Exhibit 4(f)(i)(A)
SWEPCO CAPITAL TRUST I
AMENDED AND RESTATED
TRUST AGREEMENT
AMONG
SOUTHWESTERN ELECTRIC POWER COMPANY, AS DEPOSITOR,
THE BANK OF NEW YORK, AS PROPERTY TRUSTEE,
THE BANK OF NEW YORK (DELAWARE), AS DELAWARE TRUSTEE,
AND
WENDY G. HARGUS AND JEFFREY D. CROSS,
AS ADMINISTRATIVE TRUSTEES
DATED AS OF SEPTEMBER 1, 2003
TABLE OF CONTENTS
PAGE
----
ARTICLE I DEFINED TERMS ..........................................................................................2
SECTION 1.01. Definitions.........................................2
ARTICLE II ESTABLISHMENT OF THE TRUST ...........................................................................11
SECTION 2.01. Name ..............................................11
SECTION 2.02. Offices of the Trustees; Principal Place
of Business....................................11
SECTION 2.03. Initial Contribution of Trust Property;
Organizational Expenses........................12
SECTION 2.04. Issuance of the Preferred Securities...............12
SECTION 2.05. Subscription and Purchase of Junior
Subordinated Debentures; Issuance of
the Common Securities..........................12
SECTION 2.06. Declaration of Trust...............................13
SECTION 2.07. Authorization to Enter into Certain
Transactions...................................13
SECTION 2.08. Assets of Trust....................................18
SECTION 2.09. Title to Trust Property............................18
SECTION 2.10. Mergers and Consolidations of the Trust............18
ARTICLE III PAYMENT ACCOUNT .....................................................................................19
SECTION 3.01. Payment Account....................................19
ARTICLE IV DISTRIBUTIONS; REDEMPTION ............................................................................20
SECTION 4.01. Distributions......................................20
SECTION 4.02. Distribution Rate..................................21
SECTION 4.03. Distribution Periods...............................25
SECTION 4.04. Redemption.........................................25
SECTION 4.05. Subordination of Common Securities and
Distributions..................................27
SECTION 4.06. Payment Procedures.................................27
SECTION 4.07. Tax Returns and Reports............................28
ARTICLE V TRUST SECURITIES CERTIFICATES .........................................................................28
SECTION 5.01. Initial Ownership..................................28
SECTION 5.02. The Trust Securities Certificates..................28
SECTION 5.03. Authentication of Trust Securities
Certificates...................................28
SECTION 5.04. Registration of Transfer and Exchange of
Preferred Securities Certificates..............29
SECTION 5.05. Mutilated, Destroyed, Lost or Stolen Trust
Securities Certificates........................29
SECTION 5.06. Persons Deemed Securityholders.....................30
SECTION 5.07. Access to List of Securityholders' Names
and Addresses..................................30
SECTION 5.08. Maintenance of Office or Agency....................31
SECTION 5.09. Appointment of Paying Agent........................31
SECTION 5.10. Ownership of Common Securities by Depositor........31
SECTION 5.11. Book-Entry Preferred Securities
Certificates; Common Securities
Certificate....................................32
SECTION 5.12. Notices to Clearing Agency.........................33
SECTION 5.13. Definitive Preferred Securities
Certificates...................................33
SECTION 5.14. Rights of Securityholders..........................33
ARTICLE VI ACTS OF SECURITYHOLDERS; MEETINGS; VOTING.............................................................34
SECTION 6.01. Limitations on Voting Rights.......................34
SECTION 6.02. Notice of Meetings.................................37
SECTION 6.03. Meetings of Preferred Securityholders..............37
SECTION 6.04. Voting Rights......................................38
SECTION 6.05. Proxies, etc.......................................38
SECTION 6.06. Securityholder Action by Written Consent...........38
SECTION 6.07. Record Date for Voting and Other Purposes..........38
SECTION 6.08. Acts of Securityholders............................39
SECTION 6.09. Inspection of Records..............................40
ARTICLE VII REPRESENTATIONS AND WARRANTIES OF THE TRUSTEES.......................................................40
SECTION 7.01. Representations and Warranties of the
Trustees.......................................40
ARTICLE VIII THE TRUSTEES .......................................................................................41
SECTION 8.01. Certain Duties and Responsibilities................41
SECTION 8.02. Notice of Defaults.................................41
SECTION 8.03. Certain Rights of Property Trustee.................42
SECTION 8.04. Not Responsible for Recitals or Issuance
of Securities..................................43
SECTION 8.05. May Hold Securities................................43
SECTION 8.06. Compensation; Fees; Indemnity......................44
SECTION 8.07. Trustees Required; Eligibility.....................44
SECTION 8.08. Conflicting Interests..............................45
SECTION 8.09. Co-Trustees and Separate Trustee...................45
SECTION 8.10. Resignation and Removal; Appointment of
Successor......................................46
SECTION 8.11. Acceptance of Appointment by Successor.............47
SECTION 8.12. Merger, Conversion, Consolidation or
Succession to Business.........................48
SECTION 8.13. Preferential Collection of Claims Against
Depositor or Trust.............................48
SECTION 8.14. Reports by Property Trustee........................48
SECTION 8.15. Reports to the Property Trustee....................49
SECTION 8.16. Evidence of Compliance with Conditions
Precedent......................................49
SECTION 8.17. Number of Trustees.................................49
SECTION 8.18. Delegation of Power................................50
SECTION 8.19. Enforcement of Rights of Property Trustee
by Securityholders.............................50
SECTION 8.20. Delaware Trustee...................................51
ARTICLE IX TERMINATION AND LIQUIDATION ..........................................................................51
SECTION 9.01. Termination Upon Expiration Date...................51
SECTION 9.02. Early Termination..................................51
SECTION 9.03. Termination........................................52
SECTION 9.04. Liquidation........................................52
SECTION 9.05. Bankruptcy.........................................53
SECTION 9.06. Certificate of Cancellation........................53
ARTICLE X REMARKETING PROCEDURES ................................................................................54
SECTION 10.01. Election to Remarket...............................54
SECTION 10.02. Notice of Election.................................54
SECTION 10.03. Determination of Distribution Rate.................55
ARTICLE XI MISCELLANEOUS PROVISIONS .............................................................................56
SECTION 11.01. Guarantee by the Depositor.........................56
SECTION 11.02. Limitation of Rights of Securityholders............57
SECTION 11.03. Amendment..........................................57
SECTION 11.04. Separability.......................................58
SECTION 11.05. Governing Law......................................58
SECTION 11.06. Successors.........................................58
SECTION 11.07. Headings...........................................58
SECTION 11.08. Notice and Demand..................................58
SECTION 11.09. Agreement Not to Petition..........................59
SECTION 11.10. Conflict with Trust Indenture Act..................60
SWEPCO CAPITAL TRUST I
Certain Sections of this Trust Agreement relating to
Sections 310 through 318 of the
Trust Indenture Act of 1939:
TRUST INDENTURE ACT SECTION TRUST AGREEMENT SECTION
- --------------------------- -----------------------
Section 310(a)(1) .......................................................8.07
(a)(2) ...........................................................8.07
(a)(3) ...........................................................8.09
(a)(4) .................................................Not Applicable
(b) ..............................................................8.08
Section 311(a) ..........................................................8.13
(b) ..............................................................8.13
Section 312(a) ..........................................................5.07
(b) ..............................................................5.07
(c) ..............................................................5.07
Section 313(a) .......................................................8.14(a)
(a)(4) ........................................................8.14(b)
(b) ...........................................................8.14(b)
(c) ...........................................................8.14(a)
(d) ..................................................8.14(a), 8.14(b)
Section 314(a) ..........................................................8.15
(b) ....................................................Not Applicable
(c)(1) .....................................................8.15, 8.16
(c)(2) ...........................................................8.16
(c)(3) ...........................................................8.16
(d) ....................................................Not Applicable
(e) ..............................................................8.16
Section 315(a) ..........................................................8.01
(b) .....................................................8.02, 8.14(b)
(c) ...........................................................8.01(a)
(d) ........................................................8.01, 8.03
(e) ....................................................Not Applicable
Section 316(a) ................................................Not Applicable
(a)(1)(A) ........................................................8.19
(a)(1)(B) ........................................................8.19
(a)(2) .................................................Not Applicable
(b) ....................................................Not Applicable
(c) ....................................................Not Applicable
Section 317(a)(1) .............................................Not Applicable
(a)(2) .................................................Not Applicable
(b) ..............................................................5.09
Section 318(a) .........................................................11.10
- --------------
Note: This Cross Reference Table does not constitute part of the Trust Agreement
and shall not affect the
interpretation of any of its terms and provisions.
AMENDED AND RESTATED TRUST AGREEMENT
THIS AMENDED AND RESTATED TRUST AGREEMENT is made as of September 1,
2003, by and among (i) Southwestern Electric Power Company, a Delaware
corporation (the "Depositor" or the "Company"); (ii) The Bank of New York, a
banking corporation duly organized and existing under the laws of New York, as
trustee (the "Property Trustee" and, in its separate corporate capacity and not
in its capacity as Trustee, the "Bank"); (iii) The Bank of New York (Delaware),
a banking corporation duly organized and existing under the laws of the State of
Delaware, as Delaware trustee (the "Delaware Trustee" and, in its separate
corporate capacity and not in its capacity as Delaware Trustee, the "Delaware
Bank"); (iv) Wendy G. Hargus, an individual, and Jeffrey D. Cross, an
individual, as administrative trustees (each an "Administrative Trustee" and
together the "Administrative Trustees") (the Property Trustee, the Delaware
Trustee and the Administrative Trustees referred to collectively as the
"Trustees"); and (v) the several Holders, as hereinafter defined.
W I T N E S S E T H :
WHEREAS, the Depositor, the Bank, the Delaware Bank, Jeffrey D. Cross
and Geoffrey S. Chatas, an individual, have heretofore duly declared and
established a statutory trust pursuant to the Delaware Statutory Trust Act by
entering into that certain Trust Agreement, dated as of August 15, 2003 (the
"Original Trust Agreement"), and by the execution and filing by the Trustees
with the Secretary of State of the State of Delaware of the Certificate of
Trust, dated August 15, 2003;
WHEREAS, Geoffrey S. Chatas resigned as an Administrative Trustee under
the Original Trust Agreement by giving written notice thereof to the Depositor
pursuant to Section 8 of the Original Trust Agreement, and the Depositor
accepted such resignation, and pursuant to this Trust Agreement, the Depositor
appoints Wendy G. Hargus as an Administrative Trustee, who by her execution
hereof accepts such appointment; and
WHEREAS, the parties hereto desire to amend and restate the Original
Trust Agreement in its entirety as set forth herein to provide for, among other
things, (i) the acquisition by the Trust from the Depositor of all of the right,
title and interest in the Junior Subordinated Debentures; (ii) the issuance of
the Common Securities by the Trust to the Depositor; (iii) the issuance and sale
of the Preferred Securities by the Trust pursuant to the Underwriting Agreement
and (iv) the appointment of Wendy G. Hargus as an Administrative Trustee as
described above.
NOW THEREFORE, in consideration of the agreements and obligations set
forth herein and for other good and valuable consideration, the sufficiency of
which is hereby acknowledged, each party, for the benefit of the other parties
and for the benefit of the Securityholders, hereby amends and restates the
Original Trust Agreement in its entirety and agrees as follows:
ARTICLE I
DEFINED TERMS
SECTION 1.01 DEFINITIONS
For all purposes of this Trust Agreement, except as otherwise expressly
provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(b) all other terms used herein that are defined in the Trust Indenture
Act, either directly or by reference therein, have the meanings assigned to them
therein;
(c) unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the case may be,
of this Trust Agreement; and
(d) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Trust Agreement as a whole and not to any
particular Article, Section or other subdivision.
"Act" has the meaning specified in Section 6.08.
"Administrative Trustee" means each of the individuals identified as an
"Administrative Trustee" in the preamble to this Trust Agreement solely in their
capacities as Administrative Trustees of the Trust formed and continued
hereunder and not in their individual capacities, or such trustee's successor(s)
in interest in such capacity, or any successor "Administrative Trustee"
appointed as herein provided.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Bank" has the meaning specified in the preamble to this Trust
Agreement.
"Bankruptcy Event" means, with respect to any Person:
(i) the entry of a decree or order by a court having
jurisdiction in the premises judging such Person a bankrupt or
insolvent, or approving as properly filed a petition seeking
reorganization, arrangement, adjudication or composition of or in
respect of such Person under federal bankruptcy law or any other
applicable federal or state law, or appointing a receiver,
liquidator, assignee, trustee, sequestrator or other similar
official of such Person or of any substantial part of its property,
or ordering the winding up or liquidation of its affairs, and the
2
continuance of such decree or order unstayed and in effect for a
period of 60 consecutive days; or
(ii) the institution by such Person of proceedings to be
adjudicated a bankrupt or insolvent, or the consent by it to the
institution of bankruptcy or insolvency proceedings against it, or
the filing by it of a petition or answer or consent seeking
reorganization or relief under federal bankruptcy law or any other
applicable federal or state law, or the consent by it to the filing
of such petition or to the appointment of a receiver, liquidator,
assignee, trustee, sequestrator or similar official of such Person
or of any substantial part of its property, or the making by it of
an assignment for the benefit of creditors, or the admission by it
in writing of its inability to pay its debts generally as they
become due, or the taking of action by such Person in furtherance of
any such action.
"Bankruptcy Laws" has the meaning specified in Section 11.09.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Depositor to have been duly adopted
by the Depositor's Board of Directors or a duly authorized committee thereof and
to be in full force and effect on the date of such certification, and delivered
to the Trustees.
"Book-Entry Preferred Securities Certificates" means certificates
representing Preferred Securities issued in global, fully registered form to the
Clearing Agency as described in Section 5.11.
"Business Day" means a day other than (i) a Saturday or a Sunday; (ii)
a day on which banks in New York, New York are authorized or obligated by law or
executive order to remain closed; or (iii) a day on which the Indenture
Trustee's corporate trust office is closed for business.
"Calculation Agent" means The Bank of New York, acting as calculation
agent, or its successor appointed by the Company and the Trust.
"Calculation Agent Agreement" means the agreement among the Company,
the Trust and The Bank of New York, as calculation agent, dated as of October 1,
2003.
"Calendar Period" means a period of 180 days.
"Certificate Depository Agreement" means the agreement among the Trust,
the Property Trustee and The Depository Trust Company, as the initial Clearing
Agency, dated September 29, 2003, relating to the Preferred Securities
Certificates.
"Clearing Agency" means an organization registered as a "clearing
agency" pursuant to Section 17A of the Exchange Act. The Depository Trust
Company will be the initial Clearing Agency.
3
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time a Clearing
Agency effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission, as from time
to time constituted, created under the Exchange Act, or, if at any time after
the execution of this instrument such Commission is not existing and performing
the duties now assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.
"Common Security" means an undivided beneficial ownership interest in
the assets of the Trust having a Liquidation Amount of $1,000 and having the
rights provided therefor in this Trust Agreement, including the right to receive
Distributions and a Liquidation Distribution as provided herein.
"Common Securities Certificate" means a certificate evidencing
ownership of a Common Security or Securities, substantially in the form attached
as Exhibit C.
"Company" means Southwestern Electric Power Company.
"Definitive Preferred Securities Certificates" means either or both (as
the context requires) of (i) Preferred Securities Certificates issued in
certificated, fully registered form as provided in Section 5.11(a) and (ii)
Preferred Securities Certificates issued in certificated, fully registered form
as provided in Section 5.13.
"Delaware Bank" has the meaning specified in the preamble to this Trust
Agreement.
"Delaware Statutory Trust Act" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code Section 3801 et seq., as it may be amended from time
to time.
"Delaware Trustee" means the commercial bank or trust company or any
other Person identified as the "Delaware Trustee" and has the meaning specified
in the preamble to this Trust Agreement solely in its capacity as Delaware
Trustee of the Trust formed and continued hereunder and not in its individual
capacity, or its successor in interest in such capacity, or any successor
Delaware Trustee appointed as herein provided.
