Exhibit 10.6
AMENDED AND RESTATED DECLARATION
OF TRUST
Valley Commerce Trust I
Dated as of March 27, 2003
TABLE OF CONTENTS
Page
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1. Definitions 1
ARTICLE II
ORGANIZATION
SECTION 2.1. Name 8
SECTION 2.2. Office 8
SECTION 2.3. Purpose 8
SECTION 2.4. Authority 9
SECTION 2.5. Title to Property of the Trust 9
SECTION 2.6. Powers and Duties of the Trustees and the Administrators 9
SECTION 2.7. Prohibition of Actions by the Trust and the Trustees 14
SECTION 2.8. Powers and Duties of the Institutional Trustee 15
SECTION 2.9. Certain Duties and Responsibilities of the Trustees and the Administrators 16
SECTION 2.10. Certain Rights of Institutional Trustee 18
SECTION 2.11. Delaware Trustee 20
SECTION 2.12. Execution of Documents 20
SECTION 2.13. Not Responsible for Recitals or Issuance of Securities 21
SECTION 2.14. Duration of Trust 21
SECTION 2.15. Mergers 21
ARTICLE III
SPONSOR
SECTION 3.1. Sponsor's Purchase of Common Securities 23
SECTION 3.2. Responsibilities of the Sponsor 23
ARTICLE IV
TRUSTEES AND ADMINISTRATORS
SECTION 4.1. Number of Trustees 23
SECTION 4.2. Delaware Trustee 24
SECTION 4.3. Institutional Trustee; Eligibility 24
SECTION 4.4. Certain Qualifications of the Delaware Trustee Generally 24
SECTION 4.5. Administrators 25
SECTION 4.6. Initial Delaware Trustee 25
SECTION 4.7. Appointment, Removal and Resignation of the Trustees and the Administrators 25
SECTION 4.8. Vacancies Among Trustees 27
SECTION 4.9. Effect of Vacancies 27
SECTION 4.10. Meetings of the Trustees and the Administrators 27
SECTION 4.11. Delegation of Power 28
SECTION 4.12. Merger, Conversion, Consolidation or Succession to Business 28
ARTICLE V
DISTRIBUTIONS
SECTION 5.1. Distributions 28
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TABLE OF CONTENTS
(continued)
Page
ARTICLE VI
ISSUANCE OF SECURITIES
SECTION 6.1. General Provisions Regarding Securities 28
SECTION 6.2. Paying Agent, Transfer Agent, Calculation Agent and Registrar 29
SECTION 6.3. Form and Dating 30
SECTION 6.4. Mutilated, Destroyed, Lost or Stolen Certificates 30
SECTION 6.5. Temporary Securities 31
SECTION 6.6. Cancellation 31
SECTION 6.7. Rights of Holders; Waivers of Past Defaults 31
ARTICLE VII
DISSOLUTION AND TERMINATION OF TRUST
SECTION 7.1. Dissolution and Termination of Trust 33
ARTICLE VIII
TRANSFER OF INTERESTS
SECTION 8.1. General 34
SECTION 8.2. Transfer Procedures and Restrictions 35
SECTION 8.3. Deemed Security Holders 38
ARTICLE IX
LIMITATION OF LIABILITY OF HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 9.1. Liability 38
SECTION 9.2. Exculpation 39
SECTION 9.3. Fiduciary Duty 39
SECTION 9.4. Indemnification 40
SECTION 9.5. Outside Businesses 43
SECTION 9.6. Compensation; Fee 43
ARTICLE X
ACCOUNTING
SECTION 10.1. Fiscal Year 43
SECTION 10.2. Certain Accounting Matters 43
SECTION 10.3. Banking 44
SECTION 10.4. Withholding 44
ARTICLE XI
AMENDMENTS AND MEETINGS
SECTION 11.1. Amendments 45
SECTION 11.2. Meetings of the Holders of the Securities; Action by Written Consent 47
ARTICLE XII
REPRESENTATIONS OF INSTITUTIONAL TRUSTEE AND DELAWARE TRUSTEE
SECTION 12.1. Representations and Warranties of Institutional Trustee 48
SECTION 12.2. Representations and Warranties of Delaware Trustee 49
ARTICLE XIII
MISCELLANEOUS
SECTION 13.1. Notices 50
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TABLE OF CONTENTS
(continued)
Page
SECTION 13.2. Governing Law 51
SECTION 13.3. Submission to Jurisdiction 51
SECTION 13.4. Intention of the Parties 52
SECTION 13.5. Headings 52
SECTION 13.6. Successors and Assigns 52
SECTION 13.7. Partial Enforceability 52
SECTION 13.8. Counterparts 52
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TABLE OF CONTENTS
(continued)
ANNEXES AND EXHIBITS
ANNEX I Terms of TP Securities and Common Securities
EXHIBIT A-1 Form of Capital Security Certificate
EXHIBIT A-2 Form of Common Security Certificate
EXHIBIT B Form of Transferee Certificate to be Executed by Transferees Other
than QIBs
EXHIBIT C Form of Transferor Certificate to be Executed for QIBs
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AMENDED AND RESTATED DECLARATION OF TRUST
OF
Valley Commerce Trust I
March 27, 2003
AMENDED AND RESTATED DECLARATION OF TRUST (this "Declaration"), dated and
effective as of March 27, 2003, by the Trustees (as defined herein), the
Administrators (as defined herein), the Sponsor (as defined herein) and 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, certain of the Trustees, the Administrators and the Sponsor
established Valley Commerce Trust I (the "Trust"), a statutory trust under the
Statutory Trust Act (as defined herein), pursuant to a Declaration of Trust,
dated as of March 19, 2003, (the "Original Declaration"), and a Certificate of
Trust filed with the Secretary of State of the State of Delaware on March 19,
2003, for the sole purpose of issuing and selling certain securities
representing undivided beneficial interests in the assets of the Trust and
investing the proceeds thereof in certain debentures of the Debenture Issuer (as
defined herein);
WHEREAS, as of the date hereof, no interests in the assets of the Trust
have been issued; and
WHEREAS, all of the Trustees, the Administrators and the Sponsor, by this
Declaration, amend and restate each and every term and provision of the Original
Declaration.
NOW, THEREFORE, it being the intention of the parties hereto to continue
the Trust as a statutory trust under the Statutory Trust Act and that this
Declaration constitutes the governing instrument of such statutory trust, and
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, and, in consideration of the mutual covenants
contained herein and other good and valuable consideration, the receipt of which
is hereby acknowledged, the parties, intending to be legally bound hereby, amend
and restate in its entirety the Original Declaration and agree as follows:
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 or elsewhere herein have the respective meanings assigned
to them in this Section 1.1 or, if not defined in this Section 1.1 or
elsewhere herein, in the Indenture;
(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 (as defined herein) 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.
"Additional Interest" has the meaning set forth in Section 3.06 of the
Indenture.
"Administrative Action" has the meaning set forth in paragraph 4(a) of
Annex I.
"Administrators" means each of Donald A. Gilles and Roy O. Estridge,
solely in such Person's capacity as Administrator of the Trust continued
hereunder and not in such Person's individual capacity, or such Administrator's
successor in interest in such capacity, or any successor appointed as herein
provided.
"Affiliate" has the same meaning as given to that term in Rule 405 of the
Securities Act or any successor rule thereunder.
"Authorized Officer" of a Person means any Person that is authorized to
bind such Person.
"Bankruptcy Event" means, with respect to any Person:
(a) a court having jurisdiction in the premises enters a decree or order
for relief in respect of such Person in an involuntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or appoints a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of such Person or for any substantial
part of its property, or orders the winding-up or liquidation of its
affairs, and such decree, appointment or order remains unstayed and in
effect for a period of 90 consecutive days; or
(b) such Person commences a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect,
consents to the entry of an order for relief in an involuntary case under
any such law, or consents to the appointment of or taking possession by a
receiver, liquidator, assignee, trustee, custodian, sequestrator or other
similar official of such Person of any substantial part of its property,
or makes any general assignment for the benefit of creditors, or fails
generally to pay its debts as they become due.
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"Business Day" means any day other than Saturday, Sunday or any other day
on which banking institutions in Wilmington, Delaware, New York City or are
permitted or required by any applicable law or executive order to close.
"Calculation Agent" has the meaning set forth in Section 1.01 of the
Indenture.
"Capital Securities" has the meaning set forth in Section 6.1(a).
"Capital Security Certificate" means a definitive Certificate registered
in the name of the Holder representing a Capital Security substantially in the
form of Exhibit A-1.
"Capital Treatment Event" has the meaning set forth in paragraph 4(a) of
Annex I.
"Certificate" means any certificate evidencing Securities.
"Certificate of Trust" means the certificate of trust filed with the
Secretary of State of the State of Delaware with respect to the Trust, as
amended and restated from time to time.
"Closing Date" has the meaning set forth in the Purchase Agreement.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, or any successor legislation.
"Commission" means the United States Securities and Exchange Commission.
"Common Securities" has the meaning set forth in Section 6.1(a).
"Common Security Certificate" means a definitive Certificate registered in
the name of the Holder representing a Common Security substantially in the form
of Exhibit A-2.
"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.
"Corporate Trust Office" means the office of the Institutional Trustee at
which the corporate trust business of the Institutional Trustee shall, at any
particular time, be principally administered, which office shall at all times be
located in the United States and at the date of execution of this Declaration is
located at 919 Market Street Suite 700 Wilmington, DE 19801, Attention:
Corporate Trust Division.
"Coupon Rate" has the meaning set forth in paragraph 2(a) of Annex I.
"Covered Person" means: (a) any Administrator, 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 Valley Commerce Bancorp, a bank holding company
incorporated in California, in its capacity as issuer of the Debentures under
the Indenture.
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"Debenture Trustee" means Wells Fargo Bank, National Association, a
national banking association with its principal place of business in the State
of Delaware, not in its individual capacity but solely as trustee under the
Indenture until a successor is appointed thereunder, and thereafter means such
successor trustee.
"Debentures" means the Junior Subordinated Debt Securities due April 7,
2033 to be issued by the Debenture Issuer under the Indenture.
"Deferred Interest" means any interest on the Debentures that would have
been overdue and unpaid for more than one Distribution Payment Date but for the
imposition of an Extension Period, and the interest that shall accrue (to the
extent that the payment of such interest is legally enforceable) on such
interest at the Coupon Rate in effect for each such Extension Period, compounded
quarterly from the date on which such Deferred Interest would otherwise have
been due and payable until paid or made available for payment.
"Definitive Capital Securities" means any Capital Securities in definitive
form issued by the Trust.
"Delaware Trustee" has the meaning set forth in Section 4.2.
"Direct Action" has the meaning set forth in Section 2.8(e).
"Distribution" means a distribution payable to Holders of Securities in
accordance with Section 5.1.
"Distribution Payment Date" has the meaning set forth in paragraph 2(e) of
Annex I.
"Event of Default" means the occurrence of an Indenture Event of Default.
"Exchange Act" means the Securities Exchange Act of 1934, as amended from
time to time, or any successor legislation.
"Extension Period" has the meaning set forth in paragraph 2(e) of Annex I.
"Federal Reserve" has the meaning set forth in paragraph 3 of Annex I.
"Fiduciary Indemnified Person" shall mean each of the Institutional
Trustee (including in its individual capacity), the Delaware Trustee (including
in its individual capacity), any Affiliate of the Institutional Trustee or the
Delaware Trustee, and any officers, directors, shareholders, members, partners,
employees, representatives, custodians, nominees or agents of the Institutional
Trustee or the Delaware Trustee.
"Fiscal Year" has the meaning set forth in Section 10.1.
"Guarantee" means the Guarantee Agreement, dated as of March 27, 2003, of
the Sponsor in respect of the Capital Securities.
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"Holder" means a Person in whose name a Certificate representing a
Security is registered on the register maintained by or on behalf of the
Registrar, such Person being a beneficial owner within the meaning of the
Statutory Trust Act.
"Indemnified Person" means a Company Indemnified Person or a Fiduciary
Indemnified Person.
"Indenture" means the Indenture, dated as of March 27, 2003, among the
Debenture Issuer and the Debenture Trustee, and any indenture supplemental
thereto pursuant to which the Debentures are to be issued.
"Indenture Event of Default" means an "Event of Default" as defined in the
Indenture.
"Indenture" means the Person that acquires the Capital Securities upon the
original issuance thereof by the Trust.
"Institutional Trustee" means the Trustee meeting the eligibility
requirements set forth in Section 4.3.
"Investment Company" means an investment company as defined in the
Investment Company Act.
"Investment Company Act" means the Investment Company Act of 1940, as
amended from time to time, or any successor legislation.
"Investment Company Event" has the meaning set forth in paragraph 4(a) of
Annex I.
"Legal Action" has the meaning set forth in Section 2.8(e).
"LIBOR" means the London Interbank Offered Rate for U.S. Dollar deposits
in Europe as determined by the Calculation Agent according to paragraph 2(b) of
Annex I.
"LIBOR Banking Day" has the meaning set forth in paragraph 2(b)(1) of
Annex I.
"LIBOR Business Day" has the meaning set forth in paragraph 2(b)(1) of
Annex I.
"LIBOR Determination Date" has the meaning set forth in paragraph 2(b)(1)
of Annex I.
"Liquidation" has the meaning set forth in paragraph 3 of Annex I.
"Liquidation Distribution" has the meaning set forth in paragraph 3 of
Annex I.
"Majority in liquidation amount of the Securities" means Holders of
outstanding 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.
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"Maximum Rate Increase" means that for the period of time from the date
hereof to the fourth quarterly Distribution Payment Date and during each
twelve-month period covering each subsequent four quarterly Distribution Payment
Dates (each a "Measured Period"), up to and including the 20th quarterly
Distribution Payment Date, the applicable Coupon Rate shall not exceed the sum
of (i)(A) for the first Measured Period, the Coupon Rate in effect on the first
Distribution Payment Date and (B) for each subsequent Measured Period, the
Coupon Rate in effect on the last quarterly Distribution Payment Date of the
immediately preceding Measured Period, plus (ii) 2.75%.
"Notice" has the meaning set forth in Section 2.11 of the Indenture.
"Officers' Certificate" means, with respect to any Person, a certificate
signed by two Authorized Officers of such Person. Any Officers' Certificate
delivered with respect to compliance with a condition or covenant provided for
in this Declaration shall include:
(c) a statement that each officer signing the Officers' Certificate has
read the covenant or condition and the definitions relating thereto;
(d) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Officers'
Certificate;
(e) a statement that each 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
(f) a statement as to whether, in the opinion of each such officer, such
condition or covenant has been complied with.
"Paying Agent" has the meaning set forth in Section 6.2.
"Payment Amount" has the meaning set forth in Section 5.1.
"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.
"PORTAL" has the meaning set forth in Section 2.6(a)(i).
"Property Account" has the meaning set forth in Section 2.8(c).
"Pro Rata" has the meaning set forth in paragraph 8 of Annex I.
"Purchase Agreement" means the agreement relating to the offering and sale
of Capital Securities.
"QIB" means a "qualified institutional buyer" as defined under Rule 144A.
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"Quorum" means a majority of the Administrators or, if there are only two
Administrators, both of them.
"Redemption/Distribution Notice" has the meaning set forth in paragraph
4(e) of Annex I.
"Redemption Price" has the meaning set forth in paragraph 4(a) of Annex I.
"Registrar" has the meaning set forth in Section 6.2.
"Relevant Trustee" has the meaning set forth in Section 4.7(a).
"Responsible Officer" means, with respect to the Institutional Trustee,
any officer within the Corporate Trust Office of the Institutional Trustee with
direct responsibility for the administration of this Declaration, including any
vice-president, any assistant vice-president, any secretary, any assistant
secretary, the treasurer, any assistant treasurer, any trust officer or other
officer of the Corporate Trust Office of the Institutional 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.
"Restricted Securities Legend" has the meaning set forth in Section
8.2(c). "Rule 144A" means Rule 144A under the Securities Act.
"Rule 3a-5" means Rule 3a-5 under the Investment Company Act. "Rule 3a-7"
means Rule 3a-7 under the Investment Company Act. "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.
"Sponsor" means Valley Commerce Bancorp, a bank holding company that is a
U.S. Person incorporated in California, or any successor entity in a merger,
consolidation or amalgamation that is a U.S. Person, in its capacity as sponsor
of the Trust.
"Statutory Trust Act" means Chapter 38 of Title 12 of the Delaware Code,
12 Del. Code ss. 3801 et seq., as it may be amended from time to time, or any
successor legislation.
"Successor Delaware Trustee" has the meaning set forth in Section 4.7(e).
"Successor Entity" has the meaning set forth in Section 2.15(b).
"Successor Institutional Trustee" has the meaning set forth in Section
4.7(b).
"Successor Securities" has the meaning set forth in Section 2.15(b).
"Super Majority" has the meaning set forth in paragraph 5(b) of Annex I.
"Tax Event" has the meaning set forth in paragraph 4(a) of Annex I.
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"10% in liquidation amount of the Securities" means Holders of outstanding
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.
"Transfer Agent" has the meaning set forth in Section 6.2.
"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).
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended
from time-to-time, or any successor legislation.
"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 Property" means (a) the Debentures, (b) any cash on deposit in, or
owing to, the Property Account and (c) all proceeds and rights in respect of the
foregoing and any other property and assets for the time being held or deemed to
be held by the Institutional Trustee pursuant to the trusts of this Declaration.
"U.S. Person" means a United States Person as defined in Section
7701(a)(30) of the Code.
ARTICLE II
ORGANIZATION
SECTION 2.1. Name. The Trust is named "Valley Commerce Trust I," as such name
may be modified from time to time by the Administrators following written notice
to the Institutional Trustee and the Holders of the Securities. The Trust's
activities may be conducted under the name of the Trust or any other name deemed
advisable by the Administrators.
SECTION 2.2. Office. The address of the principal office of the Trust, which
shall be in a state of the United States or the District of Columbia, is 200 S.
Court St., Visalia, California 93291. On ten Business Days' written notice to
the Institutional Trustee and the Holders of the Securities, the Administrators
may designate another principal office, which shall be in a state of the United
States or the District of Columbia.
SECTION 2.3. Purpose. The exclusive purposes and functions of the Trust are (a)
to issue and sell the Securities representing undivided beneficial interests in
the assets of the Trust, (b) to
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invest the gross proceeds from such sale in the Debentures and (c) except as
otherwise limited herein, to engage in only those other activities incidental
thereto that are deemed necessary or advisable by the Institutional Trustee,
including, without limitation, those activities specified in this Declaration.
The Trust shall not borrow money, issue debt or reinvest proceeds derived from
investments, pledge any of its assets, or otherwise undertake (or permit to be
undertaken) any activity that would cause the Trust not to be classified for
United States federal income tax purposes as a grantor trust.
SECTION 2.4. Authority. Except as specifically provided in this Declaration, the
Institutional Trustee shall have exclusive and complete authority to carry out
the purposes of the Trust. An action taken by a Trustee on behalf of the Trust
and in accordance with such Trustee's powers shall constitute the act of and
serve to bind the Trust. In dealing with the Trustees acting on behalf of the
Trust, no Person shall be required to inquire into the authority of the Trustees
to bind the Trust. Persons dealing with the Trust are entitled to rely
conclusively on the power and authority of the Trustees as set forth in this
Declaration. 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.
The Institutional Trustee shall have the right, but shall not be obligated
except as provided in Section 2.6, to perform those duties assigned to the
Administrators.
SECTION 2.5. Title to Property of the Trust. Except as provided in Section
2.6(g) and Section 2.8 with respect to the Debentures and the Property Account
or as otherwise provided in this Declaration, legal title to all assets of the
Trust shall be vested in the Trust. The Holders shall not have legal title to
any part of the assets of the Trust, but shall have an undivided beneficial
interest in the assets of the Trust.
SECTION 2.6. Powers and Duties of the Trustees and the Administrators.
(a) The Trustees and the Administrators shall conduct the affairs of the
Trust in accordance with the terms of this Declaration. Subject to the
limitations set forth in paragraph (b) of this Section, and in accordance
with the following provisions (i) and (ii), the Administrators and, at the
direction of the Administrators, the Trustees, shall have the authority to
enter into all transactions and agreements determined by the
Administrators to be appropriate in exercising the authority, express or
implied, otherwise granted to the Trustees or the Administrators, as the
case may be, under this Declaration, and to perform all acts in
furtherance thereof, including without limitation, the following:
(i) Each Administrator shall have the power, duty and authority, and
is hereby authorized, to act on behalf of the Trust with respect to
the following matters:
(A) the issuance and sale of the Securities;
(B) to cause the Trust to enter into, and to execute, deliver
and perform on behalf of the Trust, such agreements as may be
necessary or desirable in connection with the purposes and
function of the Trust, including agreements with the
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Paying Agent, a Debenture subscription agreement between the
Trust and the Sponsor and a Common Securities subscription
agreement between the Trust and the Sponsor;
(C) ensuring compliance with the Securities Act and applicable
state securities or blue sky laws;
(D) if and at such time determined solely by the Sponsor at
the request of the Holders, assisting in the designation of
the Capital Securities for trading in the Private Offering,
Resales and Trading through the Automatic Linkages ("PORTAL")
system if available;
(E) the sending of notices (other than notices of default) and
other information regarding the Securities and the Debentures
to the Holders in accordance with this Declaration, including
notice 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;
(F) the appointment of a Paying Agent, Transfer Agent and
Registrar in accordance with this Declaration;
(G) execution and delivery of the Securities in accordance
with this Declaration;
(H) execution and delivery of closing certificates pursuant to
the Purchase Agreement and the application for a taxpayer
identification number;
(I) unless otherwise determined by the Holders of a Majority
in liquidation amount of the Securities or as otherwise
required by the Statutory Trust Act, to execute on behalf of
the Trust (either acting alone or together with any or all of
the Administrators) any documents that the Administrators have
the power to execute pursuant to this Declaration;
(J) the taking of any action incidental to the foregoing as
the Sponsor or an Administrator may from time to time
determine is necessary or advisable to give effect to the
terms of this Declaration for the benefit of the Holders
(without consideration of the effect of any such action on any
particular Holder);
(K) to establish a record date with respect to all actions to
be taken hereunder that require a record date be established,
including Distributions, voting rights, redemptions and
exchanges, and to issue relevant notices to the Holders of
Capital Securities and Holders of Common Securities as to such
actions and applicable record dates;
(L) to duly prepare and file on behalf of the Trust all
applicable tax returns and tax information reports that are
required to be filed with respect to the Trust;
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(M) to negotiate the terms of, and the execution and delivery
of, the Purchase Agreement providing for the sale of the
Capital Securities;
(N) to employ or otherwise engage employees, agents (who may
be designated as officers with titles), managers, contractors,
advisors, attorneys and consultants and pay reasonable
compensation for such services;
(O) to incur expenses that are necessary or incidental to
carry out any of the purposes of the Trust;
(P) to give the certificate required by ss. 314(a)(4) of the
Trust Indenture Act to the Institutional Trustee, which
certificate may be executed by an Administrator; and
(Q) 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
trust under the laws of each jurisdiction (other than the
State of Delaware) 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.
