.1 Dissolution upon Expiration Date...........................................................45
SECTION 9.2 Early Dissolution..........................................................................46
SECTION 9.3 Dissolution................................................................................46
SECTION 9.4 Liquidation................................................................................46
SECTION 9.5 Mergers, Consolidations or Replacements of the Trust.......................................48
(ii)
Table of Contents
(continued)
Page
ARTICLE 10 MISCELLANEOUS PROVISIONS.............................................................................49
SECTION 10.1 Limitation of Rights of Securityholders...................................................49
SECTION 10.2 Amendment.................................................................................49
SECTION 10.3 Separability..............................................................................50
SECTION 10.4 Governing Law.............................................................................50
SECTION 10.5 Payments Due on Non-Business Day..........................................................50
SECTION 10.6 Successors................................................................................50
SECTION 10.7 Headings..................................................................................51
SECTION 10.8 Reports, Notices and Demands..............................................................51
SECTION 10.9 Agreement Not to Petition.................................................................51
SECTION 10.10 Trust Indenture Act; Conflict with Trust Indenture Act...................................51
SECTION 10.11 Acceptance of Terms of Trust Agreement, Guarantee and Indenture..........................52
SECTION 10.12 Counterparts.............................................................................52
EXHIBIT A - Certificate of Trust of SNH Capital Trust I
EXHIBIT B - Form of Common Securities of SNH Capital Trust I
EXHIBIT C - Form of Preferred Securities of SNH Capital Trust I
(iii)
AMENDED AND RESTATED TRUST AGREEMENT, dated as of June 21, 2001 among
(i) SNH CAPITAL TRUST HOLDINGS, a Maryland business trust (including any
successors or assigns, the "Sponsor"), (ii) State Street Bank and Trust Company,
a Massachusetts trust company, as property trustee (in such capacity, the
"Property Trustee" and, in its personal capacity and not in its capacity as
Property Trustee, the "Bank"), (iii) Gerard M. Martin, an individual, and Barry
M. Portnoy, an individual, each of whose address is c/o Senior Housing
Properties Trust, 400 Centre Street, Newton, Massachusetts 02458 (each, an
"Regular Trustee" and, collectively, the "Regular Trustees" and, collectively
with the Property Trustee, the "Trustees") and (iv) the several Holders as
hereinafter defined.
W I T N E S S E T H:
WHEREAS, the Sponsor and certain of the Trustees have heretofore duly
declared and created a business trust pursuant to the Maryland Business Trust
Act by the entering into of that certain Declaration of Trust, dated as of May
4, 2001 (the "Original Trust Agreement"), and by the execution and filing by
certain of the Trustees with the State Department of Assessments and Taxation of
Maryland of the Certificate of Trust, filed on May 4, 2001, attached as Exhibit
A, for the sole purpose of issuing and selling certain securities representing
undivided beneficial interests in the assets of the Trust (as defined herein)
and investing the proceeds thereof in the Debt Securities (as defined herein);
and
WHEREAS, the parties hereto desire to amend and restate the Original
Trust Agreement in its entirety as set forth herein to provide for, among other
things, (i) the issuance and sale of the Common Securities (as defined herein)
by the Trust to the Sponsor, (ii) the issuance and sale of the Preferred
Securities (as defined herein) by the Trust pursuant to the Underwriting
Agreement (as defined herein) and (iii) the acquisition by the Trust from the
Parent of all of the right, title and interest in the Debt Securities;
NOW, THEREFORE, in consideration of the agreements and obligations set
forth herein and for other good and valuable consideration, the sufficiency of
which is hereby acknowledged, each party, for the benefit of the other parties
and for the benefit of the Holders of the Preferred Securities, hereby amends
and restates the Original Trust Agreement in its entirety and agrees as follows:
ARTICLE 1
DEFINED TERMS
SECTION 1.1 Definitions. For all purposes of this Trust Agreement,
except as otherwise expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(b) all other terms used herein that are defined in the Trust Indenture
Act, either directly or by reference therein, have the meanings assigned to them
therein;
(c) unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the case may be,
of this Trust Agreement; and
(d) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Trust Agreement as a whole and not to any
particular Article, Section or other subdivision.
"Act" has the meaning specified in Section 6.8.
"Additional Amount" means, with respect to the Trust Securities, the
amount of Additional Interest (as defined in the Indenture), if any, paid by the
Parent on the Debt Securities.
"Additional Sums" means, with respect to the Trust Securities, the
amount of Additional Sums (as defined in the Indenture), if any, paid by the
Parent on the Debt Securities.
"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, provided, however that an Affiliate of the
Sponsor or the Parent shall be deemed not to include the Trust. 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.
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Certificate or beneficial interest therein, the
rules and procedures of the Euroclear system, of Clearstream Banking, societe
anonyme (or its successor), and of the Clearing Agency for such security, in
each case to the extent applicable to such transaction and as in effect from
time to time.
"Bank" has the meaning specified in the preamble to this Trust
Agreement.
"Bankruptcy Event" means, with respect to any Person:
(a) such Person, pursuant to or within the meaning of any
Bankruptcy Law (i) commences a voluntary case, (ii) consents to the
entry of an order for relief against it in an involuntary case, or
(iii) consents to the appointment of a Custodian of it or for all or
substantially all of its property, or
(b) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that: (i) is for relief against such
Person in an involuntary case, (ii) appoints a Custodian of such Person
or for all or substantially all of its property, or (iii) orders the
liquidation of such Person, and the order or decree remains unstayed
and in effect for 90 days.
"Bankruptcy Laws" means Title 11, United States Bankruptcy Code of
1978, as amended, or any similar United States federal or state law relating to
bankruptcy, insolvency,
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receivership, winding-up, liquidation, reorganization or relief of debtors or
any amendment to, succession to or change in any such law.
"Board of Trustees" means either the board of trustees of the Sponsor
or any committee of that board duly authorized to act hereunder.
"Book-Entry Preferred Securities Certificates" means a beneficial
interest in the Preferred Securities Certificates, ownership and transfers of
which shall be made through book entries by a Clearing Agency as described in
Section 5.11.
"Business Day" means any day other than a Saturday or Sunday or a day
on which banking institutions in New York, New York or in Boston, Massachusetts
are authorized or required by law or executive order to remain closed or a day
on which the Corporate Trust Office of the Property Trustee or the corporate
trust office of the Indenture Trustee, is closed for business.
"Clearing Agency" means an organization registered as a "clearing
agency" pursuant to Section 17A of the Securities Exchange Act of 1934, as
amended. 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 a Clearing
Agency effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
"Closing Date" means the first Time of Delivery (as defined in the
Underwriting Agreement), which date is also the date of execution and delivery
of this Trust Agreement.
"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 Certificate" means a certificate evidencing
ownership of Common Securities, substantially in the form attached as Exhibit B.
"Common Security" means an undivided beneficial interest in the assets
of the Trust, having a Liquidation Amount with respect to the assets of the
Trust of $25.00 and having the rights provided therefor in this Trust Agreement,
including the right to receive Distributions and a Liquidation Distribution as
provided herein.
"Common Stock" means common shares of beneficial interest, $.01 par
value per share, of the Parent.
"Corporate Trust Office" means the principal corporate trust office of
the Property Trustee at which at any particular time its corporate trust
business shall be administered, which office at the date hereof is located at
Boston, Massachusetts, Attention: Paul D. Allen.
3
"Debt Security Redemption Date" means, with respect to any Debt
Securities to be redeemed under the Indenture, the date fixed for redemption
thereof under the Indenture.
"Debt Securities" means up to $29,639,200 aggregate principal amount of
10.125% Junior Subordinated Debentures of the Parent issued pursuant to the
Indenture.
"Definitive Preferred Securities Certificates" means either or both (as
the context requires) of (x) Preferred Securities Certificates issued in
certificated, fully registered form as provided in Section 5.11(b) and (y)
Preferred Securities Certificates issued in certificated, fully registered form
as provided in Section 5.13.
"Direct Action" has the meaning specified in Section 6.8.
"Distribution Date" has the meaning specified in Section 4.1(a).
"Distributions" means amounts payable in respect of the Trust
Securities as provided in Section 4.1.
"Early Dissolution Event" has the meaning specified in Section 9.2.
"Event of Default" means the occurrence of an Indenture Event of
Default, whatever the reason for such Indenture 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.
"Exchange Agent" means any exchange agent appointed pursuant to Section
4.4(h).
"Exchange Notice" has the meaning specified in Section 4.4(b).
"Expiration Date" has the meaning specified in Section 9.1.
"Global Certificate" means a Preferred Security that is registered in
the Securities Register in the name of a Clearing Agency or a nominee thereof.
"Guarantee" means the Guarantee Agreement executed and delivered by the
Parent and State Street Bank and Trust Company, a Massachusetts trust company,
as guarantee trustee, contemporaneously with the execution and delivery of this
Trust Agreement, for the benefit of the Holders of the Preferred Securities, as
amended from time to time.
"Holder" means a Person in whose name a Trust Securities Certificate
representing a Trust Security is registered, such Person being a beneficial
owner within the meaning of the Maryland Business Trust Act.
"Indenture" means the Junior Subordinated Indenture, dated as of June
21, 2001, between the Parent and the Indenture Trustee, as supplemented by the
Supplemental Indenture No. 1 thereto, dated as of June 21, 2001, as the same may
be amended or supplemented from time to time.
4
"Indenture Event of Default" means an "Event of Default" as defined in
the Indenture.
"Indenture Trustee" means State Street Bank and Trust Company, a
Massachusetts trust company, as trustee under the Indenture.
"Investment Company Event" means the receipt by the Property Trustee,
on behalf of the Trust, of an Opinion of Counsel, rendered by a law firm having
a national tax and securities practice (which Opinion of Counsel shall not have
been rescinded by such law firm), to the effect that, as a result of the
occurrence of a change in law or regulation or a change in interpretation or
application of law or regulation by any legislative body, court, governmental
agency or regulatory authority (a "Change in 1940 Act Law"), there is more than
an insubstantial risk that the Trust is or will be considered an "investment
company" that is required to be registered under the 1940 Act, which Change in
1940 Act Law becomes effective on or after the date of original issuance of the
Preferred Securities under this Trust Agreement.
"Lien" means any lien, pledge, charge, encumbrance, mortgage, deed of
trust, adverse ownership interest, hypothecation, assignment, security interest
or preference, priority or other security agreement or preferential arrangement
of any kind or nature whatsoever.
"Liquidation Amount" means an amount with respect to the assets of the
Trust equal to $25.00 per Trust Security.
"Liquidation Date" means each date on which Debt Securities or cash are
to be distributed to Holders of Trust Securities in connection with a
dissolution and liquidation of the Trust pursuant to Section 9.4(a).
"Liquidation Distribution" has the meaning specified in Section 9.4(d).
"Maryland Business Trust Act" means Title 12 of the Corporations and
Associations Article of the Annotated Code of Maryland, as it may be amended
from time to time.
"1940 Act" means the Investment Company Act of 1940, as amended.
"Officers' Certificate" means a certificate signed by the Chairman of
the Board, a Trustee, a Vice Chairman of the Board, the Chief Executive Officer,
the Chief Operating Officer, the Chief Financial Officer, the President or a
Vice President, and, by the Treasurer, an Assistant Treasurer, the Controller,
the Secretary or an Assistant Secretary, of the Sponsor, and delivered to the
Property Trustee. Any Officers' Certificate delivered with respect to compliance
with a condition or covenant provided for in this Trust Agreement shall include:
(a) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the definitions
relating thereto; a brief statement of the nature and scope of the
examination or investigation undertaken by each officer in rendering
the Officers' Certificate;
(b) a statement that each 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
5
(c) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied with.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Trust, the Property Trustee or the Sponsor, and who may be an
employee of any thereof, and who shall be acceptable to the Property Trustee.
"Optional Redemption Price" means with respect to the Preferred
Securities (except as set forth below with respect to redemption upon the
occurrence of a Tax Event), 100% of the Liquidation Amounts thereof, plus
accumulated and unpaid Distributions, if any, to the date fixed for redemption
if redeemed during the twelve-month period commencing June 15 of each year. In
the event of a redemption of Trust Securities upon the occurrence of a Tax
Event, Trust Securities shall be redeemed at the redemption price of $25.00 per
Trust Security and all accumulated and unpaid Distributions, if any, to the date
fixed for redemption.
"Original Trust Agreement" has the meaning specified in the recitals to
this Trust Agreement.
"Outstanding", when used with respect to Trust Securities, means, as of
the date of determination, all Trust Securities theretofore executed and
delivered under this Trust Agreement, except:
(a) Trust Securities theretofore cancelled by the Securities
Registrar or delivered to the Securities Registrar for cancellation or
tendered for conversion;
(b) Trust Securities for whose payment or redemption money in
the necessary amount has been theretofore deposited with the Property
Trustee or any Paying Agent for the Holders of such Trust Securities;
provided that, if such Trust Securities are to be redeemed, notice of
such redemption has been duly given pursuant to this Trust Agreement;
(c) Trust Securities which have been exchanged for Debt
Securities pursuant to Section 4.4; and
(d) Trust Securities which have been paid or in exchange for
or in lieu of which other Trust Securities have been executed and
delivered pursuant to Section 5.5;
provided, however, that in determining whether the Holders of the requisite
Liquidation Amount of the Outstanding Trust Securities have given any request,
demand, authorization, direction, notice, consent or waiver hereunder, Trust
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
(a) in determining whether any Trustee shall be fully protected in relying upon
any such request, demand, authorization, direction, notice, consent or waiver,
only Trust Securities that a Responsible Officer of the Property Trustee, or an
individual Regular Trustee, as the case may be, actually knows to be so owned
shall be so disregarded and (b) the foregoing shall not apply at any time when
all of the Outstanding Trust Securities are owned by the Sponsor, one or more of
the Regular Trustees and/or any such Affiliate. Trust Securities so owned which
have been pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the
6
satisfaction of the Securities Registrar the pledgee's right so to act with
respect to such Trust 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).
"Parent" means Senior Housing Properties Trust, a Maryland real estate
investment trust and its successors and assigns.
"Paying Agent" means any paying agent or co-paying agent appointed
pursuant to Section 5.9.
"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 Debt Securities will be held and from which the Property Trustee
shall make payments to the Securityholders in accordance with Section 4.1.
"Person" means any individual, corporation, partnership, joint venture,
association, joint stock company, trust, limited liability company or
corporation, unincorporated organization or government or any agency or
political subdivision thereof.
"Preferred Securities Certificate" means a certificate evidencing
ownership of Preferred Securities, substantially in the form attached as Exhibit
C.
"Preferred Security" means an undivided beneficial interest in the
assets of the Trust, having a Liquidation Amount with respect to the assets of
the Trust of $25.00 and having the rights provided therefor in this Trust
Agreement, including the right to receive Distributions and a Liquidation
Distribution as provided herein.
"Property Trustee" means the commercial bank or trust company
identified as the "Property Trustee" in the preamble to this Trust Agreement
solely in its capacity as Property Trustee of the Trust 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, each Debt Security Redemption Date.
"Redemption Price" means, with respect to any Trust Security, $25.00
per Trust Security, plus accumulated and unpaid Distributions (including any
Additional Sums) to the date of redemption.
"Regular Trustee" means each individual named as a Regular Trustee in
the preamble to this Trust Agreement, each solely in his capacity as Regular
Trustee of the Trust and not in his individual capacity, or such Regular
Trustee's successor in interest in such capacity, or any
7
successor in interest in such capacity, or any successor Regular Trustee
appointed as herein provided.
"Relevant Trustee" has the meaning specified in Section 8.9.
"Responsible Officer" when used with respect to the Property Trustee,
means the chairman or any vice-chairman of the board of directors, the chairman
or any vice-chairman of the executive committee of the board of directors, the
chairman of the trust committee, the president, any vice president, the
secretary, any assistant secretary, the treasurer, any assistant treasurer, the
cashier, any assistant cashier, any trust officer or assistant trust officer,
the controller or any assistant controller 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 his knowledge of and familiarity with the particular subject.
"Securities Register" and "Securities Registrar" have the respective
meanings specified in Section 5.4.
"Securityholder" or "Holder" means a Person in whose name a Trust
Security or Securities is registered in the Securities Register; any such Person
shall be deemed to be a beneficial owner within the meaning of the Maryland
Business Trust Act.
"Special Event" means a Tax Event or an Investment Company Event.
"Sponsor" has the meaning specified in the preamble to this Trust
Agreement.
"Sponsor Indemnified Person" has the meaning specified in Section 8.6.
"Successor Property Trustee" has the meaning specified in Section 8.9.
"Successor Securities" has the meaning specified in Section 9.5.
"Super Majority" has the meaning specified in Section 8.2.