"Depositor" means Southwestern Electric Power Company, in its capacity
as "Depositor" under this Trust Agreement.
"Designated CMT Maturity Index" means the original period to maturity
of the U.S. Treasury securities (10 years) with respect to which the 10-year
Treasury CMT will be calculated.
"Distribution Payment Date" means each day on which Distributions are
payable determined based on the prevailing Distribution Rate.
4
"Distribution Period" means each semiannual period in a Fixed Rate
Period and each quarterly period in a Floating Rate Period for which
Distributions are payable.
"Distribution Rate" means the rate at which Distributions will accrue
in respect of any Distribution Period, as determined pursuant to the terms of
this Trust Agreement, whether by Remarketing or otherwise.
"Distributions" means amounts payable in respect of the Trust
Securities as provided in Section 4.01.
"Election Date" means a date that is no later than the fifth Business
Day prior to the proposed Remarketing Date.
"Event of Default" means any one of the following events (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(a) the occurrence of an Indenture Event of Default;
(b) default by the Trust in the payment of any Distribution
when it becomes due and payable, and continuation of such default for a period
of 30 days;
(c) default by the Trust in the payment of any Redemption Price
of any Trust Security when it becomes due and payable;
(d) default in the performance, or breach, in any material
respect, of any covenant or warranty of the Property Trustee and the Delaware
Trustee in this Trust Agreement (other than a covenant or warranty a default in
the performance of which or the breach of which is dealt with in clause (b) or
(c) above) and continuation of such default or breach for a period of 60 days
after there has been given, by registered or certified mail, to the appropriate
trustees and the Depositor by the Holders of at least 33% in aggregate
Liquidation Amount of the Outstanding Preferred Securities, a written notice
specifying such default or breach and requiring it to be remedied and stating
that such notice is a "Notice of Default" hereunder;
(e) the occurrence of any Bankruptcy Event with respect to the
Property Trustee or all or substantially all of its property if a successor
Property Trustee has not been appointed within a period of 90 days thereof; or
(f) the occurrence of any Bankruptcy Event with respect to the
Trust.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Expense Agreement" means the Agreement as to Expenses and Liabilities
between the Company and the Trust, substantially in the form attached as Exhibit
B, as amended from time to time.
"Extension Period" has the meaning specified in Section 4.01(d).
5
"Federal Reserve Board" means the Board of Governors of the Federal
Reserve System.
"Fixed Rate" means the Distribution Rate during a Fixed Rate Period as
determined by a Remarketing.
"Fixed Rate Period" means the Initial Fixed Rate Period and each period
set by the Company and the Administrative Trustees during a Remarketing for
which the Fixed Rate determined in such Remarketing will apply; provided,
however, that a Fixed Rate Period must be for a duration of at least six months,
may not extend beyond the stated maturity of the Junior Subordinated Debentures
and may not end on a day other than a day immediately preceding a Distribution
Payment Date.
"Floating Rate" means the Distribution Rate during a Floating Rate
Period calculated pursuant to Section 4.02(e).
"Floating Rate Determination Date" means the second London Business Day
immediately preceding the first day of the relevant Distribution Period in the
Floating Rate Period.
"Floating Rate Period" means any period during which a Floating Rate is
in effect.
"Guarantee" means the Guarantee Agreement executed and delivered by the
Company and The Bank of New York, as Guarantee Trustee, contemporaneously with
the execution and delivery of this Trust Agreement, for the benefit of the
Holders of the Trust Securities, as amended from time to time.
"Indenture Event of Default" means an "Event of Default" as defined in
the Subordinated Indenture.
"Indenture Redemption Date" means "Redemption Date," as defined in the
Subordinated Indenture.
"Indenture Trustee" means the trustee under the Subordinated Indenture.
"Initial Distribution Rate" means 5.25% per annum.
"Initial Fixed Rate Period" means the Issue Date through September 30,
2008.
"Investment Company Act" means the Investment Company Act of 1940, as
amended.
"Issue Date" means the date of the delivery of the Trust Securities.
"Junior Subordinated Debentures" means the $113,403,000 aggregate
principal amount of the Depositor's Series B Junior Subordinated Debentures due
October 1, 2043, issued pursuant to the Subordinated Indenture.
6
"Lien" means any lien, pledge, charge, encumbrance, mortgage, deed of
trust, adverse ownership interest, hypothecation, assignment, security interest
or preference, priority or other security agreement or preferential arrangement
of any kind or nature whatsoever.
"Like Amount" means (i) Trust Securities having a Liquidation Amount
equal to the principal amount of Junior Subordinated Debentures to be
contemporaneously redeemed or repaid in accordance with the Subordinated
Indenture and the proceeds of which will be used to pay the Redemption Price of
such Trust Securities and (ii) Junior Subordinated Debentures having a principal
amount equal to the Liquidation Amount of the Trust Securities of the Holder to
whom such Junior Subordinated Debentures are distributed.
"Liquidation Amount" means the stated amount of $1,000 per Trust
Security.
"Liquidation Date" means the date on which Junior Subordinated
Debentures are to be distributed to Holders of Trust Securities in connection
with a dissolution and liquidation of the Trust pursuant to Section 9.04.
"Liquidation Distribution" has the meaning specified in Section 9.05.
"London Business Day" means a day that is a Business Day and a day on
which dealings in deposits in U.S. dollars are transacted, or with respect to
any future date are expected to be transacted, in the London interbank market.
"Maturity Date of the Junior Subordinated Debentures" means "Stated
Maturity" as defined in the Subordinated Indenture.
"Majority in Liquidation Amount of the Preferred Securities" or
"Majority in Liquidation Amount of the Common Securities" means, except as
provided by the Trust Indenture Act, Preferred Securities or Common Securities,
as the case may be, representing more than 50% of the aggregate Liquidation
Amount of all then Outstanding Preferred Securities or Common Securities, as the
case may be.
"Officers' Certificate" means a certificate signed by the Chairman of
the Board, a Vice Chairman of the Board, the President or a Vice President, and
by the Treasurer, an Assistant Treasurer, the Secretary or an Assistant
Secretary, of the Depositor, and delivered to the appropriate Trustee. One of
the officers signing an Officers' Certificate given pursuant to Section 8.16
shall be the principal executive, financial or accounting officer of the
Depositor. An Officers' Certificate delivered with respect to compliance with a
condition or covenant provided for in this Trust Agreement shall include:
(a) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the definitions relating
thereto;
(b) a brief statement of the nature and scope of the
examination or investigation undertaken by each officer in rendering the
Officers' Certificate;
7
(c) a statement that each such officer has made such
examination or investigation as is necessary, in such officer's opinion, to
express an informed opinion as to whether or not such covenant or condition has
been complied with; and
(d) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied with.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Trust, the Trustees or the Depositor, but not an employee of the
Trust or the Trustees, and who shall be reasonably acceptable to the Property
Trustee. Any Opinion of Counsel pertaining to federal income tax matters may
rely on published rulings of the Internal Revenue Service.
"Original Trust Agreement" has the meaning specified in the recitals to
this Trust Agreement.
"Outstanding", when used with respect to Preferred Securities, means,
as of the date of determination, all Preferred Securities theretofore
authenticated and delivered under this Trust Agreement, except:
(i) Preferred Securities theretofore canceled by the
Administrative Trustees or delivered to the Administrative Trustees
for cancellation;
(ii) Preferred Securities for whose payment or redemption money
in the necessary amount has been theretofore deposited with the
Property Trustee or any Paying Agent for the Holders of such
Preferred Securities; provided that if such Preferred Securities are
to be redeemed, notice of such redemption has been duly given
pursuant to this Trust Agreement; and
(iii) Preferred Securities in exchange for or in lieu of which
other Preferred Securities have been authenticated and delivered
pursuant to this Trust Agreement;
provided, however, that in determining whether the Holders of the requisite
Liquidation Amount of the Outstanding Preferred Securities have given any
request, demand, authorization, direction, notice, consent or waiver hereunder,
Preferred Securities owned by the Depositor, the Holder of the Common
Securities, any Trustee or any Affiliate of the Depositor or any Trustee shall
be disregarded and deemed not to be Outstanding, except that (a) in determining
whether any Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Preferred Securities
which such Trustee knows to be so owned shall be so disregarded and (b) the
foregoing shall not apply at any time when all of the outstanding Preferred
Securities are owned by the Depositor, the Holder of the Common Securities, one
or more Trustees and/or any such Affiliate. Preferred Securities so owned which
have been pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Administrative Trustees the pledgee's
right so to act with respect to such Preferred Securities and that the pledgee
is not the Depositor or any Affiliate of the Depositor.
"Owner" means each Person who is the beneficial owner of a Book-Entry
Preferred Securities Certificate as reflected in the records of the Clearing
Agency or, if a Clearing Agency
8
Participant is not the Owner, then as reflected in the records of a Person
maintaining an account with such Clearing Agency (directly or indirectly, in
accordance with the rules of such Clearing Agency).
"Paying Agent" means any paying agent or co-paying agent appointed
pursuant to Section 5.09 and shall initially be the Property Trustee.
"Payment Account" means a segregated non-interest-bearing corporate
trust account maintained by the Property Trustee for the benefit of the
Securityholders in which all amounts paid in respect of the Junior Subordinated
Debentures will be held and from which the Property Trustee shall make payments
to the Securityholders in accordance with Section 4.01.
"Person" means an individual, corporation, partnership, joint venture,
trust, limited liability company or corporation, unincorporated organization or
government or any agency or political subdivision thereof.
"Preferred Securities Certificate" means a certificate evidencing
ownership of a Preferred Security or Securities, substantially in the form
attached as Exhibit A.
"Preferred Security" means an undivided beneficial ownership interest
in the assets of the Trust having a Liquidation Amount of $1,000 and having
rights provided therefor in this Trust Agreement, including the right to receive
Distributions and a Liquidation Distribution as provided herein.
"Property Trustee" means the commercial bank or trust company
identified as the "Property Trustee" in the preamble to this Trust Agreement
solely in its capacity as Property Trustee of the Trust formed and continued
hereunder and not in its individual capacity, or its successor in interest in
such capacity, or any successor "Property Trustee" as herein provided.
"Record Date" means the opening of business on the Business Day
immediately preceding the relevant Distribution Payment Date.
"Redemption Date" means, with respect to any Trust Security to be
redeemed, the date fixed for such redemption by or pursuant to this Trust
Agreement; provided that each Indenture Redemption Date and the Maturity Date of
the Junior Subordinated Debentures shall be a Redemption Date for a Like Amount
of Trust Securities.
"Redemption Price" means, with respect to any date fixed for redemption
of any Trust Security, the Liquidation Amount of such Trust Security, plus
accrued and unpaid Distributions to such date.
"Relevant Trustee" shall have the meaning specified in Section 8.10.
"Remarketing" means the conduct by which a Fixed Rate shall be
determined in accordance with the Remarketing Procedures.
9
"Remarketing Agent" means Lehman Brothers Inc., its successors or
assigns, or such other remarketing agent appointed to such capacity by the
Company and the Administrative Trustees.
"Remarketing Agreement" means the agreement among the Company, the
Trust and Lehman Brothers Inc., as remarketing agent, dated as of October 1,
2003.
"Remarketing Date" means any Business Day no later than the third
Business Day prior to any Remarketing Settlement Date.
"Remarketing Procedures" means those procedures set forth in Article X.
"Remarketing Settlement Date" means, to the extent applicable, (i) the
first Business Day of the next Distribution Period following the expiration of
the Initial Fixed Rate Period and any subsequent Fixed Rate Period; (ii) any
Distribution Payment Date during a Floating Rate Period; or (iii) any
Distribution Payment Date during a time in which Preferred Securities are
redeemable in a Fixed Rate Period subsequent to the Initial Fixed Rate Period.
"Securities Register" and "Securities Registrar" are described in
Section 5.04.
"Securityholder" or "Holder" means a Person in whose name a Trust
Security or Securities is registered in the Securities Register; and any such
Person who is a beneficial owner within the meaning of the Delaware Statutory
Trust Act.
"Subordinated Indenture" means the Subordinated Indenture, dated as of
September 1, 2003, between the Depositor and the Indenture Trustee, as the same
may be modified, amended or supplemented in accordance with the applicable
provisions thereof including by the Supplemental Indenture.
"Supplemental Indenture" means the First Supplemental Indenture, dated
as of October 1, 2003, between the Depositor and the Indenture Trustee.
"Telerate Page 3750" means the display designated on page 3750 on
MoneyLine Telerate (or such other page as may replace the 3750 page on the
service or such other service as may be nominated by the British Bankers'
Association for the purpose of displaying London interbank offered rates for
U.S. dollar deposits).
"Telerate Page 7051" means the display on MoneyLine Telerate (or any
successor service), on such page (or any other page as may replace such page on
that service), for the purpose of displaying Treasury Constant Maturities as
reported in H.15(519).
"10-year Treasury CMT" has the meaning set forth in Section 4.02(e).
"30-year Treasury CMT" has the meaning set forth in Section 4.02(e).
"3-month LIBOR Rate" has the meaning set forth in Section 4.02(e).
10
"Trust" means the Delaware statutory trust continued hereby and
identified on the cover page to this Trust Agreement.
"Trust Agreement" means this Amended and Restated Trust Agreement, as
the same may be modified, amended or supplemented in accordance with the
applicable provisions hereof, including all exhibits hereto, including, for all
purposes of this Amended and Restated Trust Agreement and any modification,
amendment or supplement, the provisions of the Trust Indenture Act that are
deemed to be a part of and govern this Amended and Restated Trust Agreement and
any such modification, amendment or supplement, respectively.
"Trustees" means the Persons identified as "Trustees" in the preamble
to this Trust Agreement solely in their capacities as Trustees of the Trust
formed and continued hereunder and not in their individual capacities, or their
successor in interest in such capacity, or any successor trustee appointed as
herein provided.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in force
at the date as of which this instrument was executed; provided, however, that in
the event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
"Trust Property" means (i) the Junior Subordinated Debentures; (ii) any
cash on deposit in, or owing to, the Payment Account; and (iii) all proceeds and
rights in respect of the foregoing and any other property and assets for the
time being held or deemed to be held by the Property Trustee pursuant to this
Trust Agreement.
"Trust Securities Certificate" means any one of the Common Securities
Certificates or the Preferred Securities Certificates.
"Trust Security" means any one of the Common Securities or the
Preferred Securities.
"Underwriting Agreement" means the Underwriting Agreement, dated
September 26, 2003, among the Trust, the Depositor and the underwriters named
therein.
ARTICLE II
ESTABLISHMENT OF THE TRUST
SECTION 2.01. NAME
The Trust continued hereby shall be known as "SWEPCo Capital Trust I",
in which name the Trustees may conduct the business of the Trust, make and
execute contracts and other instruments on behalf of the Trust and sue and be
sued. The Administrative Trustees may change the name of the Trust from time to
time following written notice to the Holders.
SECTION 2.02. OFFICES OF THE TRUSTEES; PRINCIPAL PLACE OF BUSINESS
The address of the Property Trustee is The Bank of New York, 101
Barclay Street, New York, New York 10286, or at such other address as the
Property Trustee may designate by
11
written notice to the Securityholders and the Depositor. The principal place of
business of the Delaware Trustee is c/o The Bank of New York (Delaware), White
Clay Center, Route 273, Newark, Delaware 19711, or at such other address in
Delaware as the Delaware Trustee may designate by notice to the Depositor. The
address of the Administrative Trustees is c/o Southwestern Electric Power
Company, 1 Riverside Plaza, Columbus, Ohio 43215, Attention: Treasurer. The
principal place of business of the Trust is c/o Southwestern Electric Power
Company, 1 Riverside Plaza, Columbus, Ohio 43215. The Depositor may change the
principal place of business of the Trust at any time by giving notice thereof to
the Trustees.