(ii) As among the Trustees and the Administrators, the Institutional
Trustee shall have the power, duty and authority, and is hereby
authorized, to act on behalf of the Trust with respect to the
following matters:
(A) the establishment of the Property Account;
(B) the receipt of the Debentures;
(C) the collection of interest, principal and any other
payments made in respect of the Debentures in the Property
Account;
(D) the distribution through the Paying Agent of amounts owed
to the Holders in respect of the Securities;
(E) the exercise of all of the rights, powers and privileges
of a holder of the Debentures;
(F) the sending of notices of default and other information
regarding the Securities and the Debentures to the Holders in
accordance with this Declaration;
(G) the distribution of the Trust Property in accordance with
the terms of this Declaration;
(H) to the extent provided in this Declaration, the winding up
of the affairs of and liquidation of the Trust and the
preparation, execution and filing of the certificate of
cancellation with the Secretary of State of the State of
Delaware;
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(I) after any Event of Default (of which the Institutional
Trustee has knowledge (as provided in Section 2.10(m) hereof))
(provided, that such Event of Default is not by or with
respect to the Institutional Trustee), the taking of any
action incidental to the foregoing as the Institutional
Trustee may from time to time determine is necessary or
advisable to give effect to the terms of this Declaration and
protect and conserve the Trust Property for the benefit of the
Holders (without consideration of the effect of any such
action on any particular Holder);
(J) 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
trust under the laws of the State of Delaware 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; and
(K) to undertake any actions set forth in ss. 317(a) of the
Trust Indenture Act.
(iii) The Institutional Trustee shall have the power and authority,
and is hereby authorized, to act on behalf of the Trust with respect
to any of the duties, liabilities, powers or the authority of the
Administrators set forth in Section 2.6(a)(i)(E) and (F) herein but
shall not have a duty to do any such act unless specifically
requested to do so in writing by the Sponsor, and shall then be
fully protected in acting pursuant to such written request; and in
the event of a conflict between the action of the Administrators and
the action of the Institutional Trustee, the action of the
Institutional Trustee shall prevail.
(b) So long as this Declaration remains in effect, the Trust (or the
Trustees or Administrators acting on behalf of the Trust) shall not
undertake any business, activities or transaction except as expressly
provided herein or contemplated hereby. In particular, neither the
Trustees nor the Administrators may cause the Trust to (i) acquire any
investments or engage in any activities not authorized by this
Declaration, (ii) sell, assign, transfer, exchange, mortgage, pledge,
set-off or otherwise dispose of any of the Trust Property or interests
therein, including to Holders, except as expressly provided herein, (iii)
take any action that would cause (or in the case of the Institutional
Trustee, to the actual knowledge of a Responsible Officer would cause) the
Trust to fail or cease to qualify as a "grantor trust" for United States
federal income tax purposes, (iv) incur any indebtedness for borrowed
money or issue any other debt or (v) take or consent to any action that
would result in the placement of a lien on any of the Trust Property. The
Institutional Trustee shall, at the sole cost and expense of the Trust,
defend all claims and demands of all Persons at any time claiming any lien
on any of the Trust Property adverse to the interest of the Trust or the
Holders in their capacity as Holders.
(c) In connection with the issuance and sale of the Capital Securities,
the Sponsor shall have the right and responsibility to assist the Trust
with respect to, or effect on behalf of the Trust, the following (and any
actions taken by the Sponsor in furtherance of the following prior to the
date of this Declaration are hereby ratified and confirmed in all
respects):
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(i) the taking of any action necessary to obtain an exemption from
the Securities Act;
(ii) the determination of the States in which to take appropriate
action to qualify or register for sale all or part of the Capital
Securities and the determination of any and all such acts, other
than actions which must be taken by or on behalf of the Trust, and
the advisement of and direction to the Trustees of actions they must
take on behalf of the Trust, and the preparation for execution and
filing of any documents to be executed and filed by the Trust or on
behalf of the Trust, as the Sponsor deems necessary or advisable in
order to comply with the applicable laws of any such States in
connection with the sale of the Capital Securities; and
(iii) the taking of any other actions necessary or desirable to
carry out any of the foregoing activities.
(d) Notwithstanding anything herein to the contrary, the Administrators,
the Institutional Trustee and the Holders of a Majority in liquidation
amount of the Common Securities are authorized and directed to conduct the
affairs of the Trust and to operate the Trust so that (i) the Trust will
not be deemed to be an "investment company" required to be registered
under the Investment Company Act (in the case of the Institutional
Trustee, to the actual knowledge of a Responsible Officer), and (ii) the
Trust will not fail to be classified as a grantor trust for United States
federal income tax purposes (in the case of the Institutional Trustee, to
the actual knowledge of a Responsible Officer) and (iii) the Trust will
not take any action inconsistent with the treatment of the Debentures as
indebtedness of the Debenture Issuer for United States federal income tax
purposes (in the case of the Institutional Trustee, to the actual
knowledge of a Responsible Officer). In this connection, the Institutional
Trustee, the Administrators and the Holders of a Majority in liquidation
amount of the Common Securities are authorized to take any action, not
inconsistent with applicable laws or this Declaration, as amended from
time to time, that each of the Institutional Trustee, the Administrators
and such Holders determine in their discretion to be necessary or
desirable for such purposes, even if such action adversely affects the
interests of the Holders of the Capital Securities.
(e) All expenses incurred by the Administrators or the Trustees pursuant
to this Section 2.6 shall be reimbursed by the Sponsor, and the Trustees
shall have no obligations with respect to such expenses.
(f) The assets of the Trust shall consist of the Trust Property.
(g) Legal title to all Trust Property shall be vested at all times in the
Institutional Trustee (in its capacity as such) and shall be held and
administered by the Institutional Trustee for the benefit of the Trust in
accordance with this Declaration.
(h) If the Institutional Trustee or any Holder has instituted any
proceeding to enforce any right or remedy under this Declaration and such
proceeding has been discontinued or abandoned for any reason, or has been
determined adversely to the
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Institutional Trustee or to such Holder, then and in every such case the
Sponsor, the Institutional Trustee and the Holders shall, subject to any
determination in such proceeding, be restored severally and respectively
to their former positions hereunder, and thereafter all rights and
remedies of the Institutional Trustee and the Holders shall continue as
though no such proceeding had been instituted.
SECTION 2.7. Prohibition of Actions by the Trust and the Trustees.
The Trust shall not, and the Institutional Trustee and the Administrators
shall not, and the Administrators shall cause the Trust not to, engage in any
activity other than as required or authorized by this Declaration. In
particular, the Trust shall not, and the Institutional Trustee and the
Administrators shall not cause the Trust to:
(a) invest any proceeds received by the Trust from holding the Debentures,
but shall distribute all such proceeds to Holders of the Securities
pursuant to the terms of this Declaration and of the Securities;
(b) acquire any assets other than as expressly provided herein;
(c) possess Trust Property for other than a Trust purpose;
(d) make any loans or incur any indebtedness other than loans represented
by the Debentures;
(e) possess any power or otherwise act in such a way as to vary the Trust
Property or the terms of the Securities;
(f) issue any securities or other evidences of beneficial ownership of, or
beneficial interest in, the Trust other than the Securities; or
(g) other than as provided in this Declaration (including Annex I), (i)
direct the time, method and place of exercising any trust or power
conferred upon the Debenture Trustee with respect to the Debentures, (ii)
waive any past default that is waivable under the Indenture, (iii)
exercise any right to rescind or annul any declaration that the principal
of all the Debentures shall be due and payable, or (iv) 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
a written opinion of counsel experienced in such matters to the effect
that such amendment, modification or termination will not cause the Trust
to cease to be classified as a grantor trust for United States federal
income tax purposes.
SECTION 2.8. Powers and Duties of the Institutional Trustee.
(a) The legal title to the Debentures shall be owned by and held of record
in the name of the Institutional Trustee in trust for the benefit of the
Trust. The right, title and interest of the Institutional Trustee to the
Debentures shall vest automatically in each Person who may hereafter be
appointed as Institutional Trustee in accordance with Section 4.7. Such
vesting and cessation of title shall be effective whether or not
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conveyancing documents with regard to the Debentures have been executed
and delivered.
(b) The Institutional Trustee shall not transfer its right, title and
interest in the Debentures to the Administrators or to the Delaware
Trustee.
(c) The Institutional Trustee shall:
(i) establish and maintain a segregated non-interest bearing trust
account (the "Property Account") in the United States (as defined in
Treasury Regulations ss. 301.7701-7), in the name of and under the
exclusive control of the Institutional Trustee, and maintained in
the Institutional Trustee's trust department, on behalf of the
Holders of the Securities and, upon the receipt of payments of funds
made in respect of the Debentures held by the Institutional Trustee,
deposit such funds into the Property Account and make payments to
the Holders of the Capital Securities and Holders of the Common
Securities from the Property Account in accordance with Section 5.1.
Funds in the Property Account shall be held uninvested until
disbursed in accordance with this Declaration;
(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; 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 circumstances pursuant
to the terms of the Securities.
(d) The Institutional Trustee shall take all actions and perform such
duties as may be specifically required of the Institutional Trustee
pursuant to the terms of the Securities.
(e) The Institutional Trustee may bring or defend, pay, collect,
compromise, arbitrate, resort to legal action with respect to, or
otherwise adjust claims or demands of or against, the Trust (a "Legal
Action") which arise out of or in connection with an Event of Default of
which a Responsible Officer of the Institutional Trustee has actual
knowledge or the Institutional Trustee's duties and obligations under this
Declaration or the Trust Indenture Act; provided, however, that if an
Event of Default has occurred and is continuing and such event is
attributable to the failure of the Debenture Issuer to pay interest or
principal on the Debentures on the date such interest or principal is
otherwise payable (or in the case of redemption, on the redemption date),
then a Holder of the Capital Securities may directly institute a
proceeding for enforcement of payment to such Holder of the principal of
or interest on the Debentures having a principal amount equal to the
aggregate liquidation amount of the 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
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subrogated to the rights of such Holder of the Capital Securities to the
extent of any payment made by the Debenture Issuer to such Holder of the
Capital Securities in such Direct Action; provided, however, that a Holder
of the Common Securities may exercise such right of subrogation only if no
Event of Default with respect to the Capital Securities has occurred and
is continuing.
(f) The Institutional Trustee shall continue to serve as a Trustee until
either:
(i) the Trust has been completely liquidated and the proceeds of the
liquidation distributed to the Holders of the Securities pursuant to
the terms of the Securities and this Declaration (including Annex
I); or
(ii) a Successor Institutional Trustee has been appointed and has
accepted that appointment in accordance with Section 4.7.
(g) The Institutional Trustee shall have the legal power to exercise all
of the rights, powers and privileges of a holder of the Debentures under
the Indenture and, if an Event of Default occurs and is continuing, the
Institutional Trustee may, for the benefit of Holders of the Securities,
enforce its rights as holder of the Debentures subject to the rights of
the Holders pursuant to this Declaration (including Annex I) and the terms
of the Securities.
(h) The Institutional Trustee must exercise the powers set forth in this
Section 2.8 in a manner that is consistent with the purposes and functions
of the Trust set out in Section 2.3, and the Institutional Trustee shall
not take any action that is inconsistent with the purposes and functions
of the Trust set out in Section 2.3.
SECTION 2.9. Certain Duties and Responsibilities of the Trustees and the
Administrators.
(a) The Institutional Trustee, before the occurrence of any Event of
Default (of which the Institutional Trustee has knowledge (as provided in
Section 2.10(m) hereof)) 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 no implied covenants shall
be read into this Declaration against the Institutional Trustee. In case
an Event of Default (of which the Institutional Trustee has knowledge (as
provided in Section 2.10(m) hereof)), has occurred (that has not been
cured or waived pursuant to Section 6.7), the Institutional Trustee shall
exercise such of the rights and powers vested in it by this Declaration,
and use the same degree of care and skill in their exercise, as a prudent
person would exercise or use under the circumstances in the conduct of his
or her own affairs.
(b) The duties and responsibilities of the Trustees and the Administrators
shall be as provided by this Declaration and, in the case of the
Institutional Trustee, by the Trust Indenture Act. Notwithstanding the
foregoing, no provision of this Declaration shall require any Trustee or
Administrator to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder, or
in the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity satisfactory to it against such risk or
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liability is not reasonably assured to it. Whether or not therein
expressly so provided, every provision of this Declaration relating to the
conduct or affecting the liability of or affording protection to the
Trustees or the Administrators shall be subject to the provisions of this
Article. Nothing in this Declaration shall be construed to release a
Trustee from liability for its own negligent action, its own negligent
failure to act, or its own willful misconduct. Nothing in this Declaration
shall be construed to release an Administrator from liability for its own
gross negligent action, its own gross negligent failure to act, or its own
willful misconduct. To the extent that, at law or in equity, a Trustee or
an Administrator has duties and liabilities relating to the Trust or to
the Holders, such Trustee or Administrator shall not be liable to the
Trust or to any Holder for such Trustee's or Administrator's 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 the Administrators or the Trustees otherwise existing at law or in
equity, are agreed by the Sponsor and the Holders to replace such other
duties and liabilities of the Administrators or the Trustees.
(c) All payments made by the Institutional Trustee or a Paying Agent in
respect of the Securities shall be made only from the revenue and proceeds
from the Trust Property and only to the extent that there shall be
sufficient revenue or proceeds from the Trust Property to enable the
Institutional Trustee or a Paying Agent to make payments in accordance
with the terms hereof. Each Holder, by its acceptance of a Security,
agrees that it will look solely to the revenue and proceeds from the Trust
Property to the extent legally available for distribution to it as herein
provided and that the Trustees and the Administrators are not personally
liable to it for any amount distributable in respect of any Security or
for any other liability in respect of any Security. This Section 2.9(c)
does not limit the liability of the Trustees expressly set forth elsewhere
in this Declaration or, in the case of the Institutional Trustee, in the
Trust Indenture Act.
(d) No provision of this Declaration shall be construed to relieve the
Institutional Trustee from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct with respect to
matters that are within the authority of the Institutional Trustee under
this Declaration, except that:
(i) the Institutional Trustee shall not be liable for any error or
judgment made in good faith by an Authorized Officer of the
Institutional Trustee, unless it shall be proved that the
Institutional Trustee was negligent in ascertaining the pertinent
facts;
(ii) the Institutional Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of not less than a
Majority in liquidation amount of the Capital Securities or the
Common Securities, as applicable, relating to the time, method and
place of conducting any proceeding for any remedy available to the
Institutional Trustee, or exercising any trust or power conferred
upon the Institutional Trustee under this Declaration;
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(iii) the Institutional Trustee's sole duty with respect to the
custody, safe keeping and physical preservation of the Debentures
and the Property Account shall be to deal with such property in a
similar manner as the Institutional Trustee deals with similar
property for its own account, subject to the protections and
limitations on liability afforded to the Institutional Trustee under
this Declaration and the Trust Indenture Act;
(iv) the Institutional Trustee shall not be liable for any interest
on any money received by it except as it may otherwise agree in
writing with the Sponsor; and money held by the Institutional
Trustee need not be segregated from other funds held by it except in
relation to the Property Account maintained by the Institutional
Trustee pursuant to Section 2.8(c)(i) and except to the extent
otherwise required by law; and
(v) the Institutional 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
Institutional Trustee be liable for any default or misconduct of the
Administrators or the Sponsor.
SECTION 2.10. Certain Rights of Institutional Trustee. Subject to the provisions
of Section 2.9.
(a) the Institutional Trustee may conclusively rely and shall fully be
protected in acting or refraining from acting in good faith upon any
resolution, written opinion of counsel, certificate, written
representation of a Holder or transferee, certificate of auditors or any
other certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, appraisal, bond, debenture, note,
other evidence of indebtedness or other paper or document believed by it
to be genuine and to have been signed, sent or presented by the proper
party or parties;
(b) if (i) in performing its duties under this Declaration, the
Institutional Trustee is required to decide between alternative courses of
action, (ii) in construing any of the provisions of this Declaration, the
Institutional Trustee finds the same ambiguous or inconsistent with any
other provisions contained herein, or (iii) the Institutional Trustee is
unsure of the application of any provision of this Declaration, then,
except as to any matter as to which the Holders of Capital Securities are
entitled to vote under the terms of this Declaration, the Institutional
Trustee may deliver a notice to the Sponsor requesting the Sponsor's
opinion as to the course of action to be taken and the Institutional
Trustee shall take such action, or refrain from taking such action, as the
Institutional Trustee in its sole discretion shall deem advisable and in
the best interests of the Holders, in which event the Institutional
Trustee shall have no liability except for its own negligence or willful
misconduct;
(c) any direction or act of the Sponsor or the Administrators contemplated
by this Declaration shall be sufficiently evidenced by an Officers'
Certificate;
(d) whenever in the administration of this Declaration, the Institutional
Trustee shall deem it desirable that a matter be proved or established
before undertaking,
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suffering or omitting any action hereunder, the Institutional Trustee
(unless other evidence is herein specifically prescribed) may, in the
absence of bad faith on its part, request and conclusively rely upon an
Officers' Certificate which, upon receipt of such request, shall be
promptly delivered by the Sponsor or the Administrators;
(e) the Institutional Trustee shall have no duty to see to any recording,
filing or registration of any instrument (including any financing or
continuation statement or any filing under tax or securities laws) or any
rerecording, refiling or reregistration thereof;
(f) the Institutional Trustee may consult with counsel of its selection
(which counsel may be counsel to the Sponsor or any of its Affiliates) and
the advice of such counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon and in accordance with
such advice; the Institutional Trustee shall have the right at any time to
seek instructions concerning the administration of this Declaration from
any court of competent jurisdiction;
(g) the Institutional Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Declaration at the request or
direction of any of the Holders pursuant to this Declaration, unless such
Holders shall have offered to the Institutional Trustee security or
indemnity reasonably satisfactory to it against the costs, expenses and
liabilities which might be incurred by it in compliance with such request
or direction; provided, that nothing contained in this Section 2.10(g)
shall be taken to relieve the Institutional Trustee, upon the occurrence
of an Event of Default (of which the Institutional Trustee has knowledge
(as provided in Section 2.10(m) hereof)) that has not been cured or
waived, of its obligation to exercise the rights and powers vested in it
by this Declaration;
(h) the Institutional Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order,
approval, bond, debenture, note or other evidence of indebtedness or other
paper or document, unless requested in writing to do so by one or more
Holders, but the Institutional Trustee may make such further inquiry or
investigation into such facts or matters as it may see fit;
(i) the Institutional Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
its agents or attorneys and the Institutional Trustee shall not be
responsible for any misconduct or negligence on the part of, or for the
supervision of, any such agent or attorney appointed with due care by it
hereunder;
(j) whenever in the administration of this Declaration the Institutional
Trustee shall deem it desirable to receive instructions with respect to
enforcing any remedy or right or taking any other action hereunder, the
Institutional Trustee (i) may request instructions from the Holders of the
Common Securities and the Capital Securities, which instructions may be
given only by the Holders of the same proportion in liquidation
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amount of the Common Securities and the Capital Securities as would be
entitled to direct the Institutional Trustee under the terms of the Common
Securities and the Capital Securities in respect of such remedy, right or
action, (ii) may refrain from enforcing such remedy or right or taking
such other action until such instructions are received, and (iii) shall be
fully protected in acting in accordance with such instructions;
(k) except as otherwise expressly provided in this Declaration, the
Institutional Trustee shall not be under any obligation to take any action
that is discretionary under the provisions of this Declaration;
(l) when the Institutional Trustee incurs expenses or renders services in
connection with a Bankruptcy Event, such expenses (including the fees and
expenses of its counsel) and the compensation for such services are
intended to constitute expenses of administration under any bankruptcy law
or law relating to creditors rights generally;
(m) the Institutional Trustee shall not be charged with knowledge of an
Event of Default unless a Responsible Officer of the Institutional Trustee
has actual knowledge of such event or the Institutional Trustee receives
written notice of such event from any Holder, except with respect to an
Event of Default pursuant to Sections 5.01 (a) or 5.01 (b) of the
Indenture (other than an Event of Default resulting from the default in
the payment of Additional Interest or premium, if any, if the
Institutional Trustee does not have actual knowledge or written notice
that such payment is due and payable), of which the Institutional Trustee
shall be deemed to have knowledge;
(n) any action taken by the Institutional Trustee or its agents hereunder
shall bind the Trust and the Holders of the Securities, and the signature
of the Institutional Trustee or its agents alone shall be sufficient and
effective to perform any such action and no third party shall be required
to inquire as to the authority of the Institutional Trustee to so act or
as to its compliance with any of the terms and provisions of this
Declaration, both of which shall be conclusively evidenced by the
Institutional Trustee's or its agent's taking such action; and
(o) no provision of this Declaration shall be deemed to impose any duty or
obligation on the Institutional Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it,
in any jurisdiction in which it shall be illegal, or in which the
Institutional Trustee shall be unqualified or incompetent in accordance
with applicable law, to perform any such act or acts, or to exercise any
such right, power, duty or obligation. No permissive power or authority
available to the Institutional Trustee shall be construed to be a duty.
SECTION 2.11. Delaware Trustee. Notwithstanding any other provision of this
Declaration other than Section 4.2, the Delaware Trustee shall not be entitled
to exercise any powers, nor shall the Delaware Trustee have any of the duties
and responsibilities of any of the Trustees or the Administrators described in
this Declaration (except as may be required under the Statutory Trust Act).
Except as set forth in Section 4.2, the Delaware Trustee shall be a Trustee for
the sole and limited purpose of fulfilling the requirements of ss. 3807 of the
Statutory Trust Act.
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SECTION 2.12. Execution of Documents. Unless otherwise determined in writing by
the Institutional Trustee, and except as otherwise required by the Statutory
Trust Act, the Institutional Trustee, or any one or more of the Administrators,
as the case may be, is authorized to execute and deliver on behalf of the Trust
any documents, agreements, instruments or certificates that the Trustees or the
Administrators, as the case may be, have the power and authority to execute
pursuant to Section 2.6.
SECTION 2.13. 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 the Trustees do not assume any responsibility for
their correctness. The Trustees make no representations as to the value or
condition of the property of the Trust or any part thereof. The Trustees make no
representations as to the validity or sufficiency of this Declaration, the
Debentures or the Securities.
