EXHIBIT 4.4
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AMENDED AND RESTATED DECLARATION
OF TRUST
NEW YORK BANCORP CAPITAL TRUST
DATED AS OF ________________, 1997
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NYFS10...:\81\65281\0001\1819\DEC8157P.55E
TABLE OF CONTENTS
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ARTICLE I
INTERPRETATION AND DEFINITIONS............................................. 2
SECTION 1.1 Definitions........................................... 2
ARTICLE II
TRUST INDENTURE ACT........................................................ 9
SECTION 2.1 Trust Indenture Act; Application...................... 9
SECTION 2.2 Lists of Holders of Securities........................ 10
SECTION 2.3 Reports by the Property Trustee....................... 10
SECTION 2.4 Periodic Reports to Property Trustee.................. 10
SECTION 2.5 Evidence of Compliance with Conditions Precedent...... 11
SECTION 2.6 Events of Default; Waiver............................. 11
SECTION 2.7 Event of Default; Notice.............................. 13
ARTICLE III
ORGANIZATION............................................................... 14
SECTION 3.1 Name.................................................. 14
SECTION 3.2 Office................................................ 14
SECTION 3.3 Purpose............................................... 14
SECTION 3.4 Authority............................................. 15
SECTION 3.5 Title to Property of the Trust........................ 15
SECTION 3.6 Powers and Duties of the Administrators............... 15
SECTION 3.7 Prohibition of Actions by the Trust, the Trustees
and the Administrators................................ 18
SECTION 3.8 Powers and Duties of the Property Trustee............. 19
SECTION 3.9 Certain Additional Duties and Responsibilities of
the Property Trustee.................................. 22
SECTION 3.10 Certain Rights of the Property Trustee................ 24
SECTION 3.11 Delaware Trustee...................................... 26
SECTION 3.12 Not Responsible for Recitals or Issuance of Securities 27
SECTION 3.13 Duration of Trust..................................... 27
SECTION 3.14 Mergers............................................... 27
ARTICLE IV
SPONSOR.................................................................... 29
SECTION 4.1 Sponsor's Purchase of Common Securities............... 29
SECTION 4.2 Responsibilities of the Sponsor....................... 29
SECTION 4.3 Right to Proceed...................................... 30
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ARTICLE V
TRUSTEES AND ADMINISTRATORS................................................ 30
SECTION 5.1 Number of Trustees and Administrators; Appointment
of Co-Trustee......................................... 30
SECTION 5.2 Delaware Trustee...................................... 31
SECTION 5.3 Property Trustee; Eligibility......................... 32
SECTION 5.4 Certain Qualifications of Administrators and
Delaware Trustee Generally............................ 33
SECTION 5.5 Administrators........................................ 33
SECTION 5.6 Appointment, Removal and Resignation of Trustees and
Administrators........................................ 33
SECTION 5.7 Vacancies Among Trustees and Administrators........... 35
SECTION 5.8 Effect of Vacancies................................... 35
SECTION 5.9 Meetings.............................................. 36
SECTION 5.10 Delegation of Power................................... 36
SECTION 5.11 Merger, Conversion, Consolidation or Succession
to Business........................................... 37
ARTICLE VI
DISTRIBUTIONS.............................................................. 37
SECTION 6.1 Distributions......................................... 37
ARTICLE VII
ISSUANCE OF SECURITIES..................................................... 37
SECTION 7.1 General Provisions Regarding Securities............... 37
SECTION 7.2 Execution and Authentication.......................... 38
SECTION 7.3 Form and Dating....................................... 39
SECTION 7.4 Definitive Capital Securities......................... 40
SECTION 7.5 Registrar, Paying Agent and Conversion Agent.......... 41
SECTION 7.6 Paying Agent to Hold Money in Trust................... 42
SECTION 7.7 Replacement Securities................................ 42
SECTION 7.8 Outstanding Capital Securities........................ 43
SECTION 7.9 Capital Securities in Treasury........................ 43
SECTION 7.10 Temporary Securities.................................. 43
SECTION 7.11 Cancellation.......................................... 43
SECTION 7.12 CUSIP Numbers......................................... 44
ARTICLE VIII
DISSOLUTION AND TERMINATION OF TRUST....................................... 44
SECTION 8.1 Dissolution and Termination of Trust.................. 44
ARTICLE IX
TRANSFER OF INTERESTS...................................................... 45
SECTION 9.1 Transfer of Securities................................ 45
SECTION 9.2 Transfer Procedures and Restrictions.................. 46
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SECTION 9.3 Book Entry Interests.................................. 50
SECTION 9.4 Notices to Clearing Agency............................ 51
SECTION 9.5 Appointment of Successor Clearing Agency.............. 51
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS.................................. 51
SECTION 10.1 Liability............................................. 51
SECTION 10.2 Exculpation........................................... 52
SECTION 10.3 Fiduciary Duty........................................ 53
SECTION 10.4 Indemnification....................................... 54
SECTION 10.5 Outside Businesses.................................... 57
SECTION 10.6 Compensation; Fees.................................... 57
ARTICLE XI
ACCOUNTING................................................................. 58
SECTION 11.1 Fiscal Year........................................... 58
SECTION 11.2 Certain Accounting Matters............................ 58
SECTION 11.3 Banking............................................... 59
SECTION 11.4 Withholding........................................... 59
ARTICLE XII
AMENDMENTS AND MEETINGS.................................................... 59
SECTION 12.1 Amendments............................................ 59
SECTION 12.2 Meetings of the Holders; Action by Written Consent.... 62
ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE....................................................... 64
SECTION 13.1 Representations and Warranties of Property Trustee.... 64
SECTION 13.2 Representations and Warranties of Delaware Trustee.... 64
ARTICLE XIV
MISCELLANEOUS.............................................................. 65
SECTION 14.1 Notices............................................... 65
SECTION 14.2 Governing Law......................................... 67
SECTION 14.3 Intention of the Parties.............................. 67
SECTION 14.4 Headings.............................................. 68
SECTION 14.5 Successors and Assigns................................ 68
SECTION 14.6 Partial Enforceability................................ 68
SECTION 14.7 Counterparts.......................................... 68
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ANNEX I
TERMS OF 8.00% CONVERTIBLE TRUST PREFERRED SECURITIES
8.00% CONVERTIBLE TRUST COMMON SECURITIES................................ I-1
EXHIBIT A-1
FORM OF CONVERTIBLE TRUST PREFERRED SECURITY CERTIFICATE................. A-1
EXHIBIT B-1
FORM OF COMMON SECURITY CERTIFICATE...................................... B-1
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AMENDED AND RESTATED
DECLARATION OF TRUST
OF
NEW YORK BANCORP CAPITAL TRUST
_____________________, 1997
AMENDED AND RESTATED DECLARATION OF TRUST ("Declaration") dated and
effective as of _______________, 1997, by the Trustees (as defined herein), the
Administrators (as defined herein), the Sponsor (as defined herein) and by the
holders, from time to time, of undivided beneficial interests in the assets of
the Trust (as defined herein) to be issued pursuant to this Declaration;
WHEREAS, the Delaware Trustee, the Property Trustee, the Initial
Trustee and the Sponsor established New York Bancorp Capital Trust (the
"Trust"), a trust created under the Business Trust Act (as defined herein)
pursuant to a Declaration of Trust dated as of August 28, 1997 (the "Original
Declaration"), and a Certificate of Trust filed with the Secretary of State of
the State of Delaware on August 28, 1997, for the sole purpose of issuing and
selling certain securities representing undivided beneficial interests in the
assets of the Trust and investing the proceeds thereof in certain Debentures of
the Debenture Issuer (each as hereinafter defined);
WHEREAS, all of the trustees of the Trust, the Administrators and
the Sponsor, by this Declaration, amend and restate each and every term and
provision of the Original Declaration; and
NOW, THEREFORE, it being the intention of the parties hereto to
continue the Trust as a business trust under the Business Trust Act and that
this Declaration constitute the governing instrument of such business trust, the
Trustees declare that all assets contributed to the Trust will be held in trust
for the benefit of the holders, from time to time, of the securities
representing undivided beneficial interests in the assets of the Trust issued
hereunder, subject to the provisions of this Declaration.
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Definitions.
Unless the context otherwise requires:
(a) Capitalized terms used in this Declaration but not defined in
the preamble above have the respective meanings assigned to them in this Section
1.1;
(b) a term defined anywhere in this Declaration has the same meaning
throughout;
(c) all references to "the Declaration" or "this Declaration" are to
this Declaration as modified, supplemented or amended from time to time;
(d) all references in this Declaration to Articles and Sections and
Annexes and Exhibits are to Articles and Sections of and Annexes and Exhibits to
this Declaration unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the same meaning
when used in this Declaration unless otherwise defined in this Declaration or
unless the context otherwise requires; and
(f) a reference to the singular includes the plural and vice versa.
"Administrator" has the meaning set forth in Section 5.1.
"Affiliate" has the same meaning as given to that term in Rule 405
under the Securities Act or any successor rule thereunder.
"Agent" means any Paying Agent, Registrar or Conversion Agent.
"Authorized Officer" of a Person means any other Person that is
authorized to legally bind such former Person.
"Book Entry Interest" means a beneficial interest in a Global
Certificate registered in the name of a Clearing Agency or its nominee,
ownership and transfers of which
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shall be maintained and made through book entries by a Clearing Agency as
described in Sections 9.2 and 9.3.
"Business Day" means any day other than a Saturday or a Sunday or a
day on which banking institutions in the City of New York or Douglaston, New
York are authorized or required by law or executive order to close.
"Business Trust Act" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. C. ss.3801 et seq., as it may be amended from time to time, or any
successor legislation.
"Capital Security Beneficial Owner" means, with respect to a Book
Entry Interest, a Person who is the beneficial owner of such Book Entry
Interest, as reflected on the books of the Clearing Agency, or on the books of a
Person maintaining an account with such Clearing Agency (directly as a Clearing
Agency Participant or as an indirect participant, in each case in accordance
with the rules of such Clearing Agency).
"Capital Securities" has the meaning specified in Section 7.1(a).
"Capital Securities Guarantee" means the Capital Securities
Guarantee Agreement, dated as of ___________________, 1997, by the Sponsor as
guarantor and The Bank of New York, as Capital Securities Guarantee Trustee,
with respect to the Capital Securities.
"Clearing Agency" means an organization registered as a "Clearing
Agency" pursuant to Section 17A of the Exchange Act that is acting as depositary
for the Capital Securities and in whose name or in the name of a nominee of that
organization shall be registered a Global Certificate and which shall undertake
to effect book entry transfers and pledges of the Capital Securities.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time the Clearing
Agency effects book entry transfers and pledges of securities deposited with the
Clearing Agency.
"Closing Time" means _________, 1997.
"Code" means the Internal Revenue Code of 1986, as amended from time
to time, or any successor legislation.
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"Commission" means the United States Securities and Exchange
Commission as from time to time constituted, or if any time after the execution
of this Declaration such Commission is not existing and performing the duties
now assigned to it under applicable Federal securities laws, then the body
performing such duties at such time.
"Common Securities" has the meaning specified in Section 7.1(a).
"Common Securities Guarantee" means the Common Securities Guarantee
Agreement, dated as of _________________, 1997, by the Sponsor as guarantor,
with respect to the Common Securities.
"Common Securities Subscription Agreement" means the subscription
agreement dated as of ___________________, 1997 between the Trust and the
Sponsor relating to the Common Securities representing undivided beneficial
interests in the assets of the Trust.
"Common Stock" means the common stock, $0.01 par value per share, of
the Sponsor.
"Company Indemnified Person" means (a) any Administrator; (b) any
Affiliate of any Administrator; (c) any officers, directors, shareholders,
members, partners, employees, representatives or agents of any Administrator; or
(d) any officer, employee or agent of the Trust or its Affiliates.
"Conversion Agent" has the meaning specified in Section 7.5.
"Corporate Trust Office" means the office of the Property Trustee at
which the corporate trust business of the Property Trustee, at any particular
time, shall be principally administered, which office at the date of execution
of this Declaration is located at 101 Barclay Street, Floor 21 West, New York,
New York 10286.
"Covered Person" means (a) any officer, director, shareholder,
partner, member, representative, employee or agent of (i) the Trust or (ii) the
Trust's Affiliates and (b) any Holder of Securities.
"Debenture Issuer" means New York Bancorp Inc., a Delaware
corporation, or any successor entity resulting from any consolidation,
amalgamation, merger or other business combination, in its capacity as issuer of
the Debentures under the Indenture.
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"Debenture Subscription Agreement" means the Subscription Agreement
dated as of ____________________, 1997 between the Sponsor and the Trust
relating to the Debentures issuable pursuant to the Indenture.
"Debenture Trustee" means The Bank of New York, a New York banking
corporation, as trustee under the Indenture until a successor is appointed
thereunder, and thereafter means such successor trustee.
"Debentures" means the 8.00% Junior Convertible Subordinated
Debentures due October 31, 2027 of the Debenture Issuer issued pursuant to the
Indenture.
"Default" means an event, act or condition that with notice or lapse
of time, or both, would constitute an Event of Default.
"Definitive Capital Securities" shall have the meaning set forth in
Section 7.4.
"Delaware Trustee" has the meaning set forth in Section 5.2.
"Direct Action" shall have the meaning set forth in Section 3.8(e).
"Distribution" means a distribution payable to Holders in accordance
with Section 6.1.
"DTC" means The Depository Trust Company, the initial Clearing
Agency.
"Event of Default" in respect of the Securities means an Event of
Default (as defined in the Indenture) that has occurred and is continuing in
respect of the Debentures.
"Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time, or any successor legislation.
"Fiduciary Indemnified Person" has the meaning set forth in Section
10.4(b).
"Global Capital Security" has the meaning set forth in Section
7.3(a).
"Holder" means a Person in whose name a Security is registered, such
Person being a beneficial owner within the meaning of the Business Trust Act.
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"Indemnified Person" means a Company Indemnified Person or a
Fiduciary Indemnified Person.
"Indenture" means the Indenture, dated as of ____________________,
1997, between the Debenture Issuer and The Bank of New York, as amended from
time to time.
"Initial Trustee" shall mean Stan I. Cohen, not in his individual
capacity but solely in his capacity as initial trustee of the Trust.
"Investment Company" means an investment company as defined in the
Investment Company Act.
"Investment Company Act" means the Investment Company Act of 1940,
as amended from time to time, or any successor legislation.
"Legal Action" has the meaning set forth in Section 3.6(g).
"Majority in liquidation amount" means, with respect to the Trust
Securities, except as provided in the terms of the Capital Securities or by the
Trust Indenture Act, Holder(s) of outstanding Trust Securities voting together
as a single class or, as the context may require, Holders of outstanding Capital
Securities or Holders of outstanding Common Securities voting separately as a
class, who are the record owners of more than 50% of the aggregate liquidation
amount (including the stated amount that would be paid on redemption,
liquidation or otherwise, plus accrued and unpaid Distributions to the date upon
which the voting percentages are determined) of all outstanding Securities of
the relevant class.
"Officer's Certificate" means, with respect to any Person, a
certificate signed by the Chairman, the Co-Chairman, a Vice Chairman, the Chief
Executive Officer, the President, a Vice President, the Comptroller, the
Secretary or an Assistant Secretary of such Person. Any Officer's Certificate
delivered with respect to compliance with a condition or covenant provided for
in this Declaration shall include:
(a) a statement that the officer signing the Certificate has read
the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by such officer in rendering the Certificate;
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(c) a statement that such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such officer
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(d) a statement as to whether, in the opinion of such officer, such
condition or covenant has been complied with.
"Opinion of Counsel" shall mean a written opinion of counsel, who
may be an employee of the Sponsor, and who shall be acceptable to the Property
Trustee.
"Paying Agent" has the meaning specified in Section 7.5.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Property Trustee" has the meaning set forth in Section 5.3(a).
"Property Trustee Account" has the meaning set forth in Section
3.8(c).
"Prospectus" has the meaning set forth in Section 4.2(a).
"Public Offering" means the public offering of all Capital
Securities not sold in the Subscription Offering, if any, on a best-efforts
basis.
"Quorum" means a majority of the Administrators or, if there are
only two Administrators, both of them.
"Registrar" has the meaning set forth in Section 7.5.
"Registration Statement" means the Registration Statement on Form
S-3, including any amendments thereto, relating to, among other securities, the
Capital Securities.
"Related Party" means, with respect to the Sponsor, any direct or
indirect wholly owned subsidiary of the Sponsor or any other Person that owns,
directly or indirectly, 100% of the outstanding voting securities of the
Sponsor.
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"Responsible Officer" means, with respect to the Property Trustee,
any officer within the Corporate Trust Office of the Property Trustee, including
any vice president, any assistant vice president, any assistant secretary, any
assistant treasurer, any trust officer, any senior trust officer or other
officer of the Corporate Trust Office of the Property Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of that officer's
knowledge of and familiarity with the particular subject.
"Securities" or "Trust Securities" means the Common Securities and
the Capital Securities.
"Securities Act" means the Securities Act of 1933, as amended from
time to time, or any successor legislation.
"Securities Guarantees" means the Common Securities Guarantee and
the Capital Securities Guarantee.
"Special Event" has the meaning set forth in Annex I hereto.
"Sponsor" means New York Bancorp Inc., a Delaware corporation, or
any successor entity resulting from any merger, consolidation, amalgamation or
other business combination, in its capacity as sponsor of the Trust.
"Subscription Offering" means the offering of Capital Securities
through nontransferable subscription rights granted to holders of record of the
Common Stock as of September 18, 1997.
"Super Majority" has the meaning set forth in Section 2.6(a)(ii).
"10% in liquidation amount" means, with respect to the Trust
Securities, except as provided in the terms of the Capital Securities or by the
Trust Indenture Act, Holder(s) of outstanding Trust Securities voting together
as a single class or, as the context may require, Holders of outstanding Capital
Securities or Holders of outstanding Common Securities voting separately as a
class, who are the record owners of 10% or more of the aggregate liquidation
amount (including the stated amount that would be paid on redemption,
liquidation or otherwise, plus accrued and unpaid Distributions to the date upon
which the voting percentages are determined) of all outstanding Securities of
the relevant class.
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"Treasury Regulations" means the income tax regulations, including
temporary and proposed regulations, promulgated under the Code by the United
States Treasury, as such regulations may be amended from time to time (including
corresponding provisions of succeeding regulations).
"Trustee" or "Trustees" means each Person who has signed this
Declaration as a trustee, so long as such Person shall continue in office in
accordance with the terms hereof, and all other Persons who may from time to
time be duly appointed, qualified and serving as Trustees in accordance with the
provisions hereof, and references herein to a Trustee or the Trustees shall
refer to such Person or Persons solely in their capacity as trustees hereunder.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended from time to time, or any successor legislation.
"Underwriting Agreement" means the Underwriting Agreement among the
Sponsor, the Trust and Keefe, Bruyette & Woods, Inc., as underwriter, in
connection with the Public Offering of the Capital Securities.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application.
(a) This Declaration is subject to the provisions of the Trust
Indenture Act that are required to be part of this Declaration and, to the
extent applicable, shall be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is a
Trustee for the purposes of the Trust Indenture Act.
(c) If and to the extent that any provision of this Declaration
limits, qualifies or conflicts with the duties imposed by ss.ss. 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.
(d) The application of the Trust Indenture Act to this Declaration
shall not affect the nature of the Securities as equity securities representing
undivided beneficial interests in the assets of the Trust.
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SECTION 2.2 Lists of Holders of Securities.
(a) Each of the Sponsor and the Administrators on behalf of the
Trust shall provide the Property Trustee, unless the Property Trustee is
Registrar for the Securities (i) within 14 days after each record date for
payment of Distributions, a list, in such form as the Property Trustee may
reasonably require, of the names and addresses of the Holders ("List of
Holders") as of such record date, provided that neither the Sponsor nor the
Administrators on behalf of the Trust shall be obligated to provide such List of
Holders at any time the List of Holders does not differ from the most recent
List of Holders given to the Property Trustee by the Sponsor and the
Administrators on behalf of the Trust, and (ii) at any other time, within 30
days of receipt by the Trust of a written request for a List of Holders as of a
date no more than 14 days before such List of Holders is given to the Property
Trustee. The Property Trustee shall preserve, in as current a form as is
reasonably practicable, all information contained in Lists of Holders given to
it or which it receives in the capacity as Paying Agent (if acting in such
capacity), provided that the Property Trustee may destroy any List of Holders
previously given to it on receipt of a new List of Holders.
(b) The Property Trustee shall comply with its obligations under
ss.ss.311(a), 311(b) and 312(b) of the Trust Indenture Act.
SECTION 2.3 Reports by the Property Trustee.
Within 60 days after May 15 of each year, commencing May 15, 1998,
the Property Trustee shall provide to the Holders of the Capital Securities such
reports as are required by ss. 313(a) of the Trust Indenture Act, if any, in the
form and in the manner provided by ss. 313 of the Trust Indenture Act. The
Property Trustee shall also comply with the other requirements of ss. 313 of the
Trust Indenture Act. The Sponsor shall promptly notify the Property Trustee if
and when the Capital Securities are listed on any stock exchange.
SECTION 2.4 Periodic Reports to Property Trustee.
Each of the Sponsor and the Administrators on behalf of the Trust
shall provide to the Property Trustee such documents, reports and information as
are required by ss. 314 (if any) and the compliance certificate required by ss.
314 of the Trust Indenture Act in the form, in the manner and at the times
required by ss. 314(a)(4) of the Trust Indenture Act, such compliance
certificate to be delivered annually on or before 120 days after the end of each
fiscal year of the Sponsor; provided, that any such information, documents or
reports required to be filed with the Commission pursuant to Section 13 or 15(d)
of the Exchange Act shall be
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filed with the Property Trustee within 15 days after the same is required to be
filed with the Commission.
Delivery of such reports, information and documents to the Property
Trustee is for informational purposes only and the Property Trustee's receipt of
such shall not constitute constructive notice of any information contained
therein or determinable from information contained therein, including the
Trust's compliance with any of its covenants hereunder (as to which the Trustee
is entitled to rely exclusively on Officer's Certificates).
SECTION 2.5 Evidence of Compliance with Conditions Precedent.
Each of the Sponsor and the Administrators on behalf of the Trust
shall provide to the Property Trustee such evidence of compliance with any
conditions precedent provided for in this Declaration that relate to any of the
matters set forth in ss. 314(c) of the Trust Indenture Act. Any certificate or
opinion required to be given by an officer pursuant to ss. 314(c) (1) of the
Trust Indenture Act may be given in the form of an Officer's Certificate.
SECTION 2.6 Events of Default; Waiver.
(a) The Holders of a Majority in liquidation amount of Capital
Securities may, by vote, on behalf of the Holders of all of the Capital
Securities, waive any past Event of Default in respect of the Capital Securities
and its consequences, provided that, if the underlying Event of Default under
the Indenture:
(i) is not waivable under the Indenture, the Event of Default
under the Declaration shall also not be waivable; or
(ii) requires the consent or vote of greater than a majority
in aggregate principal amount of the holders of the Debentures (a "Super
Majority") to be waived under the Indenture, the Event of Default under the
Declaration may only be waived by the vote of the Holders of at least the
proportion in aggregate liquidation amount of the Capital Securities that the
relevant Super Majority represents of the aggregate principal amount of the
Debentures outstanding.
The foregoing provisions of this Section 2.6(a) shall be in lieu of ss.
316(a)(1)(B) of the Trust Indenture Act and such ss. 316(a)(1)(B) of the Trust
Indenture Act is hereby expressly excluded from this Declaration and the
Securities, as permitted by the Trust Indenture Act. Upon such waiver, any such
default shall cease to exist, and any Event of Default with respect to the
Capital Securities arising therefrom shall be deemed to have been cured, for
every purpose of
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this Declaration, but no such waiver shall extend to any subsequent or other
default or an Event of Default with respect to the Capital Securities or impair
any right consequent thereon. Any waiver by the Holders of the Capital
Securities of an Event of Default with respect to the Capital Securities shall
also be deemed to constitute a waiver by the Holders of the Common Securities of
any such Event of Default with respect to the Common Securities for all purposes
of this Declaration without any further act, vote or consent of the Holders of
the Common Securities.