SECTION 2.03. INITIAL CONTRIBUTION OF TRUST PROPERTY; ORGANIZATIONAL
EXPENSES
The Administrative Trustees acknowledge receipt in trust from the
Depositor in connection with the Original Trust Agreement of the sum of $10,
which constituted the initial Trust Property. The Depositor, as obligor of the
Junior Subordinated Debentures, shall pay all costs and expenses of the Trust as
they arise (including, but not limited to, costs and expenses relating to the
organization of the Trust, issuance and sale of the Preferred Securities, the
fees and expenses (including reasonable counsel fees and expenses) of the
Trustees) or shall, upon request of the Trustees, promptly reimburse the
Trustees for any such expenses paid by the Trustees. The Depositor shall make no
claim upon the Trust Property for the payment of such expenses.
SECTION 2.04. ISSUANCE OF THE PREFERRED SECURITIES
Contemporaneously with the execution and delivery of this Trust
Agreement, the Administrative Trustees, on behalf of the Trust, shall execute
and deliver to the underwriters named in the Underwriting Agreement Preferred
Securities Certificates, registered in the name of the nominee of the initial
Clearing Agency, in an aggregate amount of 110,000 Preferred Securities having
an aggregate Liquidation Amount of $110,000,000, against receipt of the
aggregate purchase price of such Preferred Securities of $109,604,000, which
amount the Administrative Trustees shall promptly deliver to the Property
Trustee.
SECTION 2.05. SUBSCRIPTION AND PURCHASE OF JUNIOR SUBORDINATED
DEBENTURES; ISSUANCE OF THE COMMON SECURITIES
Contemporaneously with the execution and delivery of this Trust
Agreement, the Administrative Trustees, on behalf of the Trust, shall execute
and deliver to the Depositor Common Securities Certificates, registered in the
name of the Depositor, in an aggregate amount of 3,403 Common Securities having
an aggregate Liquidation Amount of $3,403,000 against payment by the Depositor
of such amount, which amount shall be promptly delivered to the Property
Trustee. Contemporaneously therewith, the Administrative Trustees, on behalf of
the Trust, shall subscribe to and purchase from the Depositor Junior
Subordinated Debentures, registered in the name of the Property Trustee, on
behalf of the Trust and the Holders, and having an aggregate principal amount
equal to $113,403,000, and, in satisfaction of the purchase price for such
Junior Subordinated Debentures, the Property Trustee, on behalf of the Trust,
shall deliver to the Depositor the sum of $113,007,000.
12
SECTION 2.06. DECLARATION OF TRUST
The exclusive purposes and functions of the Trust are (i) to issue and
sell the Trust Securities and use the proceeds from such sale to acquire the
Junior Subordinated Debentures, (ii) to maintain its status as a grantor trust
for federal income tax purposes; (iii) to make Distributions, and (iv) to engage
in those activities necessary, incidental, appropriate or convenient thereto.
The Depositor hereby confirms each of the Bank, the Delaware Bank, Wendy G.
Hargus and Jeffrey D. Cross as trustees of the Trust, to have all the rights,
powers and duties to the extent set forth herein. The Property Trustee hereby
declares that it will hold the Trust Property in trust upon and subject to the
conditions set forth herein for the benefit of the Trust and the
Securityholders. The Trustees shall have all rights, powers and duties set forth
herein and in accordance with applicable law with respect to accomplishing the
purposes of the Trust. The Delaware Trustee shall not be entitled to exercise
any powers, nor shall the Delaware Trustee have any of the duties and
responsibilities, of the Property Trustee or the Administrative Trustees set
forth herein. The Delaware Trustee shall be one of the Trustees for the sole and
limited purpose of fulfilling the requirements of the Delaware Statutory Trust
Act.
SECTION 2.07. AUTHORIZATION TO ENTER INTO CERTAIN TRANSACTIONS
The Trustees shall conduct the affairs of the Trust in accordance with
the terms of this Trust Agreement. Subject to the limitations set forth in
paragraph (c) of this Section, and in accordance with the following paragraphs
(a) and (b), the Trustees shall have the authority to enter into all
transactions and agreements determined by the Trustees to be appropriate in
exercising the authority, express or implied, otherwise granted to the Trustees
under this Trust Agreement, and to perform all acts in furtherance thereof,
including without limitation, the following:
(a) As among the Trustees, the Administrative Trustees, acting
singly or jointly, shall have the exclusive power, duty and authority to act on
behalf of the Trust with respect to the following matters:
(i) to acquire the Junior Subordinated Debentures with the
proceeds of the sale of the Trust Securities; provided, however, the
Administrative Trustees shall cause legal title to all of the Junior
Subordinated Debentures to be vested in, and the Junior Subordinated
Debentures to be held of record in the name of, the Property Trustee
for the benefit of the Trust and Holders of the Trust Securities;
(ii) to give the Depositor and the Property Trustee prompt
written notice of the occurrence of any Special Event (as defined in
the Supplemental Indenture) and to take any ministerial actions in
connection therewith; provided, that the Administrative Trustees
shall consult with the Depositor and the Property Trustee before
taking or refraining to take any ministerial action in relation to a
Special Event;
(iii) to establish a record date with respect to all actions to
be taken hereunder that require a record date be established,
including for the purposes of ss. 316(c) of the Trust Indenture Act
and with respect to Distributions, voting rights,
13
redemptions, and exchanges, and to issue relevant notices to Holders
of the Trust Securities as to such actions and applicable record
dates;
(iv) to bring or defend, pay, collect, compromise, arbitrate,
resort to legal action, or otherwise adjust claims or demands of or
against the Trust ("Legal Action"), unless pursuant to Section
2.07(b)(v), the Property Trustee has the power to bring such Legal
Action;
(v) to employ or otherwise engage employees and agents (who may
be designated as officers with titles) and managers, contractors,
advisors, and consultants and pay reasonable compensation for such
services;
(vi) to cause the Trust to comply with the Trust's obligations
under the Trust Indenture Act;
(vii) to give the certificate to the Property Trustee required
by ss. 314(a)(4) of the Trust Indenture Act, which certificate may
be executed by any Administrative Trustee;
(viii) to take all actions and perform such duties as may be
required of the Administrative Trustees pursuant to the terms of
this Trust Agreement, the Remarketing Agreement and the Calculation
Agent Agreement;
(ix) 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 and of each other
jurisdiction in which such existence is necessary to protect the
limited liability of the Holders of the Trust Securities or to
enable the Trust to effect the purposes for which the Trust has been
created;
(x) to take all action necessary to cause all applicable tax
returns and tax information reports that are required to be filed
with respect to the Trust to be duly prepared and filed by the
Administrative Trustees, on behalf of the Trust;
(xi) to execute and deliver the Trust Securities on behalf of
the Trust;
(xii) to cause the Trust to enter into, and to execute, deliver
and perform on behalf of the Trust, the Remarketing Agreement, the
Calculation Agent Agreement, the Expense Agreement and the
Certificate Depository Agreement and such other agreements as may be
necessary or desirable in connection with the consummation hereof;
(xiii) to assist in the registration of the Preferred
Securities under the Securities Act of 1933, as amended, and under
state securities or blue sky laws, and the qualification of this
Trust Agreement as a trust indenture under the Trust Indenture Act;
14
(xiv) to assist in the listing of the Preferred Securities upon
such securities exchange or exchanges, if necessary and as shall be
determined by the Depositor, and the registration of the Preferred
Securities under the Exchange Act, and the preparation and filing of
all periodic and other reports and other documents pursuant to the
foregoing;
(xv) to send notices (other than notices of default) and other
information regarding the Trust Securities and the Junior
Subordinated Debentures to the Securityholders in accordance with
this Trust Agreement, the Remarketing Agreement and the Calculation
Agent Agreement;
(xvi) to appoint a Paying Agent (subject to Section 5.09),
authenticating agent, Remarketing Agent, Calculation Agent and
Securities Registrar in accordance with this Trust Agreement;
(xvii) to elect to remarket the Preferred Securities and
determine the length of any Fixed Rate Period in accordance with
this Trust Agreement, including redemption dates applicable to any
Fixed Rate Period;
(xviii) to register transfers of the Trust Securities in
accordance with this Trust Agreement;
(xix) to assist in, to the extent provided in this Trust
Agreement, the winding up of the affairs of and termination of the
Trust and the preparation, execution and filing of the certificate
of cancellation with the Secretary of State of the State of
Delaware; and
(xx) to take any action incidental to the foregoing as the
Administrative Trustees may from time to time determine is
necessary, appropriate, convenient or advisable to protect and
conserve the Trust Property for the benefit of the Securityholders
(without consideration of the effect of any such action on any
particular Securityholder).
(b) As among the Trustees, the Property Trustee shall have the
exclusive power, duty and authority to act on behalf of the Trust with respect
to the following matters:
(i) engage in such ministerial activities as shall be necessary
or appropriate to effect promptly the redemption of the Trust
Securities to the extent the Junior Subordinated Debentures are
redeemed, mature or otherwise repaid;
(ii) upon notice of a distribution issued by the Administrative
Trustees in accordance with the terms of this Trust Agreement,
engage in such ministerial activities as shall be necessary or
appropriate to effect promptly the distribution of Junior
Subordinated Debentures to Holders of Trust Securities pursuant to
the terms of this Trust Agreement;
(iii) subject to the terms hereof, exercise all of the rights,
powers and privileges of a holder of the Junior Subordinated
Debentures under the
15
Subordinated Indenture and, if an Event of Default occurs and is
continuing, shall enforce for the benefit of, and subject to the
rights of, the Holders of the Trust Securities, its rights as holder
of the Junior Subordinated Debentures under the Subordinated
Indenture;
(iv) take all actions and perform such duties as may be
specifically required of the Property Trustee pursuant to the terms
of this Trust Agreement;
(v) take any Legal Action specifically required of the Property
Trustee pursuant to the terms of this Trust Agreement which arises
out of or in connection with an Event of Default or the Property
Trustee's duties and obligations under this Trust Agreement, the
Delaware Statutory Trust Act or the Trust Indenture Act;
(vi) the establishment and maintenance of the Payment Account;
(vii) the receipt of and holding of legal title to the Junior
Subordinated Debentures as described herein;
(viii) the collection of interest, principal and any other
payments made in respect of the Junior Subordinated Debentures in
the Payment Account;
(ix) the distribution of amounts owed to the Securityholders in
respect of the Trust Securities;
(x) the sending of notices of default and other information
regarding the Trust Securities and the Junior Subordinated
Debentures to the Securityholders in accordance with this Trust
Agreement;
(xi) the distribution of the Trust Property in accordance with
the terms of this Trust Agreement;
(xii) as provided in this Trust Agreement, the winding up of
the affairs of and termination of the Trust; and
(xiii) the taking of any action incidental to the foregoing as
the Property Trustee may from time to time determine is necessary,
appropriate, convenient or advisable to protect and conserve the
Trust Property for the benefit of the Securityholders (without
consideration of the effect of any such action on any particular
Securityholder).
(c) So long as this Trust Agreement remains in effect, the Trust (or
the Trustees acting on behalf of the Trust) shall not undertake any business,
activities or transaction except as expressly provided herein or contemplated
hereby. In particular, the Trustees shall not (i) acquire any investments or
engage in any activities not authorized by this Trust Agreement; (ii) sell,
assign, transfer, exchange, pledge, set-off or otherwise dispose of any of the
Trust Property or interests therein, including to Securityholders, except as
expressly provided herein; (iii) take any action that would cause the Trust to
fail or cease to qualify as a grantor trust for
16
United States federal income tax purposes; (iv) incur any indebtedness
for borrowed money; (v) take or consent to any action that would
result in the placement of a Lien on any of the Trust Property; (vi)
issue any securities other than the Trust Securities; or (vii) have
any power to, or agree to any action by the Depositor that would, vary
the investment (within the meaning of Treasury Regulation Section
301.7701-4(c)) of the Trust or of the Securityholders. The Trustees
shall defend all claims and demands of all Persons at any time
claiming any Lien on any of the Trust Property adverse to the interest
of the Trust or the Securityholders in their capacity as
Securityholders.
(d) In connection with the issue and sale of the Preferred
Securities, the Depositor 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 Depositor in furtherance of the following prior to the date
of this Trust Agreement are hereby ratified and confirmed in all respects):
(i) to prepare for filing by the Trust with the Commission a
registration statement on Form S-3 under the Securities Act of 1933,
as amended, in relation to the Preferred Securities, including any
amendments thereto;
(ii) to determine the states in which to take appropriate
action to qualify or register for sale all or part of the Preferred
Securities and to do any and all such acts, other than actions which
must be taken by or on behalf of the Trust, and advise the Trustees
of actions they must take on behalf of the Trust, and prepare for
execution and filing any documents to be executed and filed by the
Trust or on behalf of the Trust, as the Depositor deems necessary or
advisable in order to comply with the applicable laws of any such
States;
(iii) to prepare for filing by the Trust an application to the
New York Stock Exchange or any other national stock exchange or the
Nasdaq National Market for listing upon notice of issuance of any
Preferred Securities, if applicable;
(iv) to prepare for filing by the Trust with the Commission a
registration statement on Form 8-A relating to the registration of
the Preferred Securities under Section 12(b) of the Exchange Act,
including any amendments thereto;
(v) to negotiate the terms of the Underwriting Agreement
providing for the sale of the Preferred Securities and to execute,
deliver and perform the Underwriting Agreement on behalf of the
Trust;
(vi) to negotiate the terms of the Remarketing Agreement
providing for the retention of the Remarketing Agent and the
establishment of certain procedures relating to Remarketings;
(vii) to negotiate the terms of the Calculation Agent Agreement
providing for the retention of the Calculation Agent;
17
(viii) to elect to remarket the Preferred Securities and
determine the length of any Fixed Rate Period in accordance with
this Trust Agreement, including redemption dates applicable to any
Fixed Rate Period; and
(ix) any other actions necessary, incidental, appropriate or
convenient to carry out any of the foregoing activities.
(e) Notwithstanding anything herein to the contrary, the
Administrative Trustees are authorized and directed to conduct the affairs of
the Trust and to operate the Trust so that the Trust will not be deemed to be an
"investment company" required to be registered under the Investment Company Act
of 1940, as amended, or taxed as other than a grantor trust for United States
federal income tax purposes and so that the Junior Subordinated Debentures will
be treated as indebtedness of the Depositor for United States federal income tax
purposes. In this connection, the Depositor and the Administrative Trustees are
authorized to take any action, not inconsistent with applicable law, the
Certificate of Trust or this Trust Agreement, that each of the Depositor and the
Administrative Trustees determines in its discretion to be necessary or
desirable for such purposes, as long as such action does not materially and
adversely affect the interests of the Holders of the Preferred Securities.
SECTION 2.08. ASSETS OF TRUST
The assets of the Trust shall consist of the Trust Property.
SECTION 2.09. TITLE TO TRUST PROPERTY
Legal title to all Trust Property shall be vested at all times in the
Property Trustee (in its capacity as such) and shall be held and administered by
the Property Trustee for the benefit of the Securityholders and the Trust in
accordance with this Trust Agreement. The right, title and interest of the
Property Trustee to the Junior Subordinated Debentures shall vest automatically
in each Person who may thereafter be appointed as Property Trustee in accordance
with the terms hereof. Such vesting and cessation of title shall be effective
whether or not conveyancing documents have been executed and delivered.