SECTION 2.14. Duration of Trust. The Trust, unless dissolved pursuant to the
provisions of Article VII hereof, shall have existence for thirty-five (35)
years from the Closing Date.
SECTION 2.15. Mergers. (a) The Trust may not consolidate, amalgamate, merge with
or into, or be replaced by, or convey, transfer or lease its properties and
assets substantially as an entirety to any corporation or other Person, except
as described in this Section 2.15 and except with respect to the distribution of
Debentures to Holders of Securities pursuant to Section 7.1(a)(iv) of the
Declaration or Section 4 of Annex I.
(b) The Trust may, with the consent of the Administrators (which consent
will not be unreasonably withheld) and without the consent of the
Institutional Trustee, the Delaware Trustee or the Holders of the Capital
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 a trust organized as such under the
laws of any state; provided, that:
(i) if the Trust is not the survivor, such successor entity (the
"Successor Entity") either:
(A) expressly assumes all of the obligations of the Trust
under the Securities; or
(B) substitutes for the Securities other securities having
substantially the same terms as the Securities (the "Successor
Securities") so that the Successor Securities rank the same as
the Securities rank with respect to Distributions and payments
upon Liquidation, redemption and otherwise;
(ii) the Sponsor expressly appoints, as the holder of the
Debentures, a trustee of the Successor Entity that possesses the
same powers and duties as the Institutional Trustee;
(iii) the Capital Securities or any Successor Securities (excluding
any securities substituted for the Common Securities) are listed or
quoted, or any Successor Securities will be listed or quoted upon
notification of issuance, on any
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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 cause the Capital Securities
(including any Successor Securities) to be downgraded by any
nationally recognized statistical rating organization, if the
Capital Securities are then rated;
(v) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights,
preferences and privileges of the Holders of the Securities
(including any Successor Securities) in any material respect (other
than with respect to any dilution of such Holders' interests in the
Successor Entity as a result of such merger, consolidation,
amalgamation or replacement);
(vi) such Successor Entity has a purpose substantially identical to
that of the Trust;
(vii) prior to such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, the Trust has received a
written opinion of a nationally recognized 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 of the
Securities (including any Successor Securities) in any
material respect (other than with respect to any dilution of
the Holders' interests in the Successor Entity);
(B) following such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, neither the Trust
nor the Successor Entity will be required to register as an
Investment Company; and
(C) following such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, the Trust (or the
Successor Entity) will continue to be classified as a grantor
trust for United States federal income tax purposes;
(viii) the Sponsor guarantees the obligations of such Successor
Entity under the Successor Securities to the same extent provided by
the Guarantee, the Debentures and this Declaration; and
(ix) prior to such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease, the Institutional Trustee shall have
received an Officers' Certificate of the Administrators and an
opinion of counsel, each to the effect that all conditions precedent
of this paragraph (b) to such transaction have been satisfied.
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(c) Notwithstanding Section 2.15(b), the Trust shall not, except with the
consent of Holders of 100% in liquidation amount of the Securities,
consolidate, amalgamate, merge with or into, or be replaced by, or convey,
transfer or lease its properties and assets as an entirety or
substantially as an entirety to, any other Person or permit any other
Person to consolidate, amalgamate, merge with or into, or replace it if
such consolidation, amalgamation, merger, replacement, conveyance,
transfer or lease would cause the Trust or Successor Entity to be
classified as other than a grantor trust for United States federal income
tax purposes.
ARTICLE III
SPONSOR
SECTION 3.1. Sponsor's Purchase of Common Securities. On the Closing Date, the
Sponsor will purchase all of the Common Securities issued by the Trust, in an
amount at least equal to 3% of the capital of the Trust, at the same time as the
Capital Securities are sold.
SECTION 3.2. Responsibilities of the Sponsor. In connection with the issue and
sale of the Capital Securities, the Sponsor shall have the exclusive right and
responsibility and sole decision to engage in, or direct the Administrators to
engage in, the following activities:
(a) to determine the States in which to take appropriate action to qualify
or register for sale of 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;
(b) to prepare for filing and request the Administrators to cause the
filing by the Trust, as may be appropriate, of an application to the
PORTAL system, for listing or quotation upon notice of issuance of any
Capital Securities, as requested by the Holders of not less than a
Majority in liquidation amount of the Capital Securities; and
(c) to negotiate the terms of and/or execute and deliver on behalf of the
Trust, the Purchase Agreement and other related agreements providing for
the sale of the Capital Securities.
ARTICLE IV
TRUSTEES AND ADMINISTRATORS
SECTION 4.1. Number of Trustees. The number of Trustees initially shall be two,
and:
(a) at any time before the issuance of any Securities, the Sponsor may, by
written instrument, increase or decrease the number of Trustees; and
(b) after the issuance of any Securities, the number of Trustees may be
increased or decreased by vote of the Holder of a Majority in liquidation
amount of the Common Securities voting as a class at a meeting of the
Holder of the Common Securities; provided, however, that there shall be a
Delaware Trustee if required by
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Section 4.2; and there shall always be one Trustee who shall be the
Institutional Trustee, and such Trustee may also serve as Delaware Trustee
if it meets the applicable requirements, in which case Section 2.11 shall
have no application to such entity in its capacity as Institutional
Trustee.
SECTION 4.2. Delaware Trustee. If required by the Statutory 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 is organized under the laws
of the United States or any state thereof or the District of Columbia, has
its principal place of business in the State of Delaware, and otherwise
meets the requirements of applicable law, including ss.3807 of the
Statutory Trust Act.
SECTION 4.3. Institutional Trustee; Eligibility.
(a) There shall at all times be one Trustee which shall act as
Institutional Trustee which shall:
(i) not be an Affiliate of the Sponsor;
(ii) not offer or provide credit or credit enhancement to the Trust;
and
(iii) be a banking corporation or national association organized and
doing business under the laws of the United States of America or any
state thereof or of the District of Columbia and authorized under
such laws to exercise corporate trust powers, having a combined
capital and surplus of at least fifty million U.S. dollars
($50,000,000), and subject to supervision or examination by federal,
state or District of Columbia authority. If such corporation or
national association 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 4.3(a)(iii), the combined capital and surplus of such
corporation or national association shall be deemed to be its
combined capital and surplus as set forth in its most recent report
of condition so published.
(b) If at any time the Institutional Trustee shall cease to be eligible to
so act under Section 4.3(a), the Institutional Trustee shall immediately
resign in the manner and with the effect set forth in Section 4.7.
(c) If the Institutional Trustee has or shall acquire any "conflicting
interest" within the meaning of ss. 310(b) of the Trust Indenture Act, the
Institutional Trustee shall either eliminate such interest or resign, to
the extent and in the manner provided by, and subject to this Declaration.
(d) The initial Institutional Trustee shall be Wells Fargo Bank, National
Association.
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SECTION 4.4. Certain Qualifications of the Delaware Trustee Generally. The
Delaware Trustee shall be a U.S. Person and 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 4.5. Administrators. Each Administrator shall be a U.S. Person. There
shall at all times be at least one Administrator. Except where a requirement for
action by a specific number of Administrators is expressly set forth in this
Declaration and except with respect to any action the taking of which is the
subject of a meeting of the Administrators, any action required or permitted to
be taken by the Administrators may be taken by, and any power of the
Administrators may be exercised by, or with the consent of, any one such
Administrator acting alone.
SECTION 4.6. Initial Delaware Trustee. The initial Delaware Trustee shall be
Wells Fargo Delaware Trust Company.
SECTION 4.7. Appointment, Removal and Resignation of the Trustees and the
Administrators.
(a) No resignation or removal of any Trustee (the "Relevant Trustee") and
no appointment of a successor Trustee pursuant to this Article shall
become effective until the acceptance of appointment by the successor
Trustee in accordance with the applicable requirements of this Section
4.7.
(b) Subject to Section 4.7(a), a Relevant Trustee may resign at any time
by giving written notice thereof to the Holders of the Securities and by
appointing a successor Relevant Trustee. Upon the resignation of the
Institutional Trustee, the Institutional Trustee shall appoint a successor
by requesting from at least three Persons meeting the eligibility
requirements their expenses and charges to serve as the successor
Institutional Trustee on a form provided by the Administrators, and
selecting the Person who agrees to the lowest expense and charges (the
"Successor Institutional Trustee"). If the instrument of acceptance by the
successor Relevant Trustee required by this Section 4.7 shall not have
been delivered to the Relevant Trustee within 60 days after the giving of
such notice of resignation or delivery of the instrument of removal, the
Relevant Trustee may petition, at the expense of the Trust, any federal,
state or District of Columbia court of competent jurisdiction for the
appointment of a successor Relevant Trustee. Such court may thereupon,
after prescribing such notice, if any, as it may deem proper, appoint a
Relevant Trustee. The Institutional Trustee shall have no liability for
the selection of such successor pursuant to this Section 4.7.
(c) Unless an Event of Default shall have occurred and be continuing, any
Trustee may be removed at any time by an act of the Holders of a Majority
in liquidation amount of the Common Securities. If any Trustee shall be so
removed, the Holders of the Common Securities, by act of the Holders of a
Majority in liquidation amount of the Common Securities delivered to the
Relevant Trustee, shall promptly appoint a successor Relevant Trustee, and
such successor Trustee shall comply with the applicable requirements of
this Section 4.7. If an Event of Default shall have occurred and be
continuing, the Institutional Trustee or the Delaware Trustee, or both of
them, may be removed by the act of the Holders of a Majority in
liquidation amount of the Capital
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Securities, delivered to the Relevant Trustee (in its individual capacity
and on behalf of the Trust). If any Trustee shall be so removed, the
Holders of Capital Securities, by act of the Holders of a Majority in
liquidation amount of the Capital Securities then outstanding delivered to
the Relevant Trustee, shall promptly appoint a successor Relevant Trustee
or Trustees, and such successor Trustee shall comply with the applicable
requirements of this Section 4.7. If no successor Relevant Trustee shall
have been so appointed by the Holders of a Majority in liquidation amount
of the Capital Securities and accepted appointment in the manner required
by this Section 4.7 within 30 days after delivery of an instrument of
removal, the Relevant Trustee or any Holder who has been a Holder of the
Securities for at least six months may, on behalf of himself and all
others similarly situated, petition any federal, state or District of
Columbia court of competent jurisdiction for the appointment of a
successor Relevant Trustee. Such court may thereupon, after prescribing
such notice, if any, as it may deem proper, appoint a successor Relevant
Trustee or Trustees.
(d) The Institutional Trustee shall give notice of each resignation and
each removal of a Trustee and each appointment of a successor Trustee to
all Holders and to the Sponsor. Each notice shall include the name of the
successor Relevant Trustee and the address of its Corporate Trust Office
if it is the Institutional Trustee.
(e) Notwithstanding the foregoing or any other provision of this
Declaration, in the event a Delaware Trustee who is a natural person dies
or is adjudged by a court to have become incompetent or incapacitated, the
vacancy created by such death, incompetence or incapacity may be filled by
the Institutional Trustee (provided the Institutional Trustee satisfies
the requirements of a Delaware Trustee as set forth in Section 4.2)
following the procedures in this Section 4.7 (with the successor being a
Person who satisfies the eligibility requirement for a Delaware Trustee
set forth in this Declaration) (the "Successor Delaware Trustee").
(f) In case of the appointment hereunder of a successor Relevant Trustee,
the retiring Relevant Trustee and each successor Relevant Trustee with
respect to the Securities shall execute and deliver an amendment hereto
wherein each successor Relevant Trustee shall accept such appointment and
which (a) shall contain such provisions as shall be necessary or desirable
to transfer and confirm to, and to vest in, each successor Relevant
Trustee all the rights, powers, trusts and duties of the retiring Relevant
Trustee with respect to the Securities and the Trust and (b) shall add to
or change any of the provisions of this Declaration as shall be necessary
to provide for or facilitate the administration of the Trust by more than
one Relevant Trustee, it being understood that nothing herein or in such
amendment shall constitute such Relevant Trustees co-trustees and upon the
execution and delivery of such amendment the resignation or removal of the
retiring Relevant Trustee shall become effective to the extent provided
therein and each such successor Relevant Trustee, without any further act,
deed or conveyance, shall become vested with all the rights, powers,
trusts and duties of the retiring Relevant Trustee; but, on request of the
Trust or any successor Relevant Trustee, such retiring Relevant Trustee
shall duly assign, transfer and deliver to such successor Relevant Trustee
all Trust Property, all proceeds thereof and money held by such retiring
Relevant Trustee hereunder with respect to the Securities and the Trust
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subject to the payment of all unpaid fees, expenses and indemnities of
such retiring Relevant Trustee.
(g) No Institutional Trustee or Delaware Trustee shall be liable for the
acts or omissions to act of any Successor Institutional Trustee or
Successor Delaware Trustee, as the case may be.
(h) The Holders of the Capital Securities will have no right to vote to
appoint, remove or replace the Administrators, which voting rights are
vested exclusively in the Holders of the Common Securities.
(i) Any successor Delaware Trustee shall file an amendment to the
Certificate of Trust with the Secretary of State of the State of Delaware
identifying the name and principal place of business of such Delaware
Trustee in the State of Delaware.
SECTION 4.8. Vacancies Among Trustees. If a Trustee ceases to hold office for
any reason and the number of Trustees is not reduced pursuant to Section 4.1, or
if the number of Trustees is increased pursuant to Section 4.1, a vacancy shall
occur. A resolution certifying the existence of such vacancy by the Trustees or,
if there are more than two, a majority of the Trustees shall be conclusive
evidence of the existence of such vacancy. The vacancy shall be filled with a
Trustee appointed in accordance with Section 4.7.
SECTION 4.9. Effect of Vacancies. The death, resignation, retirement, removal,
bankruptcy, dissolution, liquidation, incompetence or incapacity to perform the
duties of a Trustee shall not operate to dissolve, terminate or annul the Trust
or terminate this Declaration. Whenever a vacancy in the number of Trustees
shall occur, until such vacancy is filled by the appointment of a Trustee in
accordance with Section 4.7, the Institutional Trustee shall have all the powers
granted to the Trustees and shall discharge all the duties imposed upon the
Trustees by this Declaration.
SECTION 4.10. Meetings of the Trustees and the Administrators. Meetings of the
Trustees or the Administrators shall be held from time to time upon the call of
any Trustee or Administrator, as applicable. Regular meetings of the Trustees
and the Administrators, respectively, may be in person in the United States or
by telephone, at a place (if applicable) and time fixed by resolution of the
Trustees or the Administrators, as applicable. Notice of any in-person meetings
of the Trustees or the Administrators shall be hand delivered or otherwise
delivered in writing (including by facsimile, with a hard copy by overnight
courier) not less than 48 hours before such meeting. Notice of any telephonic
meetings of the Trustees or 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 a Trustee or an
Administrator, as the case may be, at a meeting shall constitute a waiver of
notice of such meeting except where a Trustee or an Administrator, as the case
may be, 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 Trustees or the Administrators, as the case may be, may be taken at a
meeting by vote of a majority of the
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Trustees or the Administrators present (whether in person or by telephone) and
eligible to vote with respect to such matter; provided, that, in the case of the
Administrators, a Quorum is present, or without a meeting by the unanimous
written consent of the Trustees or the Administrators, as the case may be.
Meetings of the Trustees and the Administrators together shall be held from time
to time upon the call of any Trustee or Administrator.
SECTION 4.11. Delegation of Power. (a) Any Trustee or any Administrator, as the
case may be, may, by power of attorney consistent with applicable law, delegate
to any other natural person over the age of 21 that is a U.S. Person his or her
power for the purpose of executing any documents, instruments or other writings
contemplated in Section 2.6.
(b) The Trustees shall have power to delegate from time to time to such of
their number or to any officer of the Trust that is a U.S. Person, the
doing of such things and the execution of such instruments or other
writings either in the name of the Trust or the names of the Trustees or
otherwise as the Trustees may deem expedient, to the extent such
delegation is not prohibited by applicable law or contrary to the
provisions of the Trust, as set forth herein.
SECTION 4.12. Merger, Conversion, Consolidation or Succession to Business. Any
Person into which the Institutional Trustee or the Delaware Trustee, as the case
maybe, may be merged or converted or with which either may be consolidated, or
any Person resulting from any merger, conversion or consolidation to which the
Institutional Trustee or the Delaware Trustee, as the case may be, shall be a
party, or any Person succeeding to all or substantially all the corporate trust
business of the Institutional Trustee or the Delaware Trustee, as the case may
be, shall be the successor of the Institutional Trustee or the Delaware Trustee,
as the case may be, hereunder, without the execution or filing of any paper or
any further act on the part of any of the parties hereto, provided such Person
shall be otherwise qualified and eligible under this Article and, provided,
further, that such Person shall file an amendment to the Certificate of Trust
with the Secretary of State of the State of Delaware as contemplated in Section
4.7(i).
ARTICLE V
DISTRIBUTIONS
SECTION 5.1. Distributions. Holders shall receive Distributions in accordance
with the applicable terms of the relevant Holder's Securities. Distributions
shall be made on the Capital Securities and the Common Securities in accordance
with the preferences set forth in their respective terms. If and to the extent
that the Debenture Issuer makes a payment of interest (including any Additional
Interest or Deferred Interest) and/or principal on the Debentures held by the
Institutional Trustee (the amount of any such payment being a "Payment Amount"),
the Institutional Trustee shall and is directed, to the extent funds are
available in the Property Account for that purpose, to make a distribution (a
"Distribution") of the Payment Amount to Holders. For the avoidance of doubt,
funds in the Property Account shall not be distributed to Holders to the extent
of any taxes payable by the Trust, in the case of withholding taxes, as
determined by the Institutional Trustee or any Paying Agent and, in the case of
taxes other than withholding tax taxes, as determined by the Administrators in a
written notice to the Institutional Trustee.
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ARTICLE VI
ISSUANCE OF SECURITIES
SECTION 6.1. General Provisions Regarding Securities.
(a) The Administrators shall on behalf of the Trust issue one series of
capital securities, evidenced by a certificate substantially in the form
of Exhibit A-1, representing undivided beneficial interests in the assets
of the Trust and having such terms as are set forth in Annex I (the
"Capital Securities"), and one series of common securities, evidenced by a
certificate substantially in the form of Exhibit A-2, representing
undivided beneficial interests in the assets of the Trust and having such
terms as are set forth in Annex I (the "Common Securities"). The Trust
shall issue no securities or other interests in the assets of the Trust
other than the Capital Securities and the Common Securities. The Capital
Securities rank pari passu and payment thereon shall be made Pro Rata with
the Common Securities except that, where an Event of Default has occurred
and is continuing, the rights of Holders of the Common Securities to
payment in respect of Distributions and payments upon liquidation,
redemption and otherwise are subordinated to the rights to payment of the
Holders of the Capital Securities.
(b) The Certificates shall be signed on behalf of the Trust by one or more
Administrators. Such signature shall be the facsimile or manual signature
of any Administrator. In case any Administrator of the Trust who shall
have signed any of the Securities shall cease to be such Administrator
before the Certificates so signed shall be delivered by the Trust, such
Certificates nevertheless may be delivered as though the person who signed
such Certificates had not ceased to be such Administrator. Any Certificate
may be signed on behalf of the Trust by such person who, at the actual
date of execution of such Security, shall be an Administrator of the
Trust, although at the date of the execution and delivery of the
Declaration any such person was not such an Administrator. A Capital
Security shall not be valid until authenticated by the manual signature of
an Authorized Officer of the Institutional Trustee. Such signature shall
be conclusive evidence that the Capital Security has been authenticated
under this Declaration. Upon written order of the Trust signed by one
Administrator, the Institutional Trustee shall authenticate the Capital
Securities for original issue. The Institutional Trustee may appoint an
authenticating agent that is a U.S. Person acceptable to the Trust to
authenticate the Capital Securities. A Common Security need not be so
authenticated and shall be valid upon execution by one or more
Administrators.
(c) The consideration received by the Trust for the issuance of the
Securities shall constitute a contribution to the capital of the Trust and
shall not constitute a loan to the Trust.
(d) Upon issuance of the Securities as provided in this Declaration, the
Securities so issued shall be deemed to be validly issued, fully paid and
non-assessable, and each Holder thereof shall be entitled to the benefits
provided by this Declaration.
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(e) Every Person, by virtue of having become a Holder 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 and
the Guarantee.
SECTION 6.2. Paying Agent, Transfer Agent, Calculation Agent and Registrar.
(a) The Trust shall maintain in Wilmington, Delaware, an office or agency
where the Securities may be presented for payment (the "Paying Agent"),
and an office or agency where Securities may be presented for registration
of transfer or exchange (the "Transfer Agent"). The Trust shall keep or
cause to be kept at such office or agency a register for the purpose of
registering Securities and transfers and exchanges of Securities, such
register to be held by a registrar (the "Registrar"). The Administrators
may appoint the Paying Agent, the Registrar and the Transfer Agent, and
may appoint one or more additional Paying Agents, one or more
co-Registrars, or one or more co-Transfer Agents in such other locations
as it shall determine. The term "Paying Agent" includes any additional
Paying Agent, the term "Registrar" includes any additional Registrar or
co-Registrar and the term "Transfer Agent" includes any additional
Transfer Agent or co-Transfer Agent. The Administrators may change any
Paying Agent, Transfer Agent or Registrar at any time without prior notice
to any Holder. The Administrators shall notify the Institutional Trustee
of the name and address of any Paying Agent, Transfer Agent and Registrar
not a party to this Declaration. The Administrators hereby initially
appoint the Institutional Trustee to act as Paying Agent, Transfer Agent
and Registrar for the Capital Securities and the Common Securities at its
Corporate Trust Office. The Institutional Trustee or any of its Affiliates
in the United States may act as Paying Agent, Transfer Agent or Registrar.
(b) The Trust shall also appoint a Calculation Agent, which shall
determine the Coupon Rate in accordance with the terms of the Securities.
The Trust initially appoints the Institutional Trustee as Calculation
Agent.
SECTION 6.3. Form and Dating.
(a) The Capital Securities and the Institutional Trustee's certificate of
authentication thereon shall be substantially in the form of Exhibit A-1,
and the Common Securities shall be substantially in the form of Exhibit
A-2, each of which is hereby incorporated in and expressly made a part of
this Declaration. Certificates may be typed, printed, lithographed or
engraved or may be produced in any other manner as is reasonably
acceptable to the Administrators, as conclusively evidenced by their
execution thereof. The Securities may have letters, 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 Sponsor). The Trust
at the direction of the Sponsor shall furnish any such legend not
contained in Exhibit A-1 to the Institutional 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 A-2 are part of the terms of this
Declaration and to the extent applicable, the Institutional Trustee, the
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Delaware Trustee, the Administrators and the Sponsor, by their execution
and delivery of this Declaration, expressly agree to such terms and
provisions and to be bound thereby. Capital Securities will be issued only
in blocks having a stated liquidation amount of not less than $100,000.