The Holders of a Majority in liquidation amount of the Capital
Securities shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Property Trustee or to
direct the exercise of any trust or power conferred upon the Property Trustee,
including the right to direct the Property Trustee to exercise the remedies
available to it as a holder of the Debentures; provided, however, that (subject
to the provisions of Section 3.9) the Property Trustee shall have the right to
decline to follow any such direction if the Property Trustee, upon the advice of
counsel, shall determine that the action so directed would be unjustly
prejudicial to the Holders not taking part in such direction or if the Property
Trustee, upon the advice of counsel, determines that the action or proceeding so
directed may not lawfully be taken or if the Property Trustee, in good faith, by
its board of directors or trustees, executive committee, or a trust committee of
directors or trustees, and/or Responsible Officers, shall determine that the
action or proceeding so directed would involve the Property Trustee in personal
liability.
(b) The Holders of a Majority in liquidation amount of the Common
Securities may, by vote, on behalf of the Holders of all of the Common
Securities, waive any past Event of Default with respect to the Common
Securities and its consequences, provided that, if the underlying Event of
Default under the Indenture:
(i) is not waivable under the Indenture, except where the
Holders of the Common Securities are deemed to have waived such Event of Default
under the Declaration as provided below in this Section 2.6(b), the Event of
Default under the Declaration shall also not be waivable; or
(ii) requires the consent or vote of a Super Majority to be
waived, except where the Holders of the Common Securities are deemed to have
waived such Event of Default under the Declaration as provided below in this
Section 2.6(b), the Event of Default under the Declaration may only be waived by
the vote of the Holders of at least the proportion in aggregate liquidation
amount of the Common Securities that the relevant Super Majority represents of
the aggregate principal amount of the Debentures outstanding;
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provided further, each Holder of Common Securities will be deemed to have waived
any such Event of Default and all Events of Default with respect to the Common
Securities and its consequences if all Events of Default with respect to the
Capital 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 Capital Securities and only the Holders of the Capital Securities will have
the right to direct the Property Trustee in accordance with the terms of the
Securities. The foregoing provisions of this Section 2.6(b) shall be in lieu of
ss.ss. 316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act and such ss.ss.
316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act are hereby expressly
excluded from this Declaration and the Securities, as permitted by the Trust
Indenture Act. Subject to the foregoing provisions of this Section 2.6(b), upon
such waiver, any such default shall cease to exist and any Event of Default with
respect to the Common Securities arising therefrom shall be deemed to have been
cured for every purpose of this Declaration, but no such waiver shall extend to
any subsequent or other default or Event of Default with respect to the Common
Securities or impair any right consequent thereon.
(c) A waiver of an Event of Default under the Indenture by the
Property Trustee, at the direction of the Holders of the Capital Securities,
constitutes a waiver of the corresponding Event of Default under this
Declaration. The foregoing provisions of this Section 2.6(c) shall be in lieu of
ss. 316(a)(1)(B) of the Trust Indenture Act and such ss. 316(a)(1)(B) of the
Trust Indenture Act is hereby expressly excluded from this Declaration and the
Securities, as permitted by the Trust Indenture Act.
SECTION 2.7 Event of Default; Notice.
(a) The Property Trustee, within 90 days after the occurrence of an
Event of Default, shall transmit by mail, first class postage prepaid, to the
Holders notice of all defaults with respect to the Securities actually known to
a Responsible Officer of the Property Trustee, unless such defaults have been
cured before the giving of such notice (the term "defaults" for the purposes of
this Section 2.7(a) being hereby defined to be an Event of Default as defined in
the Indenture, not including any periods of grace provided for therein and
irrespective of the giving of any notice provided therein); provided that,
except for a default in the payment of principal of (or premium, if any) or
interest on any of the Debentures, the Property Trustee shall be protected in
withholding such notice if and so long as a Responsible Officer of the Property
Trustee in good faith determines that the withholding of such notice is in the
interests of the Holders.
(b) The Property Trustee shall not be deemed to have knowledge of
any default except:
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(i) a default under Sections 5.1(a) and 5.1(b) of the
Indenture; or
(ii) any default as to which the Property Trustee shall have
received written notice or of which a Responsible Officer of the Property
Trustee charged with the administration of the Declaration shall have actual
knowledge.
(c) Within ten Business Days after the occurrence of any Event of
Default actually known to the Sponsor, the Sponsor shall transmit notice of such
Event of Default to the holders of the Capital Securities, the Administrators
and the Property Trustee, unless such Event of Default shall have been cured or
waived. The Sponsor and the Administrators shall file annually with the Property
Trustee a certification as to whether or not they are in compliance with all the
conditions and covenants applicable to them under this Declaration.
ARTICLE III
ORGANIZATION
SECTION 3.1 Name.
The Trust is named "New York Bancorp Capital Trust" as such name may
be modified from time to time by the Administrators following written notice to
the Holders of Securities and the Trustees. The Trust's activities may be
conducted under the name of the Trust or any other name deemed advisable by the
Administrators.
SECTION 3.2 Office.
The address of the principal office of the Trust is c/o New York
Bancorp Inc., 241-02 Northern Boulevard, Douglaston, New York 11362. On ten
Business Days written notice to the Holders of Securities and the Trustees, the
Administrators may designate another principal office.
SECTION 3.3 Purpose.
The exclusive purposes and functions of the Trust are (a) to issue
and sell the Securities, (b) use the proceeds from the sale of the Securities to
acquire the Debentures, and (c) except as otherwise limited herein, to engage in
only those other activities necessary, advisable 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
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undertake (or permit to be undertaken) any activity that would cause the Trust
not to be classified for United States federal income tax purposes as a grantor
trust.
SECTION 3.4 Authority.
Except as specifically provided in this Declaration, the
Administrators and the Property Trustee shall have exclusive and complete
authority to carry out the purposes of the Trust. An action taken by a Trustee
or an Administrator in accordance with its powers shall constitute the act of
and serve to bind the Trust. In dealing with the Trustees or the Administrators
acting on behalf of the Trust, no Person shall be required to inquire into the
authority of the Trustees or the Administrators to bind the Trust. Persons
dealing with the Trust are entitled to rely conclusively on the power and
authority of the Trustees as set forth in this Declaration. The Administrators
shall have only those ministerial duties set forth herein with respect to
accomplishing the purposes of the Trust and are not intended to be trustees or
fiduciaries with respect to the Trust or the Holders of Securities. The Property
Trustee shall have the right, but shall not be obligated except as provided in
Section 3.8, to perform those duties assigned to the Administrators.
SECTION 3.5 Title to Property of the Trust.
Except as provided in Section 3.8 with respect to the Debentures and
the Property Trustee Account or as otherwise provided in this Declaration, legal
title to all assets of the Trust shall be vested in the Trust. The Holders shall
not have legal title to any part of the assets of the Trust, but shall have an
undivided beneficial interest in the assets of the Trust.
SECTION 3.6 Powers and Duties of the Administrators.
The Administrators shall have the power, duty and authority to cause
the Trust to engage in the following activities:
(a) to issue and sell the Securities in accordance with this
Declaration; provided, however, that (i) the Trust may issue no more than one
series of Capital Securities (as contemplated in Section 7.1(a)) and no more
than one series of Common Securities, (ii) there shall be no interests in the
Trust other than the Securities, and (iii) the issuance of Securities shall be
limited to a simultaneous issuance of Capital Securities and Common Securities
at the Closing Time;
(b) in connection with the issue and sale of the Capital Securities,
at the direction of and to the extent so directed by the Sponsor, to:
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(i) execute and file any documents prepared by the Sponsor, or
take any acts as determined by the Sponsor to be necessary in order to qualify
or register all or part of the Capital Securities in any State in which the
Sponsor has determined to qualify or register such Capital Securities for sale;
(ii) at the direction of the Sponsor, execute and file an
application, prepared by the Sponsor, to the New York Stock Exchange or any
other national stock exchange or the Nasdaq Stock Markets National Market for
listing or quotation of the Capital Securities;
(iii) execute and deliver letters, documents, or instruments
with DTC and other Clearing Agencies relating to the Capital Securities;
(iv) if required, execute and file with the Commission a
registration statement on Form 8-A, including any amendments thereto, prepared
by the Sponsor, relating to the registration of the Capital Securities under the
Exchange Act;
(v) execute and enter into the Common Securities Subscription
Agreement providing for the purchase from the Trust of the Common Securities;
and
(vi) execute and enter into the Debenture Subscription
Agreement providing for the Trust to purchase the Debentures from the Debenture
Issuer.
(c) to acquire the Debentures with the proceeds of the sale of the
Capital Securities and the Common Securities; provided, however, that the
Administrators shall cause legal title to the Debentures to be held of record in
the name of the Property Trustee for the benefit of the Holders;
(d) to give the Sponsor and the Property Trustee prompt written
notice of the occurrence of a Special Event;
(e) to establish a record date with respect to all actions to be
taken hereunder that require a record date be established, including and with
respect to, for the purposes of ss.316(c) of the Trust Indenture Act,
Distributions, voting rights, redemptions and conversions, and to issue relevant
notices to the Holders of Capital Securities and Holders of Common Securities as
to such actions and applicable record dates;
(f) to take all actions and perform such duties as may be required
of the Administrators pursuant to the terms of this Declaration or the
Securities;
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(g) to bring or defend, pay, collect, compromise, arbitrate, resort
to legal action, or otherwise adjust claims or demands of or against the Trust
("Legal Action"), unless pursuant to Section 3.8(e), the Property Trustee has
the exclusive power to bring such Legal Action;
(h) to employ or otherwise engage employees and agents (who may be
designated as officers with titles) and managers, contractors, advisors and
consultants and pay reasonable compensation for such services;
(i) to cause the Trust to comply with the Trust's obligations under
the Trust Indenture Act;
(j) to give the certificate required by ss. 314(a)(4) of the Trust
Indenture Act to the Property Trustee, which certificate may be executed by any
Administrator;
(k) to incur expenses that are necessary or incidental to carry out
any of the purposes of the Trust;
(l) to act as, or appoint another Person to act as, Registrar and
Conversion Agent for the Securities or to appoint a Paying Agent for the
Securities as provided in Section 7.5 except for such time as such power to
appoint a Paying Agent is vested in the Property Trustee;
(m) to give prompt written notice to the Property Trustee and to
Holders of any notice received from the Debenture Issuer of its election to
defer payments of interest on the Debentures by extending the interest payment
period under the Indenture;
(n) to execute all documents or instruments, perform all duties and
powers, and do all things for and on behalf of the Trust in all matters
necessary or incidental to the foregoing;
(o) to take all action that may be necessary or appropriate for the
preservation and the continuation of the Trust's valid existence, rights,
franchises and privileges as a statutory business trust under the laws of the
State of Delaware and of each other jurisdiction in which such existence is
necessary to protect the limited liability of the Holders of the Capital
Securities or to enable the Trust to effect the purposes for which the Trust was
created;
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(p) to take any action, not inconsistent with this Declaration or
with applicable law, that the Administrators determine in their discretion to be
necessary or desirable in carrying out the activities of the Trust as set out in
this Section 3.6, including, but not limited to:
(i) causing the Trust not to be deemed to be an Investment
Company required to be registered under the Investment Company Act;
(ii) causing the Trust to be classified for United States
federal income tax purposes as a grantor trust; and
(iii) cooperating with the Debenture Issuer to ensure that the
Debentures will be treated as indebtedness of the Debenture Issuer for United
States federal income tax purposes.
(q) to take all action necessary to consummate the Subscription
Offering and, if any, the Public Offering; and
(r) to take all action necessary to cause all applicable tax returns
and tax information reports that are required to be filed with respect to the
Trust to be duly prepared and filed by the Administrators, on behalf of the
Trust.
The Administrators must exercise the powers set forth in this
Section 3.6 in a manner that is consistent with the purposes and functions of
the Trust set out in Section 3.3, and the Administrators shall not take any
action that is inconsistent with the purposes and functions of the Trust set
forth in Section 3.3.
Subject to this Section 3.6, the Administrators shall have none of
the powers or the authority of the Property Trustee set forth in Section 3.8.
Any expenses incurred by the Administrators pursuant to this Section
3.6 shall be reimbursed by the Debenture Issuer.
SECTION 3.7 Prohibition of Actions by the Trust, the Trustees and
the Administrators.
(a) The Trust shall not, and the Trustees (including the Property
Trustee) and the Administrators shall not, engage in any activity other than as
required or authorized by this Declaration. The Trust shall not:
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(i) invest any proceeds received by the Trust from holding the
Debentures, but shall distribute all such proceeds to Holders pursuant to the
terms of this Declaration and of the Securities;
(ii) acquire any assets other than as expressly provided
herein;
(iii) possess Trust property for other than a Trust purpose;
(iv) make any loans or incur any indebtedness other than loans
represented by the Debentures;
(v) possess any power or otherwise act in such a way as to
vary the Trust assets or the terms of the Securities in any way whatsoever;
(vi) issue any securities or other evidences of beneficial
ownership of, or beneficial interest in, the Trust other than the Securities; or
(vii) other than as provided in this Declaration or Annex I,
(A) direct the time, method and place of conducting any proceeding with respect
to any remedy available to the Debenture Trustee, or exercising any trust or
power conferred upon the Debenture Trustee with respect to the Debentures, (B)
waive any past default that is waivable under the Indenture, (C) exercise any
right to rescind or annul any declaration that the principal of all the
Debentures shall be due and payable, or (D) consent to any amendment,
modification or termination of the Indenture or the Debentures where such
consent shall be required unless the Trust shall have received an opinion of a
nationally recognized independent tax counsel experienced in such matters to the
effect that such modification will not affect the Trust's status as a grantor
trust for United States federal income tax purposes.
SECTION 3.8 Powers and Duties of the Property Trustee.
(a) The legal title to the Debentures shall be owned by and held of
record in the name of the Property Trustee in trust for the benefit of the
Holders. The right, title and interest of the Property Trustee to the Debentures
shall vest automatically in each Person who may hereafter be appointed as
Property Trustee in accordance with Section 5.6. Such vesting and cessation of
title shall be effective whether or not conveyancing documents with regard to
the Debentures have been executed and delivered.
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(b) The Property Trustee shall not transfer its right, title and
interest in the Debentures to the Administrators or to the Delaware Trustee (if
the Property Trustee does not also act as Delaware Trustee).
(c) The Property Trustee shall:
(i) establish and maintain a segregated non-interest bearing
trust account (the "Property Trustee Account") in the name of and under the
exclusive control of the Property Trustee on behalf of the Holders and, upon the
receipt of payments of funds made in respect of the Debentures held by the
Property Trustee, deposit such funds into the Property Trustee Account and make
payments to the Holders of the Capital Securities and Holders of the Common
Securities from the Property Trustee Account in accordance with Section 6.1.
Funds in the Property Trustee Account shall be held uninvested until disbursed
in accordance with this Declaration. The Property Trustee Account shall be an
account that is maintained with a banking institution that is at least in
compliance with the capital requirements of regulatory authority regulating such
institution;
(ii) engage in such ministerial activities as shall be
necessary or appropriate to effect the redemption of the Capital Securities and
the Common Securities to the extent the Debentures are redeemed or mature or the
conversion of Capital Securities to the extent the Capital Securities are
converted into Common Stock; and
(iii) upon written notice of distribution issued by the
Administrators in accordance with the terms of the Securities, engage in such
ministerial activities as shall be necessary or appropriate to effect the
distribution of the Debentures to Holders of Securities upon the occurrence of
certain events.
(d) The Property Trustee shall take all actions and perform such
duties as may be specifically required of the Property Trustee pursuant to the
terms of the Securities.
(e) Subject to Section 3.9(a), the Property Trustee may take any
Legal Action which arises out of or in connection with an Event of Default of
which a Responsible Officer of the Property Trustee has actual knowledge or the
Property Trustee's duties and obligations under this Declaration or the Trust
Indenture Act and if such Property Trustee shall have failed to take such Legal
Action, the Holders of the Capital Securities may, to the fullest extent
permitted by law, take such Legal Action, to the same extent as if such Holders
of Capital Securities held an aggregate principal amount of Debentures equal to
the aggregate liquidation amount of such Capital Securities, without first
proceeding against the Property Trustee or the Trust; provided however, that if
an Event of Default has occurred and is
20
continuing and such event is attributable to the failure of the Debenture Issuer
to pay the principal of or premium, if any, or interest on the Debentures on the
date such principal, premium, if any, or interest is otherwise payable (or in
the case of prepayment, on the prepayment date), then a Holder of Capital
Securities may directly institute a proceeding for enforcement of payment to
such Holder of the principal of or premium, if any, or interest on the
Debentures having a principal amount equal to the aggregate liquidation amount
of the Capital Securities of such Holder (a "Direct Action") on or after the
respective due date specified in the Debentures. In connection with such Direct
Action, the rights of the Holders of the Common Securities will be subrogated to
the rights of such Holder of Capital Securities to the extent of any payment
made by the Debenture Issuer to such Holder of Capital Securities in such Direct
Action. Except as provided in the preceding sentences, the Holders of Capital
Securities will not be able to exercise directly any other remedy available to
the holders of the Debentures.
(f) The Property Trustee shall not resign as a Trustee unless either:
(i) the Trust has been completely liquidated and the proceeds
of the liquidation distributed to the Holders pursuant to the terms of the
Securities; or
(ii) a successor property trustee possessing the
qualifications to act as Property Trustee under Section 5.3 (a "Successor
Property Trustee") has been appointed and has accepted that appointment in
accordance with Section 5.6.
(g) The Property Trustee shall have the legal power to exercise all
of the rights, powers and privileges of a holder of Debentures under the
Indenture and, if an Event of Default actually known to a Responsible Officer of
the Property Trustee occurs and is continuing, the Property Trustee, for the
benefit of Holders, shall enforce its rights as holder of the Debentures subject
to the rights of the Holders pursuant to the terms of such Securities.
(h) The Property Trustee shall be authorized to undertake any
actions set forth in ss. 317(a) of the Trust Indenture Act.
(i) For such time as the Property Trustee is the Paying Agent, the
Property Trustee may authorize one or more Persons to act as additional Paying
Agents and to pay Distributions, redemption payments or liquidation payments on
behalf of the Trust with respect to all Securities and any such Paying Agent
shall comply with ss.317(b) of the Trust Indenture Act. Any such additional
Paying Agent may be removed by the Property Trustee at any time the Property
Trustee remains as Paying Agent and a successor Paying Agent or additional
21
Paying Agents may be (but are not required to be) appointed at any time by the
Property Trustee while the Property Trustee is so acting as Paying Agent.
(j) The Property Trustee shall have the power and authority to act
with respect to any of the duties, liabilities, powers or the authority of the
Administrators set forth in Sections 3.6(b)(ii), (m) or (o), but shall not have
a duty to do any such act unless specifically directed to do so in writing by
the Sponsor and then shall be fully protected in acting pursuant to such
direction. In the event of a conflict between the action of the Administrators
and the action of the Property Trustee, the action of the Property Trustee shall
prevail.
The Property Trustee must exercise the powers set forth in this
Section 3.8 in a manner that is consistent with the purposes and functions of
the Trust set out in Section 3.3, and the Property Trustee shall not take any
action that is inconsistent with the purposes and functions of the Trust set out
in Section 3.3.
SECTION 3.9 Certain Additional Duties and Responsibilities of the
Property Trustee.
(a) The Property Trustee, before the occurrence of any Event of
Default and after the curing of all Events of Default that may have occurred,
shall undertake to perform only such duties as are specifically set forth in
this Declaration and in the Securities and no implied covenants shall be read
into this Declaration against the Property Trustee. In case an Event of Default
has occurred (that has not been cured or waived pursuant to Section 2.6) of
which a Responsible Officer of the Property Trustee has actual knowledge, the
Property Trustee shall exercise such of the rights and powers vested in it by
this Declaration, and use the same degree of care and skill in their exercise,
as a prudent person would exercise or use under the circumstances in the conduct
of his or her own affairs.
(b) No provision of this Declaration shall be construed to relieve
the Property Trustee from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that:
(i) prior to the occurrence of an Event of Default and after
the curing or waiving of all such Events of Default that may have occurred:
(A) the duties and obligations of the Property Trustee
shall be determined solely by the express provisions of this Declaration
and in the Securities and the Property Trustee shall not be liable except
for the performance of such duties and
22
obligations as are specifically set forth in this Declaration and in the
Securities, and no implied covenants or obligations shall be read into
this Declaration against the Property Trustee; and
(B) in the absence of bad faith on the part of the
Property Trustee, the Property Trustee may conclusively rely, as to the
truth of the statements and the correctness of the opinions expressed
therein, upon any certificates or opinions furnished to the Property
Trustee and conforming to the requirements of this Declaration; provided,
however, that in the case of any such certificates or opinions that by any
provision hereof are specifically required to be furnished to the Property
Trustee, the Property Trustee shall be under a duty to examine the same to
determine whether or not they conform to the requirements of this
Declaration;
(ii) the Property Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer of the Property Trustee,
unless it shall be proved that the Property Trustee was negligent in
ascertaining the pertinent facts upon which such judgment was made;
(iii) the Property Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith in accordance with
the direction of the Holders of not less than a Majority in liquidation amount
of the Securities relating to the time, method and place of conducting any
proceeding for any remedy available to the Property Trustee, or exercising any
trust or power conferred upon the Property Trustee under this Declaration;
(iv) no provision of this Declaration shall require the
Property Trustee to expend or risk its own funds or otherwise incur personal
financial liability in the performance of any of its duties or in the exercise
of any of its rights or powers, if it shall have reasonable grounds for
believing that the repayment of such funds or liability is not reasonably
assured to it under the terms of this Declaration or indemnity reasonably
satisfactory to the Property Trustee against such risk or liability is not
reasonably assured to it;
(v) the Property Trustee's sole duty with respect to the
custody, safe keeping and physical preservation of the Debentures and the
Property Trustee Account shall be to deal with such property in a similar manner
as the Property Trustee deals with similar property for its own account, subject
to the protections and limitations on liability afforded to the Property Trustee
under this Declaration and the Trust Indenture Act;
23
(vi) the Property Trustee shall have no duty or liability for
or with respect to the value, genuineness, existence or sufficiency of the
Debentures or the payment of any taxes or assessments levied thereon or in
connection therewith;
(vii) the Property Trustee shall not be liable for any
interest on any money received by it except as it may otherwise agree in writing
with the Sponsor. Money held by the Property Trustee need not be segregated from
other funds held by it except in relation to the Property Trustee Account
maintained by the Property Trustee pursuant to Section 3.8(c)(i) and except to
the extent otherwise required by law; and
(viii) the Property Trustee shall not be responsible for
monitoring the compliance by the Administrators or the Sponsor with their
respective duties under this Declaration, nor shall the Property Trustee be
liable for any default or misconduct of the Administrators or the Sponsor.
SECTION 3.10 Certain Rights of the Property Trustee.