"Tax Event" means the receipt by the Property Trustee, on behalf of the
Trust, of an Opinion of Counsel, rendered by a law firm having a national tax
and securities practice (which Opinion of Counsel shall not have been rescinded
by such law firm), 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 affecting taxation, 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
such pronouncement or decision is announced on or after the date of issuance of
the Preferred Securities under this Trust Agreement and does not pertain to the
use of the proceeds of the issuance of the Debt Securities, there is more than
an insubstantial risk in each case after the date thereof that (i) the Trust is,
or will be within 90 days after the date thereof, subject to United States
federal income tax with respect to income received or accrued on the Debt
Securities, (ii) interest payable by the Parent on the Debt Securities is not,
or will not be, within 90 days after the date thereof, deductible, in whole or
in part, for United States federal
8
income tax purposes or (iii) the Trust is, or will be within 90 days after the
date thereof, subject to more than de minimus amount of other taxes, duties,
assessments or other governmental charges.
"Trust" means the Maryland business trust continued hereby and
identified on the cover page of this Trust Agreement.
"Trust Agreement" means this Amended and Restated Trust Agreement, as
the same may be modified, amended or supplemented in accordance with the
applicable provisions hereof, including all exhibits hereto, including, for all
purposes of this Trust Agreement and any such modification, amendment or
supplement, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this Trust Agreement and any such modification, amendment or
supplement, respectively.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in force
at the date as of which this instrument was executed; provided, however, that in
the event the Trust Indenture Act of 1939 is amended after such date, "Trust
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 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 to be held by the Property Trustee pursuant to the terms of
this Trust Agreement for the benefit of the Securityholders.
"Trust Security" means any one of the Common Securities or the
Preferred Securities.
"Trust Securities Certificate" means any one of the Common Securities
Certificates, the Global Certificates or the Definitive Preferred Securities
Certificates.
"Trustees" means, collectively, the Property Trustee and the Regular
Trustees.
"Underwriting Agreement" means the Underwriting Agreement, dated as of
June 18, 2001, among the Parent, the Sponsor and UBS Warburg LLC, Salomon Smith
Barney Inc., A.G. Edwards & Sons, Inc., First Union Securities, Inc., Prudential
Securities Incorporated, Credit Suisse First Boston Corporation and Tucker
Anthony Incorporated, as representatives of the several underwriters.
ARTICLE 2
ESTABLISHMENT OF THE TRUST
SECTION 2.1 Name. The Trust continued hereby shall be known as "SNH
Capital Trust I, as such name may be modified from time to time by the Regular
Trustees following written notice to the Holders of Trust Securities and the
other Trustees, in which name the Trustees may conduct the business of the
Trust, make and execute contracts and other instruments on behalf of the Trust
and sue and be sued.
SECTION 2.2 Principal Place of Business; Registered Agent.
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(a) The address of the principal office of the Trust is c/o Senior
Housing Properties Trust, 400 Centre Street, Newton, Massachusetts 02458 or such
other address as the Regular Trustees may designate by written notice to the
Sponsor. The address of the Maryland office of the Trust is c/o Ballard Spahr
Andrews & Ingersoll, LLP, 300 East Lombard Street, Baltimore, Maryland 21202 or
such other address as the Regular Trustees may designate by written notice to
the Sponsor.
(b) The name of the resident agent of the Trust in the State of
Maryland is James J. Hanks, Jr., 300 East Lombard Street, Baltimore, Maryland
21202. The resident agent is a citizen of and resides in the State of Maryland.
At any time, the Regular Trustees may designate by written notice to the Sponsor
another resident agent who is a citizen of and resides in the State of Maryland
or which is a Maryland corporation.
SECTION 2.3 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 2.4 Issuance of the Preferred Securities. On June 18, 2001, the
Sponsor and the Trust executed and delivered the Underwriting Agreement.
Contemporaneously with the execution and delivery of this Trust Agreement, a
Regular Trustee, on behalf of the Trust, shall execute in accordance with
Section 5.2 and deliver to the Underwriters named in the Underwriting Agreement
Preferred Securities Certificates, in an aggregate amount of 1,000,000 Preferred
Securities having an aggregate Liquidation Amount of $25,000,000, against
receipt of the aggregate purchase price of such Preferred Securities of
$25,000,000, which amount the Regular Trustees shall promptly deliver, or cause
to be delivered, to the Property Trustee. If the Underwriters exercise their
over-allotment option granted pursuant to the Underwriting Agreement, then upon
exercise of the over-allotment option in accordance with the terms of the
Underwriting Agreement, a Regular Trustee, on behalf of the Trust, shall execute
in accordance with Section 5.2 and deliver to the Underwriters named in the
Underwriting Agreement Preferred Securities Certificates, in an aggregate amount
of up to 150,000 additional Preferred Securities having an aggregate Liquidation
Amount of $3,750,000, against receipt of the aggregate purchase price of such
Preferred Securities of up to $3,750,000, which amount the Regular Trustees
shall promptly deliver, or cause to be delivered, to the Property Trustee
SECTION 2.5 Subscription and Purchase of Debt Securities; Issuance of
the Common Securities. Contemporaneously with the execution and delivery of this
Trust Agreement, the Regular Trustees, on behalf of the Trust, shall subscribe
to and purchase from the Parent Debt Securities, registered in the name of the
Property Trustee (in its capacity as such) and having an aggregate principal
amount equal to $25,773,200, and, in satisfaction of the purchase price for such
Debt Securities, the Property Trustee, on behalf of the Trust, shall deliver to
the Parent the sum of $25,773,200. Contemporaneously therewith, a Regular
Trustee, on behalf of the Trust, shall execute in accordance with Section 5.2
and deliver to the Sponsor Common Securities Certificates registered in the name
of the Sponsor, in an aggregate amount of 4,640 Common Securities having an
aggregate Liquidation Amount of $116,000 against receipt by the Property Trustee
of the aggregate purchase price of such Common Securities from the Sponsor of
the sum of $116,000. If the Underwriters exercise their over-allotment option
granted pursuant to the
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Underwriting Agreement, then upon exercise of the over-allotment option in
accordance with the terms of the Underwriting Agreement, the Regular Trustees,
on behalf of the Trust, shall subscribe to and purchase from the Parent Debt
Securities, registered in the name of the Property Trustee (in its capacity as
such) and having an aggregate principal amount of up to $3,866,000 and, in
satisfaction of the purchase price for such Debt Securities, the Property
Trustee, on behalf of the Trust, shall deliver to the Parent the sum of up to
$3,866,000. Contemporaneously therewith, a Regular Trustee, on behalf of the
Trust, shall execute in accordance with Section 5.2 and deliver to the Sponsor
Common Securities Certificates registered in the name of the Sponsor, in an
aggregate amount of up to 4,640 additional Common Securities having an aggregate
Liquidation Amount of up to $116,000 against receipt by the Property Trustee of
the aggregate purchase price of such Common Securities from the Sponsor of the
sum of up to $116,000.
SECTION 2.6 Declaration of Trust. The exclusive purposes and functions
of the Trust are (a) to issue and sell Trust Securities and use the proceeds
from such sale to acquire the Debt Securities, (b) to distribute the Trust's
income as provided in this Trust Agreement and (c) to engage in only those other
activities necessary or incidental thereto. The Trust shall not borrow money,
issue debt or reinvest proceeds derived from investments, mortgage or pledge any
of its assets or otherwise undertake (or permit to be undertaken) any activity
that would cause the Trust not to be classified for United States federal income
tax purposes as a grantor trust. 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, subject to
the terms and conditions hereof. 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.
SECTION 2.7 Authorization to Enter into Certain Transactions.
(a) The Trustees shall conduct the affairs of the Trust in accordance
with the terms of this Trust Agreement. Subject to the limitations set forth in
Section 2.6 and paragraph (b) of this Section, and in accordance with the
following provisions (i) and (ii), the Trustees shall have the exclusive power,
duty and the authority to cause the Trust to engage in the following activities:
(i) As among the Trustees, each Regular Trustee shall have the
exclusive power and authority to act on behalf of the Trust with
respect to the following matters:
(A) to issue and sell the Trust Securities, provided,
however, that the Trust may issue no more than one series of
Preferred Securities and no more than one series of Common
Securities, and, provided, further, that there shall be no
interests in the Trust other than the Trust Securities, and
the issuance of Trust Securities shall be limited to
simultaneous issuance of both Preferred Securities and Common
Securities on the Closing Date and any other date Preferred
Securities and Common Securities are sold pursuant to the
over-allotment option granted to the Underwriters named in the
Underwriting Agreement, subject to the
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issuance of Trust Securities pursuant to Section 5.5 and
Successor Securities pursuant to Section 9.5;
(B) to cause the Trust to enter into, and to execute,
deliver and perform on behalf of the Trust, a certificate
depository agreement and such other agreements as may be
necessary or incidental to the purposes and function of the
Trust;
(C) to assist 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 Trust Agreement as a trust indenture under the Trust
Indenture Act;
(D) to assist in the listing of the Preferred
Securities upon such securities exchange or exchanges, if any,
as shall be determined by the Sponsor and the registration of
the Preferred Securities under the Securities Exchange Act of
1934, as amended, and the preparation and filing of all
periodic and other reports and other documents pursuant to the
foregoing (only to the extent that such listing or
registration is requested by the Sponsor);
(E) to appoint a Paying Agent, a Securities Registrar
and an authenticating agent in accordance with this Trust
Agreement;
(F) to the extent and in the manner provided in this
Trust Agreement, to wind up the affairs of and liquidate the
Trust and to prepare, execute and file a certificate of
cancellation with the State Department of Assessments and
Taxation in accordance with the provisions of the Maryland
Business Trust Act;
(G) unless otherwise required by the Maryland
Business Trust Act or the Trust Indenture Act, to execute on
behalf of the Trust (either acting alone or together with any
other Regular Trustees) any documents that the Regular
Trustees have the power to execute pursuant to this Trust
Agreement;
(H) to take 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 Trust Agreement
including, but not limited to:
(i) causing the Trust not to be deemed to be an
investment company required to be registered
under the 1940 Act;
(ii) causing the Trust to be classified for
United States federal income tax purposes as
a grantor trust; and
(iii) cooperating with the Sponsor to ensure that
the Debt Securities will be treated as
indebtedness of the Parent for United States
federal income tax purposes;
provided that such action does not adversely affect in any
material respect the
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interests of Securityholders except as otherwise provided in
Section 10.2(a); and
(I) to execute all documents or instruments, perform
all duties and powers, and do all things for and on behalf of
the Trust in all matters necessary or incidental to the
foregoing.
(ii) As among the Trustees, the Property Trustee shall have
the power, duty and authority to act on behalf of the Trust with
respect to the following matters:
(A) the establishment of the Payment Account;
(B) the receipt of and taking title to the Debt
Securities;
(C) the collection of interest, principal and any
other payments made in respect of the Debt Securities in the
Payment Account;
(D) the distribution from the Trust Property of
amounts owed to the Securityholders in respect of the Trust
Securities;
(E) the exercise of all of the rights, powers and
privileges of a holder of the Debt Securities;
(F) the sending of notices of default, other notices
and other information regarding the Trust Securities and the
Debt Securities to the Securityholders in accordance with this
Trust Agreement;
(G) the distribution of the Trust Property in
accordance with the terms of this Trust Agreement;
(H) to the extent provided in this Trust Agreement,
the winding up of the affairs of and liquidation of the Trust;
(I) after an Event of Default of which a Responsible
Officer of the Property Trustee has knowledge, the taking of
any action incidental to the foregoing as the Property Trustee
may from time to time determine is necessary or advisable to
give effect to the terms of this Trust Agreement and 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);
(J) subject to this Section 2.7(a)(ii), the Property
Trustee shall have none of the duties, liabilities, powers or
the authority of the Regular Trustees set forth in Section
2.7(a)(i);
(K) to act as Paying Agent and/or Securities
Registrar to the extent appointed as such hereunder; and
(L) the taking and holding of title to Trust
Property.
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(b) So long as this Trust Agreement remains in effect, the Trust (or
the Trustees acting on behalf of the Trust) shall not undertake any business,
activities or transaction except as expressly provided herein or contemplated
hereby. In particular, notwithstanding anything in this Trust Agreement to the
contrary, the Trust shall not, and the Trustees shall not and shall not cause
the Trust to
(i) invest any proceeds received by the Trust from holding the
Debt Securities (rather, the Trustees shall distribute all such
proceeds to the Securityholders pursuant to the terms of this Trust
Agreement and the Trust Securities), acquire any investments or engage
in any activities not authorized by this Trust Agreement, (ii) sell,
assign, transfer, exchange, mortgage, pledge, set-off or otherwise
dispose of any of the Trust Property or interests therein, including to
Securityholders, except as expressly provided herein, (iii) take any
action that would cause the Trust to fail or cease to qualify as a
"grantor trust" for United States federal income tax purposes, (iv)
make any loans or incur any indebtedness for borrowed money or issue
any other debt, (v) take or consent to any action that would result in
the placement of a Lien on any of the Trust Property, (vi) possess any
power or otherwise act in such a way as to vary the Trust assets or the
terms of the Trust Securities in any way whatsoever except as permitted
by the terms of this Trust Agreement, or (vii) issue any securities or
other evidences of beneficial ownership of, or beneficial interest in,
the Trust other than the Trust Securities. The Regular Trustees shall
defend all claims and demands of all Persons at any time claiming any
Lien on any of the Trust Property adverse to the interest of the Trust
or the Securityholders in their capacity as Securityholders.
(c) In connection with the issue and sale of the Preferred Securities,
the Sponsor shall have the right and responsibility to assist the Trust with
respect to, or effect on behalf of the Trust, the following actions (and any
actions taken by the Sponsor in furtherance of the following prior to the date
of this Trust Agreement are hereby ratified and confirmed in all respects):
(i) to file by the Trust with the Commission and to execute on
behalf of the Trust a registration statement on the appropriate form in
relation to the Preferred Securities, including any amendments thereto;
(ii) to determine the states and foreign jurisdictions in
which to take appropriate action to qualify or register for resale all
or part of the Preferred Securities and to do any and all such acts,
other than actions which must be taken by or on behalf of the Trust,
and advise the Trustees of actions they must take on behalf of the
Trust, and prepare for execution and filing any documents to be
executed and filed by the Trust or on behalf of the Trust, as the
Sponsor deems necessary or advisable in order to comply with the
applicable laws of any such states and foreign jurisdictions;
(iii) to the extent necessary, to prepare for filing by the
Trust with the Commission and to execute on behalf of the Trust a
registration statement on Form 8-A relating to the registration of the
Preferred Securities under Section 12(b) or 12(g) of the Securities
Exchange Act of 1934, as amended, including any amendments thereto (it
being understood that neither the Trust, the Sponsor nor the Parent has
any obligation
14
under the Indenture, the Underwriting Agreement or the Trust Agreement
to register any Trust Securities under the Securities Exchange Act of
1934, as amended, or to list any Trust Securities on any securities
exchange);
(iv) to negotiate, and to execute and deliver, on behalf of
the Trust, the Underwriting Agreement; and
(v) any other actions necessary or incidental to carry out any
of the foregoing activities.
(vi) Notwithstanding anything herein to the contrary, the
Regular Trustees are authorized and directed to conduct the affairs of
the Trust and to operate the Trust so that the Trust will not be deemed
to be an "investment company" required to be registered under the 1940
Act, or taxed as a corporation for United States federal income tax
purposes and so that the Debt Securities will be treated as
indebtedness of the Parent for United States federal income tax
purposes. In this connection, the Sponsor and the Regular Trustees are
authorized to take any action, not inconsistent with applicable law,
the Certificate of Trust or this Trust Agreement, that each of the
Sponsor and the Regular Trustees determines in their discretion to be
necessary or desirable for such purposes, so long as such action does
not adversely affect in any material respect the interests of the
Holders of the Preferred Securities except as otherwise provided in
Section 10.2(a).
SECTION 2.8 Assets of Trust. The assets of the Trust shall consist of
only the Trust Property.
SECTION 2.9 Title to Trust Property. Legal title to all Trust Property
shall be vested at all times in the Property Trustee (in its capacity as such)
and shall be held and administered by the Property Trustee for the benefit of
the Trust and the Securityholders in accordance with this Trust Agreement. The
Securityholders shall not have legal title to any part of the assets of the
Trust, but shall have an undivided beneficial interest in the assets of the
Trust.
ARTICLE 3
PAYMENT ACCOUNT
SECTION 3.1 Payment Account.
(a) On or prior to the Closing Date, the Property Trustee shall
establish the Payment Account. The Property Trustee and any agent of the
Property Trustee shall have exclusive control and sole right of withdrawal with
respect to the Payment Account for the purpose of making deposits in and
withdrawals from the Payment Account in accordance with this Trust Agreement.