SECTION 2.10. MERGERS AND CONSOLIDATIONS OF THE TRUST
The Trust may not merge with or into, consolidate, amalgamate, or be
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to, any entity, except pursuant to this Section
2.10 or Section 9.04. At the request of the Holders of the Common Securities,
and without the consent of the Holders of the Preferred Securities, the Trust
may merge with or into, consolidate, amalgamate, or be replaced by or convey,
transfer or lease its properties and assets substantially as an entirety to a
trust organized as such under the laws of any state; provided, however, that (i)
such successor entity either (a) expressly assumes all of the obligations of the
Trust with respect to the Preferred Securities or (b) substitutes for the
Preferred Securities other securities having substantially the same terms as the
Preferred Securities (the "Successor Preferred Securities") so long as the
Successor Preferred Securities have the same priority as the Preferred
Securities with respect to distributions and payments upon liquidation,
redemption and otherwise; (ii) a trustee of such successor entity possessing the
same powers and duties as the Property Trustee is appointed to hold the Junior
Subordinated Debentures; (iii) such
18
merger, consolidation, amalgamation, replacement, conveyance, transfer or lease
does not cause the Preferred Securities (including any Successor Preferred
Securities) to be downgraded by any nationally recognized statistical rating
organization; (iv) the Preferred Securities or any Successor Preferred
Securities are listed or quoted, or any Successor Preferred Securities will be
listed or quoted upon notification of issuance, on any national securities
exchange or with another organization on which Preferred Securities are then
listed or quoted; (v) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights, preferences
and privileges of the holders of the Preferred Securities (including any
Successor Preferred Securities) in any material respect; (vi) such successor
entity has a purpose substantially identical to that of the Trust; (vii) prior
to such merger, consolidation, amalgamation, replacement, conveyance, transfer
or lease, the Property Trustee has received an Opinion of Counsel from
independent counsel 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 Preferred Securities (including any Successor Preferred Securities) in
any material respect, and (b) following such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease, neither the Trust nor
such successor entity will be required to register as an "investment company"
under the Investment Company Act; and (viii) the Depositor or any permitted
transferee to whom it has transferred the Common Securities hereunder owns all
of the Common Securities of such successor entity and guarantees the obligations
of such successor entity under the Successor Preferred Securities at least to
the extent provided by the Guarantee. Notwithstanding the foregoing, the Trust
shall not, except with the consent of Holders of 100% in aggregate Liquidation
Amount of the Preferred Securities, consolidate, amalgamate, merge with or into,
or be replaced by or convey, transfer or lease its properties and assets
substantially as an entirety to, any other entity or permit any other entity to
consolidate, amalgamate, merge with or into, or replace it if such
consolidation, amalgamation, merger, replacement, conveyance, transfer or lease
would cause the Trust or the successor entity to be taxable other than as a
grantor trust for United States federal income tax purposes. Any merger or
similar agreement shall be executed by the Administrative Trustees on behalf of
the Trust.
ARTICLE III
PAYMENT ACCOUNT
SECTION 3.01. PAYMENT ACCOUNT
(a) On or prior to the Issue Date, the Property Trustee shall
establish the Payment Account. The Property Trustee and an agent of the Property
Trustee shall have exclusive control and sole right of withdrawal with respect
to the Payment Account for the purpose of making deposits in and withdrawals
from the Payment Account in accordance with this Trust Agreement. All monies and
other property deposited or held from time to time in the Payment Account shall
be held by the Property Trustee in the Payment Account for the exclusive benefit
of the Securityholders and for distribution as herein provided, including (and
subject to) any priority of payments provided for herein.
(b) The Property Trustee shall deposit in the Payment Account,
promptly upon receipt, all payments of principal or interest on, and any other
payments or proceeds with
19
respect to, the Junior Subordinated Debentures and any amounts paid to the
Property Trustee pursuant to the Guarantee. Amounts held in the Payment Account
shall not be invested by the Property Trustee pending distribution thereof.
ARTICLE IV
DISTRIBUTIONS; REDEMPTION
SECTION 4.01. DISTRIBUTIONS
(a) Distributions shall accrue from the Issue Date until the
Redemption Date. During the Initial Fixed Rate Period, Distributions will be
payable semiannually in arrears on April 1 and October 1 of each year,
commencing on April 1, 2004. During any Fixed Rate Period, other than the
Initial Fixed Rate Period, Distributions will be payable semiannually in arrears
on the first day of the first month that begins at least six months after the
first day of the Fixed Rate Period and on the first day of each six month period
thereafter during such Fixed Rate Period. Any Fixed Rate Period may not end on a
day other than a day immediately preceding a Distribution Payment Date. During
any Floating Rate Period, Distributions will be payable quarterly in arrears on
January 1, April 1, July 1 and October 1 of each year.
(b) If any Distribution Payment Date with respect to a Fixed Rate
Period is not a Business Day, Distributions will be payable, without interest,
on the immediately succeeding Business Day, with the same force and effect as if
payment was made on the date such payment was originally payable. If any
Distribution Payment Date with respect to a Floating Rate Period is not a
Business Day, then Distributions will be payable on the immediately succeeding
Business Day and Distributions shall accrue to the actual payment date (except
for a Distribution Payment Date that coincides with the Redemption Date).
(c) The amount of Distributions payable on each Distribution Payment
Date relating to a Fixed Rate Period will be computed on the basis of a 360-day
year of twelve 30-day months. The amount of Distributions payable on each
Distribution Payment Date relating to a Floating Rate Period will be computed by
multiplying the per annum Distribution Rate in effect for such Distribution
Period by a fraction, the numerator of which will be the actual number of days
in such Distribution Period (or portion thereof) (determined by including the
first day thereof and excluding the last thereof) and the denominator of which
will be 360, and multiplying the rate so obtained by $1,000.
(d) The Company has the right under the Subordinated Indenture to
defer payments of interest on the Junior Subordinated Debentures by extending
the interest period from time to time on the Junior Subordinated Debentures (an
"Extension Period") which, if exercised, would defer Distributions on the
Preferred Securities during any Extension Period. The payment of such
Distributions, together with any interest thereon, will be distributed to the
Holders of Trust Securities as received at the end of any Extension Period.
(e) Distributions on the Trust Securities shall be made and shall be
deemed payable on each Distribution Payment Date only to the extent that the
Trust has available funds on hand in the Payment Account for the payment of such
Distributions.
20
(f) Distributions on the Trust Securities on each Distribution Date
shall be payable to the Holders thereof as they appear on the Securities
Register for the Trust Securities on the relevant Record Date.
Each Trust Security upon registration of transfer of or in exchange
for or in lieu of any other Trust Security shall carry the rights of
Distributions accrued and unpaid, and to accrue, which were carried by such
other Trust Security.
SECTION 4.02. DISTRIBUTION RATE
(a) During the Initial Fixed Rate Period, the Distribution Rate
shall be the Initial Distribution Rate.
(b) Prior to the expiration of the Initial Fixed Rate Period and any
subsequent Fixed Rate Period, prior to any Distribution Payment Date with
respect to a Floating Rate Period or prior to any Distribution Payment Date in a
Fixed Rate Period during a time in which the Preferred Securities are redeemable
in such Fixed Rate Period, the Company and the Administrative Trustees will have
the option to remarket the Preferred Securities to establish a new Fixed Rate
for a new Fixed Rate Period (to be in effect after the expiration of the then
current Distribution Period). If the Company and the Administrative Trustees
elect to conduct a Remarketing of the Preferred Securities for the purpose of
establishing a new Fixed Rate for a new Fixed Rate Period, the Trust shall, not
less than 20 nor more than 35 Business Days prior to the related Election Date,
notify in writing the Clearing Agency, the Property Trustee, the Indenture
Trustee, the Calculation Agent and the Remarketing Agent. If the Preferred
Securities are not issued in global, fully registered form to the Clearing
Agency, such notice shall be delivered to the Holders instead of the Clearing
Agency. Such notice shall describe the Remarketing and shall indicate the length
of the proposed new Fixed Rate Period, the proposed Remarketing Date and any
redemption provisions that will apply during such new Fixed Rate Period. The
Company and the Administrative Trustees shall have the right to terminate a
Remarketing at any time prior to the Election Date by written notice of such
termination to the Clearing Agency (or the Holders, as applicable), the
Remarketing Agent, the Property Trustee, the Indenture Trustee and the
Calculation Agent.
(c) If the Remarketing Agent has determined that it will be able to
remarket all Preferred Securities tendered or deemed tendered for purchase in
the Remarketing at a Fixed Rate and at a price of $1,000 per Preferred Security,
on any Remarketing Date, the Distribution Rate for the new Fixed Rate Period
will be the Fixed Rate determined by the Remarketing Agent, which will be the
rate per annum (rounded to the nearest one-thousandth (0.001) of one percent per
annum) which the Remarketing Agent determines, in its sole judgment, to be the
lowest Fixed Rate per annum, if any, that will enable it to remarket all
Preferred Securities tendered or deemed tendered for Remarketing at a price of
$1,000 per Preferred Security.
(d) If the Company and the Administrative Trustees do not elect to
remarket the Preferred Securities pursuant to Section 4.02(b) or have terminated
a Remarketing or the Remarketing Agent is unable to remarket all of the
Preferred Securities tendered or deemed tendered for a purchase price of $1,000
per Preferred Security pursuant to the Remarketing
21
Procedures, the Distribution Rate for the next Distribution Period shall be the
Floating Rate and the new Distribution Period shall be a Floating Rate Period.
(e) The Calculation Agent shall calculate the Floating Rate as
follows:
Except as provided below, the Floating Rate for any Floating Rate
Period for the Preferred Securities will be equal to the Adjustable Rate (as
defined below) plus 2.375%. The "Adjustable Rate" for any Distribution Period
will be equal to the highest of the 3-month LIBOR Rate, the 10-year Treasury CMT
and the 30-year Treasury CMT (each as defined below and collectively referred to
as the "Benchmark Rates") for such Distribution Period during the Floating Rate
Period. In the event that the Calculation Agent determines in good faith that
for any reason:
(1) any one of the Benchmark Rates cannot be
determined for any Distribution Period, the
Adjustable Rate for such Distribution Period
will be equal to the higher of whichever two of
such rates can be so determined;
(2) only one of the Benchmark Rates can be
determined for any Distribution Period, the
Adjustable Rate for such Distribution Period
will be equal to whichever such rate can be so
determined; or
(3) none of the Benchmark Rates can be determined
for any Distribution Period, the Adjustable Rate
for the preceding Distribution Period will be
continued for such Distribution Period.
The "3-month LIBOR Rate" means, for each Distribution Period, the
arithmetic average of the two most recent weekly quotes for deposits for U.S.
Dollars having a term of three months, as published on the first Business Day of
each week during the relevant Calendar Period (as defined below) immediately
preceding the Distribution Period for which the Floating Rate is being
determined. Such quotes will be taken from Telerate Page 3750 at approximately
11:00 a.m. London time on the relevant date. If such rate does not appear on
Telerate Page 3750 on the relevant date, the 3-month LIBOR Rate will be the
arithmetic mean of the rates quoted by three major banks in New York City
selected by the Calculation Agent, at approximately 11:00 a.m., New York City
time, on the relevant date for loans in U.S. Dollars to leading European banks
for a period of three months.
"The 10-year Treasury CMT" means the rate determined in accordance with
the following provisions:
(1) With respect to any Distribution determination date and the
Distribution Period that begins immediately thereafter, the 10-year
Treasury CMT means the rate displayed on Telerate Page 7051 under the
caption "...Treasury Constant Maturities... Federal Reserve Board
Release H.15...Mondays Approximately 3:45 P.M.", under the column for
the Designated CMT Maturity Index (as defined below).
22
(2) If such rate is no longer displayed on the
relevant page, or is not so displayed by 3:00
P.M., New York City time, on the applicable
Distribution determination date, then the
10-year Treasury CMT for such Distribution
determination date will be such treasury
constant maturity rate for the Designated CMT
Maturity Index as is published in H.15(519).
(3) If such rate is no longer displayed on the
relevant page, or if not published by 3:00 P.M.,
New York City time, on the applicable
Distribution determination date, then the
10-year Treasury CMT for such Distribution
determination date will be such constant
maturity treasury rate for the Designated CMT
Maturity Index (or other United States Treasury
rate for the Designated CMT Maturity Index) for
the applicable Distribution determination date
with respect to such Distribution reset date as
may then be published by either the Board of
Governors of the Federal Reserve System or the
United States Department of the Treasury that
the Calculation Agent determines to be
comparable to the rate formerly displayed on the
Telerate Page 7051 and published in H.15(519).
(4) If such information is not provided by 3:00
P.M., New York City time, on the applicable
Distribution determination date, then the
10-year Treasury CMT for such Distribution
determination date will be calculated by the
Calculation Agent and will be a yield to
maturity, based on the arithmetic mean of the
secondary market offered rates as of
approximately 3:30 P.M., New York City time, on
the Distribution determination date reported,
according to their written records, by three
leading primary United States government
securities dealers in The City of New York
(each, a "Reference Dealer") selected by the
Calculation Agent (from five such Reference
Dealers selected by the Calculation Agent and
eliminating the highest quotation (or, in the
event of equality, one of the highest) and the
lowest quotation (or, in the event of equality,
one of the lowest)), for the most recently
issued direct noncallable fixed rate obligations
of the United States ("Treasury Debentures")
with an original maturity of approximately the
Designated CMT Maturity Index and a remaining
term to maturity of not less than such
Designated CMT Maturity Index minus one year.
(5) If the Calculation Agent is unable to obtain
three such Treasury Debentures quotations, the
10-year Treasury
23
CMT for the applicable Determination date will
be calculated by the Calculation Agent and will
be a yield to maturity based on the arithmetic
mean of the secondary market offered rates as of
approximately 3:30 P.M., New York City time, on
the applicable Distribution determination date
of three Reference Dealers in The City of New
York (from five such Reference Dealers selected
by the Calculation Agent and eliminating the
highest quotation (or, in the event of equality,
one of the highest) and the lowest quotation
(or, in the event of equality, one of the
lowest)), for Treasury Debentures with an
original maturity of the number of years that is
the next highest to the Designated CMT Maturity
Index and a remaining term to maturity closest
to the Designated CMT Maturity Index and in an
amount of at least $100 million.
(6) If three or four (and not five) of such
Reference Dealers are quoting as set forth
above, then the 10-year Treasury CMT will be
based on the arithmetic mean of the offered
rates obtained and neither the highest nor
lowest of such quotes will be eliminated;
provided, however, that if fewer than three
Reference Dealers selected by the Calculation
Agent are quoting as set forth above, the
10-year Treasury CMT with respect to the
applicable Distribution determination date will
remain the 10-year Treasury CMT for the
immediately preceding interest period. If two
Treasury Debentures with an original maturity as
described in the second preceding sentence have
remaining terms to maturity equally close to the
Designated CMT Maturity Index, then the quotes
for the Treasury Debentures with the shorter
remaining term to maturity will be used.
The "30-year Treasury CMT" has the meaning specified under the
definition of 10-year Treasury CMT, except that the Designated CMT Maturity
Index for the 30-year Treasury CMT shall be 30 years.
The 3-month LIBOR Rate, the 10-year Treasury CMT and the 30-year
Treasury CMT shall each be rounded to the nearest hundredth of a percent.
The Floating Rate with respect to each Floating Rate Period will be
calculated as promptly as practicable by the Calculation Agent according to the
appropriate method described above.
(f) If the Company elects to defer interest during a Fixed Rate
Period, Distributions will continue to accrue at the Fixed Rate until the
expiration of the Fixed Rate Period. Prior to the expiration of such Fixed Rate
Period and any Fixed Rate Period during the Extension Period, the Company and
the Administrative Trustees will have the option to remarket
24
the Preferred Securities for a new Fixed Rate Period (to take effect upon
expiration of such Fixed Rate Period). If the Company and the Trust do not
remarket the Preferred Securities, the Floating Rate during the Extension Period
shall be determined as provided herein, but shall not be less than the Fixed
Rate for the Fixed Rate Period just ended. If the Company elects to defer
interest during a Floating Rate Period, Distributions will continue to accrue at
the applicable Floating Rate, reset quarterly, subject to the right of the
Company and the Administrative Trustees to remarket the Preferred Securities
prior to any Distribution Payment Date in order to establish a new Fixed Rate
for a new Fixed Rate Period in accordance with this Section 4.02 and the
Remarketing Procedures.