(a) Subject to the provisions of Section 3.9:
(i) the Property Trustee may conclusively rely and shall be
fully protected in acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of indebtedness or other
paper or document believed by it to be genuine and to have been signed, sent or
presented by the proper party or parties;
(ii) any direction or act of the Sponsor or the Administrators
contemplated by this Declaration may be sufficiently evidenced by an Officer's
Certificate;
(iii) whenever in the administration of this Declaration, the
Property Trustee shall deem it desirable that a matter be proved or established
before taking, suffering or omitting any action hereunder, the Property Trustee
(unless other evidence is herein specifically prescribed), in the absence of bad
faith on its part, may request and conclusively rely upon an Officer's
Certificate which, upon receipt of such request, shall be promptly delivered by
the Sponsor or the Administrators;
(iv) the Property Trustee shall have no duty to see to any
recording, filing or registration of any instrument (including any financing or
continuation statement or any filing under tax or securities laws) or any
rerecording, refiling or registration thereof;
24
(v) the Property Trustee may consult with counsel or other
experts of its selection and the advice or opinion of such counsel and experts
with respect to legal matters or advice within the scope of such experts' area
of expertise shall be full and complete authorization and protection in respect
of any action taken, suffered or omitted by it hereunder in good faith and in
accordance with such advice or opinion, such counsel may be counsel to the
Sponsor or any of its Affiliates, and may include any of its employees. The
Property Trustee shall have the right at any time to seek instructions
concerning the administration of this Declaration from any court of competent
jurisdiction;
(vi) the Property Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Declaration at the
request or direction of any Holder, unless such Holder shall have provided to
the Property Trustee security and indemnity, reasonably satisfactory to the
Property Trustee, against the costs, expenses (including reasonable attorney's
fees and expenses and the expenses of the Property Trustee's agents, nominees or
custodians) and liabilities that might be incurred by it in complying with such
request or direction, including such reasonable advances as may be requested by
the Property Trustee; provided, that, nothing contained in this Section
3.10(a)(vi) shall be taken to relieve the Property Trustee, upon the occurrence
of an Event of Default, of its obligation to exercise the rights and powers
vested in it by this Declaration;
(vii) the Property Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Property Trustee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it may see fit;
(viii) the Property Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by or
through agents, custodians, nominees or attorneys and the Property Trustee shall
not be responsible for any misconduct or negligence on the part of any agent or
attorney appointed with due care by it hereunder;
(ix) any action taken by the Property Trustee or its agents
hereunder shall bind the Trust and the Holders of the Securities, and the
signature of the Property Trustee or its agents alone shall be sufficient and
effective to perform any such action and no third party shall be required to
inquire as to the authority of the Property Trustee to so act or as to its
compliance with any of the terms and provisions of this Declaration, both of
which shall be conclusively evidenced by the Property Trustees' or its agent's
taking such action;
25
(x) whenever in the administration of this Declaration the
Property Trustee shall deem it desirable to receive instructions with respect to
enforcing any remedy or right or taking any other action hereunder, the Property
Trustee (i) may request instructions from the Holders which instructions may
only be given by the Holders of the same proportion in liquidation amount of the
Securities as would be entitled to direct the Property Trustee under the terms
of the Securities in respect of such remedy, right or action, (ii) may refrain
from enforcing such remedy or right or taking such other action until such
instructions are received, and (iii) shall be protected in conclusively relying
on or acting in accordance with such instructions;
(xi) except as otherwise expressly provided by this
Declaration, the Property Trustee shall not be under any obligation to take any
action that is discretionary under the provisions of this Declaration; and
(xii) the Property Trustee shall not be liable for any action
taken, suffered or omitted to be taken by it in good faith, without negligence,
and reasonably believed by it to be authorized or within the discretion or
rights or powers conferred upon it by this Declaration.
(b) No provision of this Declaration shall be deemed to impose any
duty or obligation on the Property Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it, in any
jurisdiction in which it shall be illegal, or in which the Property Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts, or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Property Trustee
shall be construed to be a duty.
SECTION 3.11 Delaware Trustee.
Notwithstanding any other provision of this Declaration other than
Section 5.2, the Delaware Trustee shall not be entitled to exercise any powers,
nor shall the Delaware Trustee have any of the duties and responsibilities, of
the Administrators or the Property Trustee described in this Declaration. Except
as set forth in Section 5.2, the Delaware Trustee shall be a Trustee for the
sole and limited purpose of fulfilling the requirements of ss.3807 of the
Business Trust Act.
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SECTION 3.12 Not Responsible for Recitals or Issuance of Securities.
The recitals contained in this Declaration and the Securities shall
be taken as the statements of the Sponsor, and none of the Trustees or the
Administrators assume any responsibility for their correctness. None of the
Trustees or the Administrators make any representations as to the value or
condition of the property of the Trust or any part thereof. None of the Trustees
or the Administrators make any representations as to the validity or sufficiency
of this Declaration, the Debentures or the Securities.
SECTION 3.13 Duration of Trust.
The Trust, unless dissolved pursuant to the provisions of Article
VIII hereof, shall have existence up to [October 31, 2028].
SECTION 3.14 Mergers.
(a) The Trust may not merge with or into, consolidate, amalgamate,
or be replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, except as described in Section
3.14(b) and (c) and Section 3 of Annex I.
(b) The Trust may, at the request of the Sponsor, as Holder of the
Common Securities, and without the consent of the Holders, the Delaware Trustee
or the Property Trustee, merge with or into, consolidate, amalgamate, or be
replaced by, or convey, transfer or lease its properties and assets as an
entirety or substantially as an entirety to, a trust organized as such under the
laws of any State; provided that:
(i) if the Trust is not the surviving entity, such successor
entity (the "Successor Entity") either:
(A) expressly assumes all of the obligations of the
Trust under the Securities; or
(B) substitutes for the Securities other securities
having substantially the same terms as the Securities (the "Successor
Securities") so long as the Successor Securities rank the same as the
Securities rank with respect to Distributions and payments upon
liquidation, redemption and otherwise;
27
(ii) the Sponsor expressly appoints a trustee of the Successor
Entity that possesses the same powers and duties as the Property Trustee as the
Holder of the Debentures;
(iii) the Successor Securities are listed, or any Successor
Securities will be listed upon notification of issuance, on any national
securities exchange or with another organization on which the Capital Securities
are then listed or quoted, if any;
(iv) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights, preferences
and privileges of the Holders (including any Successor Securities) in any
material respect (other than with respect to any dilution of such Holders'
interests in the new entity);
(v) such Successor Entity has a purpose substantially
identical to that of the Trust;
(vi) prior to such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, the Sponsor has received an opinion
of an independent counsel to the Trust experienced in such matters to the effect
that:
(A) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not adversely affect the
rights, preferences and privileges of the Holders (including any Successor
Securities) in any material respect (other than with respect to any
dilution of the Holders' interests in the new entity); and
(B) following such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, neither the Trust nor the
Successor Entity will be required to register as an Investment Company;
and
(vii) the Sponsor or any permitted successor or assignee owns
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 Capital Securities Guarantee and the Common
Securities Guarantee.
(c) Notwithstanding Section 3.14(b), the Trust shall not, except
with the consent of Holders of 100% in liquidation amount of the Securities,
consolidate, amalgamate, merge with or into, or be replaced by, or convey,
transfer or lease its properties and assets as an entirety or substantially as
an entirety to, any other entity or permit any other entity to consolidate,
amalgamate, merge with or into, or replace it if such consolidation,
amalgamation,
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merger, replacement, conveyance, transfer or lease would cause the Trust or the
Successor Entity not to be classified as a grantor trust for United States
federal income tax purposes or result in the Holders recognizing any gain or
loss for federal income tax purposes.
ARTICLE IV
SPONSOR
SECTION 4.1 Sponsor's Purchase of Common Securities.
At the Closing Time, the Sponsor will purchase all of the Common
Securities then issued by the Trust, in an amount equal to approximately, but
not less than, 3% of the capital of the Trust, at the same time as the Capital
Securities are issued and sold.
SECTION 4.2 Responsibilities of the Sponsor.
In connection with the issue and sale of the Capital Securities, the
Sponsor shall have the exclusive right and responsibility to engage in the
following activities:
(a) to prepare one or more prospectuses (each a "Prospectus") in
preliminary and final form, in relation to the offering and sale of Capital
Securities in the Subscription Offering and the Public Offering, and to execute
and file with the Commission, the Registration Statement, including any
amendments thereto;
(b) to determine the States in which to take appropriate action to
qualify or register for sale all or part of the Capital Securities and to do any
and all such acts, other than actions which must be taken by the Trust, and
advise the Trust of actions it must take, and prepare for execution and filing
any documents to be executed and filed by the Trust, as the Sponsor deems
necessary or advisable in order to comply with the applicable laws of any such
States;
(c) if deemed necessary or advisable by the Sponsor, to prepare for
filing by the Trust an application to the New York Stock Exchange or any other
national stock exchange or the Nasdaq National Market for listing or quotation
of the Capital Securities;
(d) to prepare for filing by the Trust with the Commission a
registration statement on Form 8-A (if necessary) relating to the registration
of the Capital Securities under Section 12(b) of the Exchange Act, including any
amendments thereto; and
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(e) to negotiate the terms of and execute the Underwriting Agreement
in connection with the Public Offering, if any, and other agreements, documents
and instruments providing for the sale of the Capital Securities.
SECTION 4.3 Right to Proceed.
The Sponsor acknowledges the rights of the Holders of Capital
Securities, in the event that a failure of the Trust to pay Distributions on the
Capital Securities is attributable to the failure of the Company to pay interest
or principal on the Debentures, to institute a Direct Action against the
Debenture Issuer for enforcement of its payment obligations on the Debentures.
ARTICLE V
TRUSTEES AND ADMINISTRATORS
SECTION 5.1 Number of Trustees and Administrators; Appointment of
Co-Trustee.
The number of Trustees initially shall be two (2) and the number of
Administrators initially shall be two (2), and:
(a) at any time before the issuance of any Securities, the Sponsor,
by written instrument, may increase or decrease the number of Trustees and
Administrators; and
(b) after the issuance of any Securities, the number of Trustees and
Administrators may be increased or decreased by vote of the Holders of a
Majority in liquidation amount of the Common Securities voting as a class at a
meeting of the Holders of the Common Securities;
provided, however, that, the number of Trustees shall in no event be less than
two (2); and provided further that (1) one Trustee, in the case of a natural
person, shall be a person who is a resident of the State of Delaware or that, if
not a natural person, is an entity which has its principal place of business in
the State of Delaware; (2) there shall be at least one administrator who is an
employee or officer of, or is affiliated with the Sponsor (an "Administrator");
and (3) one Trustee shall be the Property Trustee for so long as this
Declaration is required to qualify as an indenture under the Trust Indenture
Act, and such Trustee may also serve as Delaware Trustee if it meets the
applicable requirements. Notwithstanding the above, unless an Event of Default
shall have occurred and be continuing,
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at any time or times, for the purpose of meeting the legal requirements of the
Trust Indenture Act or of any jurisdiction in which any part of the Trust's
property may at the time be located, the Holders of a Majority in liquidation
amount of the Common Securities acting as a class at a meeting of the Holders of
the Common Securities, and the Administrators shall have power to appoint one or
more persons either to act as a co-trustee, jointly with the Property Trustee,
of all or any part of the Trust's property, or to act as separate trustee of any
such property, in either case with such powers as may be provided in the
instrument of appointment, and to vest in such person or persons in such
capacity any property, title, right or power deemed necessary or desirable,
subject to the provisions of this Declaration. In case an Event of Default has
occurred and is continuing, the Property Trustee alone shall have power to make
any such appointment of a co-trustee.
(c) Effective as of the date of this Declaration, without any
further action by any Person, the Initial Trustee shall cease to be a trustee of
the Trust and the only trustees of the Trust shall be the Trustees, as their
number may increase or decrease from time to time in accordance with the
provisions of this Declaration.
SECTION 5.2 Delaware Trustee.
If required by the Business Trust Act, one Trustee (the "Delaware
Trustee") shall be:
(a) a natural person who is a resident of the State of Delaware; or
(b) if not a natural person, an entity which has its principal place
of business in the State of Delaware, and otherwise meets the requirements of
applicable law,
provided that, if the Property Trustee has its principal place of business in
the State of Delaware and otherwise meets the requirements of applicable law,
then the Property Trustee shall also be the Delaware Trustee and Section 3.11
shall have no application.
(c) The initial Delaware Trustee shall be:
The Bank of New York (Delaware)
White Clay Center, Rte 273
Newark, Delaware 19711
Attention: Corporate Trust Administration
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SECTION 5.3 Property Trustee; Eligibility.
(a) There shall at all times be one Trustee (the "Property Trustee")
which shall act as Property Trustee which shall:
(i) not be an Affiliate of the Sponsor; and
(ii) be a corporation organized and doing business under the
laws of the United States of America or any State or Territory thereof or of the
District of Columbia, or a Person permitted by the Commission to act as an
institutional trustee under the Trust Indenture Act, authorized under such laws
to exercise corporate trust powers, having a combined capital and surplus of at
least 50 million U.S. dollars ($50,000,000), and subject to supervision or
examination by Federal, State, Territorial or District of Columbia authority. If
such Person publishes reports of condition at least annually, pursuant to law or
to the requirements of the supervising or examining authority referred to above,
then for the purposes of this Section 5.3(a)(ii), the combined capital and
surplus of such Person shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published.
(b) If at any time the Property Trustee shall cease to be eligible
to so act under Section 5.3(a), the Property Trustee shall immediately resign in
the manner and with the effect set forth in Section 5.6(c).
(c) If the Property Trustee has or shall acquire any "conflicting
interest" within the meaning of ss. 310(b) of the Trust Indenture Act, the
Property Trustee and the Holder of the Common Securities (as if it were the
obligor referred to in ss. 310(b) of the Trust Indenture Act) shall in all
respects comply with the provisions of ss. 310(b) of the Trust Indenture Act,
subject to the penultimate paragraph thereof.
(d) The Capital Securities Guarantee shall be deemed to be
specifically described in this Declaration for purposes of clause (i) of the
first proviso contained in ss. 310(b) of the Trust Indenture Act.
(e) The initial Property Trustee shall be:
The Bank of New York
101 Barclay Street, Floor 21 West
New York, New York 10286
Attention: Corporate Trust Administration
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SECTION 5.4 Certain Qualifications of Administrators and Delaware
Trustee Generally.
Each Administrator and the Delaware Trustee (unless the Property
Trustee also acts as Delaware Trustee) shall be either a natural person who is
at least 21 years of age or a legal entity that shall act through one or more
Authorized Officers.
SECTION 5.5 Administrators.
The initial Administrators shall be:
Stan I. Cohen and David Fry
New York Bancorp Inc.
241-02 Northern Boulevard
Douglaston, New York 11362
(a) Except as expressly set forth in this Declaration and except if
a meeting of the Administrators is called with respect to any matter over which
the Administrators have power to act, any power of the Administrators may be
exercised by, or with the consent of, any one such Administrator.
(b) Except as otherwise required by the Business Trust Act or
applicable law, any Administrator is authorized to execute on behalf of the
Trust any documents which the Administrators have the power and authority to
cause the Trust to execute pursuant to Section 3.6.
SECTION 5.6 Appointment, Removal and Resignation of Trustees and
Administrators.
(a) Subject to Section 5.6(b) of this Declaration and to Section
7(b) of Annex I hereto, the Trustees and Administrators may be appointed or
removed without cause at any time:
(i) until the issuance of any Securities, by written
instrument executed by the Sponsor;
(ii) unless an Event of Default shall have occurred and be
continuing after the issuance of any Securities and, with respect to any
Administrator, at any time after the issuance of any Securities, by vote of the
Holders of a Majority in liquidation amount of
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the Common Securities voting as a class at a meeting of the Holders of the
Common Securities; and
(iii) if an Event of Default shall have occurred and be
continuing after the issuance of the Securities, with respect to the Property
Trustee or the Delaware Trustee, by vote of Holders of a Majority in liquidation
amount of the Capital Securities voting as a class at a meeting of Holders of
the Capital Securities.
(iv) In no event will the Holders of the Capital Securities
have the right to vote to appoint, remove or replace the Administrators, which
voting rights are vested exclusively in the Holders of the Common Securities.
(b) (i) The Trustee that acts as Property Trustee shall not be
removed in accordance with Section 5.6(a) until a Successor Property Trustee has
been appointed and has accepted such appointment by written instrument executed
by such Successor Property Trustee and delivered to the Administrators and the
Sponsor; and
(ii) the Trustee that acts as Delaware Trustee shall not be
removed in accordance with this Section 5.6(a) until a successor Trustee
possessing the qualifications to act as Delaware Trustee under Sections 5.2 and
5.4 (a "Successor Delaware Trustee") has been appointed and has accepted such
appointment by written instrument executed by such Successor Delaware Trustee
and delivered to the Administrators and the Sponsor.
(c) A Trustee or Administrator appointed to office shall hold office
until his successor shall have been appointed or until his death, removal or
resignation. Any Trustee or Administrator may resign from office (without need
for prior or subsequent accounting) by an instrument in writing signed by the
Trustee or the Administrator, as the case may be, and delivered to the Sponsor
and the Trust, which resignation shall take effect upon such delivery or upon
such later date as is specified therein; provided, however, that:
(i) No such resignation of the Trustee that acts as the
Property Trustee shall be effective:
(A) until a Successor Property Trustee has been
appointed and has accepted such appointment by instrument executed by such
Successor Property Trustee and delivered to the Trust, the Sponsor and the
resigning Property Trustee; or
(B) until the assets of the Trust have been completely
liquidated and the proceeds thereof distributed to the Holders of the
Securities; and
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(ii) no such resignation of the Trustee that acts as the
Delaware Trustee shall be effective until a Successor Delaware Trustee has been
appointed and has accepted such appointment by instrument executed by such
Successor Delaware Trustee and delivered to the Trust, the Sponsor and the
resigning Delaware Trustee.
(d) The Holders of the Common Securities shall use their best
efforts to promptly appoint a Successor Delaware Trustee or Successor Property
Trustee, as the case may be, if the Property Trustee or the Delaware Trustee
delivers an instrument of resignation in accordance with this Section 5.6.
(e) If no Successor Property Trustee or Successor Delaware Trustee
shall have been appointed and accepted appointment as provided in this Section
5.6 within 60 days after delivery of an instrument of resignation or removal,
the Property Trustee or Delaware Trustee resigning or being removed, as
applicable, may petition any court of competent jurisdiction for appointment of
a Successor Property Trustee or Successor Delaware Trustee. Such court may
thereupon, after prescribing such notice, if any, as it may deem proper, appoint
a Successor Property Trustee or Successor Delaware Trustee, as the case may be.
(f) No Property Trustee or Delaware Trustee shall be liable for the
acts or omissions to act of any Successor Property Trustee or Successor Delaware
Trustee, as the case may be.
SECTION 5.7 Vacancies Among Trustees and Administrators.
If a Trustee or Administrator ceases to hold office for any reason
and the number of Trustees or Administrators, as the case may be, is not reduced
pursuant to Section 5.1, or if the number of Trustees or Administrators, as the
case may be, is increased pursuant to Section 5.1, a vacancy shall occur. A
resolution certifying the existence of such vacancy by the Administrators or, if
there are more than two, a majority of the Administrators, shall be conclusive
evidence of the existence of such vacancy. The vacancy shall be filled with a
Trustee appointed in accordance with Section 5.6.
SECTION 5.8 Effect of Vacancies.
The death, resignation, retirement, removal, bankruptcy,
dissolution, liquidation, incompetence or incapacity to perform the duties of a
Trustee or an Administrator shall not operate to dissolve, terminate or annul
the Trust. Whenever a vacancy in the number of Administrators shall occur, until
such vacancy is filled by the appointment of an Administrator
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in accordance with Section 5.6, the Administrators in office, regardless of
their number, shall have all the powers granted to the Administrators and shall
discharge all the duties imposed upon the Administrators by this Declaration.
SECTION 5.9 Meetings.
If there is more than one Administrator, meetings of the
Administrators shall be held from time to time upon the call of any
Administrator. Regular meetings of the Administrators may be held at a time and
place fixed by resolution of the Administrators. Notice of any in-person
meetings of the Administrators shall be hand delivered or otherwise delivered in
writing (including by facsimile, with a hard copy by overnight courier) not less
than 24 hours before such meeting. Notice of any telephonic meetings of the
Administrators or any committee thereof shall be hand delivered or otherwise
delivered in writing (including by facsimile, with a hard copy by overnight
courier) not less than 24 hours before a meeting. Notices shall contain a brief
statement of the time, place and anticipated purposes of the meeting. The
presence (whether in person or by telephone) of an Administrator at a meeting
shall constitute a waiver of notice of such meeting except where an
Administrator attends a meeting for the express purpose of objecting to the
transaction of any activity on the ground that the meeting has not been lawfully
called or convened. Unless provided otherwise in this Declaration, any action of
the Administrators may be taken at a meeting by vote of a majority of the
Administrators present (whether in person or by telephone) and eligible to vote
with respect to such matter, provided that a Quorum is present, or without a
meeting by the unanimous written consent of the Administrators. In the event
there is only one Administrator, any and all action of such Administrator shall
be evidenced by a written consent of such Administrator.
SECTION 5.10 Delegation of Power.
(a) Any Administrator may, by power of attorney consistent with
applicable law, delegate to any other natural person over the age of 21 his or
her power for the purpose of executing any documents contemplated in Section
3.6.
(b) The Trustees and Administrators shall have power to delegate
from time to time to such of their number or to such of the other
Administrators, as the case may be, or to officers of the Trust the doing of
such things and the execution of such instruments either in the name of the
Trust or the names of the Trustees or Administrators, as the case may be, or
otherwise as the Trustees or Administrators, as the case amy be, 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.
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SECTION 5.11 Merger, Conversion, Consolidation or Succession to
Business.
Any Person into which the Property Trustee or the Delaware Trustee
or any Administrator that is not a natural person, as the case may be, may be
merged or converted or with which it may be consolidated, or any Person
resulting from any merger, conversion or consolidation to which the Property
Trustee, the Delaware Trustee or the Administrator, as the case may be, shall be
a party, or any Person succeeding to all or substantially all the corporate
trust business of the Property Trustee, the Delaware Trustee or the
Administrator, as the case may be, shall be the successor of the Property
Trustee, the Delaware Trustee or the Administrator, as the case may be,
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.
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 Distributions.
Holders shall receive Distributions in accordance with the
applicable terms of the relevant Holders' Securities. If and to the extent that
the Debenture Issuer makes a payment of interest (including Compounded Interest
(as defined in the Indenture) and Additional Interest (as defined in the
Indenture)), premium and/or principal on the Debentures held by the Property
Trustee (the amount of any such payment being a "Payment Amount"), the Property
Trustee shall and is directed, to the extent funds are available for that
purpose, to make a distribution (a "Distribution") of the Payment Amount to
Holders in accordance with the respective term of the Securities held by them.
ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 General Provisions Regarding Securities.
(a) The Administrators shall on behalf of the Trust issue one class
of 8.00% Convertible Trust Preferred Securities representing undivided
beneficial interests in the assets of the Trust having such terms as are set
forth in Annex I (the "Capital Securities") and one class of 8% Convertible
Trust Common Securities representing undivided beneficial interests in the
assets of the Trust having such terms as are set forth in Annex I (the "Common
37
Securities"). The Trust shall issue no securities or other interests in the
assets of the Trust other than the Securities.
(b) The consideration received by the Trust for the issuance of the
Securities shall constitute a contribution to the capital of the Trust and shall
not constitute a loan to the Trust.
(c) Upon issuance of the Securities as provided in this Declaration,
the Securities so issued shall be deemed to be validly issued, fully paid and
non-assessable.
(d) Every Person, by virtue of having become a Holder or a Capital
Security Beneficial Owner in accordance with the terms of this Declaration,
shall be deemed to have expressly assented and agreed to the terms of, and shall
be bound by, this Declaration.
SECTION 7.2 Execution and Authentication.
(a) The Securities shall be signed on behalf of the Trust by an
Administrator. In case any Administrator who shall have signed any of the
Securities shall cease to be such Administrator before the Securities so signed
shall be delivered by the Trust, such Securities nevertheless may be delivered
as though the Person who signed such Securities had not ceased to be such
Administrator; and any Securities may be signed on behalf of the Trust by such
Persons who, at the actual date of execution of such Security, shall be the
Administrators of the Trust, although at the date of the execution and delivery
of the Declaration any such Person was not such an Administrator.
(b) One Administrator shall sign the Capital Securities for the
Trust by manual or facsimile signature. Unless otherwise determined by the
Trust, such signature shall, in the case of Common Securities, be a manual
signature.
(c) A Capital Security shall not be valid until authenticated by the
manual signature of an authorized officer of the Property Trustee. The signature
shall be conclusive evidence that the Capital Security has been authenticated
under this Declaration.
(d) Upon a written order of the Trust signed by one Administrator,
the Property Trustee shall authenticate the Capital Securities for original
issue. The aggregate number of Capital Securities outstanding at any time shall
not exceed the number set forth in the Terms in Annex I hereto except as
provided in Section 7.7.
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(e) The Property Trustee may appoint an authenticating agent
acceptable to the Trust to authenticate Capital Securities. An authenticating
agent may authenticate Capital Securities whenever the Property Trustee may do
so. Each reference in this Declaration to authentication by the Property Trustee
includes authentication by such agent. An authenticating agent has the same
rights as the Property Trustee to deal with the Sponsor or an Affiliate.
SECTION 7.3 Form and Dating.
The Capital Securities and the Property Trustee's certificate of
authentication shall be substantially in the form of Exhibit A-1 and the Common
Securities shall be substantially in the form of Exhibit B-1, each of which is
hereby incorporated in and expressly made a part of this Declaration.
Certificates representing the Securities may be printed, lithographed or
engraved or may be produced in any other manner as is reasonably acceptable to
the Administrators, as evidenced by their execution thereof. The Securities may
have letters, CUSIP or other numbers, notations or other marks of identification
or designation and such legends or endorsements required by law, stock exchange
rule, agreements to which the Trust is subject, if any, or usage (provided that
any such notation, legend or endorsement is in a form acceptable to the Trust).