(b) The Capital Securities are being offered and sold by the Trust
pursuant to the Purchase Agreement in definitive form, registered in the
name of the Holder thereof, without coupons and with the Restricted
Securities Legend.
SECTION 6.4. Mutilated, Destroyed, Lost or Stolen Certificates. If:
(a) any mutilated Certificates should be surrendered to the Registrar, or
if the Registrar shall receive evidence to its satisfaction of the
destruction, loss or theft of any Certificate; and
(b) there shall be delivered to the Registrar, the Administrators and the
Institutional Trustee such security or indemnity as may be required by
them to keep each of them harmless; then, in the absence of notice that
such Certificate shall have been acquired by a bona fide purchaser, an
Administrator on behalf of the Trust shall execute (and in the case of a
Capital Security Certificate, the Institutional Trustee shall
authenticate) and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of
like denomination. In connection with the issuance of any new Certificate
under this Section 6.4, the Registrar or the Administrators may require
the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection therewith. Any duplicate
Certificate issued pursuant to this Section shall constitute conclusive
evidence of an ownership interest in the relevant Securities, as if
originally issued, whether or not the lost, stolen or destroyed
Certificate shall be found at any time.
SECTION 6.5. Temporary Securities. Until definitive Securities are ready for
delivery, the Administrators may prepare and, in the case of the Capital
Securities, the Institutional Trustee shall authenticate, temporary Securities.
Temporary Securities shall be substantially in form of definitive Securities but
may have variations that the Administrators consider appropriate for temporary
Securities. Without unreasonable delay, the Administrators shall prepare and, in
the case of the Capital Securities, the Institutional Trustee shall authenticate
definitive Securities in exchange for temporary Securities.
SECTION 6.6. Cancellation. The Administrators at any time may deliver Securities
to the Institutional Trustee for cancellation. The Registrar shall forward to
the Institutional Trustee any Securities surrendered to it for registration of
transfer, redemption or payment. The Institutional Trustee shall promptly cancel
all Securities surrendered for registration of transfer, payment, replacement or
cancellation and shall dispose of such canceled Securities as the Administrators
direct. The Administrators may not issue new Securities to replace Securities
that have been paid or that have been delivered to the Institutional Trustee for
cancellation.
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SECTION 6.7. Rights of Holders; Waivers of Past Defaults.
(a) The legal title to the Trust Property is vested exclusively in the
Institutional Trustee (in its capacity as such) in accordance with Section
2.5, and the Holders shall not have any right or title therein other than
the undivided beneficial interest in the assets of the Trust conferred by
their Securities and they shall have no right to call for any partition or
division of property, profits or rights of the Trust except as described
below. The Securities shall be personal property giving only the rights
specifically set forth therein and in this Declaration. The Securities
shall have no, and the issuance of the Securities shall not be subject to,
preemptive or other similar rights and when issued and delivered to
Holders against payment of the purchase price therefor, the Securities
will be fully paid and nonassessable by the Trust.
(b) For so long as any Capital Securities remain outstanding, if, upon an
Indenture Event of Default, the Debenture Trustee fails or the holders of
not less than 25% in principal amount of the outstanding Debentures fail
to declare the principal of all of the Debentures to be immediately due
and payable, the Holders of not less than a Majority in liquidation amount
of the Capital Securities then outstanding shall have the right to make
such declaration by a notice in writing to the Institutional Trustee, the
Sponsor and the Debenture Trustee.
(c) At any time after a declaration of acceleration with respect to the
Debentures has been made and before a judgment or decree for payment of
the money due has been obtained by the Debenture Trustee as provided in
the Indenture, if the Institutional Trustee, subject to the provisions
hereof, fails to annul any such declaration and waive such default, the
Holders of not less than a Majority in liquidation amount of the Capital
Securities, by written notice to the Institutional Trustee, the Sponsor
and the Debenture Trustee, may rescind and annul such declaration and its
consequences if:
(i) the Sponsor has paid or deposited with the Debenture Trustee a
sum sufficient to pay
(A) all overdue installments of interest on all of the
Debentures;
(B) any accrued Deferred Interest on all of the Debentures;
(C) all payments on any Debentures that have become due
otherwise than by such declaration of acceleration and
interest and Deferred Interest thereon at the rate borne by
the Debentures; and
(D) all sums paid or advanced by the Debenture Trustee under
the Indenture and the reasonable compensation, documented
expenses, disbursements and advances of the Debenture Trustee
and the Institutional Trustee, their agents and counsel; and
(ii) all Events of Default with respect to the Debentures, other
than the non-payment of the principal of the Debentures that has
become due solely by
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such acceleration, have been cured or waived as provided in Section
5.07 of the Indenture.
(d) The Holders of not less than a Majority in liquidation amount of the
Capital Securities may, on behalf of the Holders of all the Capital
Securities, waive any past default or Event of Default, except a default
or Event of Default in the payment of principal or interest (unless such
default or Event of Default has been cured and a sum sufficient to pay all
matured installments of interest and principal due otherwise than by
acceleration has been deposited with the Debenture Trustee) or a default
or Event of Default in respect of a covenant or provision that under the
Indenture cannot be modified or amended without the consent of the holder
of each outstanding Debenture. No such rescission shall affect any
subsequent default or impair any right consequent thereon.
(e) Upon receipt by the Institutional Trustee of written notice declaring
such an acceleration, or rescission and annulment thereof, by Holders of
any part of the Capital Securities, a record date shall be established for
determining Holders of outstanding Capital Securities entitled to join in
such notice, which record date shall be at the close of business on the
day the Institutional Trustee receives such notice. The Holders on such
record date, or their duly designated proxies, and only such Persons,
shall be entitled to join in such notice, whether or not such Holders
remain Holders after such record date; provided, that, unless such
declaration of acceleration, or rescission and annulment, as the case may
be, shall have become effective by virtue of the requisite percentage
having joined in such notice prior to the day that is 90 days after such
record date, such notice of declaration of acceleration, or rescission and
annulment, as the case may be, shall automatically and without further
action by any Holder be canceled and of no further effect. Nothing in this
paragraph shall prevent a Holder, or a proxy of a Holder, from giving,
after expiration of such 90-day period, a new written notice of
declaration of acceleration, or rescission and annulment thereof, as the
case may be, that is identical to a written notice that has been canceled
pursuant to the proviso to the preceding sentence, in which event a new
record date shall be established pursuant to the provisions of this
Section 6.7.
(f) Except as otherwise provided in this Section 6.7, the Holders of not
less than a Majority in liquidation amount of the Capital Securities may,
on behalf of the Holders of all the Capital Securities, waive any past
default or Event of Default and its consequences. Upon such waiver, any
such default or Event of Default shall cease to exist, and any default or
Event of Default 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 or impair any right
consequent thereon.
ARTICLE VII
DISSOLUTION AND TERMINATION OF TRUST
SECTION 7.1. Dissolution and Termination of Trust. (a) The Trust shall dissolve
on the first to occur of
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(i) unless earlier dissolved, on March 27, 2038, the expiration of
the term of the Trust;
(ii) a Bankruptcy Event with respect to the Sponsor, the Trust or
the Debenture Issuer;
(iii) (other than in connection with a merger, consolidation or
similar transaction not prohibited by the Indenture, this
Declaration or the Guarantee, as the case may be) the filing of a
certificate of dissolution or its equivalent with respect to the
Sponsor or upon the revocation of the charter of the Sponsor and the
expiration of 90 days after the date of revocation without a
reinstatement thereof;
(iv) the distribution of the Debentures to the Holders of the
Securities, upon exercise of the right of the Holders of all of the
outstanding Common Securities to dissolve the Trust as provided in
Annex I hereto;
(v) the entry of a decree of judicial dissolution of any Holder of
the Common Securities, the Sponsor, the Trust or the Debenture
Issuer;
(vi) 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; or
(vii) before the issuance of any Securities, with the consent of all
of the Trustees and the Sponsor.
(b) As soon as is practicable after the occurrence of an event referred to
in Section 7.1(a), and after satisfaction of liabilities to creditors of
the Trust as required by applicable law, including Section 3808 of the
Statutory Trust Act, and subject to the terms set forth in Annex I, the
Institutional Trustee shall terminate the Trust by filing a certificate of
cancellation with the Secretary of State of the State of Delaware.
(c) The provisions of Section 2.9 and Article IX shall survive the
termination of the Trust.
ARTICLE VIII
TRANSFER OF INTERESTS
SECTION 8.1. General. (a) Where Capital Securities are presented to the
Registrar with a request to register a transfer or to exchange them for an equal
number of Capital Securities represented by different Certificates, the
Registrar shall register the transfer or make the exchange if its requirements
for such transactions are met. To permit registrations of transfers and
exchanges, the Trust shall issue and the Institutional Trustee shall
authenticate Capital Securities at the Registrar's request.
(b) Upon issuance of the Common Securities, the Sponsor shall acquire and
retain beneficial and record ownership of the Common Securities and, for
so long as the Securities remain outstanding, the Sponsor shall maintain
100% ownership of the
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Common Securities; provided, however, that any permitted successor of the
Sponsor under the Indenture that is a U.S. Person may succeed to the
Sponsor's ownership of the Common Securities.
(c) Capital Securities may only be transferred, in whole or in part, in
accordance with the terms and conditions set forth in this Declaration and
in the terms of the Capital Securities. To the fullest extent permitted by
applicable law, any transfer or purported transfer of any Security not
made in accordance with this Declaration shall be null and void and will
be deemed to be of no legal effect whatsoever and any such transferee
shall be deemed not to be the holder of such Capital Securities for any
purpose, including but not limited to the receipt of Distributions on such
Capital Securities, and such transferee shall be deemed to have no
interest whatsoever in such Capital Securities.
(d) The Registrar shall provide for the registration of Securities and of
transfers of Securities, which will be effected without charge but only
upon payment (with such indemnity as the Registrar 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
Registrar shall cause one or more new Securities to be issued in the name
of the designated transferee or transferees. Any Security issued upon any
registration of 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 Security surrendered upon such
registration of transfer or exchange. Every Security surrendered for
registration of transfer shall be accompanied by a written instrument of
transfer in form similar to Exhibits B and C attached hereto satisfactory
to 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 Institutional Trustee pursuant to
Section 6.6. 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.
(e) Neither the Trust nor the Registrar shall be required (i) to issue,
register the transfer of, or exchange any Securities during a period
beginning at the opening of business 15 days before the day of any
selection of Securities for redemption and ending at the close of business
on the earliest date on which the relevant notice of redemption is deemed
to have been given to all Holders of the Securities to be redeemed, or
(ii) to register the transfer or exchange of any Security so selected for
redemption in whole or in part, except the unredeemed portion of any
Security being redeemed in part.
SECTION 8.2. Transfer Procedures and Restrictions.
(a) The Capital Securities shall bear the Restricted Securities Legend (as
defined below), which shall not be removed unless there is delivered to
the Trust such satisfactory evidence, which may include an opinion of
counsel reasonably acceptable to the Institutional Trustee, as may be
reasonably required by the Trust, that neither the legend nor the
restrictions on transfer set forth therein are required to ensure that
transfers thereof comply with the provisions of the Securities Act or that
such Securities are not
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"restricted" within the meaning of Rule 144 under the Securities Act. Upon
provision of such satisfactory evidence, the Institutional Trustee, at the
written direction of the Trust, shall authenticate and deliver Capital
Securities that do not bear the Restricted Securities Legend.
(b) When Capital Securities are presented to the Registrar (x) to register
the transfer of such Capital Securities, or (y) to exchange such Capital
Securities for an equal number of Capital Securities represented by
different Certificates, the Registrar shall register the transfer or make
the exchange as requested if its reasonable requirements for such
transaction are met; provided, however, that the Capital Securities
surrendered for registration of transfer or exchange shall, other than in
connection with a transfer by the Initial Purchaser, be duly endorsed or
accompanied by a written instrument of transfer in form reasonably
satisfactory to the Trust and the Registrar, duly executed by the Holder
thereof or his attorney duly authorized in writing and (i) if such Capital
Securities are being transferred to a QIB, accompanied by a certificate of
the transferor substantially in the form set forth as Exhibit C hereto or
(ii) if such Capital Securities are being transferred otherwise than to a
QIB, accompanied by a certificate of the transferee substantially in the
form set forth as Exhibit B hereto.
(c) Except as permitted by Section 8.2(a), each Capital Security shall
bear a legend (the "Restricted Securities Legend") in substantially the
following form:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS OR ANY OTHER
APPLICABLE SECURITIES LAWS. NEITHER THIS 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, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS SECURITY BY ITS
ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY ONLY
(A) TO THE DEBENTURE ISSUER OR THE TRUST, (B) PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT ("RULE 144A"), TO A PERSON THE HOLDER REASONABLY BELIEVES IS A
"QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS
OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE
IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) PURSUANT
TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT TO AN
"ACCREDITED INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH (a) (1), (2), (3) OR
(7) OF RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THE SECURITY FOR ITS
OWN ACCOUNT, OR FOR THE ACCOUNT OF AN "ACCREDITED INVESTOR," FOR INVESTMENT
PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (D) PURSUANT TO ANOTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
SUBJECT TO THE DEBENTURE ISSUER'S AND THE TRUST'S RIGHT PRIOR TO ANY SUCH OFFER,
SALE OR TRANSFER PURSUANT TO CLAUSES
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(C) OR (D) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION
AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM IN ACCORDANCE WITH THE
AMENDED AND RESTATED DECLARATION OF TRUST, A COPY OF WHICH MAY BE OBTAINED FROM
THE DEBENTURE ISSUER OR THE TRUST. THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE
HEREOF AGREES THAT IT WILL COMPLY WITH THE FOREGOING RESTRICTIONS.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES, REPRESENTS
AND WARRANTS THAT IT WILL NOT ENGAGE IN HEDGING TRANSACTIONS INVOLVING THIS
SECURITY UNLESS SUCH TRANSACTIONS ARE IN COMPLIANCE WITH THE SECURITIES ACT.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF ALSO AGREES,
REPRESENTS AND WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT, INDIVIDUAL
RETIREMENT ACCOUNT OR OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"),
(EACH A "PLAN"), OR AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE "PLAN ASSETS" BY
REASON OF ANY PLAN'S INVESTMENT IN THE ENTITY AND NO PERSON INVESTING "PLAN
ASSETS" OF ANY PLAN MAY ACQUIRE OR HOLD THIS SECURITY OR ANY INTEREST THEREIN,
UNLESS SUCH PURCHASER OR HOLDER IS ELIGIBLE FOR THE EXEMPTION RELIEF AVAILABLE
UNDER U.S. DEPARTMENT OF LABOR PROHIBITED TRANSACTION CLASS EXEMPTION
96-23,95-60,91-38,90-1 OR 84-14 OR ANOTHER APPLICABLE EXEMPTION OR ITS PURCHASE
AND HOLDING OF THIS SECURITY IS NOT PROHIBITED BY SECTION 406 OF ERISA OR
SECTION 4975 OF THE CODE WITH RESPECT TO SUCH PURCHASE OR HOLDING. ANY PURCHASER
OR HOLDER OF THIS SECURITY OR ANY INTEREST THEREIN WILL BE DEEMED TO HAVE
REPRESENTED BY ITS PURCHASE AND HOLDING THEREOF THAT EITHER (i) IT IS NOT AN
EMPLOYEE BENEFIT PLAN WITHIN THE MEANING OF SECTION 3(3) OF ERISA, OR A PLAN TO
WHICH SECTION 4975 OF THE CODE IS APPLICABLE, A TRUSTEE OR OTHER PERSON ACTING
ON BEHALF OF AN EMPLOYEE BENEFIT PLAN OR PLAN, OR ANY OTHER PERSON OR ENTITY
USING THE ASSETS OF ANY EMPLOYEE BENEFIT PLAN OR PLAN TO FINANCE SUCH PURCHASE,
OR (ii) SUCH PURCHASE WILL NOT RESULT IN A PROHIBITED TRANSACTION UNDER SECTION
406 OF ERISA OR SECTION 4975 OF THE CODE FOR WHICH THERE IS NO APPLICABLE
STATUTORY OR ADMINISTRATIVE EXEMPTION.
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR
AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS MAY BE REQUIRED BY
THE AMENDED AND RESTATED DECLARATION OF TRUST TO CONFIRM THAT THE TRANSFER
COMPLIES WITH THE FOREGOING RESTRICTIONS.
THIS SECURITY WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS HAVING
A LIQUIDATION AMOUNT OF NOT LESS THAN $100,000 AND MULTIPLES OF $1,000 IN EXCESS
THEREOF. ANY ATTEMPTED TRANSFER OF THIS
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SECURITY IN A BLOCK HAVING A LIQUIDATION AMOUNT OF LESS THAN $100,000 SHALL BE
DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER. ANY SUCH PURPORTED
TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER OF THIS SECURITY FOR ANY
PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS
SECURITY, AND SUCH PURPORTED TRANSFEREE SHALL BE DEEMED TO HAVE NO INTEREST
WHATSOEVER IN THIS SECURITY.
(d) Capital Securities may only be transferred in minimum blocks of
$100,000 aggregate liquidation amount (100 Capital Securities) and
multiples of $1,000 in excess thereof. Any attempted transfer of Capital
Securities in a block having an aggregate liquidation amount of less than
$100,000 shall be deemed to be void and of no legal effect whatsoever. Any
such purported transferee shall be deemed not to be a Holder of such
Capital Securities for any purpose, including, but not limited to, the
receipt of Distributions on such Capital Securities, and such purported
transferee shall be deemed to have no interest whatsoever in such Capital
Securities.
(e) Each party hereto understands and hereby agrees that the Initial
Purchaser is intended solely to be an interim holder of the Capital
Securities and is purchasing such securities to facilitate consummation of
the transactions contemplated herein and in the documents ancillary
hereto. Notwithstanding any provision in this Declaration to the contrary,
the Initial Purchaser shall have the right upon notice (a "Transfer
Notice") to the Institutional Trustee and the Sponsor to transfer title in
and to the Capital Securities, provided the Initial Purchaser shall take
reasonable steps to ensure that such transfer is exempt from registration
under the Securities Act of 1933, as amended, and rules promulgated
thereunder. Any Transfer Notice delivered to the Institutional Trustee and
Sponsor pursuant to the preceding sentence shall indicate the aggregate
liquidation amount of Capital Securities being transferred, the name and
address of the transferee thereof (the "Transferee") and the date of such
transfer. Notwithstanding any provision in this Declaration to the
contrary, the transfer by the Initial Purchaser of title in and to the
Capital Securities pursuant to a Transfer Notice shall not be subject to
any requirement relating to Opinions of Counsel, Certificates of Transfer
or any other Opinion or Certificate applicable to transfers hereunder and
relating to Capital Securities. To facilitate transfers by the Initial
Purchaser pursuant to this Section 8.2(e), an Administrator shall cause to
be delivered to the Institutional Trustee on the Closing Date a number of
Capital Securities Certificates executed in blank equal to the number of
Capital Securities Certificates delivered to Initial Purchaser upon the
Closing Date (the "Blank Certificates") to be held by the Institutional
Trustee pending receipt by the Institutional Trustee of one or more
Transfer Notices from the Initial Purchaser. Upon receipt of any such
Transfer Notice from the Initial Purchaser, the Institutional Trustee is
hereby and thereby authorized to, and shall thereupon, complete a Blank
Certificate with the information provided in such Transfer Notice and
hereby and thereby is authorized to, and shall thereupon, authenticate the
Capital Security Certificate so completed and cause the same to be
delivered to the Transferee.
SECTION 8.3. Deemed Security Holders. The Trust, the Administrators, the
Trustees, the Paying Agent, the Transfer Agent or the Registrar may treat the
Person in whose name any
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Certificate shall be registered on the books and records of the Trust as the
sole holder of such Certificate and of the Securities represented by such
Certificate for purposes of receiving Distributions and for all other purposes
whatsoever and, accordingly, shall not be bound to recognize any equitable or
other claim to or interest in such Certificate or in the Securities represented
by such Certificate on the part of any Person, whether or not the Trust, the
Administrators, the Trustees, the Paying Agent, the Transfer Agent or the
Registrar shall have actual or other notice thereof.
ARTICLE IX
LIMITATION OF LIABILITY OF HOLDERS
OF SECURITIES, TRUSTEES OR OTHERS
SECTION 9.1. Liability. (a) Except as expressly set forth in this Declaration,
the Guarantee 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
(ii) required to pay to the Trust or to any Holder of the Securities
any deficit upon dissolution of the Trust or otherwise.
(b) The Holder of the Common Securities shall be liable for all of the
debts and obligations of the Trust (other than with respect to the
Securities) to the extent not satisfied out of the Trust's assets.
(c) Pursuant to ss. 3803(a) of the Statutory Trust Act, the Holders of the
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, except as
otherwise specifically set forth herein.
SECTION 9.2. Exculpation. (a) No Indemnified Person shall be liable, responsible
or accountable in damages or otherwise to the Trust or any Covered Person for
any loss, damage or claim incurred by reason of any act or omission performed or
omitted by such Indemnified Person in good faith on behalf of the Trust and in a
manner such Indemnified Person reasonably believed to be within the scope of the
authority conferred on such Indemnified Person by this Declaration or by law,
except that an Indemnified Person (other than an Administrator) shall be liable
for any such loss, damage or claim incurred by reason of such Indemnified
Person's negligence or willful misconduct with respect to such acts or omissions
and except that an Administrator shall be liable for any such loss, damage or
claim incurred by reason of such Administrator'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
by or on behalf of the Trust, including information, opinions, reports or
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statements as to the value and amount of the assets, liabilities, profits,
losses or any other facts pertinent to the existence and amount of assets
from which Distributions to Holders of Securities might properly be paid.
SECTION 9.3. Fiduciary Duty. (a) To the extent that, at law or in equity, an
Indemnified Person has duties (including fiduciary duties) and liabilities
relating thereto to the Trust or to any other Covered Person, an Indemnified
Person acting under this Declaration shall not be liable to the Trust or to any
other Covered Person for its good faith reliance on the provisions of this
Declaration. The provisions of this Declaration, to the extent that they
restrict the duties and liabilities of an Indemnified Person otherwise existing
at law or in equity (other than the duties imposed on the Institutional Trustee
under the Trust Indenture Act), are agreed by the parties hereto to replace such
other duties and liabilities of the Indemnified Person.