SECTION 4.03. DISTRIBUTION PERIODS
In accordance with Section 4.02 and the Remarketing Procedures, the
Company and the Trust may, prior to the expiration of the Initial Fixed Rate
Period and any subsequent Fixed Rate Period, prior to any Distribution Payment
Date in a Fixed Rate Period during a time in which the Preferred Securities are
redeemable in such Fixed Rate Period or prior to any Distribution Payment Date
with respect to a Floating Rate Period, elect to remarket the Preferred
Securities to establish a new Fixed Rate for a new Fixed Rate Period (to be in
effect after the then current Distribution Period). A Fixed Rate Period must be
for a duration of at least six months, may not extend beyond the stated maturity
of the Junior Subordinated Debentures and may not end on a day other than a day
immediately preceding a Distribution Payment Date. If a new Fixed Rate for a new
Fixed Rate Period is set in a Remarketing, a new Fixed Rate Period shall
commence following the expiration of the then current Distribution Period. If a
new Fixed Rate for a new Fixed Rate Period is not set, for any reason, including
after the expiration of the Initial Fixed Rate Period, in accordance with the
terms of this Trust Agreement, a Floating Rate Period and the Floating Rate
reset quarterly shall be in effect if and until the Company and the
Administrative Trustees remarket the Preferred Securities and set a new Fixed
Rate for a new Fixed Rate Period in accordance with Section 4.02 and the
Remarketing Procedures.
SECTION 4.04. REDEMPTION
(a) On each Indenture Redemption Date and the Maturity Date of the
Junior Subordinated Debentures, the Trust will be required to redeem a Like
Amount of Trust Securities at the Redemption Price.
(b) Notice of redemption shall be given by the Property Trustee by
first class mail, postage prepaid, mailed not less than 30 nor more than 60 days
prior to the Redemption Date to each Holder of Trust Securities to be redeemed,
at such Holder's address appearing in the Securities Register. All notices of
redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price;
(iii) the CUSIP number or CUSIP numbers of the Preferred
Securities affected;
25
(iv) that on the Redemption Date the Redemption Price will
become due and payable upon each such Trust Security to be redeemed
and that Distributions thereon will cease to accumulate on and after
said date, except as provided in Section 4.04(e) below; and
(v) the place or places where Trust Securities are to be
surrendered for the payment of the Redemption Price.
(c) The Trust in issuing the Trust Securities may use "CUSIP" or
"private placement" numbers (if then generally in use), and, if so, the Property
Trustee shall indicate the "CUSIP" or "private placement" numbers of the Trust
Securities in notices of redemption and related materials as a convenience to
Holders; provided, that any such notice may state that no representation is made
as to the correctness of such numbers either as printed on the Trust Securities
or as contained in any notice of redemption and related material.
(d) The Trust Securities redeemed on each Redemption Date shall be
redeemed at the Redemption Price with the applicable proceeds from the
contemporaneous redemption or repayment of Subordinated Debentures. Redemptions
of the Trust Securities shall be made and the Redemption Price shall be payable
on each Redemption Date only to the extent that the Trust has funds then on hand
and available in the Payment Account for the payment of such Redemption Price.
(e) If the Trust gives a notice of redemption in respect of any
Preferred Securities, then, by 10:00 a.m., New York City time, on the Redemption
Date, the Depositor shall deposit sufficient funds with the Property Trustee to
pay the Redemption Price. If such deposit has been made, then by 12:00 noon, New
York City time, on the Redemption Date, subject to this Section 4.04(e), the
Property Trustee will, with respect to Preferred Securities held in global form,
irrevocably deposit with the Clearing Agency for such Preferred Securities, to
the extent available therefor, funds sufficient to pay the applicable Redemption
Price and will give such Clearing Agency irrevocable instructions and authority
to pay the Redemption Price to the Holders of the Preferred Securities. With
respect to Preferred Securities that are not held in global form, the Property
Trustee, subject to Section this 4.04(e), will irrevocably deposit with the
Paying Agent, to the extent available therefor, funds sufficient to pay the
applicable Redemption Price and will give the Paying Agent irrevocable
instructions and authority to pay the Redemption Price to the Holders of the
Preferred Securities upon surrender of their Preferred Securities Certificates.
Notwithstanding the foregoing, Distributions payable on or prior to the
Redemption Date for any Trust Securities called for redemption shall be payable
to the Holders of such Trust Securities as they appear on the Securities
Register for the Trust Securities on the relevant Record Dates for the related
Distribution Dates. If notice of redemption shall have been given and funds
deposited as required, then, upon the date of such deposit, all rights of
Holders holding Trust Securities so called for redemption will cease, except the
right of such Holders to receive the Redemption Price and any Distribution
payable in respect of the Trust Securities on or prior to the Redemption Date,
but without interest, and such Trust Securities will cease to be Outstanding. In
the event that any date on which any applicable Redemption Price is payable is
not a Business Day, then payment of the applicable Redemption Price payable on
such date will be made on the next succeeding day that is a Business Day (and
without any interest or other payment in respect of any such delay), except
that, if such Business Day falls in the next
26
calendar year, such payment will be made on the immediately preceding Business
Day, in each case, with the same force and effect as if made on such date. In
the event that payment of the Redemption Price in respect of any Trust
Securities called for redemption is improperly withheld or refused and not paid
either by the Trust or by the Depositor pursuant to the Guarantee, Distributions
on such Trust Securities will continue to accumulate, as set forth in Section
4.01 and in accordance with the continued accrual of interest on the
Subordinated Debentures, from the Redemption Date originally established by the
Trust for such Trust Securities to the date such applicable Redemption Price is
actually paid, in which case the actual payment date will be the date fixed for
redemption for purposes of calculating the applicable Redemption Price.
SECTION 4.05. SUBORDINATION OF COMMON SECURITIES AND DISTRIBUTIONS
(a) Payment of Distributions on, and the Redemption Price of, the
Trust Securities, as applicable, shall be made pro rata based on the Liquidation
Amount of the Trust Securities; provided, however, that if on any Distribution
Payment Date or Redemption Date an Indenture Event of Default shall have
occurred and be continuing, no payment of any Distribution on, or Redemption
Price of, any Common Security, and no other payment on account of the
redemption, liquidation or other acquisition of Common Securities, shall be made
unless payment in full in cash of all accumulated and unpaid Distributions on
all Outstanding Preferred Securities for all Distribution Periods terminating on
or prior thereto, or in the case of payment of the Redemption Price the full
amount of such Redemption Price on all Outstanding Preferred Securities, shall
have been made or provided for, and all funds immediately available to the
Property Trustee shall first be applied to the payment in full in cash of all
Distributions on, or Redemption Price of, Preferred Securities then due and
payable.
(b) In the case of the occurrence of any Indenture Event of Default,
the Holder of Common Securities will be deemed to have waived any right to act
with respect to such Event of Default under this Trust Agreement until the
effect of all such Events of Default with respect to the Preferred Securities
have been cured, waived or otherwise eliminated. Until any such Events of
Default under this Trust Agreement with respect to the Preferred Securities have
been so cured, waived or otherwise eliminated, the Property Trustee shall act
solely on behalf of the Holders of the Preferred Securities and not the Holder
of the Common Securities, and only the Holders of the Preferred Securities will
have the right to direct the Property Trustee to act on their behalf.
(c) Distributions on the Common Securities shall be payable at the
same Distribution Rates, on the same Distribution Payment Dates and for the same
Distribution Periods and to holders as of the same Record Date as for the
Preferred Securities.
SECTION 4.06. PAYMENT PROCEDURES
Payments of Distributions in respect of the Preferred Securities shall
be made by check mailed to the address of the Person entitled thereto as such
address shall appear on the Securities Register or, if the Preferred Securities
are held by a Clearing Agency, such Distributions shall be made to the Clearing
Agency, which shall credit the relevant Persons' accounts at such Clearing
Agency on the applicable Distribution Payment Dates. Payment of the Redemption
Price of or Liquidation Distribution on the Preferred Securities shall be made
in immediately available funds
27
upon surrender of the Preferred Securities Certificates representing such
Preferred Securities at the corporate trust office of the Property Trustee or,
if the Preferred Securities are held by the Clearing Agency or its nominee, such
Redemption Price or Liquidation Distribution shall be made to the Clearing
Agency by wire transfer in immediately available funds. Payments in respect of
the Common Securities shall be made in such manner as shall be mutually agreed
between the Property Trustee and the Holder of the Common Securities.
SECTION 4.07. TAX RETURNS AND REPORTS
The Administrative Trustee(s) shall prepare (or cause to be prepared),
at the Depositor's expense, and file all United States federal, state and local
tax and information returns and reports required to be filed by or in respect of
the Trust. The Administrative Trustee(s) shall provide or cause to be provided
on a timely basis to each Holder any Internal Revenue Service form required to
be so provided in respect of the Trust Securities.
ARTICLE V
TRUST SECURITIES CERTIFICATES
SECTION 5.01. INITIAL OWNERSHIP
Upon the creation of the Trust by the contribution by the Depositor
pursuant to Section 2.03 and until the issuance of the Trust Securities, and at
any time during which no Trust Securities are outstanding, the Depositor shall
be the sole beneficial owner of the Trust.
SECTION 5.02. THE TRUST SECURITIES CERTIFICATES
Each of the Preferred and Common Securities Certificates shall be
issued in minimum denominations of $1,000 and integral multiples in excess
thereof. The Trust Securities Certificates shall be executed on behalf of the
Trust by manual or facsimile signature of at least one Administrative Trustee.
Trust Securities Certificates bearing the manual or facsimile signatures of
individuals who were, at the time when such signatures shall have been affixed,
authorized to sign on behalf of the Trust, shall be validly issued and entitled
to the benefits of this Trust Agreement, notwithstanding that such individuals
or any of them shall have ceased to be so authorized prior to the authentication
and delivery of such Trust Securities Certificates or did not hold such offices
at the date of authentication and delivery of such Trust Securities
Certificates. A transferee of a Trust Securities Certificate shall become a
Securityholder, and shall be entitled to the rights and subject to the
obligations of a Securityholder hereunder, upon due registration of such Trust
Securities Certificate in such transferee's name pursuant to Section 5.04.
SECTION 5.03. AUTHENTICATION OF TRUST SECURITIES CERTIFICATES
On the Issue Date, the Administrative Trustees shall cause Trust
Securities Certificates, in an aggregate Liquidation Amount as provided in
Sections 2.04 and 2.05, to be executed on behalf of the Trust, authenticated and
delivered to or upon the written order of the Depositor signed by its Chairman
of the Board, its President or any Vice President, without further corporate
action by the Depositor, in authorized denominations. No Trust Securities
Certificate
28
shall entitle its holder to any benefit under this Trust Agreement, or shall be
valid for any purpose, unless there shall appear on such Trust Securities
Certificate a certificate of authentication substantially in the form set forth
in Exhibit A or Exhibit C, as applicable, executed by at least one
Administrative Trustee by manual signature; such authentication shall constitute
conclusive evidence that such Trust Securities Certificate shall have been duly
authenticated and delivered hereunder. All Trust Securities Certificates shall
be dated the date of their authentication.
SECTION 5.04. REGISTRATION OF TRANSFER AND EXCHANGE OF PREFERRED
SECURITIES CERTIFICATES
The Securities Registrar shall keep or cause to be kept, at the office
or agency maintained pursuant to Section 5.08, a Securities Register in which,
subject to such reasonable regulations as it may prescribe, the Securities
Registrar shall provide for the registration of Preferred Securities
Certificates and the Common Securities Certificates (subject to Section 5.10 in
the case of the Common Securities Certificates) and registration of transfers
and exchanges of Preferred Securities Certificates as herein provided. The
Property Trustee shall be the initial Securities Registrar.
Upon surrender for registration of transfer of any Preferred Securities
Certificate at the office or agency maintained pursuant to Section 5.08, the
Administrative Trustees shall execute, authenticate and deliver in the name of
the designated transferee or transferees one or more new Preferred Securities
Certificates in authorized denominations of a like aggregate Liquidation Amount
dated the date of authentication by the Administrative Trustee or Trustees. The
Securities Registrar shall not be required to register the transfer of any
Preferred Securities that have been called for redemption. At the option of a
Holder, Preferred Securities Certificates may be exchanged for other Preferred
Securities Certificates in authorized denominations of the same class and of a
like aggregate Liquidation Amount upon surrender of the Preferred Securities
Certificates to be exchanged at the office or agency maintained pursuant to
Section 5.08.
Every Preferred Securities Certificate presented or surrendered for
registration of transfer or exchange shall be accompanied by a written
instrument of transfer in form satisfactory to the Trustees and the Securities
Registrar duly executed by the Holder or his attorney duly authorized in
writing. Each Preferred Securities Certificate surrendered for registration of
transfer or exchange shall be canceled and subsequently disposed of by the
Securities Registrar in accordance with its customary practice.
No service charge shall be made for any registration of transfer or
exchange of Preferred Securities Certificates, but the Securities Registrar or
the Administrative Trustees may require payment of a sum sufficient to cover any
tax or governmental charge that may be imposed in connection with any transfer
or exchange of Preferred Securities Certificates.
SECTION 5.05. MUTILATED, DESTROYED, LOST OR STOLEN TRUST SECURITIES
CERTIFICATES
If (a) any mutilated Trust Securities Certificate shall be surrendered
to the Securities Registrar, or if the Securities Registrar shall receive
evidence to its satisfaction of the destruction, loss or theft of any Trust
Securities Certificate and (b) there shall be delivered to the
29
Securities Registrar and the Administrative Trustees such security or indemnity
as may be required by them to save each of them harmless, then in the absence of
notice that such Trust Securities Certificate shall have been acquired by a bona
fide purchaser, the Administrative Trustees or any one of them on behalf of the
Trust shall execute and authenticate and make available for delivery, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen Trust
Securities Certificate, a new Trust Securities Certificate of like class, tenor
and denomination. In connection with the issuance of any new Trust Securities
Certificate under this Section, the Administrative Trustees or the Securities
Registrar may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection therewith. Any duplicate
Trust Securities Certificate issued pursuant to this Section shall constitute
conclusive evidence of an ownership interest in the Trust, as if originally
issued, whether or not the lost, stolen or destroyed Trust Securities
Certificate shall be found at any time.
SECTION 5.06. PERSONS DEEMED SECURITYHOLDERS
Prior to due presentation of a Trust Securities Certificate for
registration of transfer, the Trustees or the Securities Registrar shall treat
the Person in whose name any Trust Securities Certificate shall be registered in
the Securities Register as the owner of such Trust Securities Certificate for
the purpose of receiving Distributions (subject to Section 4.01(d)) and for all
other purposes whatsoever, and neither the Trustees nor the Securities Registrar
shall be bound by any notice to the contrary.
SECTION 5.07. ACCESS TO LIST OF SECURITYHOLDERS' NAMES AND ADDRESSES
In the event that the Property Trustee is no longer the Securities
Registrar, the Administrative Trustees shall furnish or cause to be furnished to
(i) the Depositor and the Property Trustee semi-annually, not later than April 1
and October 1 in each year, and (ii) the Depositor or the Property Trustee, as
the case may be, within 15 days after receipt by any Administrative Trustee of a
request therefor from the Depositor or the Property Trustee, as the case may be,
in writing, a list, in such form as the Depositor or the Property Trustee, as
the case may be, may reasonably require, of the names and addresses of the
Securityholders as of a date not more than 15 days prior to the time such list
is furnished. If three or more Securityholders or one or more Holders of Trust
Securities Certificates evidencing not less than 25% of the outstanding
Liquidation Amount apply in writing to the Administrative Trustees, and such
application states that the applicants desire to communicate with other
Securityholders with respect to their rights under this Trust Agreement or under
the Trust Securities Certificates and such application is accompanied by a copy
of the communication that such applicants propose to transmit, then the
Administrative Trustees shall, within five Business Days after the receipt of
such application, afford such applicants access during normal business hours to
the current list of Securityholders. Each Holder, by receiving and holding a
Trust Securities Certificate, shall be deemed to have agreed not to hold the
Depositor, the Property Trustee or the Administrative Trustees accountable by
reason of the disclosure of its name and address, regardless of the source from
which such information was derived.