The Trust at the direction of the Sponsor shall furnish any such legend not
contained in Exhibit A-1 to the Property Trustee in writing. Each Capital
Security shall be dated the date of its authentication. The terms and provisions
of the Securities set forth in Annex I and the forms of Securities set forth in
Exhibits A-1 and B-1 are part of the terms of this Declaration and to the extent
applicable, the Property Trustee and the Sponsor, by their execution and
delivery of this Declaration, expressly agree to such terms and provisions and
to be bound thereby.
(a) Global Securities. Unless otherwise specified in the terms of
the Capital Securities, the Capital Securities issued in the Public Offering
shall be issued in the form of one or more, permanent global Securities in
definitive, fully registered form without distribution coupons with the global
legends set forth in Exhibit A-1 hereto (each a "Global Capital Security"),
which shall be deposited on behalf of the purchasers of the Capital Securities
represented thereby with the Property Trustee, at its New York office, as
custodian for the Clearing Agency, and registered in the name of the Clearing
Agency or a nominee of the Clearing Agency, duly executed by the Trust and
authenticated by the Property Trustee as hereinafter provided. The number of
Capital Securities represented by a Global Capital Security may from time to
time be increased or decreased by adjustments made on the records of the
Property Trustee and the Clearing Agency or its nominee as hereinafter provided.
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(b) Book-Entry Provisions. This Section 7.3(b) shall apply only to
the Global Capital Securities and such other Capital Securities in global form
as may be authorized by the Trust to be deposited with or on behalf of the
Clearing Agency.
The Trust shall execute and the Property Trustee shall, in
accordance with Section 7.2, authenticate and make available for delivery
initially one or more Global Capital Securities that (i) shall be registered in
the name of Cede & Co. or other nominee of such Clearing Agency and (ii) shall
be delivered by the Property Trustee to such Clearing Agency or pursuant to such
Clearing Agency's written instructions or held by the Property Trustee as
custodian for the Clearing Agency.
Members of, or participants in, the Clearing Agency ("Participants")
shall have no rights under this Declaration with respect to any Global Capital
Security held on their behalf by the Clearing Agency or by the Property Trustee
as the custodian of the Clearing Agency or under such Global Capital Security,
and the Clearing Agency may be treated by the Trust, the Property Trustee and
any agent of the Trust or the Property Trustee as the absolute owner of such
Global Capital Security for all purposes whatsoever. Notwithstanding the
foregoing, nothing herein shall prevent the Trust, the Property Trustee or any
agent of the Trust or the Property Trustee from giving effect to any written
certification, proxy or other authorization furnished by the Clearing Agency or
impair, as between the Clearing Agency and its Participants, the operation of
customary practices of such Clearing Agency governing the exercise of the rights
of a holder of a beneficial interest in any Global Capital Security.
SECTION 7.4 Definitive Capital Securities.
Except as provided in this Section 7.4, owners of beneficial
interests in a Global Capital Security will not be entitled to receive physical
delivery of certificated Capital Securities ("Definitive Capital Securities").
(a) A Global Capital Security deposited with the Clearing Agency or
with the Property Trustee as custodian for the Clearing Agency pursuant to
Section 7.3 shall be transferred to the beneficial owners thereof in the form of
Definitive Capital Securities only if such transfer complies with Section 9.2
and (i) the Clearing Agency notifies the Sponsor that it is unwilling or unable
to continue as Clearing Agency for such Global Capital Security or if at any
time such Clearing Agency ceases to be a "clearing agency" registered under the
Exchange Act and a clearing agency is not appointed by the Sponsor within 90
days of such notice or within 90 days after the Sponsor becomes aware of such
non-registration, (ii) a Default or an Event of Default has occurred and is
continuing or (iii) the Trust at its sole discretion elects to cause the
issuance of Definitive Capital Securities.
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(b) Any Global Capital Security that is transferable to the
beneficial owners thereof in the form of Definitive Capital Securities pursuant
to this Section 7.4 shall be surrendered by the Clearing Agency to the Property
Trustee located in the Borough of Manhattan, The City of New York, to be so
transferred, in whole or from time to time in part, without charge, and the
Property Trustee shall authenticate and make available for delivery, upon such
transfer of each portion of such Global Capital Security, an equal aggregate
liquidation amount of Securities in the form of Definitive Capital Securities.
Any portion of a Global Capital Security transferred pursuant to this Section
shall be registered in such names as the Clearing Agency shall direct.
(c) Subject to the provisions of Section 7.4(b), the Holder of a
Global Capital Security may grant proxies and otherwise authorize any person,
including Participants and persons that may hold interests through Participants,
to take any action which such Holder is entitled to take under this Declaration
or the Securities.
(d) In the event of the occurrence of any of the events specified in
Section 7.4(a), the Trust will promptly make available to the Property Trustee a
reasonable supply of Definitive Capital Securities in fully registered form
without distribution coupons.
SECTION 7.5 Registrar, Paying Agent and Conversion Agent.
The Trust shall maintain in the Borough of Manhattan, The City of
New York, (i) an office or agency where Capital Securities may be presented for
registration of transfer ("Registrar"), (ii) an office or agency where Capital
Securities may be presented for payment ("Paying Agent") and (iii) an office or
agency where Securities may be presented for conversion ("Conversion Agent").
The Registrar shall keep a register of the Capital Securities and of their
transfer. Subject to Section 3.8(i), the Trust may appoint the Registrar, the
Paying Agent and the Conversion Agent and may appoint one or more co-registrars,
one or more additional paying agents and one or more additional conversion
agents in such other locations as it shall determine. The term "Registrar"
includes any additional registrar, "Paying Agent" includes any additional paying
agent and the term "Conversion Agent" includes any additional conversion agent.
Subject to Section 3.8(i), the Trust may change any Paying Agent, Registrar,
co-registrar or Conversion Agent without prior notice to any Holder. The Paying
Agent shall be permitted to resign as Paying Agent upon 30 days written notice
to the Trustees and the Administrators. The Trust shall notify the Property
Trustee of the name and address of any Agent not a party to this Declaration. If
the Trust fails to appoint or maintain another entity as Registrar, Paying Agent
or Conversion Agent, the Property Trustee shall act as such. The Trust or any of
its Affiliates may act as Paying Agent, Registrar or
41
Conversion Agent. The Trust shall act as Paying Agent, Registrar, co-registrar
and Conversion Agent for the Common Securities.
The Trust initially appoints the Property Trustee as Registrar,
Paying Agent and Conversion Agent for the Capital Securities.
SECTION 7.6 Paying Agent to Hold Money in Trust.
The Trust shall require each Paying Agent other than the Property
Trustee to agree in writing that the Paying Agent will hold in trust for the
benefit of Holders or the Property Trustee all money held by the Paying Agent
for the payment of liquidation amounts or Distributions on the Securities, and
will notify the Property Trustee if there are insufficient funds for such
purpose. While any such insufficiency continues, the Property Trustee may
require a Paying Agent to pay all money held by it to the Property Trustee. The
Trust at any time may require a Paying Agent to pay all money held by it to the
Property Trustee and to account for any money disbursed by it. Upon payment over
to the Property Trustee, the Paying Agent (if other than the Trust or an
Affiliate of the Trust) shall have no further liability for the money. If the
Trust or the Sponsor or an Affiliate of the Trust or the Sponsor acts as Paying
Agent, it shall segregate and hold in a separate trust fund for the benefit of
the Holders all money held by it as Paying Agent.
SECTION 7.7 Replacement Securities.
If a Holder claims that a Security owned by it has been lost,
destroyed or wrongfully taken or if such Security is mutilated and is
surrendered to the Trust or in the case of the Capital Securities to the
Property Trustee, the Trust shall issue and the Property Trustee shall
authenticate a replacement Security if the Property Trustee's and the Trust's
requirements, as the case may be, are met. At the request of the Property
Trustee or the Sponsor, an indemnity bond may be required from the Holder which,
in the judgment of the Property Trustee, is sufficient to protect the Trustees,
the Administrators, the Sponsor or any authenticating agent from any loss which
any of them may suffer if a Security is replaced. The Trust may charge such
Holder for its expenses in replacing a Security.
Every replacement Security is an additional beneficial interest in
the Trust.
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SECTION 7.8 Outstanding Capital Securities.
The Capital Securities outstanding at any time are all the Capital
Securities authenticated by the Property Trustee except for those canceled by
it, those delivered to it for cancellation, and those described in this Section
as not outstanding.
If a Capital Security is replaced or purchased pursuant to Section
7.7 hereof, it ceases to be outstanding unless the Property Trustee receives
proof satisfactory to it that the replaced, paid or purchased Capital Security
is held by a bona fide purchaser.
If Capital Securities are considered paid in accordance with the
terms of this Declaration, they cease to be outstanding and Distributions on
them shall cease to accumulate.
A Capital Security does not cease to be outstanding because one of
the Trust, the Sponsor or an Affiliate of the Sponsor holds the Security.
SECTION 7.9 Capital Securities in Treasury.
In determining whether the Holders of the required amount of
Securities have concurred in any direction, waiver or consent, Capital
Securities owned by the Trust, the Sponsor or an Affiliate of the Sponsor, as
the case may be, shall be disregarded and deemed not to be outstanding, except
that for the purposes of determining whether the Property Trustee shall be fully
protected in relying on any such direction, waiver or consent, only Securities
which the Property Trustee actually knows are so owned shall be so disregarded.
SECTION 7.10 Temporary Securities.
Until Definitive Capital Securities are ready for delivery, the
Trust may prepare and, in the case of the Capital Securities, the Property
Trustee shall authenticate temporary Securities. Temporary Securities shall be
substantially in the form of definitive Securities but may have variations that
the Trust considers appropriate for temporary Securities. Without unreasonable
delay, the Trust shall prepare and, in the case of the Capital Securities, the
Property Trustee shall authenticate definitive Securities in exchange for
temporary Securities.
SECTION 7.11 Cancellation.
The Trust at any time may deliver Capital Securities to the Property
Trustee for cancellation. The Registrar, Paying Agent and Conversion Agent shall
forward to the Property Trustee any Capital Securities surrendered to them for
registration of transfer, redemption,
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conversion, exchange or payment. The Property Trustee shall promptly cancel all
Capital Securities, surrendered for registration of transfer, redemption,
conversion, exchange, payment, replacement or cancellation and shall dispose of
canceled Capital Securities as the Trust directs, provided that the Property
Trustee shall not be obligated to destroy Capital Securities. The Trust may not
issue new Capital Securities to replace Capital Securities that it has paid or
that have been delivered to the Property Trustee for cancellation or that any
holder has converted.
SECTION 7.12 CUSIP Numbers.
The Trust in issuing the Capital Securities may use "CUSIP" numbers
(if then generally in use), and, if so, the Property Trustee shall use "CUSIP"
numbers in notices of redemption as a convenience to Holders of Capital
Securities; provided that any such notice may state that no representation is
made as to the correctness of such numbers either as printed on the Capital
Securities or as contained in any notice of a redemption and that reliance may
be placed only on the other identification numbers printed on the Capital
Securities, and any such redemption shall not be affected by any defect in or
omission of such numbers. The Sponsor will promptly notify the Property Trustee
of any change in the CUSIP numbers.
ARTICLE VIII
DISSOLUTION AND TERMINATION OF TRUST
SECTION 8.1 Dissolution and Termination of Trust.
(a) The Trust shall dissolve:
(i) upon the bankruptcy of the Sponsor;
(ii) upon the filing of a certificate of dissolution or
liquidation or its equivalent with respect to the Sponsor; or the revocation of
the Sponsor's charter and the expiration of 90 days after the date of revocation
without a reinstatement thereof;
(iii) upon receipt by the Property Trustee of written notice
from the Holder of the Common Securities directing the Property Trustee to
dissolve the Trust (which direction is optional, and except as otherwise
expressly provided below, within the discretion of the Holder of the Common
Securities) and provided, further, that such direction (and the resulting
distribution of a Like Amount of the Debentures as provided in Annex I hereto)
is conditioned on (x) the receipt by the Sponsor or the Trust, as the case
requires, of any
44
required regulatory approval, and (y) the Administrator's receipt of an opinion
of a tax counsel experienced in such matters (a "No Recognition Opinion"), which
opinion may rely on published rulings of the Internal Revenue Service, to the
effect that the Holders will not recognize any gain or loss for United States
federal income tax purposes as a result of the dissolution of the Trust (and the
resulting distribution of Debentures);
(iv) upon the entry of a decree of judicial dissolution of the
Trust by a court of competent jurisdiction;
(v) when all of the Securities shall have been called for
redemption and the amounts necessary for redemption thereof shall have been paid
to the Holders in accordance with the terms of the Securities;
(vi) upon the repayment of the Debentures or at such time as
no Debentures are outstanding; or
(vii) the expiration of the term of the Trust provided in
Section 3.13.
(b) As soon as is practicable after the occurrence of an event
referred to in Section 8.1(a) and after satisfaction of liabilities to
creditors, and subject to the terms set forth in Annex I hereto, the
Administrators (each of whom is hereby authorized to take such action) shall
file a certificate of cancellation with the Secretary of State of the State of
Delaware.
(c) The provisions of Section 3.9 and Article X shall survive the
termination of the Trust.
ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1 Transfer of Securities.
(a) Securities may only be transferred, in whole or in part, only in
accordance with the terms and conditions set forth in this Declaration and in
the terms of the Securities. To the fullest extent permitted by law, any
transfer or purported transfer of any Security not made in accordance with this
Declaration shall be null and void.
(b) The Sponsor may not transfer the Common Securities, except to
the extent pursuant to a transaction not prohibited by Article X of the
Indenture.
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(c) The Administrators shall provide for the registration of
Securities and of the transfer of Securities, which will be effected without
charge but only upon payment (with such indemnity as the Administrators may
require) in respect of any tax or other governmental charges that may be imposed
in relation to it. Upon surrender for registration of transfer of any
Securities, the Administrators shall cause one or more new Securities to be
issued in the name of the designated transferee or transferees. Every Security
surrendered for registration of transfer shall be accompanied by a written
instrument of transfer in form satisfactory to the Administrators and the
Registrar duly executed by the Holder or such Holder's attorney duly authorized
in writing. Each Security surrendered for registration of transfer shall be
canceled by the Property Trustee in accordance with Section 7.11. A transferee
of a Security shall be entitled to the rights and subject to the obligations of
a Holder hereunder upon the receipt by such transferee of a Security. By
acceptance of a Security, each transferee shall be deemed to have agreed to be
bound by this Declaration.
SECTION 9.2 Transfer Procedures and Restrictions.
(a) Transfer and Exchange of Definitive Capital Securities.
When Definitive Capital Securities are presented to the Registrar or
co-Registrar
(x) to register the transfer of such Definitive Capital
Securities; or
(y) to exchange such Definitive Capital Securities for an
equal number of Definitive Capital Securities,
the Registrar or co-registrar shall register the transfer or make the exchange
as requested if its reasonable requirements for such transaction are met;
provided, however, that the Definitive Capital Securities surrendered for
transfer or exchange shall be duly endorsed or accompanied by a written
instrument of transfer in form reasonably satisfactory to the Administrators and
the Registrar or co-registrar, duly executed by the Holder thereof or his
attorney duly authorized in writing; and
(b) Restrictions on Transfer of a Definitive Capital Security for a
Beneficial Interest in a Global Capital Security. A Definitive Capital Security
may not be exchanged for a beneficial interest in a Global Capital Security
except upon satisfaction of the requirements set forth below. Upon receipt by
the Property Trustee of a Definitive Capital Security, duly endorsed or
accompanied by appropriate instruments of transfer, in form satisfactory to the
Registrar and the Administrators, together with written instructions directing
the Property Trustee to make, or to direct the Clearing Agency to make, an
adjustment on its books and records with respect to the appropriate Global
Capital Security to reflect an increase in the
46
number of the Capital Securities represented by such Global Capital Security,
then the Property Trustee shall cancel such Definitive Capital Security and
cause, or direct the Clearing Agency to cause, the aggregate number of Capital
Securities represented by the appropriate Global Capital Security to be
increased accordingly. If no Global Capital Securities are then outstanding, the
Trust shall issue and the Property Trustee shall authenticate, upon written
order of any Administrator, an appropriate number of Capital Securities in
global form.
(c) Transfer and Exchange of Global Capital Securities. Subject to
Section 9.02(f), the transfer and exchange of Global Capital Securities or
beneficial interests therein shall be effected through the Clearing Agency, in
accordance with this Declaration (including applicable restrictions on transfer
set forth herein, if any) and the procedures of the Clearing Agency therefor.
(d) Transfer of a Beneficial Interest in a Global Capital
Security for a Definitive Capital Security.
(i) Subject to Section 7.4, any Person having a beneficial
interest in a Global Capital Security may upon request, but only upon 20 days
prior notice to the Property Trustee, and if accompanied by the information
specified below, exchange such beneficial interest for a Definitive Capital
Security representing the same number of Capital Securities. Upon receipt by the
Property Trustee from the Clearing Agency or its nominee on behalf of any Person
having a beneficial interest in a Global Capital Security of written
instructions or such other form of instructions as is customary for the Clearing
Agency or the Person designated by the Clearing Agency as having such a
beneficial interest in a Global Capital Security and a certification from the
transferor (in a form substantially similar to that attached hereto as the "Form
of Assignment" in Exhibit A-1), which may be submitted by facsimile, then the
Property Trustee will cause the aggregate number of Capital Securities
represented by Global Capital Securities to be reduced on its books and records
and, following such reduction, the Trust will execute and the Property Trustee
will authenticate and make available for delivery to the transferee a Definitive
Capital Security.
(ii) Definitive Capital Securities issued in exchange for a
beneficial interest in a Global Capital Security pursuant to this Section 9.2(d)
shall be registered in such names and in such denominations as the Clearing
Agency, pursuant to instructions from its Participants or indirect participants
or otherwise, shall instruct the Property Trustee in writing. The Property
Trustee shall deliver such Capital Securities to the Persons in whose names such
Capital Securities are so registered in accordance with such instructions of the
Clearing Agency.
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(e) Restrictions on Transfer and Exchange of Global Capital
Securities. Notwithstanding any other provisions of this Declaration (other than
the provisions set forth in subsection (f) of this Section 9.2), a Global
Capital Security may not be transferred as a whole except by the Clearing Agency
to a nominee of the Clearing Agency or another nominee of the Clearing Agency or
by the Clearing Agency or any such nominee to a successor Clearing Agency or a
nominee of such successor Clearing Agency.
(f) Authentication of Definitive Capital Securities. If at any
time:
(i) the Clearing Agency notifies the Sponsor that it is
unwilling or unable to continue as Clearing Agency for such Global Capital
Security or if at any time such Clearing Agency ceases to be a "clearing agency"
registered under the Exchange Act and a clearing agency is not appointed by the
Sponsor within 90 days of such notice or within 90 days after the Sponsor
becomes aware of such non-registration,
(ii) there occurs a Default or an Event of Default which is
continuing, or
(iii) the Trust, in its sole discretion, notifies the Property
Trustee in writing that it elects to cause the issuance of Definitive Capital
Securities under this Declaration,
then the Trust will execute, and the Property Trustee, upon receipt of a written
order of the Trust signed by one Administrator requesting the authentication and
delivery of Definitive Capital Securities to the Persons designated by the
Trust, will authenticate and make available for delivery Definitive Capital
Securities, equal in number to the number of Capital Securities represented by
the Global Capital Securities, in exchange for such Global Capital Securities.
(g) Cancellation or Adjustment of Global Capital Security. At such
time as all beneficial interests in a Global Capital Security have either been
exchanged for Definitive Capital Securities to the extent permitted by this
Declaration or redeemed, converted, repurchased or canceled in accordance with
the terms of this Declaration, such Global Capital Security shall be returned to
the Clearing Agency for cancellation or retained and canceled by the Property
Trustee. At any time prior to such cancellation, if any beneficial interest in a
Global Capital Security is exchanged for Definitive Capital Securities, Capital
Securities represented by such Global Capital Security shall be reduced and an
adjustment shall be made on the books and records of the Property Trustee (if it
is then the custodian for such Global Capital Security) with respect to such
Global Capital Security, by the Property Trustee to reflect such reduction.
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(h) Obligations with Respect to Transfers and Exchanges of Capital
Securities.
(i) To permit registrations of transfers and exchanges, the
Trust shall execute and the Property Trustee shall authenticate Definitive
Capital Securities and Global Capital Securities at the Registrar's or
co-Registrar's request in accordance with the terms of this Declaration.
(ii) Registrations of transfers or exchanges will be effected
without charge, but only upon payment (with such indemnity as the Trust or the
Sponsor may require) in respect of any tax or other governmental charge that may
be imposed in relation to it.
(iii) The Registrar or co-registrar shall not be required to
register the transfer of or exchange of (a) Capital Securities during a period
beginning at the opening of business 15 days before the day of mailing of a
notice of redemption or any notice of selection of Capital Securities for
redemption and ending at the close of business on the day of such mailing; or
(b) any Capital Security so selected for redemption in whole or in part, except
the unredeemed portion of any Capital Security being redeemed in part.
(iv) Prior to the due presentation for registrations of
transfer of any Capital Security, the Trust, the Property Trustee, the Paying
Agent, the Registrar or any co-registrar may deem and treat the person in whose
name a Capital Security is registered as the owner of such Capital Security for
the purpose of receiving Distributions on such Capital Security (subject to
Section 2(c) of Annex I hereto) and for all other purposes whatsoever, and none
of the Trust, the Property Trustee, the Paying Agent, the Registrar or any
co-registrar shall be affected by notice to the contrary.
(v) All Capital Securities issued upon any transfer or
exchange pursuant to the terms of this Declaration shall evidence the same
security and shall be entitled to the same benefits under this Declaration as
the Capital Securities surrendered upon such transfer or exchange.
(i) No Obligation of the Property Trustee and Registrar.
(i) The Property Trustee shall have no responsibility or
obligation to any beneficial owner of a Global Capital Security, a Participant
in the Clearing Agency or other Person with respect to the accuracy of the
records of the Clearing Agency or its nominee or of any Participant thereof,
with respect to any ownership interest in the Capital Securities or with respect
to the delivery to any Participant, beneficial owner or other Person (other than
the
49
Clearing Agency) of any notice (including any notice of redemption) or the
payment of any amount, under or with respect to such Capital Securities. All
notices and communications to be given to the Holders and all payments to be
made to Holders under the Capital Securities shall be given or made only to or
upon the order of the registered Holders (which shall be the Clearing Agency or
its nominee in the case of a Global Capital Security). The rights of beneficial
owners in any Global Capital Security shall be exercised only through the
Clearing Agency subject to the applicable rules and procedures of the Clearing
Agency. The Property Trustee may conclusively rely and shall be fully protected
in relying upon information furnished by the Clearing Agency or any agent
thereof with respect to its Participants and any beneficial owners.
(ii) The Property Trustee and Registrar shall have no
obligation or duty to monitor, determine or inquire as to compliance with any
restrictions on transfer imposed under this Declaration or under applicable law
with respect to any transfer of any interest in any Capital Security (including
any transfers between or among Clearing Agency Participants or beneficial owners
in any Global Capital Security) other than to require delivery of such
certificates and other documentation or evidence as are expressly required by,
and to do so if and when expressly required by, the terms of this Declaration,
and to examine the same to determine substantial compliance as to form with the
express requirements hereof.
SECTION 9.3 Book Entry Interests.
Global Capital Securities shall initially be registered on the books
and records of the Trust in the name of Cede & Co., the nominee of the Clearing
Agency, and no Capital Security Beneficial Owner will receive a Definitive
Capital Security representing such Capital Security Beneficial Owner's interests
in such Global Capital Securities, except as provided in Sections 7.4 and 9.2.
Unless and until fully registered Definitive Capital Securities certificates
have been issued to the Capital Security Beneficial Owners pursuant to Sections
7.4 and 9.2:
(a) the provisions of this Section 9.3 shall be in full force and
effect;
(b) the Trust, the Trustees and the Administrators shall be entitled
to deal with the Clearing Agency for all purposes of this Declaration (including
the payment of Distributions on the Global Capital Securities and receiving
approvals, votes or consents hereunder) as the Holder of the Capital Securities
and the sole holder of the Global Certificates and shall have no obligation to
the Capital Security Beneficial Owners;
(c) to the extent that the provisions of this Section 9.3 conflict
with any other provisions of this Declaration, the provisions of this Section
9.3 shall control; and
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(d) the rights of the Capital Security Beneficial Owners shall be
exercised only through the Clearing Agency and shall be limited to those
established by law and agreements between such Capital Security Beneficial
Owners and the Clearing Agency and/or the Clearing Agency Participants and the
Clearing Agency will receive all Distributions pursuant to the terms of this
Declaration and payments of Distributions on the Global Certificates to such
Clearing Agency Participants will be made by the Clearing Agency in accordance
with its established procedures. DTC will make book entry transfers among the
Clearing Agency Participants.