(b) Whenever in this Declaration an Indemnified Person is permitted or
required to make a decision:
(i) in its "discretion" or under a grant of similar authority, the
Indemnified Person shall be entitled to consider such interests and
factors as it desires, including its own interests, and shall have
no duty or obligation to give any consideration to any interest of
or factors affecting the Trust or any other Person; or
(ii) in its "good faith" or under another express standard, the
Indemnified Person shall act under such express standard and shall
not be subject to any other or different standard imposed by this
Declaration or by applicable law.
SECTION 9.4. Indemnification. (a) (i) The Sponsor shall indemnify, to the
fullest extent permitted by law, any 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 such Person is or was an Indemnified Person against expenses (including
attorneys' fees and expenses), judgments, fines and amounts paid in settlement
actually and reasonably incurred by such Person in connection with such action,
suit or proceeding if such Person acted in good faith and in a manner such
Person 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 such 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 Indemnified Person did not act in good faith and in a manner which such
Person 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 such conduct was unlawful.
(ii) The Sponsor shall indemnify, to the fullest extent permitted by
law, any 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 such Person
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is or was an Indemnified Person against expenses (including
attorneys' fees and expenses) actually and reasonably incurred by
such Person in connection with the defense or settlement of such
action or suit if such Person acted in good faith and in a manner
such Person 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
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 an Indemnified Person shall be successful
on the merits or otherwise (including dismissal of an action without
prejudice or the settlement of an action without admission of
liability) in defense of any action, suit or proceeding referred to
in paragraphs (i) and (ii) of this Section 9.4(a), or in defense of
any claim, issue or matter therein, such Person shall be
indemnified, to the fullest extent permitted by law, against
expenses (including attorneys' fees and expenses) actually and
reasonably incurred by such Person in connection therewith.
(iv) Any indemnification of an Administrator under paragraphs (i)
and (ii) of this Section 9.4(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 Indemnified Person is
proper in the circumstances because such Person has met the
applicable standard of conduct set forth in paragraphs (i) and (ii).
Such determination shall be made (A) by the Administrators by a
majority vote of a Quorum consisting of such Administrators who were
not parties to such action, suit or proceeding, (B) 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 (C) by the Common Security Holder
of the Trust.
(v) To the fullest extent permitted by law, expenses (including
attorneys' fees and expenses) incurred by an Indemnified Person in
defending a civil, criminal, administrative or investigative action,
suit or proceeding referred to in paragraphs (i) and (ii) of this
Section 9.4(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 Indemnified Person to repay such
amount if it shall ultimately be determined that such Person is not
entitled to be indemnified by the Sponsor as authorized in this
Section 9.4(a). Notwithstanding the foregoing, no advance shall be
made by the Sponsor if a determination is reasonably and promptly
made (1) in the case of a Company Indemnified Person (A) by the
Administrators by a majority vote of a Quorum of disinterested
Administrators, (B) 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 (C) by the
Common Security Holder of the Trust, that,
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based upon the facts known to the Administrators, counsel or the
Common Security Holder at the time such determination is made, such
Indemnified Person acted in bad faith or in a manner that such
Person either believed to be opposed to or did not believe to be in
the best interests of the Trust, or, with respect to any criminal
proceeding, that such Indemnified Person believed or had reasonable
cause to believe such conduct was unlawful, or (2) in the case of a
Fiduciary Indemnified Person, by independent legal counsel in a
written opinion that, based upon the facts known to the counsel at
the time such determination is made, such Indemnified Person acted
in bad faith or in a manner that such Indemnified Person either
believed to be opposed to or did not believe to be in the best
interests of the Trust, or, with respect to any criminal proceeding,
that such Indemnified Person believed or had reasonable cause to
believe such conduct was unlawful. In no event shall any advance be
made (i) to a Company Indemnified Person in instances where the
Administrators, independent legal counsel or the Common Security
Holder reasonably determine that such Person deliberately breached
such Person's duty to the Trust or its Common or Capital Security
Holders or (ii) to a Fiduciary Indemnified Person in instances where
independent legal counsel promptly and reasonably determines in a
written opinion that such Person deliberately breached such Person's
duty to the Trust or its Common or Capital Security Holders.
(b) The Sponsor shall indemnify, to the fullest extent permitted by
applicable law, each Indemnified Person from and against any and all loss,
damage, liability, tax (other than taxes based on the income of such
Indemnified Person), penalty, expense or claim of any kind or nature
whatsoever incurred by such Indemnified Person arising out of or in
connection with or by reason of the creation, administration or
termination of the Trust, or any act or omission of such Indemnified
Person in good faith on behalf of the Trust and in a manner such
Indemnified Person reasonably believed to be within the scope of authority
conferred on such Indemnified Person by this Declaration, except that no
Indemnified Person shall be entitled to be indemnified in respect of any
loss, damage, liability, tax, penalty, expense or claim incurred by such
Indemnified Person by reason of negligence or willful misconduct with
respect to such acts or omissions.
(c) The indemnification and advancement of expenses provided by, or
granted pursuant to, the other paragraphs of this Section 9.4 shall not be
deemed exclusive of any other rights to which those seeking
indemnification and advancement of expenses may be entitled under any
agreement, vote of stockholders or disinterested directors of the Sponsor
or Capital Security Holders of the Trust or otherwise, both as to action
in such Person's official capacity and as to action in another capacity
while holding such office. All rights to indemnification under this
Section 9.4 shall be deemed to be provided by a contract between the
Sponsor and each Indemnified Person who serves in such capacity at any
time while this Section 9.4 is in effect. Any repeal or modification of
this Section 9.4 shall not affect any rights or obligations then existing.
(d) The Sponsor or the Trust may purchase and maintain insurance on behalf
of any Person who is or was an Indemnified Person against any liability
asserted against such Person and incurred by such Person in any such
capacity, or arising out of such
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Person's status as such, whether or not the Sponsor would have the power
to indemnify such Person against such liability under the provisions of
this Section 9.4.
(e) For purposes of this Section 9.4, 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 9.4 with respect to the
resulting or surviving entity as such Person would have with respect to
such constituent entity if its separate existence had continued.
(f) The indemnification and advancement of expenses provided by, or
granted pursuant to, this Section 9.4 shall, unless otherwise provided
when authorized or ratified, continue as to a Person who has ceased to be
an Indemnified Person and shall inure to the benefit of the heirs,
executors and administrators of such a Person.
(g) The provisions of this Section 9.4 shall survive the termination of
this Declaration or the earlier resignation or removal of the
Institutional Trustee. The obligations of the Sponsor under this Section
9.4 to compensate and indemnify the Trustees and to pay or reimburse the
Trustees for expenses, disbursements and advances shall constitute
additional indebtedness hereunder. Such additional indebtedness shall be
secured by a lien prior to that of the Securities upon all property and
funds held or collected by the Trustees as such, except funds held in
trust for the benefit of the holders of particular Capital Securities,
provided, that the Sponsor is the holder of the Common Securities.
SECTION 9.5. Outside Businesses. Any Covered Person, the Sponsor, the Delaware
Trustee and the Institutional Trustee (subject to Section 4.3(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 of Securities shall have no rights by
virtue of this Declaration in and to such independent ventures or the income or
profits derived therefrom, and the pursuit of any such venture, even if
competitive with the business of the Trust, shall not be deemed wrongful or
improper. None of any Covered Person, the Sponsor, the Delaware Trustee or the
Institutional Trustee shall be obligated to present any particular investment or
other opportunity to the Trust even if such opportunity is of a character that,
if presented to the Trust, could be taken by the Trust, and any Covered Person,
the Sponsor, the Delaware Trustee and the Institutional Trustee shall have the
right to take for its own account (individually or as a partner or fiduciary) or
to recommend to others any such particular investment or other opportunity. Any
Covered Person, the Delaware Trustee and the Institutional Trustee may engage or
be interested in any financial or other transaction with the Sponsor or any
Affiliate of the Sponsor, or may act as depositary for, trustee or agent for, or
act on any committee or body of holders of, securities or other obligations of
the Sponsor or its Affiliates.
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SECTION 9.6. Compensation; Fee. (a) The Sponsor agrees:
(i) to pay to the Trustees from time to time such compensation for
all services rendered by them hereunder as the parties shall agree
in writing 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
(ii) except as otherwise expressly provided herein, to reimburse the
Trustees upon request for all reasonable, documented expenses,
disbursements and advances incurred or made by the Trustees in
accordance with any provision of this Declaration (including the
reasonable compensation and the expenses and disbursements of their
respective agents and counsel), except any such expense,
disbursement or advance attributable to their negligence or willful
misconduct.
(b) The provisions of this Section 9.6 shall survive the dissolution of
the Trust and the termination of this Declaration and the removal or
resignation of any Trustee.
ARTICLE X
ACCOUNTING
SECTION 10.1. Fiscal Year. The fiscal year (the "Fiscal Year") of the Trust
shall be the calendar year, or such other year as is required by the Code.
SECTION 10.2. Certain Accounting Matters.
(a) At all times during the existence of the Trust, the Administrators
shall keep, or cause to be kept at the principal office of the Trust in
the United States, as defined for purposes of Treasury Regulations ss.
301.7701-7, 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.
(b) The Administrators shall either (i) cause each Form 10-K and Form 10-Q
prepared by the Sponsor and filed with the Commission in accordance with
the Exchange Act to be delivered to each Holder of Securities, within 90
days after the filing of each Form 10-K and within 30 days after the
filing of each Form 10-Q or (ii) cause to be prepared at the principal
office of the Trust in the United States, as defined for purposes of
Treasury Regulations ss. 301.7701-7, and delivered to each of the Holders
of Securities, 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 of Securities Form 1099 or such other 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
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later date, the Administrators shall endeavor to deliver all such
statements within 30 days after the end of each Fiscal Year of the Trust.
(d) The Administrators shall cause to be duly prepared in the United
States, as defined for purposes of Treasury Regulations ss. 301.7701-7,
and filed 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.
(e) So long as the only Holder of the Capital Securities is Bear Stearns
Securities Corp., the Administrators will cause the Sponsor's reports on
Form FRY-9SP to be delivered to the Holder promptly following their filing
with the Federal Reserve.
SECTION 10.3. Banking. The Trust shall maintain one or more bank accounts in the
United States, as defined for purposes of Treasury Regulations ss. 301.7701-7,
in the name and for the sole benefit of the Trust; provided, however, that all
payments of funds in respect of the Debentures held by the Institutional Trustee
shall be made directly to the Property Account and no other funds of the Trust
shall be deposited in the Property Account. The sole signatories for such
accounts (including the Property Account) shall be designated by the
Institutional Trustee.
SECTION 10.4. Withholding. The Institutional Trustee or any Paying Agent and the
Administrators shall comply with all withholding requirements under United
States federal, state and local law. The Institutional Trustee or any Paying
Agent shall request, and each Holder shall provide to the Institutional Trustee
or any Paying Agent, such forms or certificates as are necessary to establish an
exemption from withholding with respect to the Holder, and any representations
and forms as shall reasonably be requested by the Institutional Trustee or any
Paying Agent 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 Institutional Trustee or any
Paying Agent 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 to the Holder in the amount of the
withholding. In the event of any claimed overwithholding, 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
Institutional Trustee or any Paying Agent may reduce subsequent Distributions by
the amount of such withholding.
ARTICLE XI
AMENDMENTS AND MEETINGS
SECTION 11.1. 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:
(i) the Institutional Trustee,
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(ii) if the amendment affects the rights, powers, duties,
obligations or immunities of the Delaware Trustee, the Delaware
Trustee,
(iii) if the amendment affects the rights, powers, duties,
obligations or immunities of the Administrators, the Administrators,
and
(iv) the Holders of a Majority in liquidation amount of the Common
Securities.
(b) Notwithstanding any other provision of this Article XI, no amendment
shall be made, and any such purported amendment shall be void and
ineffective:
(i) unless the Institutional Trustee shall have first received
(A) an Officers' Certificate from each of the Trust and the
Sponsor that such amendment is permitted by, and conforms to,
the terms of this Declaration (including the terms of the
Securities); and
(B) an opinion of counsel (who may be counsel to the Sponsor
or the Trust) that such amendment is permitted by, and
conforms to, the terms of this Declaration (including the
terms of the Securities) and that all conditions precedent to
the execution and delivery of such amendment have been
satisfied; or
(ii) if the result of such amendment would be to
(A) cause the Trust to cease to be classified for purposes of
United States federal income taxation as a grantor trust;
(B) reduce or otherwise adversely affect the powers of the
Institutional Trustee in contravention of the Trust Indenture
Act;
(C) cause the Trust to be deemed to be an Investment Company
required to be registered under the Investment Company Act; or
(D) cause the Debenture Issuer to be unable to treat an amount
equal to the Liquidation Amount of the Debentures as "Tier 1
Capital" or its then equivalent for purposes of the capital
adequacy guidelines of the Federal Reserve; provided, that the
Debenture Issuer shall have become, or pursuant to law or
regulation will become within 180 days, subject to capital
requirements.
(c) Except as provided in Section 11.1(d), (e) or (g), no amendment shall
be made, and any such purported amendment shall be void and ineffective,
unless the Holders of a Majority in liquidation amount of the Capital
Securities shall have consented to such amendment.
(d) In addition to and notwithstanding any other provision in this
Declaration, without the consent of each affected Holder, this Declaration
may not be amended to (i) change the amount or timing of any Distribution
on the Securities or otherwise adversely
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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 to institute suit for the enforcement of any such payment on or
after such date.
(e) Sections 9.1 (b) and 9.1 (c) and this Section 11.1 shall not be
amended without the consent of all of the Holders of the Securities.
(f) The rights of the Holders of the Capital Securities and Common
Securities, as applicable, under Article IV to increase or decrease the
number of, and appoint and remove, Trustees shall not be amended without
the consent of the Holders of a Majority in liquidation amount of the
Capital Securities or Common Securities, as applicable.
(g) This Declaration may be amended by the Institutional Trustee and the
Holder of a Majority in liquidation amount of the Common Securities
without the consent of the Holders of the Capital Securities to:
(i) cure any ambiguity;
(ii) correct or supplement any provision in this Declaration that
may be defective or inconsistent with any other provision of this
Declaration;
(iii) add to the covenants, restrictions or obligations of the
Sponsor; or
(iv) modify, eliminate or add to any provision of this Declaration
to such extent as may be necessary or desirable, including, without
limitation, to ensure that the Trust will be classified for United
States federal income tax purposes at all times as a grantor trust
and will not be required to register as an Investment Company under
the Investment Company Act (including without limitation to conform
to any change in Rule 3a-5, Rule 3a-7 or any other applicable rule
under the Investment Company Act or written change in interpretation
or application thereof by any legislative body, court, government
agency or regulatory authority) which amendment does not have a
material adverse effect on the right, preferences or privileges of
the Holders of Securities;
provided, however, that no such modification, elimination or addition referred
to in clauses (i), (ii), (iii) or (iv) shall adversely affect the powers,
preferences or rights of Holders of Capital Securities.
SECTION 11.2. Meetings of the Holders of the Securities; 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, if any. The Administrators shall call a meeting of the Holders of
such class if directed to do so by the Holders of not less than 10% in
liquidation amount of such class of Securities. Such
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direction shall be given by delivering to the Administrators one or more
calls in a writing stating that the signing Holders of the Securities wish
to call a meeting and indicating the general or specific purpose for which
the meeting is to be called. Any Holders of the Securities calling a
meeting shall specify in writing the Certificates held by the Holders of
the Securities exercising the right to call a meeting and only those
Securities represented by such Certificates 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
the Securities:
(i) notice of any such meeting shall be given to all the Holders of
the Securities having a right to vote thereat at least 7 days and
not more than 60 days before the date of such meeting. Whenever a
vote, consent or approval of the Holders of the Securities 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, if any, such vote, consent or approval may be
given at a meeting of the Holders of the Securities. Any action that
may be taken at a meeting of the Holders of the Securities may be
taken without a meeting if a consent in writing setting forth the
action so taken is signed by the Holders of the Securities owning
not less than the minimum amount of Securities that would be
necessary to authorize or take such action at a meeting at which all
Holders of the Securities having a right to vote thereon were
present and voting. Prompt notice of the taking of action without a
meeting shall be given to the Holders of the Securities entitled to
vote who have not consented in writing. The Administrators may
specify that any written ballot submitted to the Holders of the
Securities 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 of a Security may authorize any Person to act for
it by proxy on all matters in which a Holder of Securities is
entitled to participate, including waiving notice of any meeting, or
voting or participating at a meeting. No proxy shall be valid after
the expiration of 11 months from the date thereof unless otherwise
provided in the proxy. Every proxy shall be revocable at the
pleasure of the Holder of the Securities executing it. Except as
otherwise provided herein, all matters relating to the giving,
voting or validity of proxies shall be governed by the General
Corporation Law of the State of Delaware relating to proxies, and
judicial interpretations thereunder, as if the Trust were a Delaware
corporation and the Holders of the Securities were stockholders of a
Delaware corporation; each meeting of the Holders of the Securities
shall be conducted by the Administrators or by such other Person
that the Administrators may designate; and
(iii) unless the Statutory 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 for
trading, if any, otherwise provides, the Administrators, in their
sole discretion, shall establish all other provisions
-48-
relating to meetings of Holders of Securities, including notice of
the time, place or purpose of any meeting at which any matter is to
be voted on by any Holders of the 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; provided, however, that each meeting shall be conducted in the
United States (as that term is defined in Treasury Regulations ss.
301.7701-7).
ARTICLE XII
REPRESENTATIONS OF INSTITUTIONAL TRUSTEE
AND DELAWARE TRUSTEE
SECTION 12.1. Representations and Warranties of Institutional Trustee. The
Trustee that acts as initial Institutional Trustee represents and warrants to
the Trust and to the Sponsor at the date of this Declaration, and each Successor
Institutional Trustee represents and warrants to the Trust and the Sponsor at
the time of the Successor Institutional Trustee's acceptance of its appointment
as Institutional Trustee, that:
(a) the Institutional Trustee is a banking corporation or national
association with trust powers, duly organized, validly existing and in
good standing under the laws of the State of Delaware or the United States
of America, respectively, 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 Institutional Trustee has a combined capital and surplus of at
least fifty million U.S. dollars ($50,000,000);
(c) the Institutional Trustee is not an affiliate of the Sponsor, nor does
the Institutional Trustee offer or provide credit or credit enhancement to
the Trust;
(d) the execution, delivery and performance by the Institutional Trustee
of this Declaration has been duly authorized by all necessary action on
the part of the Institutional Trustee. This Declaration has been duly
executed and delivered by the Institutional Trustee, and under Delaware
law (excluding any securities laws) constitutes a legal, valid and binding
obligation of the Institutional Trustee, enforceable against it in
accordance with its terms, subject to applicable bankruptcy,
reorganization, moratorium, insolvency and other similar laws affecting
creditors' rights generally and to general principles of equity and the
discretion of the court (regardless of whether considered in a proceeding
in equity or at law);
(e) the execution, delivery and performance of this Declaration by the
Institutional Trustee does not conflict with or constitute a breach of the
charter or by-laws of the Institutional Trustee; and
(f) no consent, approval or authorization of, or registration with or
notice to, any state or federal banking authority governing the trust
powers of the Institutional Trustee is required for the execution,
delivery or performance by the Institutional Trustee of this Declaration.
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SECTION 12.2. Representations and Warranties of Delaware Trustee. The Trustee
that acts as initial Delaware Trustee represents and warrants to the Trust and
to the Sponsor at the date of this Declaration, and each Successor Delaware
Trustee represents and warrants to the Trust and the Sponsor at the time of the
Successor Delaware Trustee's acceptance of its appointment as Delaware Trustee
that:
(a) if it is not a natural person, the Delaware Trustee is duly organized,
validly existing and in good standing under the laws of the State of
Delaware;
(b) if it is not a natural person, 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 under Delaware law (excluding any securities laws) 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 considered in a proceeding
in equity or at law);
(c) if it is not a natural person, the execution, delivery and performance
of this Declaration by the Delaware Trustee does not conflict with or
constitute a breach of the charter or by-laws of the Delaware Trustee;
(d) it has trust power and authority to execute and deliver, and to carry
out and perform its obligations under the terms of, this Declaration;
(e) no consent, approval or authorization of, or registration with or
notice to, any state or federal banking authority governing the trust
powers of the Delaware Trustee is required for the execution, delivery or
performance by the Delaware Trustee of this Declaration; and
(f) the Delaware Trustee is a natural person who is a resident of the
State of Delaware or, if not a natural person, it is an entity which has
its principal place of business in the State of Delaware and, in either
case, a Person that satisfies for the Trust the requirements of Section
3807 of the Statutory Trust Act.
ARTICLE XIII
MISCELLANEOUS
SECTION 13.1. 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 (which telecopy shall be followed by notice delivered or mailed by
first class mail) 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 of the Securities):
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Valley Commerce Trust I
c/o Valley Commerce Bancorp
200 S. Court St.
Visalia, California 93291
Attention: Roy O. Estridge
Telecopy: (559) 740-0747
Telephone: (559) 622-9000
(b) if given to the Delaware Trustee, at the mailing address set forth
below (or such other address as the Delaware Trustee may give notice of to
the Holders of the Securities):
Wells Fargo Delaware Trust Company
919 Market Street Suite 700
Wilmington, DE 19801
Attention: Corporate Trust Division
Telecopy: 302-575-2006
Telephone: 302-575-2005
(c) if given to the Institutional Trustee, at the Institutional Trustee's
mailing address set forth below (or such other address as the
Institutional Trustee may give notice of to the Holders of the
Securities):
Wells Fargo Bank, National Association
919 Market Street Suite 700
Wilmington, DE 19801
Attention: Corporate Trust Division
Telecopy: 302-575-2006
Telephone: 302-575-2005
(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 of to the Trust):
Valley Commerce Bancorp
200 S. Court St.
Visalia, California 93291
Attention: Roy O. Estridge
Telecopy: (559) 740-0747
Telephone: (559) 622-9000
(e) if given to any other Holder, at the address set forth on the books
and records of the Trust.
All such notices shall be deemed to have been given when received in person,
telecopied with receipt confirmed, or mailed by first class mail, postage
prepaid, except that if a notice or other document is refused delivery or cannot
be delivered because of a changed address of which no
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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 13.2. Governing Law. This Declaration and the rights and obligations of
the parties hereunder shall be governed by and interpreted in accordance with
the law of the State of Delaware and all rights, obligations and remedies shall
be governed by such laws without regard to the 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.
SECTION 13.3. Submission to Jurisdiction.