All monies and other property deposited or held from time to time in the Payment
Account shall be held by the Property Trustee in the Payment Account for the
exclusive benefit of the Securityholders and for distribution as herein
provided, including (and subject to) any priority of payments provided for
herein.
(b) The Property Trustee shall deposit in the Payment Account, promptly
upon receipt, all payments of principal of or interest on, and any other
payments or proceeds with
15
respect to, the Debt Securities. Amounts held in the
Payment Account shall not be invested by the Property Trustee pending
distribution thereof.
ARTICLE 4
DISTRIBUTIONS; REDEMPTION; EXCHANGE
SECTION 4.1 Distributions.
(a) Distributions on the Trust Securities shall be cumulative, and
shall accrue from the date of original issuance, or the most recent Distribution
Date (as defined herein) and, except in the event that the Parent exercises its
right to defer the payment of interest on the Debt Securities pursuant to the
Indenture, shall be payable quarterly in arrears on each March 15, June 15,
September 15 and December 15 of each year, commencing on September 15, 2001
(which dates correspond to the interest payment dates on the Debt Securities),
when, as and if available for payment by the Property Trustee, as further
described in paragraph (c) of this Section 4.1. If any date on which
Distributions are otherwise payable on the Trust Securities is not a Business
Day, then the payment of such Distributions shall be made on the next succeeding
day which is a Business Day (and no interest shall accrue for the period from
and after such date until the next succeeding Business Day) with the same force
and effect as if made on such date (each date on which Distributions are payable
in accordance with this Section 4.1(a), a "Distribution Date").
(b) The Trust Securities represent undivided beneficial interests in
the Trust Property, and the Distributions on the Trust Securities shall be
payable at a rate of 10.125% per annum of the Liquidation Amount of the Trust
Securities, such rate being the rate of interest payable on the Debt Securities
to be held by the Property Trustee. The amount of Distributions payable for any
period shall be computed on the basis of a 360-day year of twelve 30-day months.
For periods less than a full month, Distributions shall reflect interest on Debt
Securities computed on the basis of the number of elapsed days based on a
360-day year of twelve 30-day months. The amount of Distributions payable for
any period shall include the Additional Amounts, if any.
(c) Distributions on the Trust Securities shall be made by the Property
Trustee from the Payment Account and shall be payable on each Distribution Date
only to the extent that the Trust has funds then on hand and available in the
Payment Account for the payment of such Distributions.
(d) Distributions on the Trust Securities with respect to a
Distribution Date shall be payable to the Holders thereof as they appear on the
Securities Register for the Trust Securities on the relevant record date, which
shall be the date which is one Business Day before such Distribution Date if the
Preferred Securities are in the form of a Global Certificate, unless the
Preferred Securities are no longer in the form of a Global Certificate, in which
case the relevant record date with respect to a Distribution Date shall be the
date which is 15 days before such Distribution Date (whether or not a Business
Day).
SECTION 4.2 Redemption.
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(a) Upon an optional redemption (as set forth in the Indenture) of Debt
Securities, the proceeds from such redemption shall be applied to redeem Trust
Securities having an aggregate Liquidation Amount equal to the aggregate
principal amount of the Debt Securities so redeemed by the Parent, including
pursuant to Section 4.4, at the Optional Redemption Price, and upon a mandatory
redemption (as set forth in the Indenture) of Debt Securities, the proceeds from
such redemption shall be applied to redeem Trust Securities, having an aggregate
Liquidation Amount equal to the aggregate principal amount of the Debt
Securities so redeemed by the Parent, at the Redemption Price. The Trust may not
redeem fewer than all the Outstanding Trust Securities unless all accrued and
unpaid Distributions have been paid on all Trust Securities for all quarterly
Distribution periods terminating on or prior to the date of redemption.
(b) Notice of redemption (which notice will be irrevocable) shall be
given by the Property Trustee by first-class mail, postage prepaid, mailed not
less than 30 nor more than 60 days prior to the Redemption Date to the Sponsor
and each Holder of Trust Securities to be redeemed, at such Holder's address as
it appears in the Securities Register. All notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price or the Optional Redemption Price, as
the case may be;
(iii) the record date for the determination of Holders
entitled to receive payment of the Redemption Price or Optional
Redemption Price, as the case may be, as provided in Section 4.2(d);
(iv) the CUSIP number;
(v) if less than all of the Outstanding Trust Securities are
to be redeemed, the identification and the aggregate Liquidation Amount
of the particular Trust Securities to be redeemed; and
(vi) that on the Redemption Date, the Redemption Price or the
Optional Redemption Price, as the case may be, 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; and
the place or places where such Trust Securities are to be surrendered
for payment of the Redemption Price or the Optional Redemption Price,
as the case may be.
(c) The Trust Securities redeemed on each Redemption Date shall be
redeemed at the Redemption Price or the Optional Redemption Price, as the case
may be, with the proceeds from the contemporaneous redemption of Debt
Securities. Redemptions of the Trust Securities shall be made and the Redemption
Price or the Optional Redemption Price, as the case may be, 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 or
the Optional Redemption Price, as the case may be.
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(d) If the Property Trustee gives a notice of redemption in respect of
any Preferred Securities, then, by 12:00 noon, New York City time, on the
Redemption Date, subject to Section 4.2(c), the Property Trustee will, so long
as and to the extent 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. If the Preferred Securities
are no longer in book-entry only form, the Property Trustee, subject to Section
4.2(c), will irrevocably deposit with the Paying Agent funds sufficient to pay
the applicable Redemption Price or Optional Redemption Price, as the case may
be, on such Preferred Securities held in certificated form and will give the
Paying Agent irrevocable instructions and authority to pay the Redemption Price
or the Optional Redemption Price, as the case may be, to the Holders thereof
upon surrender of their Preferred Securities Certificates. Notwithstanding the
foregoing, Distributions payable on or prior to the Redemption Date for any
Trust Securities called for redemption shall be payable to the Holders of such
Trust Securities as they appear on the Securities Register for the Trust
Securities on the relevant record dates for the related Distribution Dates. If
notice of redemption shall have been given and funds deposited as required,
then, upon the date of such deposit, all rights of Securityholders holding Trust
Securities so called for redemption will cease, except the right of such
Securityholders to receive the Redemption Price or the Optional Redemption
Price, as the case may be, but without interest; and such Trust Securities will
cease to be Outstanding. In the event that any date on which any Redemption
Price or the Optional Redemption Price, as the case may be, is payable is not a
Business Day, then payment of the Redemption Price or the Optional Redemption
Price, as the case may be, payable on such date will be made on the next
succeeding day which is a Business Day (and without any interest or other
payment in respect of any such delay), in each case, with the same force and
effect as if made on such date. Payment of the Redemption Price or the Optional
Redemption Price, as the case may be, shall be made to the Holders of such Trust
Securities as they appear on the Securities Register for the Trust Securities on
the relevant record date, which for so long as the Preferred Securities remain
in book-entry form only shall be the date which is one Business Day before such
Redemption Date. If the Preferred Securities are no longer in book-entry form
only, the relevant record date shall be the fifteenth day before such Redemption
Date (whether or not a Business Day).
(e) If less than all the Outstanding Trust Securities are to be
redeemed on a Redemption Date, then the aggregate Liquidation Amount of Trust
Securities to be redeemed shall be allocated on a pro rata basis (based on
Liquidation Amounts) among the Common Securities and the Preferred Securities
that are to be redeemed. The particular Preferred Securities to be redeemed
shall be selected not more than 60 days prior to the Redemption Date by the
Property Trustee from the Outstanding Preferred Securities not previously called
for redemption, by lot or by such other method as the Property Trustee shall
deem fair and appropriate and which may provide for the selection for redemption
of portions (equal to $25.00 or an integral multiple of $25.00 in excess
thereof) of the Liquidation Amount of the Preferred Securities. The Property
Trustee shall promptly notify the Securities Registrar in writing of the
Preferred Securities selected for redemption and, in the case of any Preferred
Securities selected for partial redemption, the Liquidation Amount thereof to be
redeemed; it being understood that, in the case of Preferred Securities
registered in the name of and held of record by the Clearing Agency (or any
successor) or any nominee, the distribution of the proceeds of such redemption
will be made in accordance with the procedures of the Clearing Agency or its
nominee. For all purposes of this Trust Agreement, unless the context otherwise
requires, all provisions relating to
18
the redemption of Preferred Securities shall relate, in the case of any
Preferred Securities redeemed or to be redeemed only in part, to the portion of
the Liquidation Amount of Preferred Securities which has been or is to be
redeemed. In the event of any redemption in part, the Trust shall not be
required to (i) issue, register the transfer of or exchange of any Preferred
Security during a period beginning at the opening of business 15 days before any
selection for redemption of Preferred Securities and ending at the close of
business on the earliest date in which the relevant notice of redemption is
deemed to have been given to all Holders of Preferred Securities to be so
redeemed or (ii) register the transfer of or exchange of any Preferred
Securities so selected for redemption, in whole or in part, except for the
unredeemed portion of any Preferred Securities being redeemed in part.
(f) In the event of any redemption, the Trust shall not be required to
issue, register the transfer of or register the exchange of any Preferred
Security during a period beginning at the opening of business 15 days before any
Redemption Date and ending at the close of business on such Redemption Date.
SECTION 4.3 Intentionally Omitted.
SECTION 4.4 Special Event Exchange or Redemption.
(a) If a Special Event shall occur and be continuing, the Property
Trustee shall direct the Exchange Agent to exchange all Outstanding Trust
Securities for Debt Securities having a principal amount equal to the aggregate
Liquidation Amount of the Trust Securities to be exchanged and with accrued
interest in an amount equal to any unpaid Distribution (including any Additional
Amounts) on the Trust Securities; provided, however, that, in the case of a Tax
Event, the Sponsor shall have the right to (i) direct that less than all, or
none, as appropriate, of the Trust Securities be so exchanged if and for so long
as the Parent shall have elected to pay any Additional Sums such that the amount
received by Holders of Trust Securities not so exchanged in respect of
Distributions and other distributions are not reduced as a result of such Tax
Event, and shall not have revoked any such election or failed to make such
payments or (ii) cause the Trust Securities to be redeemed in the manner set
forth below. If a Tax Event shall occur and be continuing, the Parent shall have
the right, upon not less than 30 nor more than 60 days' notice, to redeem the
Debt Securities, in whole but not in part, for cash within 180 days following
the occurrence and continuation of such Tax Event. Promptly following such
redemption, Trust Securities with an aggregate Liquidation Amount equal to the
aggregate principal amount of the Debt Securities so redeemed will be redeemed
by the Trust at the Redemption Price applicable in the event of a redemption
upon the occurrence of a Tax Event on a pro rata basis.
(b) Notice of any exchange pursuant to this Section 4.4 (an "Exchange
Notice") of the Trust Securities, which Exchange Notice shall be irrevocable,
will be given by the Property Trustee by first-class mail to the Sponsor and to
each record Holder of Trust Securities to be exchanged not fewer than 30 nor
more than 60 days prior to the date fixed for exchange thereof. For purposes of
the calculation of the date of exchange and the dates on which notices are given
pursuant to this paragraph (b), an Exchange Notice shall be deemed to be given
on the day such notice is first mailed by first-class mail, postage prepaid, to
each Holder. Each Exchange Notice shall be addressed to each Holder of Trust
Securities at the address of such Holder appearing in the Securities Register.
Each Exchange Notice shall state: (A) the exchange
19
date; (B) the aggregate Liquidation Amount and any unpaid Distributions
(including any Additional Amounts) on the Trust Securities to be exchanged and
the aggregate principal amount and any accrued interest on the Debt Securities
to be exchanged therefor; (C) that on the exchange date the Trust Securities to
be so exchanged shall be exchanged for Debt Securities and that Distributions on
the Trust Securities so exchanged will cease to accumulate on and after said
date; (D) the record date for the determination of Holders of Trust Securities
to be exchanged as provided in Section 4.4(g); and (E) the identity of the
Exchange Agent, if any, and the place or places where each Trust Certificate to
be exchanged is to be surrendered in exchange for Debt Securities. No defect in
the Exchange Notice or in the mailing thereof with respect to any Trust Security
shall affect the validity of the exchange proceedings for any other Trust
Security.
(c) In the event that fewer than all the Outstanding Preferred
Securities are to be exchanged, then, on the exchange date, (i) if all of the
Outstanding Preferred Securities are represented by Definitive Preferred
Securities Certificates, the particular Preferred Securities to be exchanged
will be selected by the Property Trustee from the Outstanding Preferred
Securities not previously called for redemption or exchange on a pro rata basis,
and (ii) if all of the Outstanding Preferred Securities are represented by
Book-Entry Preferred Securities Certificates, the Property Trustee shall provide
for the selection for exchange of a portion of the Global Certificate
representing the Book-Entry Preferred Securities Certificates on a pro rata
basis. In the case of clause (ii) above, the particular Book-Entry Preferred
Securities Certificates to be exchanged shall be selected in accordance with the
applicable rules and procedures for the Clearing Agency in whose name, or whose
nominee's name, such Global Certificate is then held. Any Preferred Securities
Certificate that is to be exchanged only in part shall be surrendered with due
endorsement or by a written instrument of transfer fully executed by the Holder
thereof (or its attorney duly authorized in writing) and the Trust shall prepare
and deliver to such Holder, without service charge, a new Preferred Securities
Certificate or Certificates in aggregate stated Liquidation Amount equal to, and
in exchange for, the unredeemed portion of the Preferred Securities Certificate
so surrendered. The Common Securities shall be exchanged in a similar manner.
(d) In the event of an exchange pursuant to this Section 4.4, on the
date fixed for any such exchange, (i) if the Preferred Securities are
represented by Book-Entry Preferred Securities Certificates, the Clearing Agency
or its nominee, as the record Holder of the Preferred Securities, will exchange
through the Exchange Agent the Global Certificate representing the Preferred
Securities to be exchanged for a registered Global Certificate or certificates
representing the Debt Securities to be delivered upon such exchange, (ii) if the
Preferred Securities are represented by Definitive Preferred Securities
Certificates, the certificates representing the Preferred Securities to be so
exchanged will be deemed to represent Debt Securities having a principal amount
equal to the aggregate stated Liquidation Amount of such Preferred Securities
until such certificates are presented to the Exchange Agent for exchange for
definitive certificates representing Debt Securities and (iii) all rights of the
Holders of the Preferred Securities so exchanged will cease, except for the
right of such Holders to receive Debt Securities. The Common Securities shall be
exchanged in a similar manner.
(e) Each Holder, by becoming a party to this Trust Agreement pursuant
to Section 10.11 of this Trust Agreement, will be deemed to have agreed to be
bound by these
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exchange provisions in regard to the exchange of Trust Securities for Debt
Securities pursuant to the terms described above.
(f) Nothing in this Section 4.4 shall limit the requirement of the
Trust to withhold taxes pursuant to the terms of the Trust Securities or as set
forth in this Trust Agreement or otherwise require the Property Trustee or the
Trust to pay any amounts on account of such withholdings.
(g) An exchange of Trust Securities for Debt Securities pursuant to
this Section 4.4 shall be made to Holders of Trust Securities as they appear on
the Securities Register for Trust Securities on the relevant record date, which
for so long as the Preferred Securities remain in book-entry form only shall be
the date which is one Business Day before the exchange date. If the Preferred
Securities are no longer in book-entry form only, the relevant record date shall
be the fifteenth day before the exchange date (whether or not a Business Day).
(h) If a Special Event shall occur and be continuing, the Trust shall
maintain an office or agency (the "Exchange Agent") for the purposes specified
in this Section 4.4. The Regular Trustees may remove any Exchange Agent if such
Trustees determine in their sole discretion that the Paying Agent shall have
failed to perform its obligations under this Trust Agreement in any material
respect. The Exchange Agent shall initially be the Property Trustee. Any Person
acting as Exchange Agent shall be permitted to resign as Exchange Agent upon 30
days' written notice to the Property Trustee and the Sponsor; provided, however,
that no such resignation of the Exchange Agent shall be effective until a
successor Exchange Agent has been appointed and has accepted such appointment by
instrument executed by such successor Exchange Agent and delivered to the Trust,
the Sponsor and the resigning Exchange Agent. In the event that the Property
Trustee shall no longer be the Exchange Agent or a successor Exchange Agent
shall resign or its authority to act be revoked, the Regular Trustees shall
appoint a successor that is acceptable to the Property Trustee and the Sponsor
to act as Exchange Agent. The provisions of Sections 8.1, 8.3 and 8.6 shall
apply to the Property Trustee also in its role as Exchange Agent, for so long as
the Property Trustee shall act as Exchange Agent and, to the extent applicable,
to any other exchange agent appointed hereunder.