SECTION 9.4 Notices to Clearing Agency.
Whenever a notice or other communication to the Capital Security
Holders is required under this Declaration, the Trustees and the Administrators
shall give all such notices and communications specified herein to be given to
the Holders of Global Capital Securities to the Clearing Agency, and shall have
no notice obligations to the Capital Security Beneficial Owners.
SECTION 9.5 Appointment of Successor Clearing Agency.
If any Clearing Agency elects to discontinue its services as
securities depositary with respect to the Capital Securities, the Administrators
may, in their sole discretion, appoint a successor Clearing Agency with respect
to such Capital Securities.
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 Liability.
(a) Except as expressly set forth in this Declaration, the
Securities Guarantees and the terms of the Securities, the Sponsor shall not be:
(i) personally liable for the return of any portion of the
capital contributions (or any return thereon) of the Holders of the Securities
which shall be made solely from assets of the Trust; and
51
(ii) required to pay to the Trust or to any Holder of
Securities any deficit upon dissolution of the Trust or otherwise.
(b) Pursuant to ss. 3803(a) of the Business Trust Act, the Holders
of the Common Securities shall be entitled to the same limitation of personal
liability extended to stockholders of private corporations for profit organized
under the General Corporation Law of the State of Delaware; provided, however,
that the Sponsor shall be liable for all of the debts and obligations of the
Trust (other than with respect to the Securities) to the extent not satisfied
out of the Trust's assets.
(c) Pursuant to ss. 3803(a) of the Business Trust Act, the Holders
of the Capital Securities shall be entitled to the same limitation of personal
liability extended to stockholders of private corporations for profit organized
under the General Corporation Law of the State of Delaware.
SECTION 10.2 Exculpation.
(a) Except as otherwise specifically provided in this Declaration,
no Indemnified Person shall be liable, responsible or accountable in damages or
otherwise to the Trust or any Covered Person for any loss, damage or claim
incurred by reason of any act or omission performed or omitted by such
Indemnified Person in good faith on behalf of the Trust and in a manner such
Indemnified Person reasonably believed to be within the scope of the authority
conferred on such Indemnified Person by this Declaration or by law, except that
an Indemnified Person shall be liable for any such loss, damage or claim
incurred by reason of such Indemnified Person's gross negligence or willful
misconduct with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying in
good faith upon the records of the Trust and upon such information, opinions,
reports or statements presented to the Trust by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and, if selected by such Indemnified Person,
has been selected by such Indemnified Person with reasonable care on behalf of
the Trust, including information, opinions, reports or statements as to the
value and amount of the assets, liabilities, profits, losses, or any other facts
pertinent to the existence and amount of assets from which Distributions to
Holders of Securities might properly be paid.
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SECTION 10.3 Fiduciary Duty.
(a) To the extent that, at law or in equity, an Indemnified Person
has duties (including fiduciary duties) and liabilities relating thereto to the
Trust or to any other Covered Person, an Indemnified Person acting under this
Declaration shall not be liable to the Trust or to any other Covered Person for
its good faith reliance on the provisions of this Declaration. The provisions of
this Declaration, to the extent that they restrict the duties and liabilities of
an Indemnified Person otherwise existing at law or in equity (other than the
duties imposed on the Property Trustee under the Trust Indenture Act), are
agreed by the parties hereto to replace such other duties and liabilities of
such Indemnified Person.
(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises between
any Covered Person and any Indemnified Person; or
(ii) whenever this Declaration or any other agreement
contemplated herein or therein provides that an Indemnified Person shall act in
a manner that is, or provides terms that are, fair and reasonable to the Trust
or any Holder of Securities,
the Indemnified Person shall resolve such conflict of interest, take such action
or provide such terms, considering in each case the relative interest of each
party (including its own interest) to such conflict, agreement, transaction or
situation and the benefits and burdens relating to such interests, any customary
or accepted industry practices, and any applicable generally accepted accounting
practices or principles. In the absence of bad faith by the Indemnified Person,
the resolution, action or term so made, taken or provided by the Indemnified
Person shall not constitute a breach of this Declaration or any other agreement
contemplated herein or of any duty or obligation of the Indemnified Person at
law or in equity or otherwise.
(c) Whenever in this Declaration an Indemnified Person is
permitted or required to make a decision:
(i) in its "discretion" or under a grant of similar authority,
the Indemnified Person shall be entitled to consider such interests and factors
as it desires, including its own interests, and shall have no duty or obligation
to give any consideration to any interest of or factors affecting the Trust or
any other Person; or
53
(ii) in its "good faith" or under another express standard,
the Indemnified Person shall act under such express standard and shall not be
subject to any other or different standard imposed by this Declaration or by
applicable law.
SECTION 10.4 Indemnification.
(a) (i) The Sponsor shall indemnify, to the full extent permitted by
law, any Company Indemnified Person who was or is a party or is threatened to be
made a party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (other than an action
by or in the right of the Trust) by reason of the fact that he is or was a
Company Indemnified Person against expenses (including attorney's fees and
expenses), judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such action, suit or proceeding if
he acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the Trust, and, with respect to any criminal
action or proceeding, had no reasonable cause to believe his conduct was
unlawful. The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that the Company Indemnified Person
did not act in good faith and in a manner which he reasonably believed to be in
or not opposed to the best interests of the Trust, and, with respect to any
criminal action or proceeding, had reasonable cause to believe that his conduct
was unlawful.
(ii) The Sponsor shall indemnify, to the full extent permitted
by law, any Company Indemnified Person who was or is a party or is threatened to
be made a party to any threatened, pending or completed action or suit by or in
the right of the Trust to procure a judgment in its favor by reason of the fact
that he is or was a Company Indemnified Person against expenses (including
attorney's fees and expenses) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted in
good faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the Trust and except that no such indemnification shall be
made in respect of any claim, issue or matter as to which such Company
Indemnified Person shall have been adjudged to be liable to the Trust unless and
only to the extent that the Court of Chancery of Delaware or the court in which
such action or suit was brought shall determine upon application that, despite
the adjudication of liability but in view of all the circumstances of the case,
such person is fairly and reasonably entitled to indemnity for such expenses
which such Court of Chancery or such other court shall deem proper.
(iii) To the extent that a Company Indemnified Person shall be
successful on the merits or otherwise (including dismissal of an action without
prejudice or the
54
settlement of an action without admission of liability) in defense of any
action, suit or proceeding referred to in paragraphs (i) and (ii) of this
Section 10.4(a), or in defense of any claim, issue or matter therein, he shall
be indemnified, to the full extent permitted by law, against expenses (including
attorney's fees) actually and reasonably incurred by him in connection
therewith.
(iv) Any indemnification under paragraphs (i) and (ii) of this
Section 10.4(a) (unless ordered by a court) shall be made by the Sponsor only as
authorized in the specific case upon a determination that indemnification of the
Company Indemnified Person is proper in the circumstances because he has met the
applicable standard of conduct set forth in paragraphs (i) and (ii). Such
determination shall be made (1) by the Administrators by a majority vote of a
quorum consisting of such Administrators who were not parties to such action,
suit or proceeding, (2) if such a quorum is not obtainable, or, even if
obtainable, if a quorum of disinterested Administrators so directs, by
independent legal counsel in a written opinion, or (3) by the Common Security
Holder of the Trust.
(v) Expenses (including attorney's fees and expenses) incurred
by a Company Indemnified Person in defending a civil, criminal, administrative
or investigative action, suit or proceeding referred to in paragraphs (i) and
(ii) of this Section 10.4(a) shall be paid by the Sponsor in advance of the
final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such Company Indemnified Person to repay such
amount if it shall ultimately be determined that he is not entitled to be
indemnified by the Sponsor as authorized in this Section 10.4(a).
Notwithstanding the foregoing, no advance shall be made by the Sponsor if a
determination is reasonably and promptly made (i) by the Administrators by a
majority vote of a quorum of disinterested Administrators, (ii) if such a quorum
is not obtainable, or, even if obtainable, if a quorum of disinterested
Administrators so directs, by independent legal counsel in a written opinion or
(iii) the Common Security Holder of the Trust, that, based upon the facts known
to the Administrators, counsel or the Common Security Holder at the time such
determination is made, such Company Indemnified Person acted in bad faith or in
a manner that such person did not believe to be in or not opposed to the best
interests of the Trust, or, with respect to any criminal proceeding, that such
Company Indemnified Person believed or had reasonable cause to believe his
conduct was unlawful. In no event shall any advance be made in instances where
the Administrators, independent legal counsel or Common Security Holder
reasonably determine that such person deliberately breached his duty to the
Trust or its Common or Capital Security Holders.
(vi) The indemnification and advancement of expenses provided
by, or granted pursuant to, the other paragraphs of this Section 10.4(a) shall
not be deemed exclusive of any other rights to which those seeking
indemnification and advancement of expenses may
55
be entitled under any agreement, vote of stockholders or disinterested directors
of the Sponsor or Capital Security Holders of the Trust or otherwise, both as to
action in his official capacity and as to action in another capacity while
holding such office. All rights to indemnification under this Section 10.4(a)
shall be deemed to be provided by a contract between the Sponsor and each
Company Indemnified Person who serves in such capacity at any time while this
Section 10.4(a) is in effect. Any repeal or modification of this Section 10.4(a)
shall not affect any rights or obligations then existing.
(vii) The Sponsor or the Trust may purchase and maintain
insurance on behalf of any person who is or was a Company Indemnified Person
against any liability asserted against him and incurred by him in any such
capacity, or arising out of his status as such, whether or not the Sponsor would
have the power to indemnify him against such liability under the provisions of
this Section 10.4(a).
(viii) For purposes of this Section 10.4(a), references to
"the Trust" shall include, in addition to the resulting or surviving entity, any
constituent entity (including any constituent of a constituent) absorbed in a
consolidation or merger, so that any person who is or was a director, trustee,
officer or employee of such constituent entity, or is or was serving at the
request of such constituent entity as a director, trustee, officer, employee or
agent of another entity, shall stand in the same position under the provisions
of this Section 10.4(a) with respect to the resulting or surviving entity as he
would have with respect to such constituent entity if its separate existence had
continued.
(ix) The indemnification and advancement of expenses provided
by, or granted pursuant to, this Section 10.4(a), unless otherwise provided when
authorized or ratified, shall continue as to a person who has ceased to be a
Company Indemnified Person and shall inure to the benefit of the heirs,
executors and administrators of such a person.
(b) To the fullest extent permitted by law, the Sponsor agrees to
indemnify the (i) Property Trustee, (ii) the Delaware Trustee, (iii) any
Affiliate of the Property Trustee and the Delaware Trustee, and (iv) any
officers, directors, shareholders, members, partners, employees,
representatives, custodians, nominees or agents of the Property Trustee and the
Delaware Trustee (each of the Persons in (i) through (iv) being referred to as a
"Fiduciary Indemnified Person") for, and to hold each Fiduciary Indemnified
Person harmless against, any and all loss, liability, damage, claim or expense
including taxes (other than taxes based on the income of such Fiduciary
Indemnified Person) incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or administration of the
trust or trusts hereunder, including the costs and expenses (including
reasonable legal fees and expenses) of defending itself against or investigating
any claim or liability in connection with the exercise or
56
performance of any of its powers or duties hereunder. The obligation to
indemnify as set forth in this Section 10.4(b) shall survive the dissolution of
the Trust and the termination and discharge of this Declaration.
SECTION 10.5 Outside Businesses.
Any Covered Person, the Sponsor, the Delaware Trustee and the
Property Trustee (subject to Section 5.3(c)), may engage in or possess an
interest in other business ventures of any nature or description, independently
or with others, similar or dissimilar to the business of the Trust, and the
Trust and the Holders shall have no rights by virtue of this Declaration in and
to such independent ventures or the income or profits derived therefrom, and the
pursuit of any such venture, even if competitive with the business of the Trust,
shall not be deemed wrongful or improper. No Covered Person, the Sponsor, the
Delaware Trustee or the Property Trustee shall be obligated to present any
particular investment or other opportunity to the Trust even if such opportunity
is of a character that, if presented to the Trust, could be taken by the Trust,
and any Covered Person, the Sponsor, the Delaware Trustee and the Property
Trustee shall have the right to take for its own account (individually or as a
partner or fiduciary) or to recommend to others any such particular investment
or other opportunity. Any Covered Person, the Delaware Trustee and the Property
Trustee may engage or be interested in any financial or other transaction with
the Sponsor or any Affiliate of the Sponsor, or may act as depositary for,
trustee or agent for, or act on any committee or body of holders of, securities
or other obligations of the Sponsor or its Affiliates.
SECTION 10.6 Compensation; Fees
The Sponsor agrees:
(a) to pay to the Trustees and the Administrators from time to time
such compensation for all services rendered by them hereunder as the parties
shall agree from time to time (which compensation shall not be limited by any
provision of law in regard to the compensation of a trustee of an express
trust); and
(b) except as otherwise expressly provided herein, to reimburse the
Trustees and the Administrators upon request for all reasonable expenses,
disbursements and advances incurred or made by the Trustees or the
Administrators in accordance with any provision of this Declaration (including
the reasonable compensation and the expenses and disbursements of their
respective agents and counsel), except any such expense, disbursement or advance
as may be attributable to their respective negligence or bad faith.
57
The provisions of this Section 10.6 shall survive the dissolution of
the Trust and the termination of this Declaration and the removal or resignation
of any Trustee or Administrator.
No Trustee may claim any lien or charge on any property of the Trust
as a result of any amount due pursuant to this Section 10.6.
ARTICLE XI
ACCOUNTING
SECTION 11.1 Fiscal Year.
The fiscal year ("Fiscal Year") of the Trust shall end on September
30 of each year, or such other year as is required by the Code.
SECTION 11.2 Certain Accounting Matters.
(a) At all times during the existence of the Trust, the
Administrators shall keep, or cause to be kept, full books of account, records
and supporting documents, which shall reflect in reasonable detail, each
transaction of the Trust. The books of account shall be maintained on the
accrual method of accounting, in accordance with generally accepted accounting
principles, consistently applied. The Trust shall use the accrual method of
accounting for United States federal income tax purposes. The books of account
and the records of the Trust shall be examined by and reported upon as of the
end of each Fiscal Year of the Trust by a firm of independent certified public
accountants selected by the Administrators.
(b) The Administrators shall cause to be prepared and delivered to
each of the Holders, within 90 days after the end of each Fiscal Year of the
Trust, annual financial statements of the Trust, including a balance sheet of
the Trust as of the end of such Fiscal Year, and the related statements of
income or loss;
(c) The Administrators shall cause to be duly prepared and delivered
to each of the Holders, any annual United States federal income tax information
statement required by the Code, containing such information with regard to the
Securities held by each Holder as is required by the Code and the Treasury
Regulations. Notwithstanding any right under the Code to deliver any such
statement at a later date, the Administrators shall endeavor to deliver all such
information statements within 30 days after the end of each Fiscal Year of the
Trust.
58
(d) The Administrators shall cause to be duly prepared and filed
with the appropriate taxing authority, an annual United States federal income
tax return, on a Form 1041 or such other form required by United States federal
income tax law, and any other annual income tax returns required to be filed by
the Administrators on behalf of the Trust with any state or local taxing
authority.
SECTION 11.3 Banking. The Trust shall maintain one or more bank
accounts in the name and for the sole benefit of the Trust; provided, however,
that all payments of funds in respect of the Debentures held by the Property
Trustee shall be made directly to the Property Trustee Account and no other
funds of the Trust shall be deposited in the Property Trustee Account. The sole
signatories for such accounts shall be designated by the Administrators;
provided, however, that the Property Trustee shall designate the signatories for
the Property Trustee Account.
SECTION 11.4 Withholding. The Trust and the Administrators shall
comply with all withholding requirements under United States federal, state and
local law. The Trust shall request, and the Holders shall provide to the Trust,
such forms or certificates as are necessary to establish an exemption from
withholding with respect to each Holder, and any representations and forms as
shall reasonably be requested by the Trust to assist it in determining the
extent of, and in fulfilling, its withholding obligations. The Administrators
shall file required forms with applicable jurisdictions and, unless an exemption
from withholding is properly established by a Holder, shall remit amounts
withheld with respect to the Holder to applicable jurisdictions. To the extent
that the Trust is required to withhold and pay over any amounts to any authority
with respect to Distributions or allocations to any Holder, the amount withheld
shall be deemed to be a Distribution in the amount of the withholding to the
Holder. In the event of any claimed over withholding, Holders shall be limited
to an action against the applicable jurisdiction. If the amount required to be
withheld was not withheld from actual Distributions made, the Trust may reduce
subsequent Distributions by the amount of such withholding.
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 Amendments.
(a) Except as otherwise provided in this Declaration or by any
applicable terms of the Securities, this Declaration may only be amended by a
written instrument approved and executed by:
59
(i) the Administrators (or if there are more than two
Administrators a majority of the Administrators);
(ii) the Property Trustee;
(iii) if the amendment affects the rights, powers, duties,
obligations or immunities of the Delaware Trustee, the Delaware Trustee; and
(iv) the Sponsor.
(b) No amendment shall be made, and any such purported amendment
shall be void and ineffective:
(i) unless, the Property Trustee shall have first received an
Officer's Certificate from each of the Trust and the Sponsor that such amendment
is permitted by, and conforms to, the terms of this Declaration (including the
terms of the Securities); and
(ii) unless the Property Trustee shall have received an
Opinion of Counsel (who may be counsel to the Sponsor or the Trust) that such
amendment is permitted by, and conforms to, the terms of this Declaration
(including the terms of the Securities),
provided, however, that the Property Trustee and the Delaware Trustee (to the
extent the Delaware Trustee is required to sign such amendment) shall not be
required to sign any such amendment which affects the rights, powers, duties,
obligations or immunities of the Property Trustee or the Delaware Trustee, as
the case may be, under the Declaration or otherwise; and
(iii) to the extent the result of such amendment would be to:
(A) cause the Trust to fail to continue to be classified
for purposes of United States federal income taxation as a grantor trust;
(B) reduce or otherwise adversely affect the powers of
the Property Trustee in contravention of the Trust Indenture Act;
(C) cause the Trust to be deemed to be an Investment
Company required to be registered under the Investment Company Act; or
60
(D) result in the Holders recognizing gain or loss for
federal income tax purposes.
(c) At such time after the Trust has issued any Securities that
remain outstanding, any amendment that would adversely affect, in any material
respect, the rights, privileges or preferences of any Holder of Securities may
be effected only with such additional requirements as may be set forth in the
terms of such Securities;
(d) Sections 9.1(b), 9.1(c) and this Section 12.1 shall not be
amended without the consent of all of the Holders of the Securities;
(e) Article Four shall not be amended without the consent of the
Holders of a Majority in liquidation amount of the Common Securities;
(f) The rights of the holders of the Common Securities under Article
Five to increase or decrease the number of, and appoint and remove Trustees and
Administrators shall not be amended without the consent of the Holders of a
Majority in liquidation amount of the Common Securities; and
(g) Notwithstanding Section 12.1(c), this Declaration may be amended
without the consent of the Holders of the Securities to:
(i) cure any ambiguity, correct or supplement any provision in
this Declaration that may be inconsistent with any other provision of this
Declaration or to make any other provisions with respect to matters or questions
arising under this Declaration which shall not be inconsistent with the other
provisions of the Declaration; or
(ii) modify, eliminate or add to any provisions of the
Declaration to such extent as shall be necessary to ensure that the Trust will
be classified for United States federal income tax purposes as a grantor trust
at all times that any Securities are outstanding or to ensure that the Trust
will not be required to register as an Investment Company under the Investment
Company Act;
provided, however, that in the case of clause (i), such action shall not
adversely affect in any material respect the interest of the Holders of the
Securities.
(h) This Declaration may be amended by the Trustees, the
Administrators and the Sponsor if:
61
(i) the Holders of a Majority in liquidation amount of the
Securities consent to such amendment; and
(ii) the Trustees and Administrators have received an opinion
of nationally recognized independent counsel experienced in such matters to the
effect that such amendment or the exercise of any power granted to the Trustees
or Administrators in accordance with such amendment will not affect the Trust's
status as a grantor trust for United States federal income tax purposes or the
Trust's exemption from status as an Investment Company under the Investment
Company Act.
provided, that without the consent of each Holder of Securities, this
Declaration may not be amended to:
(x) change the amount or timing of any Distribution on the
Securities or otherwise adversely affect the amount of any Distribution required
to be made in respect of the Securities as of a specified date; or
(y) restrict the right of a Holder of Securities to institute
suit for the enforcement of any such payment on or after such date.
SECTION 12.2 Meetings of the Holders; Action by Written Consent.
(a) Meetings of the Holders of any class of Securities may be called
at any time by the Administrators (or as provided in the terms of the
Securities) to consider and act on any matter on which Holders of such class of
Securities are entitled to act under the terms of this Declaration, the terms of
the Securities or the rules of any stock exchange on which the Capital
Securities are listed or admitted for trading. The Administrators shall call a
meeting of the Holders of such class if directed to do so by the Holders of at
least 10% in liquidation amount of such class of Securities. Such direction
shall be given by delivering to the Administrators one or more notices in a
writing stating that the signing Holders of Securities wish to call a meeting
and indicating the general or specific purpose for which the meeting is to be
called. Any Holders calling a meeting shall specify in writing the Securities
held by the Holders exercising the right to call a meeting and only those
Securities specified shall be counted for purposes of determining whether the
required percentage set forth in the second sentence of this paragraph has been
met.
(b) Except to the extent otherwise provided in the terms of the
Securities, the following provisions shall apply to meetings of Holders of
Securities:
62
(i) notice of any such meeting shall be given to all the
Holders of Securities having a right to vote thereat at least seven days and not
more than 60 days before the date of such meeting. Whenever a vote, consent or
approval of the Holders is permitted or required under this Declaration or the
rules of any stock exchange on which the Capital Securities are listed or
admitted for trading, such vote, consent or approval may be given at a meeting
of the Holders. Any action that may be taken at a meeting of the Holders of
Securities may be taken without a meeting if a consent in writing setting forth
the action so taken is signed by the Holders of Securities owning not less than
the minimum amount of Securities in liquidation amount that would be necessary
to authorize or take such action at a meeting at which all Holders having a
right to vote thereon were present and voting. Prompt notice of the taking of
action without a meeting shall be given to the Holders entitled to vote who have
not consented in writing. The Administrators may specify that any written ballot
submitted to the Security Holder for the purpose of taking any action without a
meeting shall be returned to the Trust within the time specified by the
Administrators;
(ii) each Holder may authorize any Person to act for it by
proxy on all matters in which a Holder is entitled to participate, including
waiving notice of any meeting, or voting or participating at a meeting. No proxy
shall be valid after the expiration of 11 months from the date thereof unless
otherwise provided in the proxy. Every proxy shall be revocable at the pleasure
of the Holder of Securities executing it. Except as otherwise provided herein,
all matters relating to the giving, voting or validity of proxies shall be
governed by the General Corporation Law of the State of Delaware relating to
proxies, and judicial interpretations thereunder, as if the Trust were a
Delaware corporation and the Holders were stockholders of a Delaware
corporation;
(iii) each meeting of the Holders shall be conducted by the
Administrators or by such other Person that the Administrators may designate;
and
(iv) unless the Business Trust Act, this Declaration, the
terms of the Securities, the Trust Indenture Act or the listing rules of any
stock exchange on which the Capital Securities are then listed or trading
otherwise provides, the Administrators, in their sole discretion, shall
establish all other provisions relating to meetings of Holders, including notice
of the time, place or purpose of any meeting at which any matter is to be voted
on by any Holders of Securities, waiver of any such notice, action by consent
without a meeting, the establishment of a record date, quorum requirements,
voting in person or by proxy or any other matter with respect to the exercise of
any such right to vote.
63
ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE
SECTION 13.1 Representations and Warranties of Property Trustee.