(a) Each of the parties hereto agrees that any suit, action or proceeding
arising out of or based upon this Declaration, or the transactions
contemplated hereby, may be instituted in any of the courts of the State
of New York the United States District Courts and in each case located in
the Borough of Manhattan, City and State of New York, and further agrees
to submit to the jurisdiction of Delaware, and to any actions that are
instituted in state or Federal court in Wilmington, Delaware and any
competent court in the place of its corporate domicile in respect of
actions brought against it as a defendant. In addition, each such party
irrevocably waives, to the fullest extent permitted by law, any objection
which it may now or hereafter have to the laying of the venue of such
suit, action or proceeding brought in any such court and irrevocably
waives any claim that any such suit, action or proceeding brought in any
such court has been brought in an inconvenient forum and irrevocably
waives any right to which it may be entitled on account of its place of
corporate domicile. Each such party hereby irrevocably waives any and all
right to trial by jury in any legal proceeding arising out of or relating
to this Declaration or the transactions contemplated hereby. Each such
party agrees that final judgment in any proceedings brought in such a
court shall be conclusive and binding upon it and may be enforced in any
court to the jurisdiction of which it is subject by a suit upon such
judgment.
(b) Each of the Sponsor, the Trustees, the Administrators and the Holder
of the Common Securities irrevocably consents to the service of process on
it in any such suit, action or proceeding by the mailing thereof by
registered or certified mail, postage prepaid, to it at its address given
in or pursuant to Section 13.1 hereof.
(c) To the extent permitted by law, nothing herein contained shall
preclude any party from effecting service of process in any lawful manner
or from bringing any suit, action or proceeding in respect of this
Declaration in any other state, country or place.
SECTION 13.4. Intention of the Parties. It is the intention of the parties
hereto that the Trust be classified for United States federal income tax
purposes as a grantor trust. The provisions of this Declaration shall be
interpreted to further this intention of the parties.
SECTION 13.5. 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.
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SECTION 13.6. Successors and Assigns. Whenever in this Declaration any of the
parties hereto is named or referred to, the successors and assigns of such party
shall be deemed to be included, and all covenants and agreements in this
Declaration by the Sponsor and the Trustees shall bind and inure to the benefit
of their respective successors and assigns, whether or not so expressed.
SECTION 13.7. 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 13.8. Counterparts. This Declaration may contain more than one
counterpart of the signature page and this Declaration may be executed by the
affixing of the signature of each of the Trustees and Administrators to any 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 this Declaration to be
duly executed as of the day and year first above written.
WELLS FARGO DELAWARE TRUST
COMPANY,
as Delaware Trustee
By:/s/ Edward L. Truitt, Jr.
-------------------------
Edward L. Truitt, Jr.
Vice President
WELLS FARGO BANK, NATIONAL
ASSOCIATION,
as Institutional Trustee
By: /s/ Edward L. Truitt, Jr.
-------------------------
Edward L. Truitt, Jr.
Vice President
Valley Commerce Bancorp
as Sponsor
By: /s/ Donald A. Gilles
--------------------
Donald A. Gilles
President and CEO
By:/s/ Donald A. Gilles
--------------------
Donald A. Gilles
Administrator
By:/s/ Roy O. Estridge
-------------------
Roy O. Estridge
Administrator
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ANNEX I
TERMS OF
TP SECURITIES AND
COMMON SECURITIES
Pursuant to Section 6.1 of the Amended and Restated Declaration of Trust,
dated as of March 27, 2003 (as amended from time to time, the "Declaration"),
the designation, rights, privileges, restrictions, preferences and other terms
and provisions of the Capital Securities and the Common Securities are set out
below (each capitalized term used but not defined herein has the meaning set
forth in the Declaration):
1. Designation and Number.
(a) Capital Securities. 3,000 Capital Securities of Valley
Commerce Trust I (the "Trust"), with an aggregate stated
liquidation amount with respect to the assets of the Trust of
Three Million Dollars ($3,000,000) and a stated liquidation
amount with respect to the assets of the Trust of $1,000 per
Capital Security, are hereby designated for the purposes of
identification only as the "TP Securities" (the "Capital
Securities"). The Capital Security 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, if any.
(b) Common Securities. 93 Common Securities of the Trust (the
"Common Securities") will be evidenced by Common Security
Certificates substantially in the form of Exhibit A-2 to the
Declaration, with such changes and additions thereto or
deletions therefrom as may be required by ordinary usage,
custom or practice. In the absence of an Event of Default, the
Common Securities will have an aggregate stated liquidation
amount with respect to the assets of the Trust of Ninety Three
Thousand Dollars ($93,000) and a stated liquidation amount
with respect to the assets of the Trust of $1,000 per Common
Security.
2. Distributions. (a) Distributions payable on each Security will be
payable at a variable per annum rate of interest, reset quarterly,
equal to LIBOR, as determined on the LIBOR Determination Date, plus
3.30% (subject to the Maximum Rate Increase) (the "Coupon Rate") of
the stated liquidation amount of $1,000 per Security, such rate
being the rate of interest payable on the Debentures to be held by
the Institutional Trustee provided, that the applicable Coupon Rate
may not exceed 12.5% through the Distribution Payment Date on July
7, 2003. Except as set forth below in respect of an Extension
Period, Distributions in arrears for more than one quarterly period
will bear interest thereon compounded quarterly at the applicable
Coupon Rate for each such quarterly period (to the extent permitted
by applicable law). The term "Distributions" as used herein includes
cash distributions, any such compounded distributions and any
Additional Interest payable on the Debentures unless otherwise
stated. A Distribution is payable only to the extent that payments
A-I-1
are made in respect of the Debentures held by the Institutional
Trustee and to the extent the Institutional Trustee has funds
legally available in the Property Account therefor. The amount of
Distributions payable for any period will be computed for any full
quarterly Distribution period on the basis of a 360-day year and the
actual number of days elapsed in the relevant Distribution period;
provided, however, that upon the occurrence of a Special Event
redemption pursuant to paragraph 4(a) below the amounts payable
pursuant to this Declaration shall be calculated as set forth in the
definition of Special Redemption Price.
(b) LIBOR shall be determined by the Calculation Agent in
accordance with the following provisions:
(1) On the second LIBOR Business Day (provided, that on such day
commercial banks are open for business (including dealings in
foreign currency deposits) in London (a "LIBOR Banking Day"), and
otherwise the next preceding LIBOR Business Day that is also a LIBOR
Banking Day) prior to January 15, April 15, July 15 and October 15
(except, with respect to the first interest payment period, on March
25, 2003), (each such day, a "LIBOR Determination Date"), LIBOR
shall equal the rate, as obtained by the Calculation Agent for
three-month U.S. Dollar deposits in Europe, which appears on
Telerate Page 3750 (as defined in the International Swaps and
Derivatives Association, Inc. 1991 Interest Rate and Currency
Exchange Definitions) or such other page as may replace such
Telerate Page 3750, as of 11:00 a.m. (London time) on such LIBOR
Determination Date, as reported by Bloomberg Financial Markets
Commodities News; provided, however, that in the case of the first
interest payment period, LIBOR will be interpolated from LIBOR for
three-month U.S. Dollar deposits in Europe and LIBOR for four-month
U.S. Dollar deposits in Europe on a straightline basis. "LIBOR
Business Day" means any day that is not a Saturday, Sunday or other
day on which commercial banking institutions in New York, New York
or Wilmington, Delaware are authorized or obligated by law or
executive order to be closed. If such rate is superseded on Telerate
Page 3750 by a corrected rate before 12:00 noon (London time) on the
same LIBOR Determination Date, the corrected rate as so substituted
will be the applicable LIBOR for that LIBOR Determination Date.
(2) If, on any LIBOR Determination Date, such rate does not appear on
Telerate Page 3750 as reported by Bloomberg Financial Markets
Commodities News or such other page as may replace such Telerate
Page 3750, the Calculation Agent shall determine the arithmetic mean
of the offered quotations of the Reference Banks (as defined below)
to leading banks in the London interbank market for three-month U.S.
Dollar deposits in Europe (in an amount determined by the
Calculation Agent) by reference to requests for quotations as of
approximately 11:00 a.m. (London time) on the LIBOR Determination
Date made by the Calculation Agent to the Reference Banks. If, on
any LIBOR Determination Date, at least two of the Reference Banks
provide such quotations, LIBOR shall equal the arithmetic mean of
such quotations. If, on any LIBOR Determination Date, only one or
none of the Reference Banks provide such a
A-I-2
quotation, LIBOR shall be deemed to be the arithmetic mean of the
offered quotations that at least two leading banks in the City of
New York (as selected by the Calculation Agent) are quoting on the
relevant LIBOR Determination Date for three-month U.S. Dollar
deposits in Europe at approximately 11:00 a.m. (London time) (in an
amount determined by the Calculation Agent). As used herein,
"Reference Banks" means four major banks in the London interbank
market selected by the Calculation Agent.
(3) If the Calculation Agent is required but is unable to determine a
rate in accordance with at least one of the procedures provided
above, LIBOR shall be LIBOR in effect on the previous LIBOR
Determination Date (whether or not LIBOR for such period was in fact
determined on such LIBOR Determination Date).
(c) All percentages resulting from any calculations on the
Securities will be rounded, if necessary, to the nearest one
hundred-thousandth of a percentage point, with five
one-millionths of a percentage point rounded upward (e.g.,
9.876545% (or .09876545) being rounded to 9.87655% (or
.0987655)), and all dollar amounts used in or resulting from
such calculation will be rounded to the nearest cent (with
one-half cent being rounded upward).
(d) On each LIBOR Determination Date, the Calculation Agent shall
notify, in writing, the Sponsor and the Paying Agent of the
applicable Coupon Rate in effect for the related Distribution
payment period. The Calculation Agent shall, upon the request
of the Holder of any Securities, provide the Coupon Rate then
in effect. All calculations made by the Calculation Agent in
the absence of manifest error shall be conclusive for all
purposes and binding on the Sponsor and the Holders of the
Securities. The Paying Agent shall be entitled to rely on
information received from the Calculation Agent or the Sponsor
as to the Coupon Rate. The Sponsor shall, from time to time,
provide any necessary information to the Paying Agent relating
to any original issue discount and interest on the Securities
that is included in any payment and reportable for taxable
income calculation purposes.
(e) Distributions on the Securities will be cumulative, will
accrue from the date of original issuance, and will be
payable, subject to extension of Distribution payment periods
as described herein, quarterly in arrears on January 7, April
7, July 7 and October 7 of each year, commencing July 7, 2003
(each, a "Distribution Payment Date"). Subject to prior
Submission of Notice (as defined in the Indenture), the
Debenture Issuer has the right under the Indenture to defer
payments of interest on the Debentures by extending the
interest payment period for up to 20 consecutive quarterly
periods (each, an "Extension Period") at any time and from
time to time on the Debentures, subject to the conditions
described below, during which Extension Period no interest
shall be due and payable (except any Additional Interest that
may be due and payable). During any Extension Period, interest
will continue to accrue on the Debentures, and interest on
such accrued interest (such accrued interest and interest
thereon referred to herein as "Deferred Interest") will accrue
at an annual rate equal to the Coupon Rate in effect for each
such Extension Period, compounded quarterly from the date such
Deferred Interest would have been payable were it not for the
Extension Period, to the extent permitted by law. No Extension
Period may end on a date other than a Distribution Payment
Date. At the end of any such Extension
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Period, the Debenture Issuer shall pay all Deferred Interest
then accrued and unpaid on the Debentures; provided, however,
that no Extension Period may extend beyond the Maturity Date
and provided, further, that, during any such Extension Period,
the Debenture Issuer may not (i) declare or pay any dividends
or distributions on, or redeem, purchase, acquire, or make a
liquidation payment with respect to, any of the Debenture
Issuer's capital stock or (ii) make any payment due on or
repay, repurchase or redeem any debt securities of the
Debenture Issuer that rank pari passu in all respects with or
junior in interest to the Debentures (other than (a)
repurchases, redemptions or other acquisitions of shares of
capital stock of the Debenture Issuer (A) in connection with
any employment contract, benefit plan or other similar
arrangement with or for the benefit of one or more employees,
officers, directors or consultants, (B) in connection with a
dividend reinvestment or stockholder stock purchase plan or
(C) in connection with the issuance of capital stock of the
Debenture Issuer (or securities convertible into or
exercisable for such capital stock), as consideration in an
acquisition transaction entered into prior to the applicable
Extension Period, (b) as a result of any exchange or
conversion of any class or series of the Debenture Issuer's
capital stock (or any capital stock of a subsidiary of the
Debenture Issuer) for any class or series of the Debenture
Issuer's capital stock or of any class or series of the
Debenture Issuer's indebtedness for any class or series of the
Debenture Issuer's capital stock, (c) the purchase of
fractional interests in shares of the Debenture Issuer's
capital stock pursuant to the conversion or exchange
provisions of such capital stock or the security being
converted or exchanged, (d) any declaration of a dividend in
connection with any stockholder's rights plan, or the issuance
of rights, stock or other property under any stockholder's
rights plan, or the redemption or repurchase of rights
pursuant thereto, or (e) any dividend in the form of stock,
warrants, options or other rights where the dividend stock or
the stock issuable upon exercise of such warrants, options or
other rights is the same stock as that on which the dividend
is being paid or ranks pari passu with or junior to such
stock). Prior to the termination of any Extension Period, the
Debenture Issuer may further extend such period, provided,
that such period together with all such previous and further
consecutive extensions thereof shall not exceed 20 consecutive
quarterly periods, or extend beyond the Maturity Date. Upon
the termination of any Extension Period and upon the payment
of all Deferred Interest, the Debenture Issuer may commence a
new Extension Period, subject to the foregoing requirements.
No interest or Deferred Interest shall be due and payable
during an Extension Period, except at the end thereof, but
Deferred Interest shall accrue upon each installment of
interest that would otherwise have been due and payable during
such Extension Period until such installment is paid. If
Distributions are deferred, the Distributions due shall be
paid on the date that the related Extension Period terminates,
or, if such date is not a Distribution Payment Date, on the
immediately following Distribution Payment Date, to Holders of
the Securities as they appear on the books and records of the
Trust on the record date immediately
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preceding such date. Distributions on the Securities must be
paid on the dates payable (after giving effect to any
Extension Period) to the extent that the Trust has funds
legally available for the payment of such distributions in the
Property Account of the Trust. The Trust's funds available for
Distribution to the Holders of the Securities will be limited
to payments received from the Debenture Issuer. The payment of
Distributions out of moneys held by the Trust is guaranteed by
the Guarantor pursuant to the Guarantee.
(f) Distributions on the Securities will be payable to the Holders
thereof as they appear on the books and records of the
Registrar on the relevant record dates. The relevant record
dates shall be selected by the Administrators, which dates
shall be 15 days before the relevant payment dates.
Distributions payable on any Securities that are not
punctually paid on any Distribution Payment Date, as a result
of the Debenture Issuer having failed to make a payment under
the Debentures, as the case may be, when due (taking into
account any Extension Period), will cease to be payable to the
Person in whose name such Securities are registered on the
relevant record date, and such defaulted Distribution will
instead be payable to the Person in whose name such Securities
are registered on the special record date or other specified
date determined in accordance with the Indenture. If any date
on which Distributions are payable on the Securities is not a
Business Day, then payment of the Distribution payable on such
date will be made on the next succeeding day that is a
Business Day except that, if such Business Day is in the next
succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, in each case with the same
force and effect as if made on such payment date.
(g) In the event that there is any money or other property held by
or for the Trust that is not accounted for hereunder, such
property shall be distributed pro rata (as defined herein)
among the Holders of the Securities.
3. Liquidation Distribution Upon Dissolution. In the event of the
voluntary or involuntary liquidation, dissolution, winding-up or
termination of the Trust (each, a "Liquidation") other than in
connection with a redemption of the Debentures, the Holders of the
Securities will be entitled to receive out of the assets of the
Trust available for distribution to Holders of the Securities, after
satisfaction of liabilities to creditors of the Trust (to the extent
not satisfied by the Debenture Issuer), distributions equal to the
aggregate of the stated liquidation amount of $1,000 per Security
plus accrued and unpaid Distributions thereon to the date of payment
(such amount being the "Liquidation Distribution"), unless in
connection with such Liquidation, the Debentures in an aggregate
stated principal amount equal to the aggregate stated liquidation
amount of such Securities, with an interest rate equal to the Coupon
Rate of, and bearing accrued and unpaid interest in an amount equal
to the accrued and unpaid Distributions on, and having the same
record date as, such Securities, after paying or making reasonable
provision to pay all claims and obligations of the Trust in
accordance with Section 3808(e) of the Statutory Trust Act, shall be
distributed on a Pro Rata basis to the Holders of the Securities in
exchange for such Securities.
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The Sponsor, as the Holder of all of the Common Securities, has the right
at any time to dissolve the Trust (including without limitation upon the
occurrence of a Tax Event, an Investment Company Event or a Capital Treatment
Event), subject to the receipt by the Debenture Issuer of prior approval from
the Board of Governors of the Federal Reserve System (the "Federal Reserve"), if
then required under applicable capital guidelines or policies of the Federal
Reserve and, after satisfaction of liabilities to creditors of the Trust, cause
the Debentures to be distributed to the Holders of the Securities on a Pro Rata
basis in accordance with the aggregate stated liquidation amount thereof.
The Trust shall dissolve on the first to occur of (i) March 27, 2038, the
expiration of the term of the Trust, (ii) a Bankruptcy Event with respect to the
Sponsor, the Trust or the Debenture Issuer, (iii) (other than in connection with
a merger, consolidation or similar transaction not prohibited by the Indenture,
this Declaration or the Guarantee, as the case may be) the filing of a
certificate of dissolution of the Sponsor or upon the revocation of the charter
of the Sponsor and the expiration of 90 days after the date of revocation
without a reinstatement thereof, (iv) the distribution to the Holders of the
Securities of the Debentures, upon exercise of the right of the Holder of all of
the outstanding Common Securities to dissolve the Trust as described above, (v)
the entry of a decree of a judicial dissolution of the Sponsor or the Trust, or
(vi) 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. As soon as practicable after the
dissolution of the Trust and upon completion of the winding up of the Trust, the
Trust shall terminate upon the filing of a certificate of cancellation with the
Secretary of State of the State of Delaware.
If a Liquidation of the Trust occurs as described in clause (i), (ii),
(iii) or (v) in the immediately preceding paragraph, the Trust shall be
liquidated by the Institutional Trustee of the Trust as expeditiously as such
Trustee determines to be possible by distributing, after satisfaction of
liabilities to creditors of the Trust as provided by applicable law, to the
Holders of the Securities, the Debentures on a Pro Rata basis to the extent not
satisfied by the Debenture Issuer, unless such distribution is determined by the
Institutional Trustee not to be practical, in which event such Holders will be
entitled to receive out of the assets of the Trust available for distribution to
the Holders, after satisfaction of liabilities to creditors of the Trust to the
extent not satisfied by the Debenture Issuer, an amount equal to the Liquidation
Distribution. An early Liquidation of the Trust pursuant to clause (iv) of the
immediately preceding paragraph shall occur if the Institutional Trustee
determines that such Liquidation is possible by distributing, after satisfaction
of liabilities to creditors of Trust, to the Holders of the Securities on a Pro
Rata basis, the Debentures, and such distribution occurs.
If, upon any such Liquidation, the Liquidation Distribution can be paid
only in part because the Trust has insufficient assets available to pay in full
the aggregate Liquidation Distribution, then the amounts payable directly by the
Trust on such Capital Securities shall be paid to the Holders of the Securities
on a Pro Rata basis, except that if an Event of Default has occurred and is
continuing, the Capital Securities shall have a preference over the Common
Securities with regard to such distributions.
Upon any such Liquidation of the Trust involving a distribution of the
Debentures, if at the time of such Liquidation, the Capital Securities were
rated by at least one nationally-
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recognized statistical rating organization, the Debenture Issuer will use its
reasonable best efforts to obtain from at least one such or other rating
organization a rating for the Debentures.
After the date for any distribution of the Debentures upon dissolution of
the Trust, (i) the Securities of the Trust will be deemed to be no longer
outstanding, (ii) any certificates representing the Capital Securities will be
deemed to represent undivided beneficial interests in such of the Debentures as
have an aggregate principal amount equal to the aggregate stated liquidation
amount of, with an interest rate identical to the distribution rate of, and
bearing accrued and unpaid interest equal to accrued and unpaid distributions
on, the Securities until such certificates are presented to the Debenture Issuer
or its agent for transfer or reissuance (and until such certificates are so
surrendered, no payments of interest or principal shall be made to Holders of
Securities in respect of any payments due and payable under the Debentures) and
(iii) all rights of Holders of Securities under the Capital Securities or the
Common Securities, as applicable, shall cease, except the right of such Holders
to receive Debentures upon surrender of certificates representing such
Securities.
4. Redemption and Distribution.
(a) The Debentures will mature on April 7, 2033. The Debentures
may be redeemed by the Debenture Issuer, in whole or in part,
on any January 7, April 7, July 7 or October 7 on or after
April 7, 2008 at the Redemption Price, upon not less than 30
nor more than 60 days' notice to Holders of such Debentures.
In addition, upon the occurrence and continuation of a Tax
Event, an Investment Company Event or a Capital Treatment
Event, the Debentures may be redeemed by the Debenture Issuer
in whole but not in part, at any time within 90 days following
the occurrence of such Tax Event, Investment Company Event or
Capital Treatment Event, as the case may be (the "Special
Redemption Date"), at the Special Redemption Price, upon not
less than 30 nor more than 60 days' notice to Holders of the
Debentures so long as such Tax Event, Investment Company Event
or Capital Treatment Event, as the case may be, is continuing.
In each case, the right of the Debenture Issuer to redeem the
Debentures is subject to the Debenture Issuer having received
prior approval from the Federal Reserve, if then required
under applicable capital guidelines or policies of the Federal
Reserve.
"Tax Event" means the receipt by the Debenture Issuer and the Trust of an
opinion of counsel experienced in such matters to the effect that, as a result
of any amendment to or change (including any announced prospective change) in
the laws or any regulations thereunder of the United States or any political
subdivision or taxing authority thereof or therein, or as a result of any
official administrative pronouncement (including any private letter ruling,
technical advice memorandum, regulatory procedure, notice or announcement) (an
"Administrative Action") or judicial decision interpreting or applying such laws
or regulations, regardless of whether such Administrative Action or judicial
decision is issued to or in connection with a proceeding involving the Debenture
Issuer or the Trust and whether or not subject to review or appeal, which
amendment, clarification, change, Administrative Action or decision is enacted,
promulgated or announced, in each case on or after the date of original issuance
of the Debentures, there is more than an insubstantial risk that: (i) the Trust
is, or will be within 90 days of the date of such opinion, subject to United
States federal income tax with respect to income
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received or accrued on the Debentures; (ii) interest payable by the Debenture
Issuer on the Debentures is not, or within 90 days of the date of such opinion,
will not be, deductible by the Debenture Issuer, in whole or in part, for United
States federal income tax purposes; or (iii) the Trust is, or will be within 90
days of the date of such opinion, subject to more than a de minimis amount of
other taxes (including withholding taxes), duties, assessments or other
governmental charges.