SECTION 4.5 Subordination of Common Securities. Payment of
Distributions (including Additional Amounts, if applicable) on, and the
Redemption Price of, the Trust Securities, as applicable, shall be made pro rata
based on the Liquidation Amount of the Trust Securities; provided, however, that
if on any Distribution Date or Redemption Date an Event of Default shall have
occurred and be continuing, no payment of any Distribution (including Additional
Amounts, if applicable) on, or the 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 to be redeemed, 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.
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SECTION 4.6 Payment Procedures. Payments in respect of the Preferred
Securities shall be made by check mailed to the address of the Person entitled
thereto as such address shall appear on the Securities Register or, if the
Preferred Securities are held by a Clearing Agency, such Distributions shall be
made to the Clearing Agency in immediately available funds, in accordance with
the applicable certificate depositary agreement on the applicable Distribution
Dates. Payments in respect of the Common Securities shall be made in such manner
as shall be mutually agreed between the Property Trustee and the Holder of the
Common Securities.
SECTION 4.7 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 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 or filed) Form 1041 or the
appropriate Internal Revenue Service form required to be filed in respect of the
Trust in each taxable year of the Trust and (b) prepare and furnish (or cause to
be prepared and furnished) to each Securityholder a Form 1099 or the appropriate
Internal Revenue Service form required to be furnished to such Securityholder or
the information required to be provided on such form. The Regular Trustees shall
provide the Sponsor with a copy of all such returns, reports and schedules
promptly after such filing or furnishing. The Trustees shall comply with United
States federal withholding and backup withholding tax laws and information
reporting requirements with respect to any payments to Securityholders under the
Trust Securities.
SECTION 4.8 Payment of Taxes, Duties, Etc., of the Trust. Upon receipt
under the Debt Securities of Additional Sums, the Property Trustee, upon receipt
of written notice from the Sponsor or the Regular Trustees, shall promptly pay
from such Additional Sums any taxes, duties or governmental charges of
whatsoever nature (other than withholding taxes) imposed on the Trust by the
United States or any other taxing authority.
SECTION 4.9 Payments under Indenture. Any amount payable hereunder to
any Holder of Preferred Securities shall be reduced by the amount of any
corresponding payment such Holder (or any Owner with respect thereto) has
directly received pursuant to Section 503 of the Indenture in accordance with
the terms of Section 6.8 hereof.
ARTICLE 5
TRUST SECURITIES CERTIFICATES
SECTION 5.1 Initial Ownership. Upon the creation of the Trust and until
the issuance of the Trust Securities, and at any time during which no Trust
Securities are Outstanding, the Sponsor shall be the sole beneficial owner of
the Trust.
SECTION 5.2 The Trust Securities Certificates. The Preferred Securities
Certificates shall be issued in minimum denominations of $25.00 Liquidation
Amount and integral multiples of $25.00 in excess thereof, and the Common
Securities Certificates shall be issued in denominations of $25.00 Liquidation
Amount and integral multiples thereof. The consideration received by the Trust
for the issuance of the Trust Securities shall constitute a contribution to the
capital of the Trust and shall not constitute a loan to the Trust. The Trust
Securities Certificates shall be executed on behalf of the Trust by manual or
facsimile signature of at least one Regular Trustee and authenticated by the
Property Trustee. Preferred Securities initially will be
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represented by one or more certificates in registered global form (the "Global
Certificates"). Trust Securities Certificates bearing the manual or facsimile
signatures of individuals who were, at the time when such signatures shall have
been affixed, authorized to sign on behalf of the Trust, shall be validly issued
and entitled to the benefit of this Trust Agreement, notwithstanding that such
individuals or any of them shall have ceased to be so authorized prior to the
delivery of such Trust Securities Certificates or did not hold such offices at
the date of delivery of such Trust Securities Certificates. A transferee of a
Trust Securities Certificate shall become a Securityholder, and shall be
entitled to the rights and subject to the obligations of a Securityholder
hereunder, upon due registration of such Trust Securities Certificate in such
transferee's name pursuant to Section 5.4. By acceptance of a Preferred
Security, each Securityholder covenants for federal income tax purposes to treat
the Debt Securities as indebtedness of the Parent and to treat the Preferred
Securities as evidence of a beneficial ownership interest in the Debt Securities
through a grantor trust.
SECTION 5.3 Delivery of Trust Securities Certificates. On the Closing
Date, the Regular Trustees shall cause Trust Securities Certificates, in an
aggregate Liquidation Amount as provided in Sections 2.4 and 2.5, to be executed
on behalf of the Trust and delivered to or upon the written order of the
Sponsor, signed by one of its trustees or any duly authorized officer, if any,
without further trust action by the Sponsor, in authorized denominations.
A Trust Security Certificate shall not be valid until authenticated by
the manual signature of an authorized signatory of the Property Trustee. The
signature shall be conclusive evidence that the Trust Security Certificate has
been authenticated under this Trust Agreement. Upon a written order of the Trust
signed by one Regular Trustee, the Property Trustee shall authenticate the Trust
Security Certificates for original issue.
The Property Trustee may appoint an authenticating agent acceptable to
the Regular Trustees to authenticate Trust Security Certificates. An
authenticating agent may authenticate Trust Security Certificates whenever the
Property Trustee may do so. Each reference in this Trust Agreement to
authentication by the Property Trustee includes authentication by such agent. An
authenticating agent has the same rights as the Property Trustee to deal with
the Sponsor or an Affiliate with respect to the authentication of Trust
Securities.
SECTION 5.4 Registration of Transfer and Exchange of Preferred
Securities; Restrictions on Transfer. The securities registrar (the "Securities
Registrar") shall keep or cause to be kept, at the office or agency maintained
pursuant to Section 5.8, a securities register (a "Securities Register") in
which, subject to such reasonable regulations as it may prescribe, the
Securities Registrar shall provide for the registration of Preferred Securities
Certificates and Common Securities Certificates (subject to Section 5.10 in the
case of the Common Securities Certificates) and registration of transfers and
exchanges of Preferred Securities Certificates as herein provided. The Property
Trustee shall be the initial Securities Registrar.
Upon surrender for registration of transfer of any Preferred Security
at an office or agency of the Securities Registrar designated pursuant to
Section 5.8 for such purpose, a Regular Trustee shall execute on behalf of the
Trust by manual or facsimile signature, and the Property Trustee shall
authenticate and deliver, in the name of the designated transferee or
transferees, one
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or more new Preferred Securities of any authorized denominations and of a like
aggregate Liquidation Amount.
At the option of the Holder, and subject to the other provisions of
this Section 5.4, Preferred Securities may be exchanged for other Preferred
Securities of any authorized denomination and of a like Liquidation Amount, upon
surrender of the Preferred Securities to be exchanged at any such office or
agency. Whenever any Preferred Securities are so surrendered for exchange, a
Regular Trustee shall execute on behalf of the Trust by manual or facsimile
signature, and the Property Trustee shall authenticate and deliver, the
Preferred Securities which the Holder making the exchange is entitled to
receive.
All Preferred Securities issued upon any registration of transfer or
exchange of Preferred Securities shall be entitled to the same benefits under
this Trust Agreement as the Preferred Securities surrendered upon such
registration of transfer or exchange.
Every Preferred Security presented or surrendered for registration of
transfer or for exchange shall (if so requested by the Sponsor or the Securities
Registrar) be duly endorsed, or be accompanied by a written instrument of
transfer in form satisfactory to the Sponsor and the Securities Registrar duly
executed, by the Holder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Preferred Securities Certificates, but the Securities Registrar may
require payment of a sum sufficient to cover any tax or governmental charge that
may be imposed in connection with any transfer or exchange of Preferred
Securities Certificates.
SECTION 5.5 Mutilated, Destroyed, Lost or Stolen Trust Securities
Certificates. If (a) any mutilated Trust Securities Certificate shall be
surrendered to the Securities Registrar, or if the Securities Registrar shall
receive evidence to its satisfaction of the destruction, loss or theft of any
Trust Securities Certificate and (b) there shall be delivered to the Securities
Registrar and the Regular Trustees such security or indemnity as may be required
by them to save each of them harmless, then in the absence of notice that such
Trust Securities Certificate shall have been acquired by a bona fide purchaser,
the Regular Trustees, or any one of them, on behalf of the Trust shall execute
and make available for authentication and delivery, in exchange for or in lieu
of any such mutilated, destroyed, lost or stolen Trust Securities Certificate, a
new Trust Securities Certificate of like denomination. In connection with the
issuance of any new Trust Securities Certificate under this Section, 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 duplicative Trust Securities Certificate issued pursuant to this Section
shall constitute conclusive evidence of an undivided beneficial interest in the
assets of the Trust, as if originally issued, whether or not the lost, stolen or
destroyed Trust Securities Certificate shall be found at any time.
SECTION 5.6 Persons Deemed Securityholders. Each Trustee and the
Securities Registrar shall treat the Person in whose name any Trust Securities
Certificate shall be registered in the Securities Register as the owner of such
Trust Securities Certificate for the purpose of
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receiving Distributions and for all other purposes whatsoever, and none of the
Trustees nor the Securities Registrar shall be bound by any notice to the
contrary.
SECTION 5.7 Access to List of Securityholders' Names and Addresses. The
Regular Trustees or the Sponsor shall furnish or cause to be furnished (unless
the Property Trustee is acting as Securities Registrar with respect to the Trust
Securities under the Trust Agreement) a list, in such form as the Property
Trustee may reasonably require, of the names and addresses of the
Securityholders as of the most recent record date (a) to the Property Trustee,
quarterly at least five Business Days before each Distribution Date, and (b) to
the Property Trustee, promptly after receipt by the Sponsor of a written request
therefor from the Property Trustee in order to enable the Property Trustee to
discharge its obligations under this Trust Agreement, in each case to the extent
such information is in the possession or control of the Regular Trustees or the
Sponsor and is not identical to a previously supplied list or has not otherwise
been received by the Property Trustee in its capacity as Securities Registrar.
The rights of Securityholders to communicate with other Securityholders with
respect to their rights under this Trust Agreement or under the Trust
Securities, and the corresponding rights of the Trustee shall be as provided in
the Trust Indenture Act. Each Holder, by receiving and holding a Trust
Securities Certificate, and each Owner shall be deemed to have agreed not to
hold the Sponsor, the Property Trustee or the Regular Trustees accountable by
reason of the disclosure of its name and address, regardless of the source from
which such information was derived.
SECTION 5.8 Maintenance of Office or Agency. The Securities Registrar
shall maintain in The City of New York an office or offices or agency or
agencies where Preferred Securities Certificates may be surrendered for
registration of transfer, exchange or conversion and where notices and demands
to or upon the Trustees in respect of the Trust Securities Certificates may be
served. The Securities Registrar initially designates State Street Bank and
Trust Company, N.A., 61 Broadway, 15th Floor, New York, New York 10006,
Attention: Corporate Trust Department, as its principal corporate trust office
for such purposes. The Securities Registrar 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 5.9 Appointment of Paying Agent. In the event that the
Preferred Securities are not in book-entry form only, the Trust shall maintain
in the Borough of Manhattan, City of New York, an office or agency (the "Paying
Agent") where the Preferred Securities may be presented for payment. 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 Regular Trustees may revoke such power and remove the
Paying Agent if such Trustees determine in their sole discretion that the Paying
Agent shall have failed to perform its obligations under this Trust Agreement in
any material respect. The Paying Agent shall initially be the Property Trustee,
and any co-paying agent chosen by the Property Trustee and acceptable to the
Regular Trustees and the Sponsor. Any Person acting as Paying Agent shall be
permitted to resign as Paying Agent upon 30 days' written notice to the Property
Trustee and the Sponsor; provided, however, that no such resignation of the
Paying Agent shall be effective until a successor Paying Agent has been
appointed and has accepted such appointment by instrument executed by such
successor Paying Agent and delivered to the Trust, the Sponsor and the resigning
Paying Agent.
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In the event that the Property Trustee shall no longer be the Paying Agent or a
successor Paying Agent shall resign or its authority to act be revoked, the
Regular Trustees shall appoint a successor that is acceptable to the Property
Trustee and the Sponsor to act as Paying Agent (which shall be a bank or trust
company). Each successor Paying Agent or any additional Paying Agent shall agree
with the Trustees that, as Paying Agent, such successor Paying Agent or
additional Paying Agent will hold all sums, if any, held by it for payment to
the Securityholders in trust for the benefit of the Securityholders entitled
thereto until such sums shall be paid to each Securityholder. The Paying Agent
shall return all unclaimed funds to the Property Trustee and upon removal of a
Paying Agent such Paying Agent shall also return all funds in its possession to
the Property Trustee. The provisions of Sections 8.1, 8.3 and 8.6 shall apply to
the Property Trustee also in its role as Paying Agent, for so long as the
Property Trustee shall act as Paying Agent and, to the extent applicable, to any
other paying agent appointed hereunder. Any reference in this Agreement to the
Paying Agent shall include any co-paying agent unless the context requires
otherwise.
SECTION 5.10 Ownership of Common Securities by Sponsor. Upon the
issuance of Common Securities as provided for in Section 2.5, the Sponsor shall
acquire beneficial and record ownership of the Common Securities. The Parent has
covenanted in the Guarantee to maintain directly or indirectly 100% ownership of
the Common Securities; provided that any successor of the Parent under the
Indenture may succeed to the Parent's ownership of the Common Securities. To the
fullest extent permitted by law, any attempted transfer of the Common Securities
in violation of that covenant shall be void. The Regular Trustees shall cause
each Common Securities Certificate to contain a legend stating, "THIS
CERTIFICATE IS NOT TRANSFERABLE EXCEPT TO AN ENTITY WHOLLY OWNED BY SENIOR
HOUSING PROPERTIES TRUST OR TO CERTAIN SUCCESSORS OF SENIOR HOUSING PROPERTIES
TRUST."
SECTION 5.11 Global Securities; Non-Global Securities; Common
Securities Certificate.
(a) Each Global Certificate authenticated under this Trust Agreement
shall be registered in the name of the Clearing Agency designated by the Sponsor
for such Global Certificate or a nominee thereof and delivered to such Clearing
Agency or a nominee thereof or custodian therefor, and each such Global
Certificate shall constitute a Preferred Security for all purposes of this Trust
Agreement.
(b) If a Global Certificate is to be exchanged for Definitive Preferred
Securities Certificates or canceled in whole, it shall be surrendered by or on
behalf of the Clearing Agency, its nominee or custodian to the Property Trustee,
as Securities Registrar, for exchange or cancellation as provided in this
Article 5. If any Global Certificate is to be exchanged for Definitive Preferred
Securities Certificates or cancelled in part, or if another Preferred Security
is to be exchanged in whole or in part for a beneficial interest in any Global
Certificate, in each case, as provided in Section 5.4, then either (i) such
Global Certificate shall be so surrendered for exchange or cancellation as
provided in this Article 5 or (ii) the Liquidation Amount thereof (or number of
Preferred Securities represented thereby) shall be reduced or increased by an
amount equal to the portion, thereof to be so exchanged or cancelled, or equal
to the Liquidation Amount of (or number of securities represented by) such
Definitive Preferred
26
Security Certificates to be so exchanged for a beneficial interest therein, as
the case may be, by means of an appropriate adjustment made on the records of
the Property Trustee, as Securities Registrar, whereupon the Property Trustee,
in accordance with the Applicable Procedures, shall instruct the Clearing Agency
or its authorized representative to make a corresponding adjustment to its
records. Upon any such surrender or adjustment of a Global Certificate, a
Regular Trustee shall execute on behalf of the Trust by manual or facsimile
signature, and the Property Trustee shall, subject to Section 5.4 and as
otherwise provided in this Article 5, authenticate and deliver any Preferred
Securities issuable in exchange for such Global Certificate (or any portion
thereof) to or upon the written order of, and registered in such names as may be
directed by, the Clearing Agency or its authorized representative. Upon the
request of the Property Trustee in connection with the occurrence of any of the
events specified in this paragraph, the Sponsor shall promptly make available to
the Property Trustee a reasonable supply of Preferred Securities that are not in
the form of Global Certificates. The Property Trustee shall be entitled to
conclusively rely upon any order, direction or request of the Clearing Agency or
its authorized representative which is given or made pursuant to this Article 5
if such order, direction or request is given or made in accordance with the
Applicable Procedures.
(c) Every Preferred Security authenticated and delivered upon
registration of transfer of, or in exchange for or in lieu of, a Global
Certificate or any portion thereof, whether pursuant to this Article 5 or
otherwise, shall be authenticated and delivered in the form of, and shall be, a
Global Certificate, unless such Preferred Security is registered in the name of
a Person other than the Clearing Agency for such Global Certificate or a nominee
thereof.