The Trustee that acts as initial Property Trustee represents and
warrants to the Trust and to the Sponsor at the date of this Declaration, and
each Successor Property Trustee represents and warrants to the Trust and the
Sponsor at the time of the Successor Property Trustee's acceptance of its
appointment as Property Trustee (with appropriate changes to clause (a) below)
that:
(a) The Property Trustee is a New York banking corporation with
trust powers and authority to execute and deliver, and to carry out and perform
its obligations under the terms of, this Declaration;
(b) The execution, delivery and performance by the Property Trustee
of this Declaration has been duly authorized by all necessary corporate action
on the part of the Property Trustee. This Declaration has been duly executed and
delivered by the Property Trustee and constitutes a legal, valid and binding
obligation of the Property Trustee, enforceable against it in accordance with
its terms, subject to applicable bankruptcy, reorganization, moratorium,
insolvency, and other similar laws affecting creditors' rights generally and to
general principles of equity and the discretion of the court (regardless of
whether the enforcement of such remedies is considered in a proceeding in equity
or at law);
(c) The execution, delivery and performance of this Declaration by
the Property Trustee does not conflict with or constitute a breach of the
charter or by-laws of the Property Trustee; and
(d) No consent, approval or authorization of, or registration with
or notice to, any New York State or federal banking authority is required for
the execution, delivery or performance by the Property Trustee of this
Declaration.
SECTION 13.2 Representations and Warranties of Delaware Trustee.
The Trustee that acts as initial Delaware Trustee represents and
warrants to the Trust and to the Sponsor at the date of this Declaration, and
each Successor Delaware Trustee represents and warrants to the Trust and the
Sponsor at the time of the Successor Delaware Trustee's acceptance of its
appointment as Delaware Trustee that:
64
(a) The Delaware Trustee is a Delaware banking corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware, with trust power and authority to execute and deliver, and to carry
out and perform its obligations under the terms of, this Declaration;
(b) The execution, delivery and performance by the Delaware Trustee
of this Declaration has been duly authorized by all necessary corporate action
on the part of the Delaware Trustee. This Declaration has been duly executed and
delivered by the Delaware Trustee and constitutes a legal, valid and binding
obligation of the Delaware Trustee, enforceable against it in accordance with
its terms, subject to applicable bankruptcy, reorganization, moratorium,
insolvency, and other similar laws affecting creditors' rights generally and to
general principles of equity and the discretion of the court (regardless of
whether the enforcement of such remedies is considered in a proceeding in equity
or at law);
(c) No consent, approval or authorization of, or registration with
or notice to, any federal banking authority is required for the execution,
delivery or performance by the Delaware Trustee of this Declaration; and
(d) The Delaware Trustee is a natural person who is a resident of
the State of Delaware or, if not a natural person, an entity which has its
principal place of business in the State of Delaware.
ARTICLE XIV
MISCELLANEOUS
SECTION 14.1 Notices.
All notices provided for in this Declaration shall be in writing,
duly signed by the party giving such notice, and shall be delivered, telecopied
or mailed by first class mail, as follows:
(a) if given to the Trust, in care of the Administrators at the
Trust's mailing address set forth below (or such other address as the Trust may
give notice of to the Holders and the Property Trustee):
65
New York Bancorp Capital Trust
c/o New York Bancorp Inc.
241-02 Northern Boulevard
Douglaston, New York 11362
Attention: Chief Executive Officer
(b) if given to the Delaware Trustee, at the mailing address set
forth below (or such other address as Delaware Trustee may give notice of to the
Holders):
The Bank of New York (Delaware)
White Clay Center, Rte 273
Newark, Delaware 19711
Facsimile: (212) 815-5915
Attention: Corporate Trust Administration
(c) if given to the Property Trustee, at the Property Trustee's
mailing address set forth below (or such other address as the Property Trustee
may give notice of to the Holders):
The Bank of New York
101 Barclay Street, Floor 21 West
New York, New York 10286
Attention: Corporate Trust Administration
(d) if given to the Holder of the Common Securities, at the mailing
address of the Sponsor set forth below (or such other address as the Holder of
the Common Securities may give notice to the Trust and the Property Trustee):
New York Bancorp Inc.
241-02 Northern Boulevard
Douglaston, New York 11362
Attention: Chief Executive Officer
(e) if given to any other Holder, at the address set forth on the
books and records of the Trust.
All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid except that if a notice or other document is refused delivery or
cannot be delivered because of a changed
66
address of which no notice was given, such notice or other document shall be
deemed to have been delivered on the date of such refusal or inability to
deliver.
SECTION 14.2 Governing Law.
This Declaration and the rights of the parties hereunder shall be
governed by and interpreted in accordance with the laws of the State of Delaware
and all rights and remedies shall be governed by such laws without regard to
principles of conflict of laws of the State of Delaware or any other
jurisdiction that would call for the application of the law of any jurisdiction
other than the State of Delaware; provided, however, that there shall not be
applicable to the parties hereunder or this Declaration any provision of the
laws (statutory or common) of the State of Delaware (other than the Business
Trust Act) pertaining to trusts that relate to or regulate, in a manner
inconsistent with the terms hereof (A) the filing with any court or governmental
body or agency of Trustee accounts or schedules of Trustee fees and charges, (B)
affirmative requirements to post bonds for Trustees, officers, agents or
employees of a trust, (C) the necessity for obtaining court or other
governmental approval concerning the acquisition, holding or disposition of real
or personal property, (D) fees or other sums payable to Trustees, officers,
agents or employees of a trust, (E) the allocation of receipts and expenditures
to income or principal, (F) restrictions or limitations on the permissible
nature, amount or concentration of trust investments or requirements relating to
the titling, storage or other manner of holding or investing Trust assets or (G)
the establishment of fiduciary or other standards of responsibility or
limitations on the acts or powers of trustees that are inconsistent with the
limitations or liabilities or authorities and powers of the Trustees hereunder
as set forth or referenced in this Declaration. Section 3540 of Title 12 of the
Delaware Code shall not apply to the Trust.
SECTION 14.3 Intention of the Parties.
It is the intention of the parties hereto that the Trust be
classified for United States federal income tax purposes as a grantor trust. The
provisions of this Declaration shall be interpreted to further this intention of
the parties. The parties hereto agree, and any Holder by the purchase of a Trust
Security shall be deemed to have agreed, to treat in all tax and accounting
filings and reports (i) the Trust as a grantor trust and (ii) the Debentures as
indebtedness.
67
SECTION 14.4 Headings.
Headings contained in this Declaration are inserted for convenience
of reference only and do not affect the interpretation of this Declaration or
any provision hereof.
SECTION 14.5 Successors and Assigns.
Whenever in this Declaration any of the parties hereto is named or
referred to, the successors and assigns of such party shall be deemed to be
included, and all covenants and agreements in this Declaration by the Sponsor,
the Trustees and the Administrators shall bind and inure to the benefit of their
respective successors and assigns, whether so expressed.
SECTION 14.6 Partial Enforceability.
If any provision of this Declaration, or the application of such
provision to any Person or circumstance, shall be held invalid, the remainder of
this Declaration, or the application of such provision to Persons or
circumstances other than those to which it is held invalid, shall not be
affected thereby.
SECTION 14.7 Counterparts.
This Declaration may contain more than one counterpart of the
signature page and this Declaration may be executed by the affixing of the
signature of the Sponsor, each of the Trustees and each of the Administrators 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.
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IN WITNESS WHEREOF, the undersigned have caused these presents to be
executed as of the day and year first above written.
--------------------------------------------------------
Stan I. Cohen, in his capacity as Administrator
--------------------------------------------------------
David Fry, in his capacity as Administrator
The Bank of New York (Delaware),
as Delaware Trustee
By:
----------------------------------------------------
--------------------
Authorized Signatory
The Bank of New York,
as Property Trustee
By:
----------------------------------------------------
--------------------
--------------------
NEW YORK BANCORP INC.
as Sponsor
By:
----------------------------------------------------
Michael A. McManus, Jr.
President and Chief Executive Officer
- -------------------------------------------
Stan I. Cohen, solely to acknowledge the
restatement and amendment of the Original
Declaration and his removal from his
position as Initial Trustee pursuant to
Section 5.1(c).
69
ANNEX I
TERMS OF
8.00% CONVERTIBLE TRUST PREFERRED SECURITIES
8.00% CONVERTIBLE TRUST COMMON SECURITIES
Pursuant to Section 7.1 of the Amended and Restated Declaration of
Trust, dated as of ________________, 1997 (as amended from time to time, the
"Declaration"), the designation, rights, privileges, restrictions, preferences
and other terms and provisions of the Securities are set out below (each
capitalized term used but not defined herein has the meaning set forth in the
Declaration or, if not defined in such Declaration, as defined in the
Prospectus):
1. Designation and Number.
(a) Capital Securities. 2,000,000 8.00% Convertible Trust
Preferred Securities of the Trust, with an aggregate liquidation amount with
respect to the assets of the Trust of Fifty Million dollars ($50,000,000), and
each with a liquidation amount with respect to the assets of the Trust of $25
per Security, are hereby designated for the purposes of identification only as
"8.00% Convertible Trust Preferred Securities" (the "Capital Securities"). The
certificates evidencing the Capital Securities shall be substantially in the
form of Exhibit A-1 to the Declaration, with such changes and additions thereto
or deletions therefrom as may be required by ordinary usage, custom or practice
or to conform to the rules of any stock exchange on which the Capital Securities
are listed.
(b) Common Securities. 60,000 8.00% Convertible Trust Common
Securities of the Trust with an aggregate liquidation amount with respect to the
assets of the Trust of One Million Five Hundred Thousand dollars ($1,500,000)
and a liquidation amount with respect to the assets of the Trust of $25 per
Security, are hereby designated for the purposes of identification only as
"Common Securities" (the "Common Securities"). The certificates evidencing the
Common Securities shall be substantially in the form of Exhibit B-1 to the
Declaration, with such changes and additions thereto or deletions therefrom as
may be required by ordinary usage, custom or practice.
2. Distributions.
(a) Distributions payable on each Security will be fixed at a rate
per annum of 8.00% (the "Coupon Rate") of the liquidation amount of $25 per
Security (the "Liquidation Amount"), such rate being the rate of interest
payable on the Debentures to be held by the Property Trustee. Distributions in
arrears for more than one quarterly period will bear
I-1
additional distributions thereon compounded quarterly at the Coupon Rate (to the
extent permitted by applicable law). The term "Distributions", as used herein,
includes distributions of any such interest, including any Additional Interest
and Compounded Interest (each as defined in the Indenture) unless otherwise
stated. A Distribution is payable only to the extent that payments are made in
respect of the Debentures held by the Property Trustee and to the extent the
Property Trustee has funds on hand legally available therefor.
(b) Distributions on the Securities will be cumulative, will
accumulate from the most recent date to which Distributions have been paid or
duly provided for or, if no Distributions have been paid or duly provided for,
from __________, 1997, and will be payable quarterly in arrears on January 31,
April 30, July 31 and October 31 of each year, commencing on January 31, 1998
(each, a "Distribution Date"), except as otherwise described below.
Distributions will be computed on the basis of a 360-day year consisting of
twelve 30- day months and for any period less than a full calendar month on the
basis of the actual number of days elapsed in such month. As long as no Event of
Default has occurred and is continuing under the Indenture, the Debenture Issuer
has the right under the Indenture to defer payments of interest by extending the
interest payment period at any time and from time to time on the Debentures for
a period not exceeding 20 consecutive quarters, including the first such quarter
during such period (each an "Extension Period"), during which Extension Period
no interest shall be due and payable on the Debentures, provided that no
Extension Period shall end on a day other than an interest payment date for the
Debentures or shall extend beyond the Maturity Date of the Debentures. As a
consequence of such deferral, Distributions will also be deferred. Despite such
deferral, Distributions will continue to accumulate with additional
Distributions thereon (to the extent permitted by applicable law but not at a
rate greater than the rate at which interest is then accruing on the Debentures)
at the Coupon Rate compounded quarterly during any such Extension Period. Prior
to the termination of any such Extension Period, the Debenture Issuer may
further defer payments of interest by further extending such Extension Period;
provided that such Extension Period, together with all such previous and further
extensions within such Extension Period, may not exceed 20 consecutive quarters,
including the first quarter during such Extension Period, or extend beyond the
Maturity Date of the Debentures. Upon the termination of any Extension Period
and the payment of all amounts then due, the Debenture Issuer may commence a new
Extension Period, subject to the above requirements.
(c) Distributions on the Securities will be payable to the Holders
thereof as they appear on the books and records of the Trust on the fifteenth
day of the month in which the relevant Distribution Date occurs, which
Distribution Dates correspond to the interest payment dates on the Debentures.
Subject to any applicable laws and regulations and the provisions of the
Declaration, each such payment in respect of the Capital Securities will be made
as follows: (i) if the Capital Securities are held in global form by a
I-2
Clearing Agency (or its nominee), in accordance with the procedures of the
Clearing Agency, and (ii) if the Capital Securities are held in definitive form,
by check mailed to the address of the holder thereof entitled thereto as
reflected in the records of the Registrar, unless otherwise agreed by the Trust.
The relevant record dates for the Common Securities shall be the same as the
record dates for the Capital Securities. Distributions payable on any Securities
that are not punctually paid on any Distribution Date, as a result of the
Debenture Issuer having failed to make a payment under the Debentures, will
cease to be payable to the Holder on the relevant record date, and such
defaulted Distribution will instead be payable to the Person in whose name such
Securities are registered on the special record date or other specified date
determined in accordance with the Indenture. If any date on which Distributions
are payable on the Securities is not a Business Day, then payment of the
Distribution payable on such date will be made on the next succeeding day that
is a Business Day (and without any interest or other payment in respect of any
such delay), except that if such next succeeding Business Day falls in the next
succeeding calendar year, such payment shall be made on the immediately-
preceding Business Day, with the same force and effect as if made on such date.
(d) In the event of an election by a Holder to exchange its
Securities through the Conversion Agent for Debentures and convert such
Debentures into Common Stock pursuant to the terms of the Securities as set
forth in this Annex I to the Declaration, accrued Distributions will not be paid
on Securities that are converted, nor will any payment, allowance or adjustment
be made for accumulated and unpaid Distributions on such Securities, whether or
not in arrears, on converted Securities except under the limited circumstances
described in paragraph 5(b) and except that if any Security is converted on or
after a record date for payment of Distributions thereon, the Holder of
Securities at the close of business on any record date for the payment of
Distributions will be entitled to receive the Distribution payable on such
Securities on the corresponding payment date notwithstanding the conversion of
such Securities into Common Stock following such record date.
(e) In the event that there is any money or other property held by
or for the Trust on a Distribution Date that is not accounted for hereunder,
such property shall be distributed Pro Rata (as defined herein) among the
Holders of the Securities.
3. Liquidation Distribution Upon Dissolution.
In the event of any dissolution of the Trust or the Holders of the
Common Securities otherwise give notice of their election to dissolve the Trust
pursuant to and in compliance with the provisions of Section 8.1(a)(iii) of the
Declaration, the Trust shall be liquidated by the Administrators as
expeditiously as practicable by distributing, after paying or making reasonable
provision to pay all claims and obligations of the Trust in accordance with
Section 3808(e) of the Business Trust Act, to the Holders a Like Amount (as
defined below) of
I-3
the Debentures, unless such distribution is determined by the Property Trustee
not to be practicable, in which event such Holders will be entitled to receive
out of the assets of the Trust legally available for distribution to Holders,
after paying or making reasonable provision to pay all claims and obligations of
the Trust in accordance with Section 3808(e) of the Business Trust Act, an
amount equal to the aggregate of the liquidation amount of $25 per Security plus
accumulated and unpaid Distributions thereon to the date of payment (such amount
being the "Liquidation Distribution").
"Like Amount" means (i) with respect to a redemption of the
Securities, Securities having a Liquidation Amount equal to the principal amount
of Debentures to be paid in accordance with their terms and (ii) with respect to
a distribution of Debentures upon the liquidation of the Trust, Debentures
having a principal amount equal to the Liquidation Amount of the Securities of
the Holder to whom such Debentures are distributed.
If, upon any such liquidation, the Liquidation Distribution can be
paid only in part because the Trust has insufficient assets on hand legally
available to pay in full the aggregate Liquidation Distribution, then the
amounts payable directly by the Trust on the Capital Securities shall be paid on
a Pro Rata basis.
4. Redemption and Distribution.
(a) Upon the repayment of the Debentures in whole or in part,
at maturity or upon prepayment (either at the option of the Debenture Issuer or
pursuant to a Special Event, as described below), the proceeds from such
repayment shall be simultaneously applied by the Property Trustee (subject to
the Property Trustee having received notice no later than 45 days prior to such
repayment) to redeem a Like Amount of the Securities at a redemption price equal
to (i) in the case of the repayment of the Debentures at maturity, the Maturity
Redemption Price (as defined below), (ii) in the case of the optional prepayment
of the Debentures upon the occurrence and continuation of a Special Event, the
Special Event Redemption Price (as defined below) and (iii) in the case of the
optional prepayment of the Debentures other than as a result of the occurrence
and continuance of a Special Event, the Optional Redemption Price (as defined
below). The Maturity Redemption Price, the Special Event Redemption Price and
the Optional Redemption Price are referred to collectively as the "Redemption
Price". Holders will be given not less than 30 nor more than 60 days notice of
such redemption.
(b) (i) The "Maturity Redemption Price", with respect to a
redemption of Securities, shall mean an amount equal to the principal of and
accrued and unpaid interest on the Debentures as of the maturity date thereof.
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(ii) In the case of an optional redemption, if fewer than all the
outstanding Securities are to be so redeemed, the Securities will be redeemed
Pro Rata and the Capital Securities to be redeemed will be determined as
described in Section 4(f)(ii) below. Upon the entry of an order for the
dissolution of the Trust by a court of competent jurisdiction, the Debentures
thereafter will be subject to optional repayment, in whole, but not in part, on
or after October 31, 2001 (the "Initial Optional Redemption Date").
The Debenture Issuer shall have the right (subject to the
conditions in the Indenture) to elect to prepay the Debentures in whole or in
part at any time on or after the Initial Optional Redemption Date, upon not less
than 30 days and not more than 60 days notice, at the Optional Redemption Price
and, simultaneous with such prepayment, to cause a Like Amount of the Securities
to be redeemed by the Trust at the Optional Redemption Price on a Pro Rata
basis. "Optional Redemption Price" shall mean a price equal to 100% of the
liquidation amount of Debentures to be prepaid plus accumulated and unpaid
interest thereon, if any, to the date of such prepayment.
(c) If at any time a Tax Event, a Regulatory Capital Event or an
Investment Company Event (each as defined below, and each a "Special Event")
occurs, the Debenture Issuer shall have the right (subject to the conditions set
forth in the Indenture) at any time, upon not less than 30 nor more than 60 days
notice, to prepay the Debentures in whole, but not in part, within the 90 days
following the occurrence of such Special Event (the "90 Day Period"), and,
simultaneous with such prepayment, to cause a Like Amount of the Securities to
be redeemed by the Trust at the Special Event Redemption Price on a Pro Rata
basis.
A "Tax Event" means (a) the receipt by the Debenture Issuer and
the Trust of an opinion of Weil, Gotshal & Manges LLP or any other nationally
recognized tax counsel experienced in such matters, to the effect that as a
result of (i) any amendment to, clarification of, 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, (ii) any amendment to, clarification of, or change in, an
interpretation or application of any such laws or regulations by any legislative
body, court, governmental agency or regulatory authority (including the
enactment of any legislation and the publication of any judicial decision or
regulatory determination or the publication of an explanation of legislation by
the staff of the Joint Committee on Taxation), (iii) any interpretation or
pronouncement that provides for a position with respect to such laws or
regulations that differs from the theretofore generally accepted position or
(iv) any judicial decision, administrative pronouncement, ruling, regulatory
procedure, notice, announcement (including any notice or announcement of intent
to adopt procedures or regulations) or any other actions taken by any
governmental agency or regulatory authority, which amendment or change is
enacted, promulgated, issued or announced or which interpretation or
pronouncement is issued or announced or which action is
I-5
taken, in each case, on or after the Issue Date, there is more than an
insubstantial risk that (x) within 90 days the Trust is or will be subject to
United States federal income tax with respect to income received or accrued on
the Debentures, (y) interest payable by the Debenture Issuer on the Debentures
is not or will not be deductible by the Debenture Issuer, in whole or in part,
for United States federal income tax purposes, or (z) within 90 days the Trust
is or will be subject to more than a de minimis amount of other taxes, duties or
other governmental charges, or (b) a proposed audit adjustment by a taxing
authority which, if sustained, would result in any of the events described in
clauses (x), (y) or (z) above.
A "Regulatory Capital Event" means the receipt by the Debenture
Issuer and the Trust of an opinion of Weil, Gotshal & Manges LLP or any other
independent bank regulatory counsel experienced in such matters, to the effect
that, as a result of (a) any amendment to, or change (including any announced
prospective change) in, the laws (or any regulations thereunder) of the United
States or any rules, guidelines or policies of the Office of Thrift Supervision,
the Board of Governors of the Federal Reserve System (the "Federal Reserve") or
any other federal bank regulatory agency or (b) 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 Issue Date, (i) the Debenture Issuer is or
within 90 days will be subject to capital adequacy requirements and such
requirements do not or will not permit the Capital Securities to constitute,
subject to limitations on inclusion of the Capital Securities as Tier 1 capital
by the Federal Reserve capital guidelines in effect as of the date of the
Prospectus relating to the Subscription Offering, Tier 1 capital (or its
then-equivalent) or (ii) the amount of net proceeds received from the sale of
the Capital Securities and contributed by the Debenture Issuer to its
subsidiary, Home Federal Savings Bank, does not or within 90 days will not
constitute Tier 1 (core) capital (or its then-equivalent).
An "Investment Company Event" means the receipt by the Debenture
Issuer and the Trust of an opinion of Weil, Gotshal & Manges LLP or any other
nationally recognized counsel experienced in such matters, to the effect that
(a) 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 authority thereof or therein or (b) 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 Issue Date, there is
more than an insubstantial risk that the Trust is or within 90 days will be
considered an Investment Company that is required to be registered under the
Investment Company Act.
I-6
"Special Event Redemption Price" shall mean, with respect to a
redemption of Securities, a price equal to 100% of the principal of a Like
Amount of Debentures to be prepaid plus accumulated and unpaid interest thereon,
if any, to the date of such prepayment.
(d) On and from the date fixed by the Administrators for any
distribution of Debentures and liquidation of the Trust: (i) the Securities will
no longer be deemed to be outstanding and (ii) the Clearing Agency or its
nominee (or any successor Clearing Agency or its nominee), as the Holder of the
Capital Securities, will receive a registered global certificate or certificates
representing the Debentures to be delivered upon such distribution and any
certificates representing Securities not held by the Clearing Agency or its
nominee (or any successor Clearing Agency or its nominee) will be deemed to
represent beneficial interests in a Like Amount of Debentures until such
certificates are presented to the Debenture Issuer or its agent for transfer or
reissue.
(e) The Trust may not redeem fewer than all the outstanding
Securities unless all accumulated and unpaid Distributions have been paid on all
Securities for all quarterly Distribution periods terminating on or before the
date of redemption.
(f) The procedure with respect to redemptions of, or distributions
of Debentures in exchange for, the Securities, shall be as follows:
(i) Notice of any redemption of, or notice of distribution of
Debentures in exchange for, the Securities (a "Redemption/Distribution Notice")
will be given by the Trust by mail to each Holder to be redeemed or exchanged
not fewer than 30 nor more than 60 days before the date fixed for redemption or
exchange thereof which, in the case of a redemption, will be the date fixed for
prepayment of the Debentures. The Redemption/Distribution Notice shall identify
the Securities to be redeemed or exchanged and shall state:
(A) the redemption/distribution date;
(B) the Redemption Price; provided, however, if the Redemption
Price is not known at the time the Redemption/Distribution Notice is sent,
such notice shall set forth the manner of calculation thereof;
(C) the name and address of the Paying Agent;
(D) that Securities called for redemption or exchange must be
surrendered to the Paying Agent to collect the Redemption Price;
I-7
(E) if fewer than all of the outstanding Securities are to
redeemed or exchanged, the identification and amounts of the particular
Securities to be redeemed or exchanged, as the case may be;
(F) that, unless the Debenture Issuer defaults in paying the
Redemption Price, any distributions on the Securities called for
redemption will cease to accrue on and after such redemption date; and
(G) the CUSIP number, if any, of the Securities called for
redemption or exchange.