"Investment Company Event" means the receipt by the Debenture Issuer and
the Trust of an opinion of counsel experienced in such matters to the effect
that, as a result of a change in law or regulation or written change in
interpretation or application of law or regulation by any legislative body,
court, governmental agency or regulatory authority, there is more than an
insubstantial risk that the Trust is or, within 90 days of the date of such
opinion will be, considered an "investment company" that is required to be
registered under the Investment Company Act, which change or prospective change
becomes effective or would become effective, as the case may be, on or after the
date of the original issuance of the Debentures.
"Capital Treatment Event" means the receipt by the Debenture Issuer and
the Trust of an opinion of counsel experienced in such matters to the effect
that, as a result of any amendment to, or change in, the laws, rules or
regulations of the United States or any political subdivision thereof or
therein, or as the result of any official or administrative pronouncement or
action or decision interpreting or applying such laws, rules or regulations,
which amendment or change is effective or which pronouncement, action or
decision is announced on or after the date of original issuance of the
Debentures, there is more than an insubstantial risk that the Debenture Issuer
will not, within 90 days of the date of such opinion, be entitled to treat an
amount equal to the aggregate Liquidation Amount of the Capital Securities as
"Tier 1 Capital" (or the then equivalent thereof) for purposes of the capital
adequacy guidelines of the Federal Reserve (or any successor regulatory
authority with jurisdiction over bank holding companies), as then in effect and
applicable to the Debenture Issuer; provided, however, that the distribution of
the Debentures in connection with the Liquidation of the Trust by the Debenture
Issuer shall not in and of itself constitute a Capital Treatment Event unless
such Liquidation shall have occurred in connection with a Tax Event or an
Investment Company Event.
"Special Event" means any of a Capital Treatment Event, a Tax Event or an
Investment Company Event.
"Redemption Price" means 100% of the principal amount of the Debentures
being redeemed plus accrued and unpaid interest on such Debentures to the
Redemption Date or, in the case of a redemption due to the occurrence of a
Special Event, to the Special Redemption Date if such Special Redemption Date is
on or after April 7, 2008.
"Special Redemption Price" means (1) if the Special Redemption Date is
before April 7, 2008, One Hundred Seven and One Half Percent (107.5%) of the
principal amount to be redeemed plus any accrued and unpaid interest thereon to
the date of such redemption and (2) if the Special Redemption Date is on or
after April 7, 2008, the Redemption Price for such Special Redemption Date.
A-I-8
"Redemption Date" means the date fixed for the redemption of Capital
Securities, which shall be any January 7, April 7, July 7 or October 7 on or
after April 7, 2008.
(b) Upon the repayment in full at maturity or redemption in whole
or in part of the Debentures (other than following the
distribution of the Debentures to the Holders of the
Securities), the proceeds from such repayment or payment shall
concurrently be applied to redeem Pro Rata at the applicable
Redemption Price, Securities having an aggregate liquidation
amount equal to the aggregate principal amount of the
Debentures so repaid or redeemed; provided, however, that
holders of such Securities shall be given not less than 30 nor
more than 60 days' notice of such redemption (other than at
the scheduled maturity of the Debentures).
(c) If fewer than all the outstanding Securities are to be so
redeemed, the Common Securities and the Capital Securities
will be redeemed Pro Rata and the Capital Securities to be
redeemed will be as described in Section 4(e)(ii) below.
(d) The Trust may not redeem fewer than all the outstanding
Capital Securities unless all accrued and unpaid Distributions
have been paid on all Capital Securities for all quarterly
Distribution periods terminating on or before the date of
redemption.
(e) Redemption or Distribution Procedures.
(i) Notice of any redemption of, or notice of distribution
of the Debentures in exchange for, the Securities (a
"Redemption/Distribution Notice") will be given by the
Trust by mail to each Holder of Securities to be
redeemed or exchanged not fewer than 30 nor more than 60
days before the date fixed for redemption or exchange
thereof which, in the case of a redemption, will be the
date fixed for redemption of the Debentures. 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(e)(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 of such
Securities. Each Redemption/Distribution Notice shall be
addressed to the Holders of such Securities at the
address of each such Holder appearing on the books and
records of the Registrar. No defect in the
Redemption/Distribution Notice or in the mailing 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
Capital Securities.
(iii) If the Securities are to be redeemed and the Trust gives
a Redemption/Distribution Notice, which notice may only
be issued if the Debentures are redeemed as set out in
this Section 4 (which notice will be irrevocable), then,
provided, that the Institutional Trustee has a
sufficient amount of cash in connection with the related
redemption or maturity of the
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Debentures, the Institutional Trustee will pay the
relevant Redemption Price to the Holders of such
Securities by check mailed to the address of each such
Holder appearing on the books and records of the Trust
on the redemption date. If a Redemption/Distribution
Notice shall have been given and funds deposited as
required, then immediately prior to the close of
business on the date of such deposit, Distributions will
cease to accrue on the Securities so called for
redemption and all rights of Holders of such Securities
so called for redemption will cease, except the right of
the Holders of such Securities to receive the applicable
Redemption Price specified in Section 4(a), but without
interest on such Redemption Price. If any date fixed for
redemption of Securities is not a Business Day, then
payment of any such Redemption Price payable on such
date will be made on the next succeeding day that is a
Business Day except that, if such Business Day falls in
the next calendar year, such payment will be made on the
immediately preceding Business Day, in each case with
the same force and effect as if made on such date fixed
for redemption. If payment of the Redemption Price in
respect of any Securities is improperly withheld or
refused and not paid either by the Trust or by the
Debenture Issuer as guarantor pursuant to the Guarantee,
Distributions on such Securities will continue to accrue
at the then applicable rate from the original redemption
date to the actual date of payment, in which case the
actual payment date will be considered the date fixed
for redemption for purposes of calculating the
Redemption Price. In the event of any redemption of the
Capital Securities issued by the Trust in part, the
Trust shall not be required to (i) issue, register the
transfer of or exchange any Security during a period
beginning at the opening of business 15 days before any
selection for redemption of the Capital Securities and
ending at the close of business on the earliest date on
which the relevant notice of redemption is deemed to
have been given to all Holders of the Capital Securities
to be so redeemed or (ii) register the transfer of or
exchange any Capital Securities so selected for
redemption, in whole or in part, except for the
unredeemed portion of any Capital Securities being
redeemed in part.
(iv) Redemption/Distribution Notices shall be sent by the
Administrators on behalf of the Trust (A) in respect of
the Capital Securities, to the Holders thereof, and (B)
in respect of the Common Securities, to the Holder
thereof.
(v) Subject to the foregoing and applicable law (including,
without limitation, United States federal securities
laws), and provided, that 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.
5. Voting Rights - Capital Securities. (a) Except as provided under
Sections 5(b) and 7 and as otherwise required by law and the
Declaration, the Holders of the Capital Securities will have no
voting rights. The Administrators are required to call
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a meeting of the Holders of the Capital Securities if directed to do
so by Holders of not less than 10% in liquidation amount of the
Capital Securities.
(b) Subject to the requirements of obtaining a tax opinion by the
Institutional Trustee in certain circumstances set forth in
the last sentence of this paragraph, the Holders of a Majority
in liquidation amount of the Capital Securities, voting
separately as a class, have the right to direct the time,
method, and place of conducting any proceeding for any remedy
available to the Institutional Trustee, or exercising any
trust or power conferred upon the Institutional Trustee under
the Declaration, including the right to direct the
Institutional Trustee, as holder of the Debentures, to (i)
exercise the remedies available under the Indenture as the
holder of the Debentures, (ii) waive any past default that is
waivable under the Indenture, (iii) exercise any right to
rescind or annul a declaration that the principal of all the
Debentures shall be due and payable or (iv) consent on behalf
of all the Holders of the Capital Securities to any amendment,
modification or termination of the Indenture or the Debentures
where such consent shall be required; provided, however, that,
where a consent or action under the Indenture would require
the consent or act of the holders of greater than a simple
majority in principal amount of Debentures (a "Super
Majority") affected thereby, the Institutional Trustee may
only give such consent or take such action at the written
direction of the Holders of not less than the proportion in
liquidation amount of the Capital Securities outstanding which
the relevant Super Majority represents of the aggregate
principal amount of the Debentures outstanding. If the
Institutional Trustee fails to enforce its rights under the
Debentures after the Holders of a Majority in liquidation
amount of such Capital Securities have so directed the
Institutional Trustee, to the fullest extent permitted by law,
a Holder of the Capital Securities may institute a legal
proceeding directly against the Debenture Issuer to enforce
the Institutional Trustee's rights under the Debentures
without first instituting any legal proceeding against the
Institutional Trustee or any other person or entity.
Notwithstanding the foregoing, if an Event of Default has
occurred and is continuing and such event is attributable to
the failure of the Debenture Issuer to pay interest or
principal on the Debentures on the date the interest or
principal is payable (or in the case of redemption, the
redemption date), then a Holder of record of the Capital
Securities may directly institute a proceeding for enforcement
of payment, on or after the respective due dates specified in
the Debentures, to such Holder directly of the principal of or
interest on the Debentures having an aggregate principal
amount equal to the aggregate liquidation amount of the
Capital Securities of such Holder. The Institutional Trustee
shall notify all Holders of the Capital Securities of any
default actually known to the Institutional Trustee with
respect to the Debentures unless (x) such default has been
cured prior to the giving of such notice or (y) the
Institutional Trustee determines in good faith that the
withholding of such notice is in the interest of the Holders
of such Capital Securities, except where the default relates
to the payment of principal of or interest on any of the
Debentures. Such notice shall state that such Indenture Event
of Default also constitutes an Event of Default hereunder.
Except with respect to directing the time, method and place of
conducting a proceeding for a remedy, the Institutional
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Trustee shall not take any of the actions described in clause
(i), (ii) or (iii) above unless the Institutional Trustee has
obtained an opinion of tax counsel to the effect that, as a
result of such action, the Trust will not be classified as
other than a grantor trust for United States federal income
tax purposes.
In the event the consent of the Institutional Trustee, as the holder of
the Debentures is required under the Indenture with respect to any amendment,
modification or termination of the Indenture, the Institutional Trustee shall
request the written direction of the Holders of the Securities with respect to
such amendment, modification or termination and shall vote with respect to such
amendment, modification or termination as directed by a Majority in liquidation
amount of the Securities voting together as a single class; provided, however,
that where a consent under the Indenture would require the consent of a Super
Majority, the Institutional Trustee may only give such consent at the written
direction of the Holders of not less than the proportion in liquidation amount
of such Securities outstanding which the relevant Super Majority represents of
the aggregate principal amount of the Debentures outstanding. The Institutional
Trustee shall not take any such action in accordance with the written directions
of the Holders of the Securities unless the Institutional Trustee has obtained
an opinion of tax counsel to the effect that, as a result of such action, the
Trust will not be classified as other than a grantor trust for United States
federal income tax purposes.
A waiver of an Indenture Event of Default will constitute a waiver of the
corresponding Event of Default hereunder. Any required approval or direction of
Holders of the Capital Securities may be given at a separate meeting of Holders
of the Capital Securities convened for such purpose, at a meeting of all of the
Holders of the Securities in the Trust or pursuant to written consent. The
Institutional Trustee will cause a notice of any meeting at which Holders of the
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 the Capital Securities. Each such notice will include a statement
setting forth the following information (i) the date of such meeting or the date
by which such action is to be taken, (ii) a description of any resolution
proposed for adoption at such meeting on which such Holders are entitled to vote
or of such matter upon which written consent is sought and (iii) instructions
for the delivery of proxies or consents. 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 the 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 entitle the Holder thereof to vote or consent and shall, for purposes
of such vote or consent, be treated as if such Capital Securities were not
outstanding.
In no event will 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 Sponsor as the Holder of all of the Common Securities of the
Trust. Under certain circumstances as more fully described in the Declaration,
Holders of Capital Securities have the right to vote to appoint, remove or
replace the Institutional Trustee and the Delaware Trustee.
A-I-12
6. Voting Rights - Common Securities. (a) Except as provided under
Sections 6(b), 6(c) and 7 and as otherwise required by law and the
Declaration, the Common Securities will have no voting rights.
(b) The Holders of the Common Securities are entitled, in
accordance with Article IV of the Declaration, to vote to
appoint, remove or replace any Administrators.
(c) Subject to Section 6.7 of the Declaration and only after each
Event of Default (if any) with respect to the Capital
Securities has been cured, waived or otherwise eliminated and
subject to the requirements of the second to last sentence of
this paragraph, the Holders of a Majority in liquidation
amount of the Common Securities, voting separately as a class,
may direct the time, method, and place of conducting any
proceeding for any remedy available to the Institutional
Trustee, or exercising any trust or power conferred upon the
Institutional Trustee under the Declaration, including (i)
directing the time, method, place of conducting any proceeding
for any remedy available to the Debenture Trustee, or
exercising any trust or power conferred on the Debenture
Trustee with respect to the Debentures, (ii) waiving any past
default and its consequences that are waivable under the
Indenture, or (iii) exercising any right to rescind or annul a
declaration that the principal of all the Debentures shall be
due and payable, provided, however, that, where a consent or
action under the Indenture would require a Super Majority, the
Institutional Trustee may only give such consent or take such
action at the written direction of the Holders of not less
than the proportion in liquidation amount of the Common
Securities which the relevant Super Majority represents of the
aggregate principal amount of the Debentures outstanding.
Notwithstanding this Section 6(c), the Institutional Trustee
shall not revoke any action previously authorized or approved
by a vote or consent of the Holders of the Capital Securities.
Other than with respect to directing the time, method and
place of conducting any proceeding for any remedy available to
the Institutional Trustee or the Debenture Trustee as set
forth above, the Institutional Trustee shall not take any
action described in clause (i), (ii) or (iii) above, unless
the Institutional Trustee has obtained an opinion of tax
counsel to the effect that for the purposes of United States
federal income tax the Trust will not be classified as other
than a grantor trust on account of such action. If the
Institutional Trustee fails to enforce its rights under the
Declaration, to the fullest extent permitted by law any Holder
of the Common Securities may institute a legal proceeding
directly against any Person to enforce the Institutional
Trustee's rights under the Declaration, without first
instituting a legal proceeding against the Institutional
Trustee or any other Person.
Any approval or direction of Holders of the Common Securities may be given
at a separate meeting of Holders of the Common Securities convened for such
purpose, at a meeting of all of the Holders of the Securities in the Trust or
pursuant to written consent. The Administrators will cause a notice of any
meeting at which Holders of the 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 the 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
A-I-13
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.
7. Amendments to Declaration and Indenture. (a) In addition to any
requirements under Section 11.1 of the Declaration, if any proposed
amendment to the Declaration provides for, or the Trustees otherwise
propose to effect, (i) any action that would adversely affect the
powers, preferences or special rights of the Securities, whether by
way of amendment to the Declaration or otherwise, or (ii) the
Liquidation of the Trust, other than as described in Section 7.1 of
the Declaration, then the Holders of outstanding Securities, voting
together as a single class, will be entitled to vote on such
amendment or proposal and such amendment or proposal shall not be
effective except with the approval of the Holders of not less than a
Majority in liquidation amount of the Securities affected thereby;
provided, however, if any amendment or proposal referred to in
clause (i) above would adversely affect only the Capital Securities
or only the Common Securities, then only the affected class will be
entitled to vote on such amendment or proposal and such amendment or
proposal shall not be effective except with the approval of a
Majority in liquidation amount of such class of Securities.
(b) In the event the consent of the Institutional Trustee as the
holder of the Debentures is required under the Indenture with
respect to any amendment, modification or termination of the
Indenture or the Debentures, the Institutional Trustee shall
request the written direction of the Holders of the Securities
with respect to such amendment, modification or termination
and shall vote with respect to such amendment, modification,
or termination as directed by a Majority in liquidation amount
of the Securities voting together as a single class; provided,
however, that where a consent under the Indenture would
require a Super Majority, the Institutional Trustee may only
give such consent at the written direction of the Holders of
not less than the proportion in liquidation amount of the
Securities which the relevant Super Majority represents of the
aggregate principal amount of the Debentures outstanding.
(c) Notwithstanding the foregoing, no amendment or modification
may be made to the Declaration if such amendment or
modification would (i) cause the Trust to be classified for
purposes of United States federal income taxation as other
than a grantor trust, (ii) reduce or otherwise adversely
affect the powers of the Institutional Trustee or (iii) cause
the Trust to be deemed an "investment company" which is
required to be registered under the Investment Company Act.
(d) Notwithstanding any provision of the Declaration, the right of
any Holder of the Capital Securities to receive payment of
distributions and other payments upon redemption or otherwise,
on or after their respective due dates, or to institute a suit
for the enforcement of any such payment on or after such
respective dates, shall not
A-I-14
be impaired or affected without the consent of such Holder.
For the protection and enforcement of the foregoing provision,
each and every Holder of the Capital Securities shall be
entitled to such relief as can be given either at law or
equity.
8. Pro Rata. A reference in these terms of the Securities to any
payment, distribution or treatment as being "Pro Rata" shall mean
pro rata to each Holder of the Securities according to the aggregate
liquidation amount of the Securities held by the relevant Holder in
relation to the aggregate liquidation amount of all Securities
outstanding unless, in relation to a payment, an Event of Default
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
the 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 the Common Securities Pro
Rata according to the aggregate liquidation amount of the Common
Securities held by the relevant Holder relative to the aggregate
liquidation amount of all Common Securities outstanding.
9. Ranking. The Capital Securities rank pari passu with, and payment
thereon shall be made Pro Rata with, the Common Securities except
that, where an Event of Default has occurred and is continuing, the
rights of Holders of the Common Securities to receive payment of
Distributions and payments upon liquidation, redemption and
otherwise are subordinated to the rights of the Holders of the
Capital Securities with the result that no payment of any
Distribution on, or Redemption Price of, any Common Security, and no
other payment on account of redemption, liquidation or other
acquisition of Common Securities, shall be made unless payment in
full in cash of all accumulated and unpaid Distributions on all
outstanding Capital Securities for all distribution periods
terminating on or prior thereto, or in the case of payment of the
Redemption Price the full amount of such Redemption Price on all
outstanding Capital Securities then called for redemption, shall
have been made or provided for, and all funds immediately available
to the Institutional Trustee shall first be applied to the payment
in full in cash of all Distributions on, or the Redemption Price of,
the Capital Securities then due and payable.
10. Acceptance of Guarantee and Indenture. Each Holder of the Capital
Securities and the Common Securities, by the acceptance of such
Securities, agrees to the provisions of the Guarantee, including the
subordination provisions therein and to the provisions of the
Indenture.
11. No Preemptive Rights. The Holders of the Securities shall have no,
and the issuance of the Securities is not subject to, preemptive or
similar rights to subscribe for any additional securities.
12. Miscellaneous. These terms constitute a part of the Declaration. The
Sponsor will provide a copy of the Declaration, the Guarantee, and
the Indenture to a Holder without charge on written request to the
Sponsor at its principal place of business.
A-I-15
EXHIBIT A-1
FORM OF CAPITAL SECURITY CERTIFICATE
[FORM OF FACE OF SECURITY]
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS OR ANY OTHER
APPLICABLE SECURITIES LAWS. NEITHER THIS 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, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS SECURITY BY ITS
ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY ONLY
(A) TO THE DEBENTURE ISSUER OR THE TRUST, (B) PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT ("RULE 144A"), TO A PERSON THE HOLDER REASONABLY BELIEVES IS A
"QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS
OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE
IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) PURSUANT
TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT TO AN
"ACCREDITED INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH (a) (1), (2), (3) OR
(7) OF RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THE SECURITY FOR ITS
OWN ACCOUNT, OR FOR THE ACCOUNT OF AN "ACCREDITED INVESTOR," FOR INVESTMENT
PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (D) PURSUANT TO ANOTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
SUBJECT TO THE DEBENTURE ISSUER'S AND THE TRUST'S RIGHT PRIOR TO ANY SUCH OFFER,
SALE OR TRANSFER PURSUANT TO CLAUSES (C) OR (D) TO REQUIRE THE DELIVERY OF AN
OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH
OF THEM IN ACCORDANCE WITH THE AMENDED AND RESTATED DECLARATION OF TRUST, A COPY
OF WHICH MAY BE OBTAINED FROM THE DEBENTURE ISSUER OR THE TRUST. THE HOLDER OF
THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES THAT IT WILL COMPLY WITH THE
FOREGOING RESTRICTIONS.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES, REPRESENTS
AND WARRANTS THAT IT WILL NOT ENGAGE IN HEDGING TRANSACTIONS INVOLVING THIS
SECURITY UNLESS SUCH TRANSACTIONS ARE IN COMPLIANCE WITH THE SECURITIES ACT.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF ALSO AGREES,
REPRESENTS AND WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT, INDIVIDUAL
RETIREMENT ACCOUNT OR OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
A-1-1
1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE"), (EACH A "PLAN"), OR AN ENTITY WHOSE UNDERLYING
ASSETS INCLUDE "PLAN ASSETS" BY REASON OF ANY PLAN'S INVESTMENT IN THE ENTITY
AND NO PERSON INVESTING "PLAN ASSETS" OF ANY PLAN MAY ACQUIRE OR HOLD THIS
SECURITY OR ANY INTEREST THEREIN, UNLESS SUCH PURCHASER OR HOLDER IS ELIGIBLE
FOR THE EXEMPTION RELIEF AVAILABLE UNDER U.S. DEPARTMENT OF LABOR PROHIBITED
TRANSACTION CLASS EXEMPTION 96-23,95-60,91-38,90-1 OR 84-14 OR ANOTHER
APPLICABLE EXEMPTION OR ITS PURCHASE AND HOLDING OF THIS SECURITY IS NOT
PROHIBITED BY SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE WITH RESPECT TO
SUCH PURCHASE OR HOLDING. ANY PURCHASER OR HOLDER OF THIS SECURITY OR ANY
INTEREST THEREIN WILL BE DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND HOLDING
THEREOF THAT EITHER (i) IT IS NOT AN EMPLOYEE BENEFIT PLAN WITHIN THE MEANING OF
SECTION 3(3) OF ERISA, OR A PLAN TO WHICH SECTION 4975 OF THE CODE IS
APPLICABLE, A TRUSTEE OR OTHER PERSON ACTING ON BEHALF OF AN EMPLOYEE BENEFIT
PLAN OR PLAN, OR ANY OTHER PERSON OR ENTITY USING THE ASSETS OF ANY EMPLOYEE
BENEFIT PLAN OR PLAN TO FINANCE SUCH PURCHASE, OR (ii) SUCH PURCHASE WILL NOT
RESULT IN A PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975 OF
THE CODE FOR WHICH THERE IS NO APPLICABLE STATUTORY OR ADMINISTRATIVE EXEMPTION.