(d) The Clearing Agency or its nominee, as registered owner of a Global
Certificate, shall be the Holder of such Global Certificate for all purposes
under this Trust Agreement and the Preferred Securities, and owners of
beneficial interests in a Global Certificate shall hold such interests pursuant
to the Applicable Procedures. Accordingly, any such Owner's beneficial interest
in a Global Certificate will be shown only on, and the transfer of such interest
shall be effected only through, records maintained by the Clearing Agency or its
nominee or its participants and such owners of beneficial interests in a Global
Certificate will not be considered the owners or Holders of such Global
Certificate for any purpose of this Trust Agreement or the Preferred Securities.
(e) A single Common Securities Certificate representing the Common
Securities shall initially be issued to the Sponsor in the form of a definitive
Common Securities Certificate.
SECTION 5.12 Notices to Clearing Agency. To the extent that a notice or
other communication to the Owners is required under this Trust Agreement, unless
and until Definitive Preferred Securities Certificates shall have been issued to
Owners pursuant to Section 5.13, the Trustees shall give all such notices and
communications specified herein to be given to Owners to the Clearing Agency,
and shall have no obligations to provide notices directly to the Owners.
SECTION 5.13 Definitive Preferred Securities Certificates.
Notwithstanding any other provision in this Trust Agreement, no Global
Certificate may be exchanged in whole or in part for Preferred Securities
registered, and no transfer of a Global Certificate in whole or in part may be
registered, in the name of any Person other than the Clearing Agency for such
Global
27
Certificate or a nominee thereof unless (i) such Clearing Agency (A) has
notified the Trust and the Sponsor that it is unwilling or unable to continue as
Clearing Agency for such Global Certificate or (B) has ceased to be a clearing
agency registered as such under the Securities Exchange Act of 1934, as amended,
and in either case the Trust and the Sponsor thereupon fail to appoint a
successor Clearing Agency, (ii) the Trust and the Sponsor, at their option,
notify the Property Trustee in writing that it elects to cause the issuance of
the Preferred Securities in certificated form or (iii) there shall have occurred
and be continuing an Event of Default or any event which after notice or lapse
of time or both would be an Event of Default. In all cases, Definitive Preferred
Securities Certificates delivered in exchange for any Global Certificate or
beneficial interests therein will be registered in the names, and issued in any
approved denominations, requested by or on behalf of the Clearing Agency (in
accordance with its customary procedures).
SECTION 5.14 Rights of Securityholders. The legal title to the Trust
Property is vested exclusively in the Property Trustee (in its capacity as such)
in accordance with Section 2.9, and the Securityholders shall not have any right
or title therein other than the undivided beneficial interest in the assets of
the Trust conferred by their Trust Securities and they shall have no right to
call for any partition or division of property, profits or rights of the Trust
except as described below. The Trust Securities shall be personal property
giving only the rights specifically set forth therein and in this Trust
Agreement. The Trust Securities shall have no preemptive or similar rights and,
when issued and delivered to Securityholders against payment of the purchase
price therefor, will be fully paid and nonassessable undivided beneficial
interests in the assets of the Trust. The Holders of the Trust Securities, 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 Title 2 of the Maryland General Corporation Law; provided, however, the
Holders of Trust Securities may be obligated, pursuant to the terms of this
Trust Agreement, to (i) provide indemnity and/or security in connection with and
pay taxes or governmental charges arising from transfers of Trust Securities and
(ii) provide security and indemnity in connection with the requests of or
directions to the Property Trustee to exercise its rights and powers under the
Trust Agreement.
ARTICLE 6
ACT OF SECURITYHOLDERS; MEETINGS; VOTING
SECTION 6.1 Limitations on Voting Rights.
(a) Except as provided in this Section, in Section 8.2 and 10.2 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 Trust Securities Certificates, be construed so as to constitute the
Securityholders from time to time as partners or members of an association.
(b) Subject to Section 8.2 hereof, if an Event of Default with respect
to the Preferred Securities has occurred and been subsequently cured, waived or
otherwise eliminated, the provisions of Section 6.1(b)(ii) hereof shall apply.
During (x) the period commencing on the date of the occurrence of an Event of
Default with respect to the Preferred Securities and ending
28
on the date when such Event of Default is cured, waived or otherwise eliminated,
or (y) any period not described in either the preceding sentence or the
preceding clause (x), the provisions of Section 6.1(b)(i) shall apply.
(i) The Holders of a majority in aggregate Liquidation Amount
of the Preferred Securities will have the right to direct the time,
method and place of conducting any proceeding for any remedy available
to the Property Trustee or to exercise any trust or power conferred
upon the Property Trustee under this Trust Agreement, including the
right to direct the Property Trustee to exercise the remedies available
to it as a holder of the Debt Securities but excluding the right to
direct the Property Trustee to consent to an amendment, modification or
termination of the Indenture (which shall be as provided below). So
long as any Debt Securities are held by the Property Trustee, the
Trustees shall not (A) direct the time, method and place of conducting
any proceeding for any remedy available to the Indenture Trustee, or
executing any trust or power conferred on the Indenture Trustee with
respect to such Debt Securities, (B) waive any past default which is
waivable under Section 513 of the Indenture, (C) exercise any right to
rescind or annul a declaration that the principal of all the Debt
Securities shall be due and payable or (D) consent to any amendment,
modification or termination of the Indenture or the 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 (except in
the case of clause (D), which consent, in the event that no Event of
Default shall occur and be continuing, shall be of the Holders of a
majority in aggregate Liquidation Amount of all Trust Securities,
voting together as a single class); provided, however, that where a
consent under the Indenture would require the consent of each holder of
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 the
Preferred Securities, except by a subsequent vote of the Holders of the
Preferred Securities. The Property Trustee shall notify all Holders of
record of the Preferred Securities of any notice of default received
from the Indenture Trustee with respect to the 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 the Trust will
not be classified as an association taxable as a corporation or
partnership for United States federal income tax purposes on account of
such action.
(ii) Subject to Section 8.2 of this Trust Agreement and only
after the Event of Default with respect to the Preferred Securities has
been cured, waived, or otherwise eliminated, the Holders of a majority
in aggregate Liquidation Amount of the Common Securities will have the
right to direct the time, method and place of conducting any proceeding
for any remedy available to the Property Trustee or to exercise any
trust or power conferred upon the Property Trustee under this Trust
Agreement, including the right to direct the Property Trustee to
exercise the remedies available to it as a holder of the Debt
Securities but excluding the right to direct the Property Trustee to
consent to an amendment, modification or termination of the Indenture
(which shall be as provided below). So long as any Debt Securities are
held by the Property Trustee, the Trustees
29
shall not (A) direct the time, method and place of conducting any
proceeding for any remedy available to the Indenture Trustee, or
executing any trust or power conferred on the Indenture Trustee with
respect to such Debt Securities, (B) waive any past default which is
waivable under Section 513 of the Indenture, (C) exercise any right to
rescind or annul a declaration that the principal of all the Debt
Securities shall be due and payable or (D) consent to any amendment,
modification or termination of the Indenture or the 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 Common Securities (except in the case of
clause (D), which consent, in the event that no Event of Default shall
occur and be continuing, shall be of the Holders of a majority in
aggregate Liquidation Amount of all Trust Securities, voting together
as a single class); provided, however, that where a consent under the
Indenture would require the consent of each holder of Debt Securities
affected thereby, no such consent shall be given by the Property
Trustee without the prior written consent of each Holder of Common
Securities. The Trustees shall not revoke any action previously
authorized or approved by a vote of the Holders of the Common
Securities, except by a subsequent vote of the Holders of the Common
Securities. The Property Trustee shall notify all Holders of record of
the Common Securities of any notice of default received from the
Indenture Trustee with respect to the Debt Securities. In addition to
obtaining the foregoing approvals of the Holders of the Common
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 the Trust will not be
classified as an association taxable as a corporation or partnership
for United States federal income tax purposes on account of such
action.
(iii) The provisions of this Section 6.1(b) and Section 6.1(a)
of this Trust Agreement shall be in lieu of Section 316(a)(1)(A) of the
Trust Indenture Act, and such Section 316(a)(1)(A) is hereby expressly
excluded from this Trust Agreement and the Preferred Securities, as
permitted by the Trust Indenture Act.
(c) If any proposed amendment to this Trust Agreement provides for, or
the Trustees otherwise propose to effect, the dissolution, winding-up or
termination of the Trust, other than pursuant to the terms of this Trust
Agreement, then the Holders of Outstanding Preferred Securities as a class will
be entitled to vote on such amendment or proposal and such amendment or proposal
shall not be effective except with the approval of the Holders of a majority in
aggregate Liquidation Amount of the Outstanding Preferred Securities.
SECTION 6.2 Notice of Meetings. Notice of all meetings of the Holders
of the Preferred Securities, stating the time, place and purpose of the meeting,
shall be given by the Property Trustee pursuant to Section 10.8 to each
Preferred Securityholder of record, at its 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 6.3 Meetings of Preferred Securityholders. No annual meeting of
Securityholders is required to be held. The Regular Trustees, however, shall
call a meeting of
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Securityholders to vote on any matter upon the written request of the Preferred
Securityholders of record of 25% of the Preferred Securities (based upon their
Liquidation Amount), and the Regular Trustees or the Property Trustee may, at
any time in their discretion, call a meeting of the Holders of Preferred
Securities to vote on any matters as to which such Holders are entitled to vote.
Holders of record of a majority of the Preferred Securities (based upon
their Liquidation Amount), present in person or by proxy, shall constitute a
quorum at any meeting of Securityholders.
If a quorum is present at a meeting, an affirmative vote by the Holders
of record of Preferred Securities present, in person or by proxy, holding a
majority of the Preferred Securities (based upon their Liquidation Amount) held
by Holders of record of Preferred Securities present, either in person or by
proxy, at such meeting shall constitute the action of the Securityholders,
unless this Trust Agreement requires a greater number of affirmative votes.
SECTION 6.4 Voting Rights. Securityholders shall be entitled to one
vote for each $25.00 of Liquidation Amount represented by their Trust Securities
in respect of any matter as to which such Securityholders are entitled to vote.
Notwithstanding that Holders of Preferred Securities are entitled to vote or
consent under any of the circumstances described above, any of the Preferred
Securities that are owned at such time by the Sponsor, the Trustees or any
affiliate of any Trustee shall, for purposes of such vote or consent, be treated
as if such Preferred Securities were not outstanding.
SECTION 6.5 Proxies, Etc. At any meeting of Securityholders, any
Securityholders 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 Regular Trustees, or with such other officer or agent of the Trust as
the Regular Trustees may direct, for verification prior to the time at which
such vote shall be taken. Pursuant to a resolution of the Property Trustee,
proxies may be solicited in the name of the Property Trustee or one or more
officers of the Property Trustee. Only Securityholders of record shall be
entitled to vote. When Trust Securities are held jointly by several Persons, any
one of them may vote at any meeting in person or represented by proxy in respect
of such Trust Securities, but if more than one of them shall be present at such
meeting in person or by proxy, and such joint owners or their proxies so present
disagree as to any vote to be cast, such vote shall not be received in respect
of such Trust Securities. A proxy purporting to be executed by or on behalf of a
Securityholder shall be deemed valid unless challenged at or prior to its
exercise, and the burden of proving invalidity shall rest on the challenger. No
proxy shall be valid more than three years after its date of execution.
SECTION 6.6 Securityholder Action by Written Consent. Any action which
may be taken by Securityholders at a meeting may be taken without a meeting if
Securityholders holding a majority of all Outstanding Trust Securities (based
upon their Liquidation Amount) entitled to vote in respect of such action (or
such larger proportion thereof as shall be required by any express provision of
this Trust Agreement) shall consent to the action in writing.
SECTION 6.7 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 by
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written consent, or to participate in any Distribution on the Trust Securities
in respect of which a record date is not otherwise provided for in this Trust
Agreement, or for the purpose of any other action, the Regular Trustees may from
time to time fix a date, not more than 90 days prior to the date of any meeting
of Securityholders or the payment of Distributions or other action, as the case
may be, as a record date for the determination of the identity of the
Securityholders of record for such purposes.
SECTION 6.8 Acts of Securityholders. Any request, demand,
authorization, direction, notice, consent, waiver or other action provided or
permitted by this Trust Agreement to be given, made or taken by Securityholders
or Owners may be embodied in and evidenced by one or more 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 instrument or
instruments are delivered to a Regular Trustee. Such 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
instrument or instruments. Proof of execution of any such instrument or of a
writing appointing any such agent shall be sufficient for any purpose of this
Trust Agreement and (subject to Section 8.1) conclusive in favor of the
Trustees, if made in the manner provided in this Section.
The fact and date of the execution by any Person of any such instrument
or writing may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged to him the execution thereof. Where such execution is by
a signer acting in a capacity other than his individual capacity, such
certificate or affidavit shall also constitute sufficient proof of his
authority. The fact and date of the execution of any such instrument or writing,
or the authority of the Person executing the same, may also be proved in any
other manner which any Trustee receiving the same deems sufficient.
The ownership of Preferred Securities shall be proved by the Securities
Register.
Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the Securityholder of any Trust Security shall bind every future
Securityholder of the same Trust Security and the Securityholder of every Trust
Security issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted or suffered to
be done by the Trustees or the Trust in reliance thereon, whether or not
notation of such action is made upon such Trust Security.
Without limiting the foregoing, a Securityholder entitled hereunder to
take any action hereunder with regard to any particular Trust Security may do so
with regard to all or any part of the Liquidation Amount of such Trust Security
or by one or more duly appointed agents each of which may do so pursuant to such
appointment with regard to all or any part of such Liquidation Amount.
If any dispute shall arise between the Securityholders and the Regular
Trustees or among such Securityholders or Regular Trustees with respect to the
authenticity, validity or binding nature of any request, demand, authorization,
direction, consent, waiver or other Act of such
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Securityholder or Trustee under this Article 6, then the determination of such
matter by the Property Trustee shall be conclusive with respect to such matter.
Upon the occurrence and continuation of an Event of Default, the
Holders of Preferred Securities shall rely on the enforcement by the Property
Trustee of its rights as holder of the Debt Securities against the Parent. If
the Property Trustee fails to enforce its rights as holder of the Debt
Securities after a request therefor by a Holder of Preferred Securities, such
holder may proceed to enforce such rights directly against the Sponsor.
Notwithstanding the foregoing, if an Event of Default has occurred and is
continuing and such event is attributable to the failure of the Parent to pay
interest or principal on the Debt Securities on the date such interest or
principal is otherwise payable (or in the case of redemption, on the Redemption
Date), then a Holder of Preferred Securities shall have the right to institute a
proceeding directly against the Parent, for enforcement of payment to such
holder of the principal amount of or interest on Debt Securities having a
principal amount equal to the aggregate Liquidation Amount of the Preferred
Securities of such Holder after the respective due date specified in the Debt
Securities (a "Direct Action"). In connection with any such Direct Action, the
rights of the Parent will be subrogated to the rights of any Holder of the
Preferred Securities to the extent of any payment made by the Parent to such
Holder of Preferred Securities as a result of such Direct Action.
SECTION 6.9 Inspection of Records. Upon reasonable demand and notice to
the Regular Trustees and the Property Trustee, any Securityholder shall have the
right, at its expense, to inspect during usual business hours the following
records of the Trust, solely for purposes reasonably related to such
Securityholder's interest as a holder of Trust Securities:
(a) a copy of this Trust Agreement and the Certificate of Trust of the
Trust and all amendments thereto, together with copies of any written powers of
attorney under which this Trust Agreement, such Certificate of Trust or any such
amendment have been executed;
(b) if and to the extent disclosure thereof is at the time required
under the provisions of the Maryland Business Trust Act, a current list of the
name and last known business or mailing address of each Securityholder; and
(c) the separate annual financial statements of the Trust, if such
financial statements are prepared.
Any such demand and notice shall be in writing and shall state the purpose of
the demand.
ARTICLE 7
REPRESENTATIONS AND WARRANTIES
SECTION 7.1 Representations and Warranties of the Property Trustee. The
Property Trustee hereby represents and warrants for the benefit of the Sponsor
and the Securityholders that:
(a) the Property Trustee is a trust company duly organized, validly
existing and in good standing under the laws of the Commonwealth of
Massachusetts;
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(b) the Property Trustee has full corporate power, authority and legal
right to execute, deliver and perform its obligations under this Trust Agreement
and has taken all necessary action to authorize the execution, delivery and
performance by it of this Trust Agreement;
(c) this Trust Agreement has been duly authorized, executed and
delivered by the Property Trustee and constitutes the valid and legally binding
agreement of the Property Trustee 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; and
(d) the execution, delivery and performance by the Property Trustee of
this Trust Agreement have been duly authorized by all necessary corporate or
other action on the part of the Property Trustee and do not require any approval
of stockholders of the Property Trustee and such execution, delivery and
performance will not violate the Property Trustee's charter or by-laws or (b)
violate any law, governmental rule or regulation of the United States or the
Commonwealth of Massachusetts, as the case may be, governing the banking,
corporate, or trust powers of the Property Trustee, or any order, judgment or
decree applicable to the Property Trustee.