30
SECTION 5.08. MAINTENANCE OF OFFICE OR AGENCY
The Administrative Trustees shall maintain in the Borough of Manhattan,
New York, an office or offices or agency or agencies where Preferred Securities
Certificates may be surrendered for registration of transfer or exchange and
where notices and demands to or upon the Trustees in respect of the Trust
Securities Certificates may be served. The Administrative Trustees initially
designate The Bank of New York, 101 Barclay Street, New York, New York 10286, as
its principal agency for such purposes. The Administrative Trustees shall give
prompt written notice to the Depositor and to the Securityholders of any change
in the location of the Securities Register or any such office or agency.
SECTION 5.09. APPOINTMENT OF PAYING AGENT
The Paying Agent shall make Distributions and other payments provided
hereby to Securityholders from the Payment Account and shall report the amounts
of such Distributions and payments to the Property Trustee and the
Administrative Trustees. Any Paying Agent shall have the revocable power to
withdraw funds from the Payment Account for the purpose of making the
Distributions and payments provided hereby. The Administrative Trustees may
revoke such power and remove the Paying Agent if such Trustees determine in
their sole discretion that the Paying Agent shall have failed to perform its
obligations under this Agreement in any material respect, provided that such
revocation and removal shall not become effective until the appointment of a
successor. The Paying Agent shall initially be the Property Trustee, and it may
choose any co-paying agent that is acceptable to the Administrative Trustees and
the Depositor. Any Person acting as Paying Agent shall be permitted to resign as
Paying Agent upon 30 days' written notice to the Administrative Trustees and the
Property Trustee, provided that such resignation shall not become effective
until the appointment of a successor. In the event that a Paying Agent shall
resign or be removed, the Property Trustee shall appoint a successor that is
acceptable to the Administrative Trustees to act as Paying Agent (which shall be
a bank or trust company). The Property Trustee shall cause such successor Paying
Agent or any additional Paying Agent appointed by the Property Trustee to
execute and deliver to the Trustees an instrument in which such successor Paying
Agent or additional Paying Agent shall agree with the Trustees that as Paying
Agent, such successor Paying Agent or additional Paying Agent will hold all
sums, if any, held by it for payment to the Securityholders in trust for the
benefit of the Securityholders entitled thereto until such sums shall be paid to
such Securityholders. The Paying Agent shall return all unclaimed funds to the
Property Trustee and upon removal of a Paying Agent such Paying Agent shall also
return all funds in its possession to the Property Trustee. The provisions of
Sections 8.01, 8.03 and 8.06 shall apply to the Property Trustee also in its
role as Paying Agent, for so long as the Property Trustee shall act as Paying
Agent and, to the extent applicable, to any other paying agent appointed
hereunder. Any reference in this Agreement to the Paying Agent shall include any
co-paying agent unless the context requires otherwise.
SECTION 5.10. OWNERSHIP OF COMMON SECURITIES BY DEPOSITOR
On the Issue Date, the Depositor shall acquire, and thereafter retain,
beneficial and record ownership of the Common Securities. Any attempted transfer
of the Common Securities, except for transfers by operation of law or to an
Affiliate of the Depositor or a permitted successor
31
under Section 608 of the Subordinated Indenture, shall be void. The
Administrative Trustees shall cause each Common Securities Certificate issued to
the Depositor to contain a legend stating "THIS CERTIFICATE IS NOT TRANSFERABLE
EXCEPT AS PROVIDED IN THE TRUST AGREEMENT REFERRED TO HEREIN".
SECTION 5.11. BOOK-ENTRY PREFERRED SECURITIES CERTIFICATES; COMMON
SECURITIES CERTIFICATE
(a) The Preferred Securities Certificates, upon original issuance,
will be issued in the form of a typewritten Preferred Securities Certificate or
Certificates representing Book-Entry Preferred Securities Certificates, to be
delivered to The Depository Trust Company, the initial Clearing Agency, or its
custodian, by or on behalf of, the Trust. Such Preferred Securities Certificate
or Certificates shall initially be registered on the Securities Register in the
name of Cede & Co., the nominee of the initial Clearing Agency, and no Owner
will receive a definitive Preferred Securities Certificate representing such
beneficial owner's interest in such Preferred Securities, except as provided in
Section 5.13. Unless and until Definitive Preferred Securities Certificates have
been issued to Owners pursuant to Section 5.13:
(i) the provisions of this Section 5.11(a) shall be in full force
and effect;
(ii) the Securities Registrar and the Trustees shall be
entitled to deal with the Clearing Agency for all purposes of this
Trust Agreement relating to the Book-Entry Preferred Securities
Certificates (including the payment of principal of and
Distributions on the Book-Entry Preferred Securities and the giving
of instructions or directions to Owners of Book-Entry Preferred
Securities) as the sole Holder of Book-Entry Preferred Securities
and shall have no obligations to the Owners thereof;
(iii) to the extent that the provisions of this Section
conflict with any other provisions of this Trust Agreement, the
provisions of this Section shall control; and
(iv) the rights of the Owners of the Book-Entry Preferred
Securities Certificates shall be exercised only through the Clearing
Agency and shall be limited to those established by law and
agreements between such Owners and the Clearing Agency and/or the
Clearing Agency Participants. Pursuant to the Certificate Depository
Agreement, unless and until Definitive Preferred Securities
Certificates are issued pursuant to Section 5.13, the Clearing
Agency will make book-entry transfers among the Clearing Agency
Participants and receive and transmit payments on the Preferred
Securities to such Clearing Agency Participants.
(v) The Clearing Agency will make book-entry transfers among
the Clearing Agency Participants; provided, that solely for the
purposes of determining whether the Holders of the requisite amount
of Preferred Securities have voted on any matter provided for in
this Trust Agreement, so long as
32
Definitive Preferred Securities Certificates have not been issued,
the Trustees may conclusively rely on, and shall be fully protected
in relying on, any written instrument (including a proxy) delivered
to the Trustees by the Clearing Agency setting forth the Owners'
votes or assigning the right to vote on any matter to any other
Person either in whole or in part.
(b) A single Common Securities Certificate representing the
Common Securities shall be issued to the Depositor in the form of a
definitive Common Securities Certificate.
SECTION 5.12. NOTICES TO CLEARING AGENCY
To the extent a notice or other communication to the Owners is required
under this Trust Agreement, unless and until Definitive Preferred Securities
Certificates shall have been issued to Owners pursuant to Section 5.13, the
Trustees shall give all such notices and communications specified herein to be
given to Owners to the Clearing Agency, and shall have no obligations to the
Owners.
SECTION 5.13. DEFINITIVE PREFERRED SECURITIES CERTIFICATES
If (i) the Depositor advises the Trustees in writing that the Clearing
Agency is no longer willing or able to properly discharge its responsibilities
with respect to the Preferred Securities Certificates, and the Depositor is
unable to locate a qualified successor, or (ii) the Depositor at its option
advises the Trustees in writing that it elects to terminate the book-entry
system through the Clearing Agency, then the Administrative Trustees shall
notify the Clearing Agency and Holders of the Preferred Securities. Upon
surrender to the Administrative Trustees of the typewritten Preferred Securities
Certificate or Certificates representing the Book-Entry Preferred Securities
Certificates by the Clearing Agency, accompanied by registration instructions,
the Administrative Trustees or any one of them shall execute and authenticate
the Definitive Preferred Securities Certificates in accordance with the
instructions of the Clearing Agency. Neither the Securities Registrar nor the
Trustees shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Upon the issuance of Definitive Preferred Securities Certificates, the Trustees
shall recognize the Holders of the Definitive Preferred Securities Certificates
as Securityholders. The Definitive Preferred Securities Certificates shall be
printed, lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to the Administrative Trustees, as evidenced by the
execution thereof by the Administrative Trustees or any one of them.
SECTION 5.14. RIGHTS OF SECURITYHOLDERS
The legal title to the Trust Property is vested exclusively in the
Property Trustee (in its capacity as such) in accordance with Section 2.09, and
the Securityholders shall not have any right or title therein other than the
beneficial ownership interest in the assets of the Trust conferred by their
Trust Securities, and they shall have no right to call for any partition or
division of property, profits or rights of the Trust except as described below.
The Trust Securities shall be personal property giving only the rights
specifically set forth therein and in this Trust Agreement. The Trust Securities
shall have no preemptive or other similar rights and
33
when issued and delivered to Securityholders against payment of the purchase
price therefor, except as otherwise provided in the Expense Agreement and
Section 11.01 hereof, will be fully paid and nonassessable by the Trust. Except
as otherwise provided in the Expense Agreement and Section 11.01 hereof, the
Holders of the Trust 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.
ARTICLE VI
ACTS OF SECURITYHOLDERS; MEETINGS; VOTING
SECTION 6.01. LIMITATIONS ON VOTING RIGHTS
(a) Except as provided in this Section, in Section 2.10, in Section
8.10 or in Section 11.03 of this Trust Agreement, in the Subordinated Indenture,
and as otherwise required by law, no Holder of Preferred Securities shall have
any right to vote or in any manner otherwise control the administration,
operation and management of the Trust or the obligations of the parties hereto,
nor shall anything herein set forth, or contained in the terms of the Trust
Securities Certificates, be construed so as to constitute the Securityholders
from time to time as partners or members of an association.
(b) So long as any Junior Subordinated Debentures are held by the
Property Trustee on behalf of the Trust, the Property Trustee shall not (i)
direct the time, method and place of conducting any proceeding for any remedy
available to the Indenture Trustee, or execute any trust or power conferred on
the Property Trustee with respect to such Junior Subordinated Debentures; (ii)
waive any past default that may be waived under Section 513 of the Subordinated
Indenture; (iii) exercise any right to rescind or annul a declaration that the
principal of all the Junior Subordinated Debentures shall be due and payable; or
(iv) consent to any amendment, modification or termination of the Subordinated
Indenture or the Junior Subordinated Debentures, where such consent shall be
required, without, in each case, obtaining the prior approval of the Holders of
at least a Majority in Liquidation Amount of the Preferred Securities, provided,
however, that where a consent under the Subordinated Indenture would require the
consent of each holder of Junior Subordinated Debentures affected thereby, no
such consent shall be given by the Property Trustee without the prior written
consent of each Holder of Preferred Securities. The Property Trustee shall not
revoke any action previously authorized or approved by a vote of the Holders of
Preferred Securities, except by a subsequent vote of the Holders of Preferred
Securities. Subject to Section 8.02, the Property Trustee shall notify all
Holders of the Preferred Securities of any notice of default received with
respect to the Junior Subordinated Debentures. In addition to obtaining the
foregoing approvals of the Holders of the Preferred Securities, prior to taking
any of the foregoing actions, the Property Trustee shall, at the expense of the
Depositor, obtain an Opinion of Counsel experienced in such matters to the
effect that such action will not cause the Trust to be taxable other than as a
grantor trust for United States federal income tax purposes.
(c) If any proposed amendment to the Trust Agreement provides for,
or the Trust otherwise proposes to effect, (i) any action that would adversely
affect in any material respect the interests, powers, preferences or special
rights of the Preferred Securities, whether by
34
way of amendment to the Trust Agreement or otherwise, or (ii) the dissolution,
winding-up or termination of the Trust, other than pursuant to the terms of this
Trust Agreement, then the Holders of Outstanding Trust Securities as a class
will be entitled to vote on such amendment or proposal and such amendment or
proposal shall not be effective except with the approval of the Holders of at
least a Majority in Liquidation Amount of the Preferred Securities; except as
otherwise provided in Section 11.03(c). Notwithstanding any other provision of
this Trust Agreement, no amendment to this Trust Agreement may be made if, as a
result of such amendment, it would cause the Trust to be taxable other than as a
grantor trust for United States federal income tax purposes.
(d) Holders of a Majority in Liquidation Amount of the Preferred
Securities may, on behalf of the Holders of all the Preferred Securities, waive
any past Event of Default and its consequences, except a default described in
clause (b) or (c) of the definition of "Event of Default" contained in Section
1.01, a default in respect of a covenant or provision which under this Trust
Agreement cannot be modified or amended without the consent of the Holder of
each Outstanding Preferred Security or an Indenture Event of Default that the
Holders of a Majority in Liquidation Amount of the Preferred Securities would
not be entitled to waive pursuant to Section 6.01(e).
Upon any such waiver, any such Event of Default shall cease to exist,
and any Event of Default arising therefrom shall be deemed to have been cured
for every purpose of this Trust Agreement; but no such waiver shall extend to
any subsequent or other default or Event of Default or impair any right
consequent thereon. Any waiver by the Holders of the Preferred Securities of an
Event of Default with respect to Preferred Securities shall also be deemed to
constitute a waiver by the Holders of Common Securities for all purposes of the
Trust Agreement without any further act, vote or consent of the Holders of
Common Securities.
(e) For so long as any Preferred Securities remain Outstanding, if,
upon an Indenture Event of Default, the Indenture Trustee and the holders of the
outstanding Junior Subordinated Debentures have failed to declare the principal
of all of the Junior Subordinated Debentures to be immediately due and payable,
the Holders of at least 33% in aggregate Liquidation Amount of the Preferred
Securities then Outstanding shall have such right to make such declaration by a
notice in writing to the Property Trustee, the Depositor and the Indenture
Trustee.
At any time after such a declaration of acceleration with respect to
the Junior Subordinated Debentures has been made and before a judgment or decree
for payment of the money due has been obtained by the Indenture Trustee as
provided in the Subordinated Indenture, the Holders of a Majority in Liquidation
Amount of the Preferred Securities, by written notice to the Property Trustee,
the Depositor and the Indenture Trustee, may rescind and annul such declaration
and its consequences if:
(i) the Depositor has paid or deposited with the Indenture
Trustee a sum sufficient to pay
(1) all overdue installments of interest on all of the
Junior Subordinated Debentures,
35
(2) the principal of any Junior Subordinated Debentures
which have become due otherwise than by such declaration of
acceleration and interest thereon at the rate borne by the
Junior Subordinated Debentures, and
(3) all sums paid or advanced by the Indenture Trustee
under the Subordinated Indenture and the reasonable
compensation, expenses, disbursements and advances of the
Indenture Trustee and the Property Trustee, their agents and
counsel; and
(ii) all Indenture Events of Default, other than the
non-payment of the principal of the Junior Subordinated Debentures
which has become due solely by such acceleration, have been cured or
waived as provided in Section 813 of the Subordinated Indenture.
The Holders of at least a Majority in Liquidation Amount of the
Preferred Securities may, on behalf of the Holders of all the Preferred
Securities, waive any past default under the Subordinated Indenture, except a
default in the payment of principal or interest (unless such 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
Indenture Trustee) or a default in respect of a covenant or provision which
under the Subordinated Indenture cannot be modified or amended without the
consent of the holder of each outstanding Junior Subordinated Debentures. No
such rescission shall affect any subsequent default or impair any right
consequent thereon.
Upon receipt by the Property Trustee of written notice declaring such
an acceleration, or rescission and annulment thereof, by Holders of the
Preferred Securities all or part of which is represented by Book-Entry Preferred
Securities Certificates, a record date shall be established for determining
Holders of Outstanding Preferred Securities entitled to join in such notice,
which record date shall be at the close of business on the day the Property
Trustee receives such notice. The Holders on such record date, or their duly
designated proxies, and only such Persons, shall be entitled to join in such
notice, whether or not such Holders remain Holders after such record date;
provided, that, unless such declaration of acceleration, or rescission and
annulment, as the case may be, shall have become effective by virtue of the
requisite percentage having joined in such notice prior to the day which is 90
days after such record date, such notice of declaration of acceleration, or
rescission and annulment, as the case may be, shall automatically and without
further action by any Holder be canceled and of no further effect. Nothing in
this paragraph shall prevent a Holder, or a proxy of a Holder, from giving,
after expiration of such 90-day period, a new written notice of declaration of
acceleration, or rescission and annulment thereof, as the case may be, that is
identical to a written notice which has been canceled pursuant to the proviso to
the preceding sentence, in which event a new record date shall be established
pursuant to the provisions of this Section 6.01(e).