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR
AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS MAY BE REQUIRED BY
THE AMENDED AND RESTATED DECLARATION OF TRUST TO CONFIRM THAT THE TRANSFER
COMPLIES WITH THE FOREGOING RESTRICTIONS.
THIS SECURITY WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS HAVING
A LIQUIDATION AMOUNT OF NOT LESS THAN $100,000 AND MULTIPLES OF $1,000 IN EXCESS
THEREOF. ANY ATTEMPTED TRANSFER OF THIS SECURITY IN A BLOCK HAVING A LIQUIDATION
AMOUNT OF LESS THAN $100,000 SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT
WHATSOEVER. ANY SUCH PURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER
OF THIS SECURITY FOR ANY PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF
DISTRIBUTIONS ON THIS SECURITY, AND SUCH PURPORTED TRANSFEREE SHALL BE DEEMED TO
HAVE NO INTEREST WHATSOEVER IN THIS SECURITY.
A-1-2
Certificate Number [P-001] Number of Capital Securities 3,000
Certificate Evidencing Capital Securities
of
Valley Commerce Trust I
TP Securities
(liquidation amount $1,000 per Capital Security)
Valley Commerce Trust I, a statutory trust created under the laws of the
State of Delaware (the "Trust"), hereby certifies that Bear Stearns Securities
Corp. (the "Holder") is the registered owner of 3,000 capital securities of the
Trust representing undivided beneficial interests in the assets of the Trust,
designated the TP Securities (liquidation amount $1,000 per Capital Security)
(the "Capital Securities"). Subject to the Declaration (as defined below), 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 Capital Securities represented
hereby are issued pursuant to, and the designation, rights, privileges,
restrictions, preferences and other terms and provisions of the Capital
Securities shall in all respects be subject to, the provisions of the Amended
and Restated Declaration of Trust of the Trust, dated as of March 27, 2003, (the
"Declaration") among Donald A. Gilles and Roy O. Estridge, as Administrators,
Wells Fargo Delaware Trust Company, as Delaware Trustee, Wells Fargo Bank,
National Association, as Institutional Trustee, Valley Commerce Bancorp, as
Sponsor, and the holders from time to time of undivided beneficial interests in
the assets of the Trust, including the designation of the terms of the Capital
Securities as set forth in Annex I to the Declaration, as the same may be
amended from time to time. Capitalized terms used herein but not defined shall
have the meaning given them in the Declaration. The Holder is entitled to the
benefits of the Guarantee to the extent provided therein. The Sponsor will
provide a copy of the Declaration, the Guarantee, and the Indenture to the
Holder without charge upon written request to the Sponsor at its principal place
of business.
By acceptance of this Security, the Holder is bound by the Declaration and
is entitled to the benefits thereunder.
By acceptance of this Security, the Holder agrees to treat, for United
States federal income tax purposes, the Debentures as indebtedness and the
Capital Securities as evidence of beneficial ownership in the Debentures.
This Capital Security is governed by, and shall be construed in accordance
with, the laws of the State of Delaware, without regard to principles of
conflict of laws.
A-1-3
IN WITNESS WHEREOF, the Trust has duly executed this certificate.
Valley Commerce Trust I
By:___________________________________
Name:______________________________
Title: Administrator
Dated:________________________________
CERTIFICATE OF AUTHENTICATION
This is one of the Capital Securities referred to in the within-mentioned
Declaration.
WELLS FARGO BANK, NATIONAL
ASSOCIATION,
not in its individual capacity but solely
as the Institutional Trustee
By:__________________________________
Authorized Officer
Dated________________________________
A-1-4
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Capital Security will be payable at a
variable per annum rate of interest, reset quarterly, equal to LIBOR (as defined
in the Declaration) plus 3.30% (subject to the Maximum Rate Increase) (the
"Coupon Rate") of the stated liquidation amount of $1,000 per Capital Security,
such rate being the rate of interest payable on the Debentures to be held by the
Institutional Trustee (provided, that the applicable Coupon Rate may not exceed
12.5% through the Distribution Payment Date on April 7, 2008). Except as set
forth below in respect of an Extension Period, Distributions in arrears for more
than one quarterly period will bear interest thereon compounded quarterly at the
applicable Coupon Rate for each such quarterly period (to the extent permitted
by applicable law). The term "Distributions" as used herein includes cash
distributions, any such compounded distributions and any Additional Interest
payable on the Debentures unless otherwise stated. A Distribution is payable
only to the extent that payments are made in respect of the Debentures held by
the Institutional Trustee and to the extent the Institutional Trustee has funds
legally available in the Property Account therefor. The amount of Distributions
payable for any period will be computed for any full quarterly Distribution
period on the basis of a 360-day year and the actual number of days elapsed in
the relevant Distribution period.
Except as otherwise described below, Distributions on the Capital
Securities will be cumulative, will accrue from the date of original issuance
and will be payable quarterly in arrears on January 7, April 7 and July 7 and
October 7 of each year, commencing on July 7, 2003 (each, a "Distribution
Payment Date"). Upon submission of Notice, the Debenture Issuer has the right
under the Indenture to defer payments of interest on the Debentures by extending
the interest payment period for up to 20 consecutive quarterly periods (each, an
"Extension Period") at any time and from time to time on the Debentures, subject
to the conditions described below, during which Extension Period no interest
shall be due and payable (except any Additional Interest that may be due and
payable). During any Extension Period, interest will continue to accrue on the
Debentures, and interest on such accrued interest (such accrued interest and
interest thereon referred to herein as "Deferred Interest") will accrue at an
annual rate equal to the Coupon Rate in effect for each such Extension Period,
compounded quarterly from the date such Deferred Interest would have been
payable were it not for the Extension Period, to the extent permitted by law. No
Extension Period may end on a date other than a Distribution Payment Date. At
the end of any such Extension Period, the Debenture Issuer shall pay all
Deferred Interest then accrued and unpaid on the Debentures; provided, however,
that no Extension Period may extend beyond the Maturity Date. Prior to the
termination of any Extension Period, the Debenture Issuer may further extend
such period, provided, that such period together with all such previous and
further consecutive extensions thereof shall not exceed 20 consecutive quarterly
periods, or extend beyond the Maturity Date. Upon the termination of any
Extension Period and upon the payment of all Deferred Interest, the Debenture
Issuer may commence a new Extension Period, subject to the foregoing
requirements. No interest or Deferred Interest shall be due and payable during
an Extension Period, except at the end thereof, but Deferred Interest shall
accrue upon each installment of interest that would otherwise have been due and
payable during such Extension Period until such installment is paid. If
Distributions are deferred, the Distributions due shall be paid on the date that
the related Extension Period terminates to Holders of the Securities as they
appear on the books and records of the Trust on the record date immediately
preceding such date. Distributions on the Securities must be paid on the dates
payable (after giving effect to any
A-1-5
Extension Period) to the extent that the Trust has funds legally available for
the payment of such distributions in the Property Account of the Trust. The
Trust's funds available for Distribution to the Holders of the Securities will
be limited to payments received from the Debenture Issuer. The payment of
Distributions out of moneys held by the Trust is guaranteed by the Guarantor
pursuant to the Guarantee.
The Capital Securities shall be redeemable as provided in the Declaration.
A-1-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Capital
Security Certificate to:
_______________________
_______________________
_______________________
(Insert assignee's social security or tax identification number)
_______________________
_______________________
_______________________
(Insert address and zip code of assignee),
and irrevocably appoints _______________________________________________________
as agent to transfer this Capital Security Certificate on the books of the
Trust. The agent may substitute another to act for it, him or her.
Date:_____________________________
Signature:________________________
(Sign exactly as your name appears on the other side of this Capital
Security Certificate)
Signature Guarantee:(1)
--------------------------------
- ----------
(1) 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 Security 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 Security registrar in addition to, or in
substitution for, STAMP, all in accordance with the Securities Exchange
Act of 1934, as amended.
A-1-7
EXHIBIT A-2
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 LAWS AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED
EXCEPT PURSUANT TO AN EXEMPTION FROM REGISTRATION.
EXCEPT AS SET FORTH IN SECTION 8.1 (b) OF THE DECLARATION (AS DEFINED
BELOW), THIS SECURITY MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED.
A-2-1
Certificate Number [C-001] Number of Common Securities 93
Certificate Evidencing Common Securities
of
Valley Commerce Trust I
Valley Commerce Trust I, a statutory trust created under the laws of the
State of Delaware (the "Trust"), hereby certifies that Valley Commerce Bancorp
(the "Holder") is the registered owner of 93 common securities of the Trust
representing undivided beneficial interests in the assets of the Trust
(liquidation amount $1,000 per Common Security)(the "Common Securities"). The
Common Securities represented hereby are issued pursuant to, and the
designation, rights, privileges, restrictions, preferences and other terms and
provisions of the Common Securities shall in all respects be subject to, the
provisions of the Amended and Restated Declaration of Trust of the Trust, dated
as of March 27, 2003, among Donald A. Gilles and Roy O. Estridge, as
Administrators, Wells Fargo Delaware Trust Company, as Delaware Trustee, Wells
Fargo Bank, National Association, as Institutional Trustee, the Holder, as
Sponsor, and the holders from time to time of undivided beneficial interests in
the assets of the Trust, including the designation of the terms of the Common
Securities as set forth in Annex I to the Declaration, as the same may be
amended from time to time (the "Declaration"). Capitalized terms used herein but
not defined shall have the meaning given them in the Declaration. The Sponsor
will provide a copy of the Declaration and the Indenture to the Holder without
charge upon written request to the Sponsor at its principal place of business.
As set forth in the Declaration, when an Event of Default has occurred and
is continuing, the rights of Holders of Common Securities to payment in respect
of Distributions and payments upon Liquidation, redemption or otherwise are
subordinated to the rights of payment of Holders of the Capital Securities.
By acceptance of this Certificate, the Holder is bound by the Declaration
and is entitled to the benefits thereunder.
By acceptance of this Certificate, the Holder agrees to treat, for United
States federal income tax purposes, the Debentures as indebtedness and the
Common Securities as evidence of undivided beneficial ownership in the
Debentures.
This Common Security is governed by, and shall be construed in accordance
with, the laws of the State of Delaware, without regard to principles of
conflict of laws.
A-2-2
IN WITNESS WHEREOF, the Trust has executed this certificate March 27,
2003.
Valley Commerce Trust I
By:___________________________________
Name:______________________________
Title: Administrator
A-2-3
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Common Security will be identical in amount
to the Distributions payable on each Capital Security, which is at a variable
per annum rate of interest, reset quarterly, equal to LIBOR (as defined in the
Declaration) plus 3.30% (subject to the Maximum Rate Increase) (the "Coupon
Rate") of the stated liquidation amount of $1,000 per Capital Security, such
rate being the rate of interest payable on the Debentures to be held by the
Institutional Trustee (provided, that the applicable Coupon Rate may not exceed
12.5% through the Distribution Payment Date on April 7, 2008). Except as set
forth below in respect of an Extension Period, Distributions in arrears for more
than one quarterly period will bear interest thereon compounded quarterly at the
applicable Coupon Rate for each such quarterly period (to the extent permitted
by applicable law). The term "Distributions" as used herein includes cash
distributions, any such compounded distributions and any Additional Interest
payable on the Debentures unless otherwise stated. A Distribution is payable
only to the extent that payments are made in respect of the Debentures held by
the Institutional Trustee and to the extent the Institutional Trustee has funds
legally available in the Property Account therefor. The amount of Distributions
payable for any period will be computed for any full quarterly Distribution
period on the basis of a 360-day year and the actual number of days elapsed in
the relevant Distribution period.
Except as otherwise described below, Distributions on the Common
Securities will be cumulative, will accrue from the date of original issuance
and will be payable quarterly in arrears on January 7, April 7, July 7 and
October 7 of each year, commencing on July 7, 2003 (each, a "Distribution
Payment Date"). Upon submission of Notice, the Debenture Issuer has the right
under the Indenture to defer payments of interest on the Debentures by extending
the interest payment period for up to 20 consecutive quarterly periods (each, an
"Extension Period") at any time and from time to time on the Debentures, subject
to the conditions described below, during which Extension Period no interest
shall be due and payable (except any Additional Interest that may be due and
payable). During any Extension Period, interest will continue to accrue on the
Debentures, and interest on such accrued interest (such accrued interest and
interest thereon referred to herein as "Deferred Interest") will accrue at an
annual rate equal to the Coupon Rate in effect for each such Extension Period,
compounded quarterly from the date such Deferred Interest would have been
payable were it not for the Extension Period, to the extent permitted by law. No
Extension Period may end on a date other than a Distribution Payment Date. At
the end of any such Extension Period, the Debenture Issuer shall pay all
Deferred Interest then accrued and unpaid on the Debentures; provided, however,
that no Extension Period may extend beyond the Maturity Date. Prior to the
termination of any Extension Period, the Debenture Issuer may further extend
such period, provided, that such period together with all such previous and
further consecutive extensions thereof shall not exceed 20 consecutive quarterly
periods, or extend beyond the Maturity Date. Upon the termination of any
Extension Period and upon the payment of all Deferred Interest, the Debenture
Issuer may commence a new Extension Period, subject to the foregoing
requirements. No interest or Deferred Interest shall be due and payable during
an Extension Period, except at the end thereof, but Deferred Interest shall
accrue upon each installment of interest that would otherwise have been due and
payable during such Extension Period until such installment is paid. If
Distributions are deferred, the Distributions due shall be paid on the date that
the related Extension Period terminates to Holders of the Securities as they
appear on the books and records of the Trust on the record date immediately
preceding such date.
A-2-4
Distributions on the Securities must be paid on the dates payable (after
giving effect to any Extension Period) to the extent that the Trust has funds
legally available for the payment of such distributions in the Property Account
of the Trust. The Trust's funds legally available for Distribution to the
Holders of the Securities will be limited to payments received from the
Debenture Issuer. The payment of Distributions out of moneys held by the Trust
is guaranteed by the Guarantor pursuant to the Guarantee.
The Common Securities shall be redeemable as provided in the Declaration.
A-2-5
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Common
Security Certificate to:
_______________________
_______________________
_______________________
(Insert assignee's social security or tax identification number)
_______________________
_______________________
_______________________
(Insert address and zip code of assignee),
and irrevocably appoints ________ as agent to transfer this Common Security
Certificate on the books of the Trust. The agent may substitute another to act
for him or her.
Date:________________________________
Signature:___________________________
(Sign exactly as your name appears on the other side of this Common Security
Certificate)
Signature Guarantee:(2)
---------------------------
- ----------
(2) Signature must be guaranteed by an "eligible guarantor institution" that
is a bank, stockbroker, savings and loan association or credit union,
meeting the requirements of the Security 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 Security registrar in addition to, or in
substitution for, STAMP, all in accordance with the Securities Exchange
Act of 1934, as amended.
EXHIBIT B
FORM OF TRANSFEREE CERTIFICATE
TO BE EXECUTED BY TRANSFEREES OTHER THAN QIBS
Valley Commerce Bancorp
Valley Commerce Trust I
200 S. Court St.
Visalia, California 93291
Re: Purchase of $1,000 stated liquidation amount of TP Securities
(the "Capital Securities") of Valley Commerce Trust I
Ladies and Gentlemen:
In connection with our purchase of the Capital Securities we confirm that:
1. We understand that the TP Securities (the "Capital Securities") of
Valley Commerce Trust I (the "Trust") (including the guarantee (the "Guarantee")
of Valley Commerce Bancorp (the "Company") executed in connection therewith) and
the Junior Subordinated Debt Securities due April 7, 2033 of the Company (the
"Subordinated Debt Securities") (the Capital Securities, the Guarantee and the
Subordinated Debt Securities together being referred to herein as the "Offered
Securities"), have not been registered under the Securities Act of 1933, as
amended (the "Securities Act"), and may not be offered or sold except as
permitted in the following sentence. We agree on our own behalf and on behalf of
any investor account for which we are purchasing the Offered Securities that, if
we decide to offer, sell or otherwise transfer any such Offered Securities, such
offer, sale or transfer will be made only (a) to the Company or the Trust, (b)
pursuant to Rule 144A under the Securities Act, to a person we reasonably
believe is a qualified institutional buyer under Rule 144A (a "QIB") that
purchases for its own account or for the account of a QIB and to whom notice is
given that the transfer is being made in reliance on Rule 144A, (c) pursuant to
an exemption from registration, to an "accredited investor" within the meaning
of subparagraph (a) (1), (2), (3) or (7) of Rule 501 under the Securities Act
that is acquiring Offered Securities for its own account or for the account of
such an accredited investor for investment purposes and not with a view to, or
for offer or sale in connection with, any distribution thereof in violation of
the Securities Act, or (d) pursuant to another available exemption from the
registration requirements of the Securities Act, and in each of the foregoing
cases in accordance with any applicable state securities laws and any
requirements of law that govern the disposition of our property. The foregoing
restrictions on resale will not apply subsequent to the date on which, in the
written opinion of counsel, the Capital Securities are not "restricted
securities" within the meaning of Rule 144 under the Securities Act. If any
resale or other transfer of the Offered Securities is proposed to be made
pursuant to clause (c) or (d) above, the transferor shall deliver a letter from
the transferee substantially in the form of this letter to the Institutional
Trustee as Transfer Agent, which shall provide as applicable, among other
things, that the transferee is an "accredited investor" within the meaning of
subparagraph (a)(1), (2), (3) or (7) of Rule 501 under the Securities Act that
is acquiring such Securities for investment purposes and not for distribution in
violation of the Securities Act. We acknowledge on our behalf and on behalf of
any investor account for which we are purchasing Securities that
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the Trust and the Company reserve the right prior to any offer, sale or other
transfer pursuant to clause (c) or (d) to require the delivery of any opinion of
counsel, certifications and/or other information satisfactory to the Trust and
the Company. We understand that the certificates for any Offered Security that
we receive will bear a legend substantially to the effect of the foregoing.
2. We are an "accredited investor" within the meaning of subparagraph (a)
(1), (2), (3) or (7) of Rule 501 under the Securities Act purchasing for our own
account or for the account of such an "accredited investor," and we are
acquiring the Offered Securities for investment purposes and not with view to,
or for offer or sale in connection with, any distribution in violation of the
Securities Act, and we have such knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of our
investment in the Offered Securities, and we and any account for which we are
acting are each able to bear the economic risks of our or its investment.
3. We are acquiring the Offered Securities purchased by us for our own
account (or for one or more accounts as to each of which we exercise sole
investment discretion and have authority to make, and do make, the statements
contained in this letter) and not with a view to any distribution of the Offered
Securities, subject, nevertheless, to the understanding that the disposition of
our property will at all times be and remain within our control.
4. In the event that we purchase any Capital Securities or any
Subordinated Debt Securities, we will acquire such Capital Securities having an
aggregate stated liquidation amount of not less than $100,000 or such
Subordinated Debt Securities having an aggregate principal amount not less than
$100,000, for our own account and for each separate account for which we are
acting.
5. We acknowledge that we either (A) are not a fiduciary of a pension,
profitsharing or other employee benefit plan subject to the Employee Retirement
Income Security Act of 1974, as amended ("ERISA") (a "Plan"), or an entity whose
assets include "plan assets" by reason of any Plan's investment in the entity
and are not purchasing the Offered Securities on behalf of or with "plan assets"
by reason of any Plan's investment in the entity and are not purchasing the
Offered Securities on behalf of or with "plan assets" of any Plan or (B) are
eligible for the exemptive relief available under one or more of the following
prohibited transaction class exemptions ("PTCEs") issued by the U.S. Department
of Labor: PTCE 96-23, 95-60, 91-38, 90-1 or 84-14.
6. We acknowledge that the Trust and the Company and others will rely upon
the truth and accuracy of the foregoing acknowledgments, representations,
warranties and agreements and agree that if any of the acknowledgments,
representations, warranties and agreements deemed to have been made by our
purchase of the Offered Securities are no longer accurate, we shall promptly
notify the Initial Purchaser. If we are acquiring any Offered Securities as a
fiduciary or agent for one or more investor accounts, we represent that we have
sole discretion with respect to each such investor account and that we have full
power to make the foregoing acknowledgments, representations and agreement on
behalf of each such investor account.
B-2
____________________________________
(Name of Purchaser)
By:_________________________________
Date:_______________________________
Upon transfer, the Offered Securities would be registered in the name of
the new beneficial owner as follows.
Name:__________________________
Address:_______________________
Taxpayer ID Number:____________
B-3
EXHIBIT C
FORM OF TRANSFEROR CERTIFICATE
TO BE EXECUTED FOR QIBs
________, [ ]
Valley Commerce Bancorp
Valley Commerce Trust I
200 S. Court St.
Visalia, California 93291
Re: Purchase of $1,000 stated liquidation amount of TP Securities
(the "Capital Securities") of Valley Commerce Trust I
Reference is hereby made to the Amended and Restated Declaration of Trust
of Valley Commerce Trust I, dated as of March 27, 2003 (the "Declaration"),
among Donald A. Gilles and Roy O. Estridge, as Administrators, Wells Fargo
Delaware Trust Company, as Delaware Trustee, Wells Fargo Bank, National
Association, as Institutional Trustee, Valley Commerce Bancorp, as Sponsor, and
the holders from time to time of undivided beneficial interests in the assets of
Valley Commerce Trust I. Capitalized terms used but not defined herein shall
have the meanings given them in the Declaration.
This letter relates to $[__________] aggregate liquidation amount of
Capital Securities which are held in the name of [name of transferor] (the
"Transferor").
In accordance with Section 8.2(b) of the Declaration, the Transferor does
hereby certify that such Capital Securities are being transferred in accordance
with (i) the transfer restrictions set forth in the Capital Securities and (ii)
Rule 144A under the Securities Act ("Rule 144A"), to a transferee that the
Transferor reasonably believes is purchasing the Capital Securities for its own
account or an account with respect to which the transferee exercises sole
investment discretion and the transferee and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A, in a transaction meeting
the requirements of Rule 144A and in accordance with applicable securities laws
of any state of the United States or any other jurisdiction.
You are entitled to rely upon this letter and are irrevocably authorized
to produce this letter or a copy hereof to any interested party in any
administrative or legal proceeding or official inquiry with respect to the
matters covered hereby.
______________________________________
(Name of Transferor)
By:___________________________________
Name:______________________________
Title:_____________________________
Date:_________________________________
C-1