SECTION 7.2 Representations and Warranties of Sponsor. The Sponsor
hereby represents and warrants for the benefit of the Property Trustee and the
Securityholders that:
(a) the Trust Securities 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 Trust Agreement
and the Securityholders will be, as of such date, entitled to the benefits of
this Trust Agreement; and
(b) there are no taxes, fees or other governmental charges payable by
the Trust (or the Trustees on behalf of the Trust) under the laws of the State
of Maryland or any political subdivision thereof in connection with the
execution, delivery and performance by the Property Trustee of this Trust
Agreement.
ARTICLE 8
THE TRUSTEES
SECTION 8.1 Certain Duties and Responsibilities.
(a) The duties and responsibilities of the Trustees shall be as
provided by this Trust Agreement and, in the case of the Property Trustee, by
the Trust Indenture Act. The Property Trustee, before the occurrence of any
Event of Default and after the curing or waiving of all Events of Default that
may have occurred, shall undertake to perform only such duties and obligations
as are specifically set forth in this Trust Agreement and the Trust Indenture
Act and no implied covenants shall be read into this Trust Agreement against the
Property Trustee. In case an Event of Default has occurred (that has not been
cured or waived pursuant to Section 8.2) of which a Responsible Officer of the
Property Trustee has actual knowledge, the Property
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Trustee shall exercise such rights and powers vested in it by this Trust
Agreement and the Trust Indenture Act, and use the same degree of care and skill
in its exercise, as a prudent individual would exercise or use under the
circumstances in the conduct of his or her own affairs.
Notwithstanding the foregoing, no provision of this Trust Agreement
shall require the Trustees to expend or risk their own funds or otherwise incur
any financial liability in the performance of any of their duties hereunder, or
in the exercise of any of their rights or powers, if they shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it. Whether or not therein
expressly so provided, every provision of this Trust Agreement relating to the
conduct or affecting the liability of or affording protection to the Trustees
shall be subject to the provisions of this Section. Nothing in this Trust
Agreement shall be construed to release the Regular Trustees from liability for
their own grossly negligent action, their own grossly negligent failure to act,
or their own willful misconduct.
To the extent that, at law or in equity, a Regular Trustee has duties
(including fiduciary duties) and liabilities relating thereto to the Trust or to
the Securityholders, such Regular Trustee shall not be liable to the Trust or to
any Securityholder to the maximum extent that Maryland law in effect from time
to time permits limitation of the liability of trustees and officers of a
business trust. The provisions of this Trust Agreement, to the extent that they
restrict the duties and liabilities of the Regular Trustees otherwise existing
at law or in equity, are agreed by the Sponsor and the Securityholders to
replace such other duties and liabilities of the Regular Trustees.
(b) All payments made by the Property Trustee or a Paying Agent in
respect of the Trust Securities shall be made only from the revenue and proceeds
from the Trust Property and only to the extent that there shall be sufficient
revenue or proceeds from the Trust Property to enable the Property Trustee or a
Paying Agent to make payments in accordance with the terms hereof. Each
Securityholder, by its acceptance of a Trust Security, agrees that it will look
solely to the revenue and proceeds from the Trust Property to the extent legally
available for distribution to it as herein provided and that the Trustees are
not personally liable to it for any amount distributable in respect of any Trust
Security or for any other liability in respect of any Trust Security. This
Section 8.1(b) does not limit the liability of the Trustees expressly set forth
elsewhere in this Trust Agreement or, in the case of the Property Trustee, in
the Trust Indenture Act.
(c) No provision of this Trust Agreement shall be construed to relieve
the Property Trustee from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that:
(i) the Property Trustee shall not be liable for any error of
judgment made in good faith by an authorized officer of the Property
Trustee, unless it shall be proved that the Property Trustee was
negligent in ascertaining the pertinent facts;
(ii) the Property Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of a majority in aggregate
Liquidation Amount of the Trust Securities relating to the time,
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method and place of conducting any proceeding for any remedy available
to the Property Trustee, or exercising any trust or power conferred
upon the Property Trustee under this Trust Agreement;
(iii) the Property Trustee's sole duty with respect to the
custody, safekeeping and physical preservation of the Debt Securities
and the Payment Account shall be to deal with such property as
fiduciary assets, subject to the protections and limitations on
liability afforded to the Property Trustee under this Trust Agreement
and the Trust Indenture Act;
(iv) the Property Trustee shall not be liable for any interest
on any money received by it except as it may otherwise agree, in
writing, 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 Trust Agreement, nor shall the
Property Trustee be liable for the default or misconduct of the Regular
Trustees or the Sponsor;
(vi) the Property Trustee shall have no duty or liability with
respect to the value, genuineness, existence or sufficiency of the Debt
Securities or the payment of any taxes or assessments thereon or in
connection therewith;
(vii) the duties and obligations of the Property Trustee shall
be determined solely by the express provisions of this Trust Agreement
and in the Preferred Securities and the Common Securities and the
Property Trustee shall not be liable except for the performance of such
duties and obligations as are specifically set forth in this Trust
Agreement and in the Preferred Securities and the Common Securities,
and no implied covenants or obligations shall be read into this Trust
Agreement against the Property Trustee; and
(viii) no provision of this Trust Agreement shall require the
Property Trustee to expend or risk its own funds or otherwise incur
personal financial liability in the performance of any of its duties or
in the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that the repayment of such funds or
liability is not reasonably assured to it under the terms of this Trust
Agreement or indemnity reasonably satisfactory to the Property Trustee
against such risk or liability is not reasonably assured to it.
SECTION 8.2 Notice of Defaults.
(a) Within ten days after the occurrence of any Event of Default
actually known to a Responsible Officer of the Property Trustee, the Property
Trustee shall transmit, in the manner and to the extent provided in Section
10.8, notice of such Event of Default to the Holders of Preferred Securities,
the Regular Trustees and the Sponsor, unless such Event of
36
Default shall have been cured or waived, provided that, except for a default in
the payment of principal of (or premium, if any) or interest on any of the Debt
Securities, the Property Trustee shall be fully protected in withholding such
notice if and so long as the Board of Trustees, the executive committee, or a
trust committee of directors and/or Responsible Officers of the Property Trustee
in good faith determines that the withholding of such notice is in the interests
of the Holders of the Preferred Securities.
(b) Within ten days after the receipt of notice of the Parent's
exercise of its right to extend the interest payment period for the Debt
Securities pursuant to the Indenture, the Property Trustee shall transmit, in
the manner and to the extent provided in Section 10.8, notice of such exercise
to the Securityholders, unless such exercise shall have been revoked.
(c) The Holders of a majority in Liquidation Amount of Preferred
Securities may, by vote, on behalf of the Holders of all of the Preferred
Securities, waive any past Event of Default in respect of the Preferred
Securities and its consequences, provided that, if the underlying Indenture
Event of Default:
(i) is not waivable under the Indenture, the Event of Default
under this Trust Agreement shall also not be waivable; or
(ii) requires the consent or vote of greater than a majority
in principal amount of the holders of the Debt Securities, including
the consent or vote of all such holders, (a "Super Majority") to be
waived under the Indenture, the Event of Default under this Trust
Agreement may only be waived by the vote of the Holders of the same
proportion in Liquidation Amount of the Preferred Securities that the
relevant Super Majority represents of the aggregate principal amount of
the Debt Securities outstanding.
The provisions of Section 6.1(b) and this Section 8.2(c) shall be in
lieu of Section 316(a)(1)(B) of the Trust Indenture Act and such Section
316(a)(1)(B) of the Trust Indenture Act is hereby expressly excluded from this
Trust Agreement and the Preferred Securities, as permitted by the Trust
Indenture Act. Upon such waiver, any such default shall cease to exist, and any
Event of Default with respect to the Preferred Securities arising therefrom
shall be deemed to have been cured, for every purpose of this Trust Agreement,
but no such waiver shall extend to any subsequent or other default or an Event
of Default with respect to the Preferred Securities or impair any right
consequent thereon. Any waiver by the Holders of the Preferred Securities of an
Event of Default with respect to the Preferred Securities shall also be deemed
to constitute a waiver by the Holders of the Common Securities of any such Event
of Default with respect to the Common Securities for all purposes of this Trust
Agreement without any further act, vote, or consent of the Holders of the Common
Securities.
(d) The Holders of a majority in Liquidation Amount of the Common
Securities may, by vote, on behalf of the Holders of all of the Common
Securities, waive any past Event of Default with respect to the Common
Securities and its consequences, provided that, if the underlying Indenture
Event of Default:
(i) is not waivable under the Indenture, except where the
Holders of the Common Securities are deemed to have waived such Event
of Default under the Trust
37
Agreement as provided below in this Section 8.2(d), the Event of
Default under this Trust Agreement shall also not be waivable; or
(ii) requires the consent or vote of a Super Majority to be
waived, except where the Holders of the Common Securities are deemed to
have waived such Event of Default under this Trust Agreement as
provided below in this Section 8.2(d), the Event of Default under this
Trust Agreement may only be waived by the vote of the Holders of the
same proportion in Liquidation Amount of the Common Securities that the
relevant Super Majority represents of the aggregate principal amount of
the Debt Securities outstanding; provided further, that each Holder of
Common Securities will be deemed to have waived any such Event of
Default and all Events of Default with respect to the Common Securities
and its consequences until all Events of Default with respect to the
Preferred Securities have been cured, waived or otherwise eliminated,
and until such Events of Default have been so cured, waived or
otherwise eliminated, the Property Trustee will be deemed to be acting
solely on behalf of the Holders of the Preferred Securities and only
the Holders of the Preferred Securities will have the right to direct
the Property Trustee in accordance with the terms of the Securities.
The provisions of Section 6.1(b) and this Section 8.2(d) 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 Trust Agreement and the Preferred Securities, as
permitted by the Trust Indenture Act. Subject to the foregoing
provisions of this Section 8.2(d), upon such waiver, any such default
shall cease to exist and any Event of Default with respect to the
Common Securities arising therefrom shall be deemed to have been cured
for every purpose of this Trust Agreement, but no such waiver shall
extend to any subsequent or other default or Event of Default with
respect to the Common Securities or impair any right consequent
thereon.
(e) A waiver of a Indenture Event of Default by the Property Trustee at
the direction of the Holders of the Preferred Securities, constitutes a waiver
of the corresponding Event of Default under this Trust Agreement. The foregoing
provisions of this Section 8.2(e) 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 Trust Agreement and the Preferred
Securities, as permitted by the Trust Indenture Act.
SECTION 8.3 Certain Rights of Property Trustee. Subject to the
provisions of Section 8.1:
(a) the Property Trustee may conclusively rely and shall be fully
protected in acting or refraining from acting in good faith upon any resolution,
Opinion of Counsel, certificate, written representation of a Holder or
transferee such as of a certificate presented for transfer, certificate of
auditors or any other certificate, statement, instrument, opinion, report,
notice, request, consent, order, appraisal, bond, debenture, note, other
evidence of indebtedness or other paper or document believed by it to be genuine
and to have been signed or presented by the proper party or parties;
(b) if no Event of Default has occurred and is continuing and, (i) in
performing its duties under this Trust Agreement the Property Trustee is
required to decide
38
between alternative courses of action or (ii) in construing any of the
provisions in this Trust Agreement the Property Trustee finds the same ambiguous
or inconsistent with any other provisions contained herein or (iii) the Property
Trustee is unsure of the application of any provision of this Trust Agreement,
then, except as to any matter as to which the Holders of Preferred Securities
are entitled to vote under the terms of this Trust Agreement, the Property
Trustee shall deliver a notice to the Sponsor requesting written instructions of
the Sponsor as to the course of action to be taken and the Property Trustee
shall take such action, or refrain from taking such action, as the Property
Trustee shall be instructed in writing to take, or to refrain from taking, by
the Sponsor; provided, however, that if the Property Trustee does not receive
such instructions of the Sponsor within ten Business Days after it has delivered
such notice, or such reasonably shorter period of time set forth in such notice
(which to the extent practicable shall not be less than two Business Days), it
may, but shall be under no duty to, take or refrain from taking such action not
inconsistent with this Trust Agreement as it shall deem advisable and in the
best interests of the Securityholders, in which event the Property Trustee shall
have no liability except for its own bad faith, negligence or willful
misconduct;
(c) any direction or act of the Sponsor or the Regular Trustees
contemplated by this Trust Agreement shall be sufficiently evidenced by an
Officers' Certificate;
(d) whenever in the administration of this Trust Agreement, the
Property Trustee shall deem it desirable that a matter be established before
undertaking, suffering or omitting any action hereunder, the Property Trustee
(unless other evidence is herein specifically prescribed) may, in the absence of
bad faith on its part, request and conclusively rely upon an Officers'
Certificate and an Opinion of Counsel which, upon receipt of such request, shall
be promptly delivered by the Sponsor or the Regular Trustees; (e) the Property
Trustee shall have no duty to accomplish any recording, filing or registration
of any instrument (including any financing or continuation statement or any
filing under tax or securities laws) or any rerecording, refiling or
reregistration thereof;
(f) the Property Trustee may consult with counsel at the Sponsor's
expense (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; and the Property
Trustee shall have the right at any time to seek instructions concerning the
administration of this Trust Agreement from any court of competent jurisdiction;
(g) the Property Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Trust Agreement at the request or
direction of any of the Securityholders pursuant to this Trust Agreement, unless
such Securityholders shall have offered to the Property Trustee reasonable
security or indemnity satisfactory to it against the costs, expenses (including
attorneys' fees and expenses and the expenses of the Property Trustee's agents,
custodians or nominees) and liabilities which might be incurred by it in
compliance with such request or direction;
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(h) the Property Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolutions, 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 may make such further inquiry or investigation into
such facts or custodian or nominee matters as it may see fit;
(i) 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, custodians or nominees, attorneys or an Affiliate, provided that the
Property Trustee shall not be responsible for the negligence or recklessness on
the part of any agent, attorney, custodian or nominee appointed by it with due
care hereunder;
(j) whenever in the administration of this Trust Agreement the Property
Trustee shall deem it desirable to receive instructions with respect to
enforcing any remedy or right or taking any other action hereunder, the Property
Trustee (i) may request instructions from the Holders of the Trust Securities,
which instructions may only be given by the Holders of the same proportion in
Liquidation Amount of the Trust Securities as would be entitled to direct the
Property Trustee under the terms of the Trust Securities in respect of such
remedy, right or action, (ii) may refrain from enforcing such remedy or right or
taking such other action until such instructions are received, and (iii) shall
be fully protected in conclusively relying on or acting in accordance with such
instructions;
(k) except as otherwise expressly provided by this Trust Agreement, the
Property Trustee shall not be under any obligation to take any action that is
discretionary under the provisions of this Trust Agreement;
(l) to the maximum extent that Maryland law in effect from time to time
permits the limitation of the liability of trustees and officers of a business
trust, the Property Trustee shall not be liable for any action taken, suffered,
or omitted to be taken by it in connection with this Trust Agreement; and
(m) in the event that the Property Trustee is also acting as a Paying
Agent, Exchange Agent and/or Securities Registrar hereunder, the rights and
protections afforded to the Property Trustee pursuant to this Article 8 shall
also be afforded to such Paying Agent, Exchange Agent and/or Securities
Registrar.
No provision of this Trust Agreement shall be deemed to impose any duty
or obligation on the Property Trustee to perform any act or acts or exercise any
right, power, duty or obligation conferred or imposed on it, in any jurisdiction
in which it shall be illegal, or in which the Property Trustee shall be
unqualified or incompetent in accordance with applicable law, to perform any
such act or acts, or to exercise any such right, power, duty or obligation. No
permissive power or authority available to the Property Trustee shall be
construed to be a duty.
SECTION 8.4 Not Responsible for Recitals or Issuance of Securities. The
recitals contained herein and in the Trust Securities Certificates shall not be
taken as the statements of the Trustees, and the Trustees do not assume any
responsibility for their correctness. The
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Trustees shall not be accountable for the use or application by the Sponsor of
the proceeds of the Debt Securities.
SECTION 8.5 May Hold Securities. Except as provided in the definition
of the term "Outstanding" in Article 1, any Trustee or any other agent of any
Trustee or the Trust, in its individual or any other capacity, may become the
owner or pledgee of Trust Securities and, subject to Section 8.8 and 8.12, may
otherwise deal with the Trust with the same rights it would have if it were not
a Trustee or such other agent.
SECTION 8.6 Compensation; Indemnity; Fees.