(f) For so long as any Preferred Securities remain Outstanding, to
the fullest extent permitted by law and subject to the terms of this Trust
Agreement and the Subordinated Indenture, upon an Indenture Event of Default
specified in Sections 801(a) and (b) of the Subordinated Indenture, any Holder
of Preferred Securities shall have the right to institute a
36
proceeding directly against the Depositor, pursuant to Section 808 of the
Subordinated Indenture, for enforcement of payment to such Holder of the
principal amount of Junior Subordinated Debentures having an aggregate principal
amount equal to the aggregate Liquidation Amount of the Preferred Securities of
such Holder (a "Direct Action"). Except as set forth in Section 6.01(e) and this
Section 6.01(f), the Holders of Preferred Securities shall have no right to
exercise directly any right or remedy available to the holders of, or in respect
of, the Junior Subordinated Debentures.
The holders of a Majority in Liquidation Amount of the Preferred
Securities at the time Outstanding shall have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Property Trustee, or exercising any trust or power conferred on the Property
Trustee with respect to the Preferred Securities; provided, however, that, the
Property Trustee shall have the right to decline to follow any such direction if
the Property Trustee being advised by counsel determines that the action so
directed may not lawfully be taken, or if the Property Trustee in good faith
shall determine that the proceedings so directed would be illegal or involve it
in personal liability or be unduly prejudicial to the rights of Holders of
Preferred Securities not parties to such direction, and provided further that
nothing in this Trust Agreement shall impair the right of the Property Trustee
to take any action deemed proper by the Property Trustee and which is not
inconsistent with such direction by such Holders.
SECTION 6.02. NOTICE OF MEETINGS
Notice of all meetings of the Preferred Securityholders, stating the
time, place and purpose of the meeting, shall be given by the Administrative
Trustees pursuant to Section 11.08 to each Preferred Securityholder of record,
at his registered address, at least 15 days and not more than 90 days before the
meeting. At any such meeting, any business properly before the meeting may be so
considered whether or not stated in the notice of the meeting. Any adjourned
meeting may be held as adjourned without further notice.
SECTION 6.03. MEETINGS OF PREFERRED SECURITYHOLDERS
No annual meeting of Securityholders is required to be held. The
Administrative Trustees, however, shall call a meeting of Securityholders to
vote on any matter upon the written request of the Preferred Securityholders of
record of at least 25% of the Preferred Securities (based upon their Liquidation
Amount) and the Administrative Trustees or the Property Trustee may, at any time
in their discretion, call a meeting of Preferred Securityholders to vote on any
matters as to which Preferred Securityholders are entitled to vote.
Preferred Securityholders of record of at least 50% of the Preferred
Securities (based upon their Liquidation Amount), present in person or by proxy,
shall constitute a quorum at any meeting of Securityholders.
If a quorum is present at a meeting, an affirmative vote by the
Preferred Securityholders of record present, in person or by proxy, holding more
than 66-2/3% of the Preferred Securities (based upon their Liquidation Amount)
held by the Preferred Securityholders of record present,
37
either in person or by proxy, at such meeting shall constitute the action of the
Securityholders, unless this Trust Agreement requires a greater number of
affirmative votes.
SECTION 6.04. VOTING RIGHTS
Securityholders shall be entitled to one vote for each $1,000 of
Liquidation Amount represented by their Trust Securities in respect of any
matter as to which such Securityholders are entitled to vote; provided, however,
any Preferred Securities that are owned by the Company, the Property Trustee or
the Delaware Trustee will, for purposes of any vote or consent, be treated as if
they were not outstanding.
SECTION 6.05. PROXIES, ETC.
At any meeting of Securityholders, any Securityholder entitled to vote
may vote by proxy, provided that no proxy shall be voted at any meeting unless
it shall have been placed on file with the Administrative Trustees, or with such
other officer or agent of the Trust as the Administrative Trustees may direct,
for verification prior to the time at which such vote shall be taken. Pursuant
to a resolution of the Property Trustee, proxies may be solicited in the name of
the Property Trustee or one or more officers of the Property Trustee. Only
Securityholders of record shall be entitled to vote. When Trust Securities are
held jointly by several Persons, any one of them may vote at any meeting in
person or by proxy in respect of such Trust Securities, but if more than one of
them shall be present at such meeting in person or by proxy, and such joint
owners or their proxies so present disagree as to any vote to be cast, such vote
shall not be received in respect of such Trust Securities. A proxy purporting to
be executed by or on behalf of a Securityholder shall be deemed valid unless
challenged at or prior to its exercise, and the burden of proving invalidity
shall rest on the challenger. No proxy shall be valid more than three years
after its date of execution.
SECTION 6.06. SECURITYHOLDER ACTION BY WRITTEN CONSENT
Any action which may be taken by Securityholders at a meeting may be
taken without a meeting if Securityholders holding at least 66-2/3% of all
outstanding Trust Securities entitled to vote in respect of such action (or such
other proportion thereof as shall be required by any express provision of this
Trust Agreement) shall consent to the action in writing (based upon their
Liquidation Amount).
SECTION 6.07. RECORD DATE FOR VOTING AND OTHER PURPOSES
For the purposes of determining the Securityholders who are entitled to
notice of and to vote at any meeting or by written consent, or to participate in
any Distribution on the Trust Securities in respect of which a record date is
not otherwise provided for in this Trust Agreement, or for the purpose of any
other action, the Administrative Trustees may from time to time fix a date, not
more than 90 days prior to the date of any meeting of Securityholders or the
payment of Distribution or other action, as the case may be, as a record date
for the determination of the identity of the Securityholders of record for such
purposes.
38
SECTION 6.08. ACTS OF SECURITYHOLDERS
Any request, demand, authorization, direction, notice, consent, waiver
or other action provided or permitted by this Trust Agreement to be given, made
or taken by Securityholders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Securityholders in
person or by an agent appointed in writing; and, except as otherwise expressly
provided herein, such action shall become effective when such instrument or
instruments are delivered to the Administrative Trustees. Such instrument or
instruments (and the action embodied therein and evidenced thereby) are herein
sometimes referred to as the "Act" of the Securityholders signing such
instrument or instruments. Proof of execution of any such instrument or of a
writing appointing any such agent shall be sufficient for any purpose of this
Trust Agreement and (subject to Section 8.01) conclusive in favor of the
Trustees, if made in the manner provided in this Section.
The fact and date of the execution by any Person of any such instrument
or writing may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged to him the execution thereof. Where such execution is by
a signer acting in a capacity other than his individual capacity, such
certificate or affidavit shall also constitute sufficient proof of his
authority. The fact and date of the execution of any such instrument or writing,
or the authority of the Person executing the same, may also be proved in any
other manner which the Trustees deem sufficient.
The ownership of Preferred Securities shall be proved by the Securities
Register. Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the Securityholder of any Trust Security shall bind every future
Securityholder of the same Trust Security and the Securityholder of every Trust
Security issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted or suffered to
be done by the Trustees or the Trust in reliance thereon, whether or not
notation of such action is made upon such Trust Security.
Without limiting the foregoing, a Securityholder entitled hereunder to
take any action hereunder with regard to any particular Trust Security may do so
with regard to all or any part of the Liquidation Amount of such Trust Security
or by one or more duly appointed agents each of which may do so pursuant to such
appointment with regard to all or any part of such Liquidation Amount.
If any dispute shall arise between the Securityholders of Trust
Securities and the Administrative Trustees or among such Securityholders or
Trustees with respect to the authenticity, validity or binding nature of any
request, demand, authorization, direction, consent, waiver or other Act of such
Securityholder or Trustee under this Article VI, then the determination of such
matter by the Property Trustee shall be conclusive with respect to such matter.
39
SECTION 6.09. INSPECTION OF RECORDS
Upon reasonable notice to the Trustees, the records of the Trust shall
be open to inspection by Securityholders during normal business hours for any
purpose reasonably related to such Securityholder's interest as a
Securityholder.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES OF THE TRUSTEES
SECTION 7.01. REPRESENTATIONS AND WARRANTIES OF THE TRUSTEES
The Bank, the Delaware Bank, the Property Trustee and the Delaware
Trustee, each on behalf of and as to itself, hereby represents and warrants for
the benefit of the Depositor and the Securityholders that: (a) the Bank is a
banking corporation or trust company duly organized, validly existing and in
good standing under the laws of the State of New York, and the Delaware Bank is
a banking corporation or trust company, duly organized, validly existing and in
good standing under the laws of the State of Delaware;
(b) each of the Bank and the Delaware Bank has full corporate power,
authority and legal right to execute, deliver and perform their obligations
under this Trust Agreement and has taken all necessary action to authorize the
execution, delivery and performance by it of this Trust Agreement;
(c) this Trust Agreement has been duly authorized, executed and
delivered by each of the Bank and the Delaware Bank and constitutes the valid
and legally binding agreement of each of the Bank and the Delaware Bank,
enforceable against it in accordance with its terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors' rights and to general
equity principles;
(d) the execution, delivery and performance by each of the Bank and
the Delaware Bank of this Trust Agreement have been duly authorized by all
necessary corporate action on the part of the Bank, the Property Trustee, the
Delaware Bank and the Delaware Trustee and do not require any approval of
stockholders of the Bank or the Delaware Bank and such execution, delivery and
performance will not (i) violate the Bank's or the Delaware Bank's Charter or
By-laws, or (ii) violate any law, governmental rule or regulation of the United
States or the State of New York or Delaware, as the case may be, governing the
banking or trust powers of the Bank and the Property Trustee or the Delaware
Bank and the Delaware Trustee, or any order, judgment or decree applicable to
the Bank, the Property Trustee, the Delaware Bank or the Delaware Trustee; and
(e) neither the authorization, execution or delivery by the Bank or
the Delaware Bank of this Trust Agreement, nor the consummation of any of the
transactions by the Bank, the Property Trustee, the Delaware Bank or the
Delaware Trustee (as appropriate in context) contemplated herein or therein,
require the consent or approval of, the giving of notice
40
to, the registration with or the taking of any other action with respect to any
governmental authority or agency under any existing federal, New York or
Delaware law governing the banking or trust powers of the Bank or the Delaware
Bank.
ARTICLE VIII
THE TRUSTEES
SECTION 8.01. CERTAIN DUTIES AND RESPONSIBILITIES
(a) The rights, duties and responsibilities of the Trustees shall be
as provided by this Trust Agreement and, in the case of the Property Trustee,
the Trust Indenture Act. The Property Trustee, other than during the occurrence
and continuation of an Event of Default, undertakes to perform only such duties
as are specifically set forth in this Trust Agreement and, upon an Event of
Default, must exercise the same degree of care and skill as a prudent person
would exercise or use in the conduct of his/her own affairs. The Trustees shall
have all the privileges, rights and immunities provided by the Delaware
Statutory Trust Act. Notwithstanding the foregoing, no provision of this Trust
Agreement shall require the Trustees to expend or risk their own funds or
otherwise incur any financial liability in the performance of any of their
duties hereunder, or in the exercise of any of their rights or powers, if they
shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured to
them. Whether or not therein expressly so provided, every provision of this
Trust Agreement relating to the conduct or affecting the liability of or
affording protection to the Trustees shall be subject to the provisions of this
Section. To the extent that, at law or in equity, the Delaware Trustee has
duties (including fiduciary duties) and liabilities relating thereto to the
Trust or to the Securityholders, the Delaware Trustee shall not be liable to the
Trust or to any Securityholder for the Delaware Trustee's good faith reliance on
the provisions of this Trust Agreement. The provisions of this Trust Agreement,
to the extent that they restrict the duties and liabilities of the Delaware
Trustee otherwise existing at law or in equity, are agreed by the Depositor and
the Securityholders to replace such other duties and liabilities of the Delaware
Trustee.
(b) All payments made by the Property Trustee in respect of the
Trust Securities shall be made only from the income and proceeds from the Trust
Property and only to the extent that there shall be sufficient income or
proceeds from the Trust Property to enable the Property Trustee to make payments
in accordance with the terms hereof. Each Securityholder, by its acceptance of a
Trust Security, agrees that it will look solely to the income and proceeds from
the Trust Property to the extent available for distribution to it as herein
provided and that the Trustees are not personally liable to it for any amount
distributable in respect of any Trust Security or for any other liability in
respect of any Trust Security. This Section 8.01(b) does not limit the liability
of the Trustees expressly set forth elsewhere in this Trust Agreement or, in the
case of the Property Trustee, in the Trust Indenture Act.
SECTION 8.02. NOTICE OF DEFAULTS
Within 90 days after the occurrence of any default, the Property
Trustee shall transmit, in the manner and to the extent provided in Section
11.08, notice of any default actually known to
41
the Property Trustee to the Securityholders, the Administrative Trustees and the
Depositor, unless such default shall have been cured or waived before the giving
of such notice, provided that the Property Trustee shall be protected in
withholding such notice if and so long as the board of directors, the executive
committee, or a trust committee of directors and/or responsible officers of the
Property Trustee in good faith determines that the withholding of such notice is
in the interests of the Securityholders. For the purpose of this Section, the
term "default" means any event which is, or after notice or lapse of time or
both would become, an Event of Default.
SECTION 8.03. CERTAIN RIGHTS OF PROPERTY TRUSTEE
Subject to the provisions of Section 8.01 and except as provided by
law:
(a) the Property Trustee may rely and shall be protected in acting
or refraining from acting in good faith upon any resolution, Opinion of Counsel,
certificate, written representation of a Holder or transferee, certificate of
auditors or any other certificate, statement, instrument, opinion, report,
notice, request, consent, order, appraisal, bond or other paper or document
believed by it to be genuine and to have been signed or presented by the proper
party or parties;
(b) if (i) in performing its duties under this Trust Agreement the
Property Trustee is required to decide between alternative courses of action, or
(ii) in construing any of the provisions in this Trust Agreement the Property
Trustee finds the same ambiguous or inconsistent with any other provisions
contained herein, or (iii) the Property Trustee is unsure of the application of
any provision of this Trust Agreement, then, except as to any matter as to which
the Preferred Securityholders are entitled to vote under the terms of this Trust
Agreement, the Property Trustee shall deliver a notice to the Depositor
requesting written instructions of the Depositor as to the course of action to
be taken. The Property Trustee shall take such action, or refrain from taking
such action, as the Property Trustee shall be instructed in writing to take, or
to refrain from taking, by the Depositor; provided, however, that if the
Property Trustee does not receive such instructions of the Depositor within ten
Business Days after it has delivered such notice, or such reasonably shorter
period of time set forth in such notice (which to the extent practicable shall
not be less than two Business Days), it may, but shall be under no duty to, take
or refrain from taking such action not inconsistent with this Trust Agreement as
it shall deem advisable and in the best interests of the Securityholders, in
which event the Property Trustee shall have no liability except for its own bad
faith, negligence or willful misconduct;
(c) the Property Trustee may consult with counsel or other experts
of its selection and the written advice of such counsel or other experts or any
Opinion of Counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in good faith
and in reliance thereon;
(d) the Property Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Trust Agreement at the request
or direction of any of the Securityholders pursuant to this Trust Agreement,
unless such Securityholders shall have offered to the Property Trustee
reasonable security or indemnity against the costs, expenses and liabilities
which might be incurred by it in compliance with such request or direction;
42
(e) the Property Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order,
approval, bond or other document, but the Property Trustee, in its discretion,
may make such further inquiry or investigation into such facts or matters as it
may see fit;
(f) the Property Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through its
agents or attorneys; provided that the Property Trustee shall be responsible for
its own negligence or recklessness with respect to selection of any agent or
attorney appointed by it hereunder;
(g) the Property Trustee shall not be liable for any action taken,
suffered, or omitted to be taken by it in good faith and reasonably believed by
it to be authorized or within the discretion or rights or powers conferred upon
it by this Trust Agreement;
(h) the Property Trustee shall not be deemed to have notice of any
default or Event of Default unless an officer of the Property Trustee assigned
to its Corporate Trust Division has actual knowledge thereof or unless written
notice of any event which is in fact such a default is received by the Property
Trustee at its corporate trust office, and such notice references the Trust
Securities and this Trust Agreement; and
(i) the rights, privileges, protections, immunities and benefits
given to the Property Trustee, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Property Trustee
in each of its respective capacities hereunder, and to each agent, custodian and
other Person employed to act hereunder.