For purposes of the calculation of the date of redemption or exchange and the
dates on which notices are given pursuant to this Section 4(f)(i), a
Redemption/Distribution Notice shall be deemed to be given on the day such
notice is first mailed by first-class mail, postage prepaid, to Holders. Each
Redemption/Distribution Notice shall be addressed to the Holders of Securities
at the address of each such Holder appearing in the books and records of the
Trust. No defect in the Redemption/Distribution Notice or in the mailing of
either thereof with respect to any Holder shall affect the validity of the
redemption or exchange proceedings with respect to any other Holder.
(ii) In the event that fewer than all the outstanding Securities
are to be redeemed, the Securities to be redeemed shall be redeemed Pro Rata
from each Holder of Securities, it being understood that, in respect of Capital
Securities registered in the name of and held of record by the Clearing Agency
or its nominee (or any successor Clearing Agency or its nominee), the
distribution of the proceeds of such redemption will be made to the Clearing
Agency and disbursed by such Clearing Agency in accordance with the procedures
applied by such agency or nominee.
(iii) If Securities are to be redeemed and the Trust gives a
Redemption/Distribution Notice, (which notice will be irrevocable), then (A)
with respect to Capital Securities issued in book-entry form, by 12:00 noon, New
York City time, on the redemption date, provided that the Debenture Issuer has
paid the Property Trustee a sufficient amount of cash in connection with the
related prepayment or maturity of the Debentures by 10:00 a.m., New York City
time, on the maturity date or the date of prepayment, as the case requires, the
Property Trustee will deposit irrevocably with the Clearing Agency or its
nominee (or successor Clearing Agency or its nominee) funds sufficient to pay
the applicable Redemption Price with respect to such Capital Securities, and (B)
with respect to Capital Securities issued in certificated form and Common
Securities, provided that the Debenture Issuer has paid the Property Trustee a
sufficient amount of cash in connection with the related prepayment or maturity
of the Debentures, the Property Trustee will pay the relevant
I-8
Redemption Price to the Holders of such Securities against presentation to the
Paying Agent of the certificates therefor. If a Redemption/Distribution Notice
shall have been given and funds deposited as required, if applicable, then
immediately prior to the close of business on the date of such deposit, or on
the redemption date, as applicable, Distributions will cease to accumulate on
the Securities so called for redemption and all rights of Holders so called for
redemption will cease, except the right of the Holders of such Securities to
receive the Redemption Price, but without interest on such Redemption Price, and
such Securities shall cease to be outstanding.
(iv) Payment of accumulated and unpaid Distributions on the
Redemption Date of the Securities will be subject to the rights of Holders of
Securities on the close of business on a regular record date in respect of a
Distribution Date occurring on or prior to such Redemption Date.
Neither the Administrators nor the Trust shall be required to
register or cause to be registered the transfer of (i) any Securities beginning
on the opening of business 15 days before the day of mailing of a notice of
redemption or any notice of selection of Securities for redemption or (ii) any
Securities selected for redemption except the unredeemed portion of any Security
being redeemed. If any date fixed for redemption of Securities is not a Business
Day, then payment of the Redemption Price payable on such date will be made on
the next succeeding day that is a Business Day (and without any interest or
other payment in respect of any such delay), with the same force and effect as
if made on such date fixed for redemption. If payment of the Redemption Price in
respect of any Securities is improperly withheld or refused and not paid either
by the Property Trustee or by the Sponsor as guarantor pursuant to the relevant
Securities Guarantee, Distributions on such Securities will continue to
accumulate from the original redemption date to the actual date of payment, in
which case the actual payment date will be considered the date fixed for
redemption for purposes of calculating the Redemption Price.
(v) Redemption/Distribution Notices shall be sent by the Property
Trustee on behalf of the Trust to (A) in respect of the Capital Securities, the
Clearing Agency or its nominee (or any successor Clearing Agency or its nominee)
if the Global Certificates have been issued or, if Definitive Capital Security
Certificates have been issued, to the Holder thereof, and (B) in respect of the
Common Securities, to the Holder thereof.
(vi) Subject to the foregoing and applicable law (including,
without limitation, United States federal securities laws and banking laws),
provided the acquiror is not the Holder of the Common Securities or the obligor
under the Indenture, the Sponsor or any of its subsidiaries may at any time and
from time to time purchase outstanding Capital Securities by tender, in the open
market or by private agreement.
I-9
5. Conversion Rights.
Holders of Securities shall have the right at any time prior to
5:00 p.m. (New York City time) on the earlier of (i) the Business Day
immediately preceding the date of repayment of such Securities, whether at
maturity or upon redemption, and (ii) the Conversion Termination Date, if any,
to cause the Conversion Agent to exchange Securities, on behalf of the
converting Holders, for Debentures, which Debentures will be converted into
shares of Common Stock in the manner described herein on and subject to the
following terms and conditions:
(a) The Securities will be exchangeable for Debentures which will
be convertible at the office of the Conversion Agent into fully paid and
nonassessable shares of Common Stock pursuant to the Holder's direction to the
Conversion Agent to exchange such Securities for a portion of the Debentures
theretofore held by the Trust on the basis of one Security per $25 principal
amount of Debentures, and immediately convert such amount of Debentures into
fully paid and nonassessable shares of Common Stock at an initial per share
conversion price equal to 110% of the average of the daily last reported sales
prices of the Common Stock for the 10 consecutive days immediately preceding the
date of the Public Offering Prospectus or, in the event all of the Capital
Securities are sold in the Subscription Offering, for the 10 consecutive trading
days immediately preceding the Subscription Offering Expiration Date, in each
case as reported on the NYSE Composite Tape, subject to certain adjustments set
forth in the terms of the Debentures (as so adjusted, the "Conversion Price").
(b) To exchange the Securities for Debentures and to convert the
Debentures into Common Stock, the Holder shall submit to the Conversion Agent at
the office designated therefor an irrevocable request to convert Securities on
behalf of such Holder (the "Conversion Request"), together, if the Securities
are in certificated form, with such certificates. The Conversion Request shall
(i) set forth the number of Securities to be exchanged and the name or names, if
other than the Holder, in which the shares of Common Stock should be issued and
(ii) direct the Conversion Agent (A) to exchange such Securities for a portion
of the Debentures held by the Trust (at the rate of exchange specified in the
preceding paragraph) and (B) to immediately convert such Debentures on behalf of
such Holder, into Common Stock (at the Conversion Price specified in the
preceding paragraph). The Conversion Agent shall notify the Trust of the
Holder's election to exchange Securities for a portion of the Debentures held by
the Trust and the Trust shall, upon receipt of such notice, deliver to the
Conversion Agent the appropriate principal amount of Debentures for exchange in
accordance with this Section 5. The Conversion Agent shall thereupon notify the
Debenture Issuer of the Holder's election to convert such Debentures into shares
of Common Stock. Holders of Securities at 5:00 p.m. (New York City time) on a
record date for a Distribution Date will be entitled to receive the Distribution
payable on such Securities on the corresponding Distribution Date
notwithstanding
I-10
the conversion of such Securities following such record date but on or prior to
such Distribution Date. Except as provided in the immediately preceding
sentence, neither the Trust nor the Debenture Issuer will make, or be required
to make, any payment, allowance or adjustment for accumulated and unpaid
Distributions, whether or not in arrears, on converted Securities; provided,
however, that if notice of redemption of Securities is mailed or otherwise given
to Holders of Securities or the Trust issues a press release announcing a
Conversion Termination Date, then, if any Holder of Securities converts any
Securities into Common Stock on any date on or after the date on which such
notice of redemption is mailed or otherwise given or the date of such press
release, as the case may be, and if such Conversion Date falls on any day from
and including the first day of an Extension Period and on or prior to the
Distribution Date upon which such Extension Period ends, such converting holder
shall be entitled to receive either (i) if the Conversion Date falls after a
record date and on or prior to the next succeeding Distribution Date, all
accrued and unpaid Distributions on such Securities (including interest thereon,
if any, to the extent permitted by applicable law) to such Distribution Date or
(ii) if the Conversion Date does not fall on a date described in clause (i)
above, all accrued and unpaid Distributions on such Securities (including
interest thereon, if any, to the extent permitted by applicable law) to the most
recent Distribution Date prior to the Conversion Date, which Distributions
shall, in either such case, be paid to such converting holder unless the
Conversion Date of such Securities is on or prior to the Distribution Date upon
which such Extension Period ends and after the record date for such Distribution
Date, in which case such Distributions shall be paid to the Person who was the
Holder of such Securities (or one or more predecessor Securities) at 5:00 p.m.
(New York City time) on such record date. The Debenture Issuer shall make no
payment or allowance for distributions on the shares of Common Stock issued upon
such conversion, except to the extent that such shares of Common Stock are held
of record on the record date for any such distributions. Securities shall be
deemed to have been converted immediately prior to 5:00 p.m. (New York City
time) on the day on which a Conversion Request relating to such Securities is
received by the Trust in accordance with the foregoing provision (the
"Conversion Date"). The Person or Persons entitled to receive Common Stock
issuable upon conversion of the Debentures shall be treated for all purposes as
the record holder or holders of such Common Stock at such time. As promptly as
practicable on or after the Conversion Date, the Debenture Issuer shall issue
and deliver at the office of the Conversion Agent a certificate or certificates
for the number of full shares of Common Stock issuable upon such conversion,
together with the cash payment, if any, in lieu of any fraction of any share to
the Person or Persons entitled to receive the same, unless otherwise directed by
the Holder in the notice of conversion and the Conversion Agent shall distribute
such certificate or certificates to such Person or Persons.
(c) Each Holder of a Security by his acceptance thereof appoints
The Bank of New York (the "Conversion Agent") for the purpose of effecting the
exchange of Securities and conversion of Debentures in accordance with this
Section 5. In effecting the exchange,
I-11
conversion and transactions described in this Section 5, the Conversion Agent
shall be acting as agent of the Holders of Securities directing it to effect
such transactions. The Conversion Agent is hereby authorized (i) to exchange
Securities from time to time for Debentures held by the Trust in connection with
the conversion of such Securities in accordance with this Section 5 and (ii) to
convert all or a portion of the Debentures into Common Stock and thereupon to
deliver such shares of Common Stock in accordance with the provisions of this
Section 5 and to deliver to the Trust a new Debenture or Debentures for any
resulting unconverted principal amount.
(d) No fractional shares of Common Stock will be issued as a
result of conversion, but in lieu thereof, such fractional interest will be paid
in cash (based on the Closing Price of Common Stock on the Conversion Date) by
the Debenture Issuer to the Trust, which in turn will make such payment to the
Holder or Holders of Securities so exchanged.
(e) The Debenture Issuer shall at all times reserve and keep
available out of its authorized and unissued Common Stock, solely for issuance
upon the conversion of the Debentures, free from any preemptive or other similar
rights, such number of such shares of Common Stock as shall from time to time be
issuable upon the conversion of all the Debentures then outstanding.
Notwithstanding the foregoing, the Debenture Issuer shall be entitled to deliver
upon conversion of Debentures, shares of Common Stock reacquired and held in the
treasury of the Debenture Issuer (in lieu of the issuance of authorized and
unissued shares of Common Stock), so long as any such treasury shares are free
and clear of all liens, charges, security interests or encumbrances. Any shares
of Common Stock issued upon conversion of the Debentures shall be duly
authorized, validly issued, fully paid and nonassessable. The Trust shall
deliver the shares of Common Stock received upon conversion of the Debentures to
the converting Holder free and clear of all liens, charges, security interests
and encumbrances, except for United States withholding taxes. Each of the
Debenture Issuer and the Trust shall prepare and shall use its best efforts to
obtain and keep in force such governmental or regulatory permits or other
authorizations as may be required by law, and shall comply with all applicable
requirements as to registration or qualification of the Common Stock issuable
upon conversion of Debentures (and all requirements to list on any national
securities exchange or quotation system such Common Stock that are at the time
applicable), to enable the Debenture Issuer to lawfully issue Common Stock to
the Trust upon conversion of the Debentures and the Trust to lawfully deliver
Common Stock to each Holder upon such conversion.
(f) The Debenture Issuer shall pay any and all taxes that may be
payable in respect of the issue or delivery of shares of Common Stock on
conversion of Debentures and the delivery of shares of Common Stock by the Trust
to the Holder upon conversion. The Debenture Issuer shall not, however, be
required to pay any tax that may be payable in respect
I-12
of any transfer involved in the issue and delivery of shares of Common Stock in
a name other than that in which the Securities so converted were registered, and
no such issue or delivery shall be made unless and until the Person requesting
such issue has paid to the Trust the amount of any such tax or has established
to the satisfaction of the Trust that such tax has been paid.
(g) Nothing in the preceding Section 5(f) shall limit the
requirement of the Trust to withhold taxes pursuant to the terms of the
Securities or as set forth in this Annex I to the Declaration or the Declaration
itself or otherwise require the Property Trustee or the Trust to pay any amounts
on account of such withholdings.
(h) (i) On and after October 31, 2001, the Debenture Issuer shall
have the right, at its option, to cause the conversion rights of holders of the
Debentures to convert the Debentures into Common Stock to terminate, in which
case the rights of Holders of the Securities to convert the Securities into
Common Stock pursuant to this Section 5 will likewise terminate, if (x) the
Trust is current in the payment of Distributions on the Securities (except to
the extent that the payment of Distributions may have been deferred as the
result of an Extension Period) and (y) for at least 20 trading days within any
period of 30 consecutive trading days ending on or after October 31, 2001,
including the last trading day of such period, the Closing Price of the Common
Stock on each of such 20 trading days shall have exceeded 110% of the Conversion
Price in effect on such trading day.
(ii) To exercise its option to cause the conversion rights of
Holders of the Securities to terminate, the Debenture Issuer must cause the
Trust to issue a press release for publication on the Dow Jones News Service or
on a comparable news service (the "Press Release") prior to the opening of
business on the second trading day after any period in which the conditions in
paragraph 5(h)(i) have been met (which date shall not be prior to October 31,
2001), which Press Release shall state that the Debenture Issuer has elected to
exercise its right to terminate the conversion rights of holders of Debentures
and Holders of Securities, specify the Conversion Termination Date and provide
the current Conversion Price of the Securities and the Closing Price of the
Capital Securities and the Common Stock, in each case as of the close of
business on the trading day next preceding the date of the Press Release. If the
Debenture Issuer exercises the option described in this paragraph 5(h), the
"Conversion Termination Date" shall be the Business Day selected by the
Debenture Issuer which shall not be less than 30 nor more than 60 calendar days
after the date on which the Trust issues the Press Release. If the Debenture
Issuer does not exercise the option described in this paragraph 5(h), and the
Securities are otherwise called for redemption, the Securities will be
convertible until 5:00 p.m. (New York City time) on the Business Day immediately
preceding the date of such redemption.
I-13
(iii) In addition to the Press Release, notice of the termination
of conversion rights of Holders of the Securities (a "Notice of Conversion
Termination") must be given by the Trust by first-class mail to each Holder of
Securities not more than four Business Days after the Trust issues the Press
Release. Each such mailed Notice of Conversion Termination shall state: (1) the
Conversion Termination Date; (2) the Conversion Price of the Securities and the
Closing Price of the Capital Securities and the Common Stock, in each case as of
the close of business on the trading day next preceding the date of the Notice
of Conversion Termination; (3) that Securities will be convertible until 5:00
p.m. (New York City time) on the Conversion Termination Date and the place or
places at which a conversion notice may be given and Securities (if not in
book-entry form) may be surrendered for conversion into shares of Common Stock;
and (4) such other information or instructions as the Trust deems necessary or
advisable to enable a Holder to exercise its conversion rights hereunder. For
purposes of the calculation of the Conversion Termination Date and the dates on
which notices are given pursuant to this paragraph 5(h)(iii), a Notice of
Conversion Termination shall be deemed to have been given on the day such notice
is first mailed by first-class mail, postage prepaid, to each Holder of
Securities at the address of such Holder appearing in the books and records of
the Trust (whether or not any such Holder receives the Notice of Conversion
Termination). No defect in the Notice of Conversion Termination or in the
mailing thereof with respect to any Security shall affect the validity of such
notice with respect to any other Security. As of 5:00 p.m. (New York City time)
on the Conversion Termination Date, the Securities shall be deemed to be
non-convertible securities.
(iv) The term "Closing Price" of any security on any day means the
last reported sale price of such security, regular way on such day, or, if no
sale takes place on such day, the average of the reported closing bid and asked
prices on such day, regular way, in either case as reported on the NYSE
Composite Tape, or, if such security is not listed or admitted to trading on the
NYSE, on the principal national securities exchange on which such security is
listed or admitted to trading, or, if such security is not listed or admitted to
trading on a national securities exchange, on the National Market System of the
National Association of Securities Dealers, Inc., or, if such security is not
quoted or admitted to trading on such quotation system, on the principal
quotation system on which such security may be listed or admitted to trading or
quoted, or, if not listed or admitted to trading or quoted on any national
securities exchange or quotation system, the average of the closing bid and
asked prices of such security in the over-the-counter market on the day in
question as reported by the National Quotation Bureau Incorporated, or a similar
generally accepted reporting service, or, if not so available in such manner, as
furnished by any NYSE member firm selected from time to time by the Board of
Directors of the Sponsor for that purpose or, if not so available in such
manner, as otherwise determined in good faith by the Board of Directors of the
Sponsor.
I-14
6. Voting Rights - Capital Securities.
(a) Except as provided under Sections 6(b) and 8 and as otherwise
required by law and the Declaration, the Holders of the Capital Securities will
have no voting rights.
(b) So long as any Debentures are held by the Property Trustee,
the Trustees shall not (i) direct the time, method and place of conducting any
proceeding for any remedy available to the Debenture Trustee, or executing any
trust or power conferred on such Debenture Trustee with respect to the
Debentures, (ii) waive any past default that is waivable under Section 5.7 of
the Indenture, (iii) exercise any right to rescind or annul a declaration of
acceleration of the maturity of the principal of the Debentures or (iv) consent
to any amendment, modification or termination of the Indenture or the
Debentures, where such consent shall be required, without, in each case,
obtaining the prior approval of the Holders of a Majority in liquidation amount
of all outstanding Capital Securities; provided, however, that where a consent
under the Indenture would require the consent of each holder of Debentures
affected thereby, no such consent shall be given by the Property Trustee without
the prior approval of each Holder of the Capital Securities. The Trustees shall
not revoke any action previously authorized or approved by a vote of the Holders
of the Capital Securities except by subsequent vote of such Holders. Subject to
Section 2.7 of the Declaration, the Property Trustee shall notify each Holder of
Capital Securities of any notice of default with respect to the Debentures. In
addition to obtaining the foregoing approvals of such Holders of the Capital
Securities, prior to taking any of the foregoing actions, the Trustees shall
obtain an opinion of counsel experienced in such matters to the effect that, as
a result of such action, the Trust will not be classified as an association
taxable as a corporation for United States federal income tax purposes and (ii)
the Holders will not recognize gain or loss for federal income tax purposes.
If an Event of Default under the Declaration has occurred and is
continuing and such event is attributable to the failure of the Debenture Issuer
to pay principal of or premium, if any, or interest on the Debentures on the due
date (or in the case of prepayment, on the prepayment date), then a Holder of
Capital Securities may directly institute a proceeding for enforcement of
payment to such Holder of the principal of or premium, if any, or interest on a
Like Amount of Debentures (a "Direct Action") on or after the respective due
date specified in the Debentures. In connection with such Direct Action, the
rights of the Common Securities Holder will be subordinated to the rights of
such Holder of Capital Securities to the extent of any payment made by the
Debenture Issuer to such Holder of Capital Securities in such Direct Action.
Except as provided in the second preceding sentence or as otherwise provided in
the Declaration, the Holders of Capital Securities will not be able to exercise
directly any other remedy available to the holders of the Debentures.
I-15
Any approval or direction of Holders of Capital Securities may be
given at a separate meeting of Holders of Capital Securities convened for such
purpose, at a meeting of all of the Holders of Securities in the Trust or
pursuant to written consent. The Administrators will cause a notice of any
meeting at which Holders of Capital Securities are entitled to vote, or of any
matter upon which action by written consent of such Holders is to be taken, to
be mailed to each Holder of record of Capital Securities. Each such notice will
include a statement setting forth (i) the date of such meeting or the date by
which such action is to be taken, (ii) a description of any resolution proposed
for adoption at such meeting on which such Holders are entitled to vote or of
such matter upon which written consent is sought and (iii) instructions for the
delivery of proxies or consents.
No vote or consent of the Holders of the Capital Securities will
be required for the Trust to redeem and cancel Capital Securities or to
distribute the Debentures in accordance with the Declaration and the terms of
the Securities.
Notwithstanding that Holders of Capital Securities are entitled to
vote or consent under any of the circumstances described above, any of the
Capital Securities that are owned by the Sponsor or any Affiliate of the Sponsor
shall not be entitled to vote or consent and shall, for purposes of such vote or
consent, be treated as if they were not outstanding.
7. Voting Rights - Common Securities.
(a) Except as provided under Sections 7(b), 7(c) and 8 as
otherwise required by law and the Declaration, the Holders of the Common
Securities will have no voting rights.
(b) Unless an Event of Default shall have occurred and be
continuing, any Trustee may be removed at any time by the holder of the Common
Securities. If an Event of Default has occurred and is continuing, the Property
Trustee and the Delaware Trustee may be removed at such time by the Holders of a
Majority in liquidation amount of the outstanding Capital Securities. In no
event will the Holders of the Capital Securities have the right to vote to
appoint, remove or replace the Administrators, which voting rights are vested
exclusively in the Holders of the Common Securities. No resignation or removal
of a Trustee or Administrator and no appointment of a successor trustee or
administrator shall be effective until the acceptance of appointment by the
successor trustee or administrator in accordance with the provisions of the
Declaration.
(c) So long as any Debentures are held by the Property Trustee,
the Trustees shall not (i) direct the time, method and place of conducting any
proceeding for any remedy available to the Debenture Trustee, or executing any
trust or power conferred on such Debenture Trustee with respect to the
Debentures, (ii) waive any past default that is waivable
I-16
under Section 5.7 of the Indenture, (iii) exercise any right to rescind or annul
a declaration of acceleration of the maturity of the principal of the Debentures
or (iv) consent to any amendment, modification or termination of the Indenture
or the Debentures, where such consent shall be required, without, in each case,
obtaining the prior approval of the Holders of a Majority in liquidation amount
of all outstanding Common Securities; provided, however, that where a consent
under the Indenture would require the consent of each holder of Debentures
affected thereby, no such consent shall be given by the Property Trustee without
the prior approval of each Holder of the 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 subsequent vote of such Holders. Subject to
Section 2.7 of the Declaration, the Property Trustee shall notify each Holder of
Common Securities of any notice of default with respect to the Debentures. In
addition to obtaining the foregoing approvals of such Holders of the Common
Securities, prior to taking any of the foregoing actions, the Trustees shall
obtain an opinion of counsel experienced in such matters to the effect that, as
a result of such action, the Trust will not be classified as an association
taxable as a corporation for United States federal income tax purposes and (ii)
the Holders will not recognize gain or loss for federal income tax purposes.
If an Event of Default under the Declaration has occurred and is
continuing and such event is attributable to the failure of the Debenture Issuer
to pay principal of or premium, if any, or interest on the Debentures on the due
date (or in the case of prepayment, on the prepayment date), then a Holder of
Common Securities may institute a Direct Action for enforcement of payment to
such Holder of the principal of or premium, if any, or interest on a Like Amount
of Debentures on or after the respective due date specified in the Debentures.
In connection with any Direct Action, the rights of the Common Securities Holder
will be subordinated to the rights of such Holder of Capital Securities to the
extent of any payment made by the Debenture Issuer to such Holder of Common
Securities in such Direct Action. Except as provided in the second preceding
sentence, the Holders of Common Securities will not be able to exercise directly
any other remedy available to the holders of the Debentures.
Any approval or direction of Holders of Common Securities may be
given at a separate meeting of Holders of Common Securities convened for such
purpose, at a meeting of all of the Holders of Securities in the Trust or
pursuant to written consent. The Administrators will cause a notice of any
meeting at which Holders of Common Securities are entitled to vote, or of any
matter upon which action by written consent of such Holders is to be taken, to
be mailed to each Holder of record of Common Securities. Each such notice will
include a statement setting forth (i) the date of such meeting or the date by
which such action is to be taken, (ii) a description of any resolution proposed
for adoption at such meeting on which such
I-17
Holders are entitled to vote or of such matter upon which written consent is
sought and (iii) instructions for the delivery of proxies or consents.