The Sponsor agrees:
(a) to pay the Trustees from time to time reasonable compensation for
all services rendered by them hereunder (which compensation shall not be limited
by any provision of law in regard to the compensation of a trustee of an express
trust);
(b) except as otherwise expressly provided herein and subject to the
applicable limitations set forth in subsection (c) or (d) below, to reimburse
each Trustee, or advance expenses to each Trustee, upon request for all
reasonable expenses, disbursements and advances incurred or made by such Trustee
in accordance with any provision of this Trust Agreement (including the
reasonable compensation and the expenses and disbursements of its agents and
counsel);
(c) to the fullest extent permitted by applicable law, to indemnify and
hold harmless (i) each Regular Trustee, (ii) any Affiliate of any Regular
Trustee, (iii) any officer, director, shareholder, employee, representative or
agent of any Regular Trustee, and (iv) any employee or agent of the Trust or its
Affiliates (referred to herein as an "Sponsor Indemnified Person") from and
against any loss, damage, liability, tax, penalty, expense or claim of any kind
or nature whatsoever incurred by such Sponsor Indemnified Person by reason of
the creation, operation, dissolution or termination of the Trust or in
connection with the administration of the Trust or any act or omission performed
or omitted by such Sponsor Indemnified Person on behalf of the Trust, except
that no Sponsor Indemnified Person shall be entitled to be indemnified in
respect of any loss, damage or claim incurred by such Sponsor Indemnified Person
if it has been established that such expense, disbursement or advance is
attributable to such Sponsor Indemnified Person's own grossly negligent action,
grossly negligent failure to act, or willful misconduct;
(d) to the fullest extent permitted by applicable law, to indemnify and
hold harmless the Property Trustee for, and to hold it harmless against, any
loss, liability or expense incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or administration of the
trust or trusts hereunder, including the costs and expenses of defending itself
against any claim or liability in connection with the exercise or performance of
any of its powers or duties hereunder; and
(e) no Trustee may claim any lien or charge on any Trust Property as a
result of any amount due pursuant to this Section 8.6.
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SECTION 8.7 Property Trustee Required; Eligibility of Trustees.
(a) There shall at all times be a Property Trustee hereunder with
respect to the Trust Securities. The Property Trustee shall be a Person that is
eligible pursuant to the Trust Indenture Act to act as such and has a combined
capital and surplus of at least $50,000,000. If any such Person publishes
reports of condition at least annually, pursuant to law or to the requirements
of its supervising or examining authority, then for the purposes of this
Section, the combined capital and surplus of such Person shall be deemed to be
its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time the Property Trustee with respect to the
Trust Securities shall cease to be eligible in accordance with the provisions of
this Section, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article.
(b) There shall at all times be one or more Regular Trustees hereunder
with respect to the Trust Securities. Each Regular Trustee shall be either a
natural person who is at least 21 years of age or a legal entity that shall act
through one or more persons authorized to bind that entity.
SECTION 8.8 Conflicting Interests. If the Property Trustee has or shall
acquire a conflicting interest within the meaning of the Trust Indenture Act,
the Property Trustee shall either eliminate such interest or resign, to the
extent and in the manner provided by, and subject to the provisions of, the
Trust Indenture Act and this Trust Agreement.
SECTION 8.9 Resignation and Removal; Appointment of Successor.
(a) Subject to Sections 8.9(b), Trustees (the "Relevant Trustee") may
be appointed or removed without cause at any time:
(i) until the issuance of any Trust Securities, by written
instrument executed by the Sponsor; and
(ii) after the issuance of any Securities, by vote of the
Holders of a majority in Liquidation Amount of the Common Securities
voting as a class.
(b) The Trustee that acts as Property Trustee shall not be removed in
accordance with Section 8.9(a) until a successor possessing the qualifications
to act as a Property Trustee under Section 8.7 (a "Successor Property Trustee")
has been appointed and has accepted such appointment by instrument executed by
such Successor Property Trustee and delivered to the Trust, the Sponsor and the
removed Property Trustee.
(c) A Trustee appointed to office shall hold office until his, her or
its successor shall have been appointed or until his, her or its death, removal,
resignation, dissolution or liquidation. Any Trustee may resign from office
(without need for prior or subsequent accounting) by an instrument in writing
signed by the Trustee and delivered to the Sponsor and the Trust, which
resignation shall take effect upon such delivery or upon such later date as is
specified therein; provided, however, that:
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(i) No such resignation of the Trustee that acts as the
Property Trustee shall be effective:
(A) until a Successor Property Trustee has been
appointed and has accepted such appointment by instrument
executed by such Successor Property Trustee and delivered to
the Trust, the Sponsor and the resigning Property Trustee; or
(B) until the assets of the Trust have been
completely liquidated and the proceeds thereof distributed to
the Holders of the Securities;
(ii) no appointment of a successor Property Trustee shall be
effective until all fees, charges, and expenses of the retiring
Property Trustee have been paid.
(d) The Holders of the Common Securities shall use their best efforts
to promptly appoint a Successor Property Trustee if the Property Trustee
delivers an instrument of resignation in accordance with Section 8.9(c).
(e) If no Successor Property Trustee shall have been appointed and
accepted appointment as provided in this Section 8.9 within 60 days after
delivery pursuant to this Section 8.9 of an instrument of resignation or
removal, the Property Trustee resigning or being removed may petition any court
of competent jurisdiction for appointment of a Successor Property Trustee. Such
court may thereupon, after prescribing such notice, if any, as it may deem
proper and prescribe, appoint a Successor Property Trustee.
(f) No Property Trustee shall be liable for the acts or omissions to
act of any Successor Property Trustee.
(g) The Property Trustee shall give notice of each resignation and each
removal of a Trustee and each appointment of a successor Trustee to all
Securityholders in the manner provided in Section 10.8 and shall give notice to
the 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.
(h) Notwithstanding the foregoing or any other provision of this Trust
Agreement, in the event any Regular 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 Trustees set forth
in Section 8.7).
The indemnity provided to a Trustee under Section 8.6 shall survive any
Trustee's resignation or removal or termination of this Trust Agreement.
SECTION 8.10 Acceptance of Appointment by Successor. In case of the
appointment hereunder of a successor Relevant Trustee, the retiring Relevant
Trustee and each successor Relevant Trustee shall execute and deliver an
amendment hereto wherein each successor
43
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 and (b) shall add to or change any of
the provisions of this Trust Agreement as shall be necessary to provide for or
facilitate the administration of the trusts hereunder by more than one Relevant
Trustee, it being understood that nothing herein or in such amendment shall
constitute such Relevant Trustees as 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.
Upon request of any such successor Relevant Trustee, the Trust shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Relevant Trustee all such rights, powers and trusts
referred to in the first or second preceding paragraph, as the case may be.
No successor Relevant Trustee shall accept its appointment unless at
the time of such acceptance such successor Relevant Trustee shall be qualified
and eligible under this Article.
SECTION 8.11 Merger, Conversion, Consolidation or Succession to
Business. Any Person into which the Property Trustee or any Regular Trustee that
is not a natural person may be merged or converted or with which it may be
consolidated, or any Person resulting from any merger, conversion or
consolidation to which such Relevant Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of such Relevant Trustee, shall be the successor of such Relevant Trustee
hereunder, provided such Person shall be otherwise qualified and eligible under
this Article, without the execution or filing of any paper or any further act on
the part of any of the parties hereto.
SECTION 8.12 Preferential Collection of Claims Against Sponsor or
Trust. If and when the Property Trustee shall be or become a creditor of the
Sponsor or the Trust (or any other obligor upon the Debt Securities or the Trust
Securities), the Property Trustee shall be subject to and shall take all actions
necessary in order to comply with the provisions of the Trust Indenture Act
regarding the collection of claims against the Sponsor or Trust (or any such
other obligor).
SECTION 8.13 Reports by Property Trustee. Within 60 days after May 15
of each year, commencing with the first May 15, after the first issuance of
Preferred Securities, the Property Trustee shall provide to the Holders of the
Preferred Securities such reports as are required by Section 313 of the Trust
Indenture Act, if any, in the form and in the manner provided by Section 313 of
the Trust Indenture Act. The Property Trustee shall also comply with the
requirements of Section 313(d) of the Trust Indenture Act.
SECTION 8.14 Reports to the Property Trustee. The Sponsor and the
Regular Trustees on behalf of the Trust shall provide to the Property Trustee
such documents, reports and information as are required by Section 314 of the
Trust Indenture Act (if any) and the
44
compliance certificate required by Section 314(a) of the Trust Indenture Act in
the form, in the manner and at the times required by Section 314 of the Trust
Indenture Act.
SECTION 8.15 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 Trust Agreement that relate to any of the matters set
forth in Section 314(c) of the Trust Indenture Act. Any certificate or opinion
required to be given by an officer pursuant to Section 314(c)(1) of the Trust
Indenture Act shall be given in the form of an Officers' Certificate.
SECTION 8.16 Number of Trustees.
(a) The number of Trustees shall be three, provided that the Holder of
all of the Common Securities by written instrument may increase or decrease the
number of Regular Trustees.
(b) If a Trustee ceases to hold office for any reason and the number of
Regular Trustees is not reduced pursuant to Section 8.16(a), or if the number of
Trustees is increased pursuant to Section 8.16(a), a vacancy shall occur.
(c) The death, resignation, retirement, removal, bankruptcy,
incompetence or incapacity to perform the duties of a Trustee shall not operate
to dissolve, terminate or annul the Trust. Whenever a vacancy in the number of
Regular Trustees shall occur, until such vacancy is filled by the appointment of
a Regular Trustee in accordance with Section 8.9, 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 Trust
Agreement.
SECTION 8.17 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
2.7(a), including any registration statement or amendment thereof filed with the
Commission, or making any other governmental filing.
(b) The Regular Trustees shall have power to delegate from time to time
to such of their number or to 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 the Trust, as set forth herein.
ARTICLE 9
DISSOLUTION, LIQUIDATION AND MERGER
SECTION 9.1 Dissolution upon Expiration Date. Unless earlier dissolved,
the Trust shall dissolve on June 15, 2041 (the "Expiration Date") or as soon as
possible thereafter.
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SECTION 9.2 Early Dissolution. The first to occur of any of the
following events is an "Early Dissolution Event":
(a) the occurrence of a Bankruptcy Event in respect of, or the
dissolution or liquidation (other than a deemed liquidation for tax purposes)
of, the Parent or the Sponsor;
(b) the occurrence of a Special Event except in the case of a Tax Event
following which the Parent has elected (i) to pay any Additional Sums (in
accordance with Section 4.4) such that the net amount received by Holders of
Preferred Securities in respect of Distributions are not reduced as a result of
such Tax Event and the Parent has not revoked any such election or failed to
make such payments or (ii) to redeem all or some of the Debt Securities pursuant
to Section 4.4(a);
(c) the redemption, conversion or exchange of all of the Trust
Securities;
(d) an order for dissolution of the Trust shall have been entered by a
court of competent jurisdiction; and
(e) receipt by the Property Trustee of written notice from the Parent
or the Sponsor at any time (which direction is optional and wholly within the
discretion of the Parent and the Sponsor, as the case may be) of its intention
to dissolve the Trust and distribute the Debt Securities in exchange for the
Preferred Securities.
SECTION 9.3 Dissolution. The respective obligations and
responsibilities of the Trustees and the Trust created and continued hereby
shall terminate upon the latest to occur of the following: (a) the distribution
by the Property Trustee to Securityholders upon the liquidation of the Trust
pursuant to Section 9.4, or upon the redemption of all of the Trust Securities
pursuant to Section 4.2, of all amounts required to be distributed hereunder
upon the final payment of the Trust Securities; (b) the payment of all 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 9.4 Liquidation.
(a) If an Early Dissolution Event specified in clause (a), (b), (d) or
(e) of Section 9.2 occurs or upon the Expiration Date, the Trust shall be
liquidated by the Trustees as expeditiously as the Trustees determine to be
possible by distributing, after satisfaction of liabilities to creditors of the
Trust as provided by applicable law, to each Securityholder an aggregate
principal amount of Debt Securities equal to the aggregate Liquidation Amount of
Trust Securities held by such Holder, subject to Section 9.4(d). Notice of
liquidation shall be given by the Property Trustee by first-class mail, postage
prepaid, mailed not later than 30 nor more than 60 days prior to the Liquidation
Date to each Holder of Trust Securities at such Holder's address as it appears
in the Securities Register. All notices of liquidation shall be prepared by the
Regular Trustees and shall:
(i) state the Liquidation Date;
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(ii) state that, from and after the Liquidation Date, the
Trust Securities will no longer be deemed to be Outstanding and any
Trust Securities Certificates not surrendered for exchange will be
deemed to represent an aggregate principal amount of Debt Securities
equal to the aggregate Liquidation Amount of Preferred Securities held
by such Holder; and
(iii) provide such information with respect to the mechanics
by which Holders may exchange Trust Securities Certificates for Debt
Securities, or, if Section 9.4(d) applies, receive a Liquidation
Distribution, as the Regular Trustees or the Property Trustee shall
deem appropriate.
(b) Except where Section 9.2(c) or 9.4(d) applies, in order to effect
the liquidation of the Trust and distribution of the Debt Securities to
Securityholders, the Property Trustee shall establish a record date for such
distribution (which date shall be not more than 45 days prior to the Liquidation
Date and, unless the Property Trustee determines otherwise, (i) shall be the
date which, for so long as the Preferred Securities remain in book-entry form
only, is one Business Day before the Liquidation Date, or (ii) if the Preferred
Securities are no longer in book-entry form only, shall be the fifteenth day
before the Liquidation Date (whether or not a Business Day)) 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 Debt Securities in exchange for the Outstanding Trust
Securities Certificates.
(c) Except where Section 9.2(c) or 9.4(d) applies, after the
Liquidation Date, (i) the Trust Securities will no longer be deemed to be
Outstanding, (ii) the Clearing Agency or its nominee, as the record holder of
such Trust Securities, will receive a registered global certificate or
certificates representing the Debt Securities to be delivered upon such
distribution and (iii) any Trust Securities Certificates not held by the
Clearing Agency will be deemed to represent an aggregate principal amount of
Debt Securities equal to the aggregate Liquidation Amount of Preferred
Securities held by such Holders, and bearing accrued and unpaid interest in an
amount equal to the accrued and unpaid Distributions on such Trust Securities
until such certificates are presented to the Property Trustee for transfer or
reissuance.
(d) In the event that, notwithstanding the other provisions of this
Section 9.4, whether because of an order for dissolution entered by a court of
competent jurisdiction or otherwise, distribution of the Debt Securities in the
manner provided herein is determined by the Property Trustee not to be
practicable, the Trust Property shall be liquidated, and the Trust shall be
wound-up or terminated, by the Property Trustee in such manner as the Property
Trustee determines, and a majority of the Regular Trustees shall prepare,
execute and file the certificate of cancellation with the State Department of
Assessments and Taxation of Maryland. 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 accrued and unpaid Distributions thereon to the date of payment
(such amount being the "Liquidation Distribution"). If, upon any such winding-up
or termination, the Liquidation Distribution can be paid only in part because
the Trust has insufficient assets available to pay in full the aggregate
Liquidation Distribution, then, subject to the next succeeding sentence, the
amounts payable by the Trust on the Trust Securities shall be paid on a pro rata
basis (based upon Liquidation
47
Amounts). The Holder of the Common Securities will be entitled to receive
Liquidation Distributions upon any such winding-up or termination pro rata
(determined as aforesaid) with Holders of Preferred Securities, except that, if
a Indenture Event of Default has occurred and is continuing, the Preferred
Securities shall have a priority over the Common Securities.
SECTION 9.5 Mergers, Consolidations or Replacements of the Trust. The
Trust may not merge with or into, consolidate, 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 9.5 or Section 9.4. At the request of
the Sponsor, with the consent of the Regular Trustees and without the consent of
the Property Trustee or the Holders of the Preferred Securities, the Trust may
merge with or into, consolidate, be replaced by or convey, transfer or lease its
properties and assets substantially as an entirety to a trust organized as such
under the laws of any state; provided, that (i) such successor entity either (a)
expressly assumes all of the obligations of the Trust with respect to the
Preferred Securities or (b) substitutes for the Preferred Securities other
securities having substantially the same terms as the Preferred Securities (the
"Successor Securities") so long as the Successor Securities rank the same as the
Preferred Securities rank in priority with respect to Distributions and payments
upon liquidation, redemption and otherwise, (ii) the Sponsor expressly appoints
a trustee of such successor entity possessing the same powers and duties as the
Property Trustee as the holder of the Debt Securities, (iii) the Successor
Securities are listed, or any Successor Securities will be listed upon
notification of issuance, on any national securities exchange or other
organization on which the Preferred Securities are then listed, if any, (iv)
such merger, consolidation, 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, 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 (other than with respect to any dilution of the Holder's interest in the
new entity), (vi) such successor entity has a purpose substantially identical to
that of the Trust, (vii) prior to such merger, consolidation, replacement,
conveyance, transfer or lease the Sponsor has received an Opinion of Counsel to
the effect that (a) such merger, consolidation, 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 (other than with respect to any dilution of
the Holder's interest in the new entity), (b) following such merger,
consolidation, 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 (c) following such merger, consolidation, replacement,
the Trust or such successor entity will be treated as a grantor trust for United
States federal income tax purposes and (viii) the Sponsor or any permitted
successor or assignee owns, directly or indirectly, all of the common securities
of such successor entity and guarantees the obligations of such successor entity
under the Successor Securities at least to the extent provided by the Guarantee.
Notwithstanding the foregoing, the Trust shall not, except with the consent of
Holders of 100% in aggregate Liquidation Amount of the Preferred Securities,
consolidate, merge with or into, 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, merge with or into, or replace it if such
consolidation, 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.
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ARTICLE 10
MISCELLANEOUS PROVISIONS
SECTION 10.1 Limitation of Rights of Securityholders. Other than as set forth in
Section 9.1, the death, incapacity, dissolution, bankruptcy or termination of
any Person having an interest, beneficial or otherwise, in Trust Securities
shall not operate to dissolve the Trust or terminate this Trust Agreement, nor
entitle the legal representatives or heirs of such Person or any Securityholder
for such Person to claim an accounting, take any action or bring any proceeding
in any court for a partition or winding-up of the arrangements contemplated
hereby, nor otherwise affect the rights, obligations and liabilities of the
parties hereto or any of them.
SECTION 10.2 Amendment.
(a) This Trust Agreement may be amended from time to time by the
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 Trust Agreement, which
shall not be inconsistent with the other provisions of this Trust Agreement,
(ii) to modify, eliminate or add to any provisions of this Trust Agreement to
such extent as shall be necessary to ensure that the Trust will be classified
for United States federal income tax purposes as a grantor trust at all times
that any Trust Securities are Outstanding or to ensure that the Trust will not
be required to register as an "investment company" under the 1940 Act, or be
classified as other than a grantor trust for United States federal income tax
purposes, or (iii) to comply with the requirements of the Commission in order to
effect or maintain the qualification of this Trust Agreement under the Trust
Indenture 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 Trust Agreement shall become
effective when notice thereof is given to the Securityholders.
(b) Except as provided in Section 10.2(c) hereof, any provision of this
Trust Agreement may be amended by the Trustees and the Sponsor with (i) the
consent of Holders representing not less than a majority (based upon Liquidation
Amounts) of the Trust Securities then Outstanding, acting as a single class, 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 the
status of an "investment company" under the 1940 Act, provided, however, if any
amendment or proposal that would adversely affect the powers, preferences or
special rights of the Trust Securities, whether by way of amendment or
otherwise, would adversely affect only the Preferred Securities or only the
Common Securities, then only the affected class will be entitled to vote on such
amendment or proposal and such amendment or proposal shall not be effective
except with the approval of a majority in Liquidation Amount of such class of
Trust Securities.
(c) In addition to and notwithstanding any other provision in this
Trust Agreement, without the consent of each affected Securityholder (such
consent being obtained in accordance with Section 6.3 or 6.6 hereof), this Trust
Agreement may not be amended to (i) change the amount or timing of any
Distribution on the Trust Securities or otherwise adversely
49
affect the amount of any Distribution required to be made in respect of the
Trust 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 (such consent being obtained in
accordance with Section 6.3 or 6.6 hereof), this paragraph (c) of this Section
10.2 may not be amended.
(d) Notwithstanding any other provisions of this Trust Agreement, no
Trustee shall enter into or consent to any amendment to this Trust Agreement
which would cause the Trust to fail or cease to qualify for the exemption from
the status of an "investment company" under the 1940 Act or be classified as
other than a grantor trust for United States federal income tax purposes.
(e) Notwithstanding anything in this Trust Agreement to the contrary,
without the consent of the Sponsor, this Trust Agreement may not be amended in a
manner which imposes any additional obligation on the Sponsor.
(f) In the event that any amendment to this Trust Agreement is made,
the Regular Trustees shall promptly provide to the Sponsor a copy of such
amendment.
(g) The Property Trustee shall not be required to enter into any
amendment to this Trust Agreement which affects its own rights, duties or
immunities under this Trust Agreement. The Property Trustee shall be entitled to
receive an Opinion of Counsel and an Officers' Certificate stating that any
amendment to this Trust Agreement is in compliance with this Trust Agreement and
that all conditions precedent, if any, in this Trust Agreement to the execution
and delivery of such amendment have been satisfied.
SECTION 10.3 Separability. In case any provision in this Trust
Agreement or in the Trust Securities Certificates shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
SECTION 10.4 Governing Law. EXCEPT AS PROVIDED IN SECTION 10.10 HEREOF,
THIS TRUST AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF EACH OF THE
SECURITYHOLDERS, THE TRUST AND TRUSTEES WITH RESPECT TO THIS TRUST AGREEMENT AND
THE TRUST SECURITIES SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE
LAWS OF THE STATE OF MARYLAND WITHOUT REGARD TO ITS CONFLICT OF LAWS PRINCIPLES.
SECTION 10.5 Payments Due on Non-Business Day. If the date fixed for
any payment on any Trust Security shall be a day which is not a Business Day,
then such payment need not be made on such date but may be made on the next
succeeding day which is a Business Day except as otherwise provided in Section
4.1(a) and Section 4.2(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 10.6 Successors. This Trust Agreement 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 transaction that is permitted under
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Article 8 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 10.7 Headings. The Article and Section headings are for
convenience only and shall not affect the construction of this Trust Agreement.
SECTION 10.8 Reports, Notices and Demands. Any report, notice, demand
or other communication which by any provision of this Trust Agreement 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 Holder of Preferred
Securities, to such Holder as such Holder's name and address may appear on the
Securities Register; and (b) in the case of the Holder of the Common Securities,
to SNH Capital Trust Holdings, c/o Senior Housing Properties Trust, 400 Centre
Street, Newton, Massachusetts 02458.
Any notice, demand or other communication which by any provision of
this Trust Agreement is required or permitted to be given or served to or upon
the Trust, the Property 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 State Street Bank and Trust
Company, 2 Avenue de Lafayette, Boston, Massachusetts, 02111 Attention: Paul D.
Allen, Corporate Trust Department and (b) with respect to the Regular Trustees,
to them at the address for notices to the Sponsor, marked "Attention: Gerard M.
Martin and Barry M. Portnoy. 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 10.9 Agreement Not to Petition. Each of the Trustees and the
Sponsor agrees for the benefit of the Securityholders that, until at least one
year and one day after the Trust has been dissolved in accordance with Article
9, it shall not file, or join in the filing of, a petition against the Trust
under any Bankruptcy Law 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 10.9, 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, if any, as counsel for the Trustee or the Trust may assert. The
provisions of this Section 10.9 shall survive the dissolution of this Trust
Agreement.
SECTION 10.10 Trust Indenture Act; Conflict with Trust Indenture Act.
(a) This Trust Agreement is subject to the provisions of the Trust
Indenture Act that are required to be part of this Trust Agreement and shall, to
the extent applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is the trustee
for the purposes of the Trust Indenture Act.
51
(c) If any provision hereof limits, qualifies or conflicts with another
provision hereof which is required to be included in this Trust Agreement by any
of the provisions of the Trust Indenture Act, such required provision shall
control. If any provision of this Trust Agreement modifies or excludes any
provision of the Trust Indenture Act which may be so modified or excluded, the
latter provision shall be deemed to apply to this Trust Agreement as so modified
or to be excluded, as the case may be.
(d) The application of the Trust Indenture Act to this Trust Agreement
shall not affect the nature of the Trust Securities as equity securities
representing undivided beneficial interests in the assets of the Trust.
SECTION 10.11 Acceptance of Terms of Trust Agreement, Guarantee and
Indenture. THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST
THEREIN BY OR ON BEHALF OF A SECURITYHOLDER OR BENEFICIAL OWNER, WITHOUT ANY
SIGNATURE OR FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL
ACCEPTANCE BY THE SECURITYHOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN
SUCH TRUST SECURITY OF ALL THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT AND
AGREEMENT TO SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND THE
INDENTURE, AND SHALL CONSTITUTE THE AGREEMENT OF THE TRUST, SUCH SECURITYHOLDER
AND SUCH OTHERS THAT THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT SHALL BE
BINDING, OPERATIVE AND EFFECTIVE AS THE AGREEMENT OF THE TRUST AND SUCH
SECURITYHOLDER AND SUCH OTHERS.
SECTION 10.12 Counterparts. This Trust Agreement may contain more than
one counterpart of the signature page and this Trust Agreement may be executed
by the affixing of the signature of each of the Trustees to one of such
counterpart signature pages. All of such counterpart signature pages shall be
read as though one, and they shall have the same force and effect as though all
of the signers had signed a single signature page.
IN WITNESS WHEREOF, the parties hereto have caused this Trust Agreement
to be duly executed as of the day and year first above written.
SNH CAPITAL TRUST HOLDINGS, as Sponsor
By:
------------------------------------------
Name:
Title:
52
STATE STREET BANK AND TRUST COMPANY, as Property
Trustee
By:
-------------------------------------------
Name:
Title:
Gerard M. Martin, as Regular Trustee and not
individually
Barry M. Portnoy, as Regular Trustee and not
individually
53
EXHBIIT A
SNH CAPITAL TRUST I
CERTIFICATE OF TRUST
THIS IS TO CERTIFY THAT:
FIRST: The undersigned trustees hereby form a business trust pursuant
to the laws of the State of Maryland.
SECOND: The name of the business trust (the "Trust") is:
SNH Capital Trust I
THIRD: The address of the Trust's principal office in the State of
Maryland is c/o Ballard Spahr Andrews & Ingersoll, LLP, 300 East Lombard Street,
Baltimore, Maryland 21202, Attention: James J. Hanks, Jr.
FOURTH: The name and business address of the Trust's resident agent are
James J. Hanks, Jr., c/o Ballard Spahr Andrews & Ingersoll, LLP, 300 East
Lombard Street, Baltimore, Maryland 21202.
The undersigned, being all of the trustees of the Trust, acknowledge
under the penalties of perjury, that to the best of their knowledge and belief,
the facts stated herein are true.
IN WITNESS WHEREOF, each of the undersigned trustees have signed this
Certificate of Trust this 4th day of May, 2001.
_____________________________
Gerard M. Martin
_____________________________
Barry M. Portnoy
A-1
EXHIBIT B
Form of Common Securities of SNH Capital Trust I
THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT TO AN ENTITY WHOLLY OWNED BY SENIOR
HOUSING PROPERTIES TRUST OR TO CERTAIN SUCCESSORS OF SENIOR HOUSING PROPERTIES
TRUST.
Certificate Number 1 Number of Common Securities ___
Certificate Evidencing Common Securities
of
SNH Capital Trust I
10.125% Common Securities
(Liquidation Amount $25.00 per Common Security)
SNH Capital Trust I, a business trust created under the laws of the
State of Maryland (the "Trust"), hereby certifies that SNH Capital Trust
Holdings, a business trust created under the laws of the State of Maryland (the
"Holder"), is the registered owner of ________ common securities of the Trust
representing undivided beneficial interests in the assets of the Trust (the
"Common Securities"). Except as set forth in Section 5.10 of the Trust Agreement
(as defined below), the Common Securities are not transferable and any attempted
transfer hereof shall be void. The designations, rights, privileges,
restrictions, preferences and other terms and provisions of the Common
Securities are set forth in, and this certificate and the Common Securities
represented hereby are issued and shall in all respects be subject to the terms
and provisions of, the Amended and Restated Trust Agreement of the Trust dated
as of June 21, 2001, as the same may be amended from time to time (the "Trust
Agreement") including the designation of the terms of the Common Securities as
set forth therein. The Trust will furnish a copy of the Trust Agreement and the
Guarantee to the Holder without charge upon written request to the Trust at its
principal place of business or registered office.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.
IN WITNESS WHEREOF, one of the Regular Trustees of the Trust has
executed this certificate.
Dated: June __, 2001 SNH CAPITAL TRUST I
By: ______________________________________
Name: Barry M. Portnoy
As Regular Trustee and not individually
PROPERTY TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Common Securities referred to in the
within-mentioned Trust Agreement.
STATE STREET BANK AND TRUST
COMPANY, as Property Trustee
By:_____________________________________
Name:
Title:
B-2
EXHIBIT C
Form of Preferred Securities of SNH Capital Trust I
This Preferred Security is a Book-Entry Preferred Securities
Certificate within the meaning of the Trust Agreement hereinafter referred to
and is registered in the name of The Depository Trust Company ("DTC") or a
nominee of DTC. This Preferred Security is exchangeable for Preferred Securities
registered in the name of a person other than DTC or its nominee only in the
limited circumstances described in the Trust Agreement and no transfer of this
Preferred Security (other than a transfer of this Preferred Security as a whole
by DTC to a nominee of DTC or by a nominee of DTC to DTC or another nominee of
DTC) may be registered except in limited circumstances.
Unless this certificate is presented by an authorized representative of
The Depository Trust Company, a New York corporation ("DTC"), to Issuer or its
agent for registration of transfer, exchange or payment, and any certificate
issued is registered in the name of Cede & Co. or in such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
Certificate Number ____ Number of Preferred Securities ____
CUSIP NO. 78460V 20 9
CERTIFICATE EVIDENCING PREFERRED SECURITIES
OF
SNH CAPITAL TRUST I
10.125% Trust Preferred Securities
(Liquidation Amount $25.00 per Preferred Security)
SNH Capital Trust I, a business trust created under the laws of the
State of Maryland (the "Trust"), hereby certifies that Cede & Co. or its
registered assigns (the "Holder") is the registered owner of ___________________
(_______) preferred securities of the Trust representing an undivided beneficial
interest in the assets of the Trust and designated the SNH Capital Trust I
10.125% Trust Preferred Securities (Liquidation Amount $25.00 per Preferred
Security) (the "Preferred Securities"). Except to the extent set forth in the
Trust Agreement (as defined below), the Preferred Securities are transferable on
the books and records of the Trust, in person or by a duly authorized attorney,
upon surrender of this certificate duly endorsed and in proper form for transfer
as provided in Section 5.4 of the Trust Agreement (as defined below). The
designations, rights, privileges, restrictions, preferences and other terms and
provisions of the Preferred Securities are set forth in, and this certificate
and the Preferred Securities represented hereby are issued and shall in all
respects be subject to the terms and provisions of, the Amended and Restated
Trust Agreement of the Trust dated as of June 21, 2001 as the same may be
amended from time to time (the "Trust Agreement") including the designation of
the terms of Preferred Securities as set forth therein. The Holder is entitled
to the benefits of the Guarantee Agreement entered into by Senior Housing
Properties Trust, a Maryland real estate
investment trust, and State Street Bank and Trust Company, as Guarantee Trustee,
dated as of June 21, 2001 (the "Guarantee"), to the extent provided therein. The
Trust will furnish a copy of the Trust Agreement and the Guarantee to the Holder
without charge upon written request to the Trust at its principal place of
business or registered office.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.
IN WITNESS WHEREOF, one of the Regular Trustees of the Trust has
executed this certificate.
Dated: June __, 2001 SNH CAPITAL TRUST I
By: ______________________________
Name: Barry M. Portnoy
As Regular Trustee and not individually
C-2
PROPERTY TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Preferred Securities referred to in the
within-mentioned Trust Agreement.
STATE STREET BANK AND TRUST
COMPANY, as Property Trustee
By: ______________________________
Name:
Title:
C-3
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this
Preferred Security to:
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Insert assignee's social security or tax identification number)
______________________________________________________________________________
______________________________________________________________________________
(Insert address and zip code of assignee)
and irrevocably appoints
______________________________________________________________________________
______________________________________________________________________________
agent to transfer this Preferred Securities Certificate on the books of the
Trust. The agent may substitute another to act for him or her.
Date: __________________________
Signature: ______________________
(Sign exactly as your name appears on the other side of this Preferred
Securities Certificate)
C-4
[TO BE ATTACHED TO GLOBAL CERTIFICATE]
SCHEDULE A
The initial Liquidation Amount of this Global Certificate shall be
$25,000,000. The following increases or decreases in the Liquidation Amount of
this Global Certificate have been made:
Amount of Increase
in Liquidation
Amount of This Liquidation Amount
Global Certificate Amount of Decrease in of this Global Signature of
Including Upon Liquidation Amount of Certificate Authorized Officer
Exercise of this Global Following such of Trustee or
Date Made Over-Allotment Option Certificate Decrease or Increase Securities Custodian
- ---------------------------------------------------------------------------------------------------------------------
C-5