No vote or consent of the Holders of the Common Securities will be
required for the Trust to redeem and cancel Common Securities or to distribute
the Debentures in accordance with the Declaration and the terms of the
Securities.
8. Amendments to Declaration.
In addition to the requirements set out in Section 12.1 of the
Declaration, the Declaration may be amended from time to time by the Sponsor,
the Property Trustee and the Administrators, without the consent of the Holders
of the Securities (i) to cure any ambiguity, correct or supplement any
provisions in the Declaration that may be inconsistent with any other
provisions, or to make any other provisions with respect to matters or questions
arising under the Declaration which shall not be inconsistent with the other
provisions of the Declaration, or (ii) to modify, eliminate or add to any
provisions of the Declaration to such extent as shall be necessary to ensure
that the Trust will be classified for United States federal income tax purposes
as a grantor trust at all times that any Securities are outstanding or to ensure
that the Trust will not be required to register as an Investment Company under
the Investment Company Act; provided, however, that in the case of clause (i),
such action shall not adversely affect in any material respect the interests of
any Holder of Securities, and any such amendments of the Declaration shall
become effective when notice thereof is given to the holders of the Securities.
The Declaration may be amended by the Trustees, the Administrators and the
Sponsor with (i) the consent of Holders representing a Majority in liquidation
amount of all outstanding Securities, and (ii) receipt by the Trustees and the
Administrators of an Opinion of Counsel to the effect that such amendment or the
exercise of any power granted to the Trustees or Administrators in accordance
with such amendment will not affect the Trust's status as a grantor trust for
United States federal income tax purposes or the Trust's exemption from status
as an Investment Company under the Investment Company Act or result in the
Holders recognizing gain or loss for federal income tax purposes, provided that,
without the consent of each Holder of Securities, the Declaration may not be
amended to (i) change the amount or timing of any Distribution on the Securities
or otherwise adversely affect the amount of any Distribution required to be made
in respect of the Securities as of a specified date or (ii) restrict the right
of a holder of Securities to institute suit for the enforcement of any such
payment on or after such date.
9. Pro Rata.
A reference in these terms of the Securities to any payment,
distribution or treatment as being "Pro Rata" shall mean pro rata to each Holder
according to the aggregate
I-18
liquidation amount of the Securities held by the relevant Holder in relation to
the aggregate liquidation amount of all Securities outstanding unless, in
relation to a payment, an Event of Default under the Declaration has occurred
and is continuing, in which case any funds available to make such payment shall
be paid first to each Holder of the Capital Securities pro rata according to the
aggregate liquidation amount of Capital Securities held by the relevant Holder
relative to the aggregate liquidation amount of all Capital Securities
outstanding, and only after satisfaction of all amounts owed to the Holders of
the Capital Securities, to each Holder of Common Securities pro rata according
to the aggregate liquidation amount of Common Securities held by the relevant
Holder relative to the aggregate liquidation amount of all Common Securities
outstanding. In any such proration, the Trust may make such adjustments as may
be appropriate in order that only Securities in authorized denominations shall
be redeemed.
10. Ranking.
The Capital Securities rank pari passu with the Common Securities
and payment thereon shall be made Pro Rata with the Common Securities, except
that, if an Event of Default under the Declaration occurs and is continuing, no
payments in respect of Distributions on, or payments upon liquidation,
redemption or otherwise with respect to, the Common Securities shall be made
until the Holders of the Capital Securities shall be paid in full the
Distributions, Redemption Price, Liquidation Distribution and other payments to
which they are entitled at such time.
11. Acceptance of Securities Guarantee and Indenture.
Each Holder of Capital Securities and Common Securities, by the
acceptance thereof, agrees to the provisions of the Capital Securities Guarantee
and the Common Securities Guarantee, respectively, including the subordination
provisions therein and to the provisions of the Indenture.
12. No Preemptive Rights.
The Holders of the Securities shall have no preemptive or similar
rights to subscribe for any additional securities.
I-19
13. Miscellaneous.
These terms constitute a part of the Declaration.
The Sponsor will provide a copy of the Declaration, the Capital
Securities Guarantee or the Common Securities Guarantee (as may be appropriate),
and the Indenture (including any supplemental indenture) to a Holder without
charge on written request to the Sponsor at its principal place of business.
I-20
EXHIBIT A-1
FORM OF CONVERTIBLE TRUST PREFERRED SECURITY CERTIFICATE
[FORM OF FACE OF SECURITY]
[IF THIS GLOBAL SECURITY IS A GLOBAL CONVERTIBLE TRUST PREFERRED
SECURITY ("CAPITAL SECURITY"), INSERT: THIS CAPITAL SECURITY IS A GLOBAL CAPITAL
SECURITY WITHIN THE MEANING OF THE DECLARATION HEREINAFTER REFERRED TO AND IS
REGISTERED IN THE NAME OF THE DEPOSITORY TRUST COMPANY (THE "CLEARING AGENCY")
OR A NOMINEE OF THE CLEARING AGENCY. THIS CAPITAL SECURITY IS EXCHANGEABLE FOR
CAPITAL SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE CLEARING
AGENCY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
DECLARATION AND NO TRANSFER OF THIS CAPITAL SECURITY (OTHER THAN A TRANSFER OF
THIS CAPITAL SECURITY AS A WHOLE BY THE CLEARING AGENCY TO A NOMINEE OF THE
CLEARING AGENCY OR BY A NOMINEE OF THE CLEARING AGENCY TO THE CLEARING AGENCY OR
ANOTHER NOMINEE OF THE CLEARING AGENCY) MAY BE REGISTERED EXCEPT IN LIMITED
CIRCUMSTANCES.
UNLESS THIS CAPITAL SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW
YORK) TO THE TRUST OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CAPITAL SECURITY ISSUED IS REGISTERED IN THE NAME OF CEDE & CO.
OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY AND ANY PAYMENT HEREON IS MADE TO CEDE & CO., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS
WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
A-1
Certificate Number Number of Convertible Trust Preferred Securities
CUSIP NO. __________
Certificate Evidencing Convertible Trust Preferred Securities
of
New York Bancorp Capital Trust
8.00% Convertible Trust Preferred Securities
(liquidation amount $25 per Capital Security)
New York Bancorp Capital Trust, a statutory business trust created
under the laws of the State of Delaware (the "Trust"), hereby certifies that
_____ (the "Holder") is the registered owner of [$_______ in aggregate
liquidation amount of Convertible Trust Preferred Securities of the Trust]1 [the
aggregate liquidation amount of Convertible Trust Preferred Securities of the
Trust specified in Schedule A hereto]2 representing undivided beneficial
interests in the assets of the Trust designated the 8.00% Convertible Trust
Preferred Securities (liquidation amount $25 per Capital Security) (the "Capital
Securities"). The Capital Securities are transferable on the books and records
of the Trust, in person or by a duly authorized attorney, upon surrender of this
certificate duly endorsed and in proper form for transfer. The designation,
rights, privileges, restrictions, preferences and other terms and provisions of
the Capital Securities represented hereby are issued and shall in all respects
be subject to the provisions of the Amended and Restated Declaration of Trust of
the Trust dated as of __________, 1997, as the same may be amended from time to
time (the "Declaration"), including the designation of the terms of the Capital
Securities as set forth in Annex I to the Declaration. Capitalized terms used
but not defined herein shall have the meaning given them in the Declaration. The
Sponsor will provide a copy of the Declaration, the Capital Securities Guarantee
and the Indenture to a Holder without charge upon written request to the Trust
at its principal place of business.
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder and to the benefits of
the Capital Securities Guarantee, to the extent provided therein.
By its acceptance, the Holder agrees to treat, for United States
federal income tax purposes, the Trust as a grantor trust, the Debentures as
indebtedness and the Capital Securities as evidence of indirect beneficial
ownership in the Debentures.
- --------
1 Insert in Definitive Capital Securities only.
2 Insert in Global Capital Securities only.
A-2
IN WITNESS WHEREOF, the Trust has executed this certificate this
day of , .
NEW YORK BANCORP CAPITAL TRUST
By:
-------------------------------
Name:
Title: Administrator
PROPERTY TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Capital Securities referred to in the
within-mentioned Declaration.
Dated: ________ __, 1997
The Bank of New York,
as Property Trustee
By:
---------------------------
Authorized Signatory
A-3
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Capital Security will be fixed at a
rate per annum of 8.00% (the "Coupon Rate") of the liquidation amount of $25 per
Capital Security, such rate being the rate of interest payable on the Debentures
to be held by the Property Trustee. Distributions in arrears for more than one
quarter period will bear interest thereon compounded quarterly at the Coupon
Rate (to the extent permitted by applicable law). The term "Distributions", as
used herein, includes such cash distributions and any such interest payable
unless otherwise stated. A Distribution is payable only to the extent that
payments are made in respect of the Debentures held by the Property Trustee and
to the extent the Property Trustee has funds on hand legally available therefor.
Distributions on the Capital Securities will be cumulative, will
accumulate from the most recent date to which Distributions have been paid or
duly provided for or, if no Distributions have been paid or duly provided for,
from _________________, 1997 and will be payable quarterly in arrears, on
January 31, April 30, July 31 and October 31 of each year, commencing on January
31, 1998, except as otherwise described below. Distributions will be computed on
the basis of a 360-day year consisting of twelve 30-day months and, for any
period less than a full calendar month, the number of days elapsed in such
month. As long as no Event of Default has occurred and is continuing under the
Indenture, the Debenture Issuer has the right under the Indenture to defer
payments of interest by extending the interest payment period at any time and
from time to time on the Debentures for a period not exceeding 20 consecutive
calendar quarters, including the first quarter during such extension period
(each an "Extension Period"), provided that no Extension Period shall end on a
day other than an interest payment date for the Debentures or shall extend
beyond the Maturity Date of the Debentures. As a consequence of such deferral,
Distributions will also be deferred. Despite such deferral, quarterly
Distributions will continue to accumulate with interest thereon (to the extent
permitted by applicable law, but not at a rate exceeding the rate of interest
then accruing on the Debentures) at the Coupon Rate compounded quarterly during
any such Extension Period. Prior to the termination of any such Extension
Period, the Debenture Issuer may further defer payments of interest by further
extending such Extension Period; provided that such Extension Period, together
with all such previous and further extensions within such Extension Period, may
not exceed 20 consecutive quarters, including the first quarter during such
Extension Period, or extend beyond the Maturity Date of the Debentures. Payments
of accumulated Distributions will be payable to Holders as they appear on the
books and records of the Trust on the first record date preceding the end of the
Extension Period. Upon the termination of any Extension Period and the payment
of all amounts then due, the Debenture Issuer may commence a new Extension
Period, subject to the above requirements.
A-4
Subject to the prior obtaining of any regulatory approval then
required and to certain other conditions set forth in the Declaration and the
Indenture, the Property Trustee may, at the direction of the Holder of the
Common Securities, at any time dissolve the Trust and, after satisfaction of
liabilities to creditors of the Trust as required by applicable law, cause the
Debentures to be distributed to the holders of the Securities in liquidation of
the Trust or, simultaneous with any prepayment of the Debentures, cause a Like
Amount of the Securities to be redeemed by the Trust.
The Capital Securities shall be governed by, and construed in
accordance with, the laws of the State of Delaware (without regard to conflict
of laws principles that would call for the application of the substantive law of
any jurisdiction other than the State of Delaware).
The Capital Securities shall be redeemable as provided in the
Declaration.
The Capital Securities shall be convertible into shares of Common
Stock, through (i) the exchange of Capital Securities for an appropriate
principal amount of Debentures and (ii) the immediate conversion of such
Debentures into shares of Common Stock, in the manner and according to the terms
set forth in Annex I to the Declaration and in the Indenture. The conversion
rights of the Holders of Capital Securities are subject to termination at the
option of the Debenture Issuer on and after October 31, 2001, subject to and
upon satisfaction of certain conditions set forth in Annex I to the Declaration
and in the Indenture.
A-5
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Capital Security
certificate to:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Insert assignees social security or tax identification number)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Insert address and zip code of assignee)
and irrevocably appoints
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------- agent to transfer this Capital Security certificate on
the books of the Trust. The agent may substitute another to act for him or her.
Date: _______________________
Signature: __________________
(Sign exactly as your name appears on the other side of this Capital Security
certificate)
Signature Guarantee(3): ___________________________________
- --------
3 Signature must be guaranteed by an "eligible guarantor institution" that
is a bank, stockbroker, savings and loan association or credit union
meeting the requirements of the Registrar, which requirements include
membership or participation in the Securities Transfer Agents Medallion
Program ("STAMP") or such other "signature guarantee program" as may be
determined by the Registrar in addition to, or in substitution for, STAMP,
all in accordance with the Securities and Exchange Act of 1934, as
amended.
A-6
Schedule A(1)
The initial aggregate liquidation amount of Capital Securities
evidenced by the Certificate to which this Schedule is attached is
$_____________ (equivalent to ______ Capital Securities). The notations on the
following table evidence decreases and increases in the number of Capital
Securities evidenced by such Certificate.
Liquidation Amount
Decrease in Increase in of Capital Securities
Liquidation Amount Liquidation Amount After such Decrease Notation by
of Capital Securities of Capital Securities or Increase Registrar
- --------------------- --------------------- ----------- ---------
- --------
1 Append to Global Capital Securities only.
A-7
CONVERSION REQUEST
To: [Name of Trustee], as Conversion Agent of Holders of Capital Securities
The undersigned owner of these Capital Securities hereby
irrevocably exercises the option to convert these Capital Securities, or the
portion below designated, into Common Stock of New York Bancorp Inc. (the
"Common Stock") in accordance with the terms of the Amended and Restated
Declaration of Trust (the "Declaration"), dated as of __________ __, 1997, by
Stan I. Cohen and David Fry, as Administrators, The Bank of New York (Delaware),
as Delaware Trustee, The Bank of New York, as Property Trustee, New York Bancorp
Inc., as Sponsor, and by the Holders, from time to time, of undivided beneficial
interests in the assets of the Trust to be issued pursuant to the Declaration.
Pursuant to the aforementioned exercise of the right to convert these Capital
Securities, the undersigned hereby directs the Conversion Agent (as that term is
defined in the Declaration) to (i) exchange such Capital Securities for a
portion of the Debentures (as that term is defined in the Declaration) held by
the Trust (at the rate of exchange specified in the terms of the Capital
Securities set forth as Annex I to the Declaration) and (ii) immediately convert
such Debentures on behalf of the undersigned, into Common Stock (at the
conversion price specified in the terms of the Capital Securities set forth as
Annex I to the Declaration).
The undersigned also hereby directs the Conversion Agent that the
shares issuable and deliverable upon conversion, together with any check in
payment for fractional shares, be issued in the name of and delivered to the
undersigned, unless a different name has been indicated in the assignment below.
If shares are to be issued in the name of a person other than the undersigned,
the undersigned will pay all transfer taxes payable with respect thereto.
Date: __________________
Number of Capital Securities to be converted: ____________________
If a name or names other than the undersigned, please indicate in the spaces
below the name or names in which the shares of Common Stock are to be issued,
along with the address or addresses of such person or persons.
- ----------------------------------------------------------------
- ----------------------------------------------------------------
- -----------------------------------------
(Sign exactly as your name appears on the other side of this Capital Security
certificate) (for conversion only)
A-8
Please Print or Type Name and Address,
Including Zip Code, and Social Security or
Other Identifying Number.
- ---------------------------------------
- ---------------------------------------
- ---------------------------------------
Signature Guarantee: *____________________________
- ----------------------------
* Signature must be guaranteed by an "eligible guarantor institution" that
is a bank, stockholder, savings and loan association or credit union
meeting the requirements of the Registrar, which requirements include
membership or participation in the Securities Transfer Agents Medallion
Program ("STAMP") or such other "signature guarantee program" as may be
determined by the Registrar in addition to, or in substitution for, STAMP,
all in accordance with the Securities Exchange Act of 1934, as amended.
A-9
EXHIBIT B-1
FORM OF COMMON SECURITY CERTIFICATE
THIS COMMON SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED OR ANY STATE SECURITIES LAWS OR ANY OTHER APPLICABLE
SECURITIES LAW. NEITHER THIS COMMON SECURITY NOR ANY INTEREST OR PARTICIPATION
HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH
TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.
THIS SECURITY MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED EXCEPT UPON LIMITED CIRCUMSTANCES SET FORTH IN THE DECLARATION.
B-1
Certificate Number Number of Common Securities
Certificate Evidencing Common Securities
of
New York Bancorp Capital Trust
8.00%Common Securities
(liquidation amount $25 per Common Security)
New York Bancorp Capital Trust, a statutory business trust created
under the laws of the State of Delaware (the "Trust"), hereby certifies that New
York Bancorp Inc. (the "Holder") is the registered owner of ____________ common
securities of the Trust representing undivided beneficial interests in the
assets of the Trust designated the 8.00% Convertible Common Securities
(liquidation amount $25 per Common Security) (the "Common Securities"). The
Common Securities are not transferable except to the extent permitted by the
Declaration. The designation, rights, privileges, restrictions, preferences and
other terms and provisions of the Common Securities represented hereby are
issued and shall in all respects be subject to the provisions of the Amended and
Restated Declaration of Trust of the Trust dated as of ___________, 1997, as the
same may be amended from time to time (the "Declaration"), including the
designation of the terms of the Common Securities as set forth in Annex I to the
Declaration. Capitalized terms used but not defined herein shall have the
meaning given them in the Declaration. The Sponsor will provide a copy of the
Declaration, the Common Securities Guarantee and the Indenture (including any
supplemental indenture) to a Holder without charge upon written request to the
Sponsor at its principal place of business.
Upon receipt of this certificate, the Sponsor is bound by the
Declaration and is entitled to the benefits thereunder and to the benefits of
the Common Securities Guarantee to the extent provided therein.
By its acceptance, the Holder agrees to treat, for United States
federal income tax purposes, the Trust as a grantor trust, the Debentures as
indebtedness and the Common Securities as evidence of indirect beneficial
ownership in the Debentures.
B-2
IN WITNESS WHEREOF, the Trust has executed this certificate this
___ day of ________ , 1997.
NEW YORK BANCORP CAPITAL TRUST
By:
-------------------------------
Name:
Title: Administrator
B-3
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Common Security will be fixed at a
rate per annum of 8.00% (the "Coupon Rate") of the liquidation amount of $25 per
Common Security, such rate being the rate of interest payable on the Debentures
to be held by the Property Trustee. Distributions in arrears for more than one
quarter will bear interest thereon compounded quarterly at the Coupon Rate (to
the extent permitted by applicable law). The term "Distributions", as used
herein, includes such cash distributions and any such interest payable unless
otherwise stated. A Distribution is payable only to the extent that payments are
made in respect of the Debentures held by the Property Trustee and to the extent
the Property Trustee has funds legally available therefor.
Distributions on the Common Securities will be cumulative, will
accrue from the most recent date to which Distributions have been paid or duly
provided or, if no Distributions have been paid or duly provided, from
___________, 1997 and will be payable quarterly in arrears, on January 31, April
30, July 31 and October 31 of each year, commencing on January 31, 1998, except
as otherwise described below. Distributions will be computed on the basis of a
360-day year consisting of twelve 30-day months and, for any period less than a
full calendar month, the number of days elapsed in such month. As long as no
Event of Default has occurred and is continuing under the Indenture, the
Debenture Issuer has the right under the Indenture to defer payments of interest
by extending the interest payment period at any time and from time to time on
the Debentures for a period not exceeding 20 consecutive calendar quarters,
including the first such quarter during such extension period (each an
"Extension Period"), provided that no Extension Period shall end on a day other
than an interest payment date for the Debentures or extend beyond the Maturity
Date of the Debentures. As a consequence of such deferral, Distributions will
also be deferred. Despite such deferral, Distributions will continue to
accumulate with interest thereon (to the extent permitted by applicable law, but
not at a rate exceeding the rate of interest then accruing on the Debentures) at
the Coupon Rate compounded quarterly during any such Extension Period. Prior to
the termination of any such Extension Period, the Debenture Issuer may further
defer payments of interest by further extending such Extension Period; provided
that such Extension Period, together with all such previous and further
extensions within such Extension Period, may not exceed 20 consecutive quarters,
including the first quarter during such Extension Period, or extend beyond the
Maturity Date of the Debentures. Payments of accrued Distributions will be
payable to Holders as they appear on the books and records of the Trust on the
first record date preceding the end of the Extension Period. Upon the
termination of any Extension Period and the payment of all amounts then due, the
Debenture Issuer may commence a new Extension Period, subject to the above
requirements.
Subject to the Sponsor obtaining any regulatory prior approval
then required and to certain other conditions set forth in the Declaration and
the Indenture, the Property
B-4
Trustee may, at the direction of the Holders of the Common Securities, at any
time dissolve the Trust and, after satisfaction of liabilities to creditors of
the Trust as required by applicable law, cause the Debentures to be distributed
to the holders of the Securities in liquidation of the Trust or, simultaneous
with any prepayment of the Debentures, cause a Like Amount of the Securities to
be redeemed by the Trust.
The Common Securities shall be governed by, and construed in
accordance with, the laws of the State of Delaware (without regard to conflicts
by laws principles that would call for the application of the substantive law of
any jurisdiction other than the State of Delaware).
The Common Securities shall be redeemable as provided in the
Declaration.
The Common Securities shall be convertible into shares of Common
Stock, through (i) the exchange of Common Securities for an appropriate
principal amount of Debentures and (ii) the immediate conversion of such
Debentures into shares of Common Stock, in the manner and according to the terms
set forth in Annex I to the Declaration and in the Indenture. The conversion
rights of the Holders of Common Securities are subject to termination at the
option of the Debenture Issuer on and after October 31, 2001, subject to and
upon satisfaction of certain conditions set forth in Annex I to the Declaration
and in the Indenture.
---------------------
B-5
CONVERSION REQUEST
To: [Name of Trustee], as Conversion Agent of Holders of Common Securities
The undersigned owner of these Common Securities hereby irrevocably
exercises the option to convert these Common Securities, or the portion below
designated, into Common Stock of New York Bancorp Inc. (the "Common Stock") in
accordance with the terms of the Amended and Restated Declaration of Trust (the
"Declaration"), dated as of __________ __, 1997, by Stan I. Cohen and David Fry,
as Administrators, The Bank of New York (Delaware), as Delaware Trustee, The
Bank of New York, as Property Trustee, New York Bancorp Inc., as Sponsor, and by
the Holders, from time to time, of undivided beneficial interests in the assets
of the Trust to be issued pursuant to the Declaration. Pursuant to the
aforementioned exercise of the right to convert these Common Securities, the
undersigned hereby directs the Conversion Agent (as that term is defined in the
Declaration) to (i) exchange such Common Securities for a portion of the
Debentures (as that term is defined in the Declaration) held by the Trust (at
the rate of exchange specified in the terms of the Common Securities set forth
as Annex I to the Declaration) and (ii) immediately convert such Debentures on
behalf of the undersigned, into Common Stock (at the conversion price specified
in the terms of the Common Securities set forth as Annex I to the Declaration).
The undersigned also hereby directs the Conversion Agent that the shares
issuable and deliverable upon conversion, together with any check in payment for
fractional shares, be issued in the name of and delivered to the undersigned,
unless a different name has been indicated in the assignment below. If shares
are to be issued in the name of a person other than the undersigned, the
undersigned will pay all transfer taxes payable with respect thereto.
Date: __________________
Number of Common Securities to be converted: ____________________
If a name or names other than the undersigned, please indicate in the spaces
below the name or names in which the shares of Common Stock are to be issued,
along with the address or addresses of such person or persons.
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(Sign exactly as your name appears on the other side of this Common Security
certificate) (for conversion only)
B-6
Please Print or Type Name and Address,
Including Zip Code, and Social Security or
Other Identifying Number.
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- -----------------------------------
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Signature Guarantee: *____________________________
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* Signature must be guaranteed by an "eligible guarantor institution" that
is a bank, stockholder, savings and loan association or credit union
meeting the requirements of the Registrar, which requirements include
membership or participation in the Securities Transfer Agents Medallion
Program ("STAMP") or such other "signature guarantee program" as may be
determined by the Registrar in addition to, or in substitution for, STAMP,
all in accordance with the Securities Exchange Act of 1934, as amended.
B-7