SECTION 8.04. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES
The recitals contained herein and in the Trust Securities Certificates
shall be taken as the statements of the Trust, and the Trustees do not assume
any responsibility for their correctness. The Trustees shall not be accountable
for the use or application by the Trust of the proceeds of the Trust Securities
in accordance with Section 2.05.
The Property Trustee may conclusively assume that any funds held by it
hereunder are legally available unless an officer of the Property Trustee
assigned to its Institutional Trust Services Department shall have received
written notice from the Company, any Holder or any other Trustee that such funds
are not legally available.
The Property Trustee makes no representations as to the value or
condition of the property of the Trust or any part thereof. The Property Trustee
makes no representations as to the validity or sufficiency of this Trust
Agreement or the Trust Securities.
SECTION 8.05. MAY HOLD SECURITIES
Except as provided in the definition of the term "Outstanding" in
Article I, any Trustee or any other agent of the Trustees or the Trust, in its
individual or any other capacity, may become the owner or pledgee of Trust
Securities and may otherwise deal with the Trust with the same rights it would
have if it were not a Trustee or such other agent.
43
SECTION 8.06. COMPENSATION; FEES; INDEMNITY
The Depositor, as obligor of the Junior Subordinated Debentures,
agrees:
(a) to pay to the Trustees from time to time reasonable compensation
for all services rendered by the Trustees hereunder (which compensation shall
not be limited by any provision of law in regard to the compensation of a
trustee of an express trust);
(b) except as otherwise expressly provided herein, to reimburse the
Trustees upon request for all reasonable expenses, disbursements and advances
incurred or made by the Trustees in accordance with any provision of this Trust
Agreement (including the reasonable compensation and the expenses and
disbursements of their agents and counsel), except any such expense,
disbursement or advance as may be attributable to their willful misconduct,
negligence or bad faith (or, in the case of the Delaware Trustee, any such
expense, disbursement or advance as shall have been caused by his/her own gross
negligence); and
(c) to indemnify each of the Trustees for, and to hold each of the
Trustees harmless against, any and all loss, damage, claims, liability or
expense incurred without willful misconduct, negligence or bad faith on their
part, arising out of or in connection with the acceptance or administration of
this Trust Agreement, including the costs and expenses of defending themselves
against any claim (whether by the Depositor, any Securityholder or any other
person) or liability in connection with the exercise or performance of any of
their powers or duties hereunder.
The provisions of this Section 8.06 shall survive the termination of
this Trust Agreement.
SECTION 8.07. TRUSTEES REQUIRED; ELIGIBILITY
(a) There shall at all times be a Property Trustee hereunder with
respect to the Trust Securities. The Property Trustee shall be a Person that has
a combined capital and surplus of at least $50,000,000. If any such Person
publishes reports of condition at least annually, pursuant to law or to the
requirements of its supervising or examining authority, then for the purposes of
this Section, the combined capital and surplus of such Person shall be deemed to
be its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time the Property Trustee with respect to the
Trust Securities shall cease to be eligible in accordance with the provisions of
this Section, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article.
(b) There shall at all times be one or more Administrative Trustees
hereunder with respect to the Trust Securities. Each Administrative Trustee
shall be either a natural person who is at least 21 years of age or a legal
entity that shall act through one or more persons authorized to bind such
entity.
(c) There shall at all times be a Delaware Trustee with respect to
the Trust Securities. The Delaware Trustee shall either be (i) a natural person
who is at least 21 years of age and a resident of the State of Delaware or (ii)
a legal entity authorized to conduct a trust business and with its principal
place of business in the State of Delaware that shall act through one or more
persons authorized to bind such entity.
44
SECTION 8.08. CONFLICTING INTERESTS
If the Property Trustee has or shall acquire a conflicting interest
within the meaning of the Trust Indenture Act, the Property Trustee shall either
eliminate such interest or resign, to the extent and in the manner provided by,
and subject to the provisions of, the Trust Indenture Act and this Trust
Agreement. To the extent permitted by the Trust Indenture Act, the Property
Trustee shall not be deemed to have a conflicting interest by virtue of being
trustee under the Guarantee.
SECTION 8.09. CO-TRUSTEES AND SEPARATE TRUSTEE
At any time or times, for the purpose of meeting the legal requirements
of the Trust Indenture Act or of any jurisdiction in which any part of the Trust
Property may at the time be located, the Holder of the Common Securities and the
Property Trustee shall have power to appoint, and upon the written request of
the Property Trustee, the Depositor shall for such purpose join with the
Property Trustee in the execution, delivery and performance of all instruments
and agreements necessary or proper to appoint, one or more Persons approved by
the Property Trustee either to act as co-trustee, jointly with the Property
Trustee, of all or any part of such Trust Property, or to act as separate
trustee of any such Trust Property, in either case with such powers as may be
provided in the instrument of appointment, and to vest in such Person or Persons
in the capacity aforesaid, any property, title, right or power deemed necessary
or desirable, subject to the other provisions of this Section. If the Depositor
does not join in such appointment within 15 days after the receipt by it of a
request so to do, or in case an Indenture Event of Default has occurred and is
continuing, the Property Trustee alone shall have power to make such
appointment. Any co-trustee or separate trustee appointed pursuant to this
Section shall satisfy the requirements of Section 8.07.
Should any written instrument from the Depositor be required by any
co-trustee or separate trustee so appointed for more fully confirming to such
co-trustee or separate trustee such property, title, right, or power, any and
all such instruments shall, on request, be executed, acknowledged, and delivered
by the Depositor.
Every co-trustee or separate trustee shall, to the extent permitted by
law, but to such extent only, be appointed subject to the following terms,
namely:
(i) The Trust Securities shall be executed, authenticated and
delivered and all rights, powers, duties, and obligations hereunder
in respect of the custody of securities, cash and other personal
property held by, or required to be deposited or pledged with, the
Trustees hereunder, shall be exercised, solely by the Trustees.
(ii) The rights, powers, duties, and obligations hereby
conferred or imposed upon the Property Trustee in respect of any
property covered by such appointment shall be conferred or imposed
upon and exercised or performed by the Property Trustee or by the
Property Trustee and such co-trustee or separate trustee jointly, as
shall be provided in the instrument appointing such co-trustee or
separate trustee, except to the extent that under any law of any
jurisdiction in which any particular act is to be performed, the
Property Trustee shall be
45
incompetent or unqualified to perform such act, in which event such
rights, powers, duties, and obligations shall be exercised and
performed by such co-trustee or separate trustee.
(iii) The Property Trustee, at any time, by an instrument in
writing executed by it, with the written concurrence of the
Depositor, may accept the resignation of or remove any co-trustee or
separate trustee appointed under this Section, and, in case an
Indenture Event of Default has occurred and is continuing, the
Property Trustee shall have power to accept the resignation of, or
remove, any such co-trustee or separate trustee without the
concurrence of the Depositor. Upon the written request of the
Property Trustee, the Depositor shall join with the Property Trustee
in the execution, delivery, and performance of all instruments and
agreements necessary or proper to effectuate such resignation or
removal. A successor to any co-trustee or separate trustee so
resigned or removed may be appointed in the manner provided in this
Section.
(iv) No co-trustee or separate trustee hereunder shall be
personally liable by reason of any act or omission of the Property
Trustee, or any other such trustee hereunder.
(v) The Trustees shall not be liable by reason of any act of a
co-trustee or separate trustee.
(vi) Any Act of Holders delivered to the Property Trustee shall
be deemed to have been delivered to each such co-trustee and
separate trustee.
SECTION 8.10. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR
No resignation or removal of any Trustee (the "Relevant Trustee") and
no appointment of a successor Relevant Trustee pursuant to this Article shall
become effective until the acceptance of appointment by the successor Relevant
Trustee in accordance with the applicable requirements of Section 8.11.
The Relevant Trustee may resign at any time by giving written notice
thereof to the Securityholders. If the instrument of acceptance by a successor
Relevant Trustee required by Section 8.11 shall not have been delivered to the
Relevant Trustee within 30 days after the giving of such notice of resignation,
the resigning Relevant Trustee may petition any court of competent jurisdiction
for the appointment of a successor Relevant Trustee.
Unless an Indenture Event of Default shall have occurred and be
continuing, the Relevant Trustee may be removed at any time by Act of the Holder
of the Common Securities. If an Indenture Event of Default shall have occurred
and be continuing, the Relevant Trustee may be removed at such time by Act of
the Securityholders of a majority in Liquidation Amount of the Preferred
Securities Certificates, delivered to the Relevant Trustee (in its individual
capacity and on behalf of the Trust).
If the Relevant Trustee shall resign, be removed or become incapable of
continuing to act as Trustee at a time when no Indenture Event of Default shall
have occurred and be continuing,
46
the Holder of the Common Securities, by Act of the Holder of the Common
Securities delivered to the retiring Relevant Trustee, shall promptly appoint a
successor Relevant Trustee or Trustees, and the retiring Relevant Trustee shall
comply with the applicable requirements of Section 8.11. If the Relevant Trustee
shall resign, be removed or become incapable of continuing to act as the
Relevant Trustee at a time when an Indenture Event of Default shall have
occurred and be continuing, the Holders of Preferred Securities, by Act of the
Securityholders of a majority in Liquidation Amount of the Preferred Securities
then outstanding delivered to the retiring Relevant Trustee, shall promptly
appoint a successor Relevant Trustee or Trustees, and the Relevant Trustee shall
comply with the applicable requirements of Section 8.11. If no successor
Relevant Trustee shall have been so appointed in accordance with this Section
8.10 and accepted appointment in the manner required by Section 8.11, any
Securityholder who has been a Securityholder of Trust Securities for at least
six months may, on behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the appointment of a successor Relevant
Trustee.
The retiring Relevant Trustee shall give notice of each resignation and
each removal of the Relevant Trustee, and each appointment of a successor
Trustee to all Securityholders in the manner provided in Section 11.08 and shall
give notice to the Depositor. Each notice shall include the name of the
successor Relevant Trustee and the address of its corporate trust office if it
is the Property Trustee.
Notwithstanding the foregoing or any other provision of this Trust
Agreement, in the event any Administrative Trustee or a Delaware Trustee who is
a natural person dies or becomes incompetent or incapacitated, the vacancy
created by such death, incompetence or incapacity may be filled by (i) the act
of the remaining Administrative Trustee or (ii) otherwise by the Depositor (with
the successor in each case being an individual who satisfies the eligibility
requirement for Administrative Trustees set forth in Section 8.07).
Additionally, notwithstanding the foregoing or any other provision of this Trust
Agreement, in the event the Depositor believes that any Administrative Trustee
has become incompetent or incapacitated, the Depositor, by notice to the
remaining Trustees, may terminate the status of such Person as an Administrative
Trustee (in which case the vacancy so created will be filled in accordance with
the preceding sentence).
SECTION 8.11. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR
In case of the appointment hereunder of a successor Relevant Trustee,
every such successor Relevant Trustee so appointed shall execute, acknowledge
and deliver to the Trust and to the retiring Relevant Trustee an instrument
accepting such appointment, and thereupon the resignation or removal of the
retiring Relevant Trustee shall become effective and 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 the request of the Depositor or the successor Relevant Trustee, such retiring
Relevant Trustee shall, upon payment of its charges, execute and deliver an
instrument transferring to such successor Relevant Trustee all the rights,
powers and trusts of the retiring Relevant Trustee and shall duly assign,
transfer and deliver to such successor Relevant Trustee all property and money
held by such retiring Relevant Trustee hereunder.
47
Upon request of any such successor Relevant Trustee, the Trust shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Relevant Trustee all such rights, powers and trusts
referred to in the preceding paragraph.
No successor Relevant Trustee shall accept its appointment unless at
the time of such acceptance such successor Relevant Trustee shall be qualified
and eligible under this Article.
SECTION 8.12. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
BUSINESS
Any Person into which the Property Trustee, Delaware Trustee or any
Administrative Trustee which is not a natural person may be merged or converted
or with which it may be consolidated, or any Person resulting from any merger,
conversion or consolidation to which such Relevant Trustee shall be a party, or
any Person succeeding to all or substantially all the corporate trust business
of such Relevant Trustee, shall be the successor of such Relevant Trustee
hereunder; provided such Person shall be otherwise qualified and eligible under
this Article, without the execution or filing of any paper or any further act on
the part of any of the parties hereto.
SECTION 8.13. PREFERENTIAL COLLECTION OF CLAIMS AGAINST DEPOSITOR OR
TRUST
If and when the Property Trustee shall be or become a creditor of the
Depositor or the Trust (or any other obligor upon the Junior Subordinated
Debentures or the Trust Securities), the Property Trustee shall be subject to
the provisions of the Trust Indenture Act regarding the collection of claims
against the Depositor or Trust (or any such other obligor). For purposes of
Section 311(b)(4) and (6) of the Trust Indenture Act:
(a) "cash transaction" means any transaction in which full payment
for goods or securities sold is made within seven days after delivery of the
goods or securities in currency or in checks or other orders drawn upon banks or
bankers and payable upon demand; and
(b) "self-liquidating paper" means any draft, bill of exchange,
acceptance or obligation which is made, drawn, negotiated or incurred by the
Depositor or the Trust (or any such obligor) for the purpose of financing the
purchase, processing, manufacturing, shipment, storage or sale of goods, wares
or merchandise and which is secured by documents evidencing title to, possession
of, or a lien upon, the goods, wares or merchandise or the receivables or
proceeds arising from the sale of the goods, wares or merchandise previously
constituting the security; provided the security is received by the Property
Trustee simultaneously with the creation of the creditor relationship with the
Depositor or the Trust (or any such obligor) arising from the making, drawing,
negotiating or incurring of the draft, bill of exchange, acceptance or
obligation.
SECTION 8.14. REPORTS BY PROPERTY TRUSTEE
(a) Within 60 days after May 15 of each year commencing with May 15,
2004, if required by Section 313(a) of the Trust Indenture Act, the Property
Trustee shall transmit a brief report dated as of such May 15 with respect to
any of the events specified in such Section 313(a) that may have occurred since
the later of the date of this Trust Agreement or the preceding May 15.
48
(b) The Property Trustee shall transmit to Securityholders the
reports required by Section 313(b) of the Trust Indenture Act at the times
specified therein.
(c) Reports pursuant to this Section shall be transmitted in the
manner and to the Persons required by Sections 313(c) and (d) of the Trust
Indenture Act.
SECTION 8.15. REPORTS TO THE PROPERTY TRUSTEE
The Depositor and the Administrative Trustees on behalf of the Trust
shall provide to the Property Trustee such documents, reports and information as
required by Section 314 of the Trust Indenture Act (if any) and, within 120 days
after the end of each fiscal year of the Depositor, the compliance certificate
required by Section 314(a)(4) of the Trust Indenture Act in the form and in the
manner required by Section 314 of the Trust Indenture Act.
Delivery of such reports, information and documents to the Property
Trustee is for informational purposes only and the Property Trustee's receipt of
such shall not constitute constructive notice of any information contained
therein or determinable from information contained therein.
SECTION 8.16. EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT
Each of the Depositor and the Administrative Trustees on behalf of the
Trust shall provide to the Property Trustee such evidence of compliance with any
conditions precedent, if any, provided for in this Trust Agreement, including an
Officers' Certificate and an Opinion of Counsel that relate to any of the
matters set forth in Section 314(c) of the Trust Indenture Act. Any certificate
or opinion required to be given pursuant to Section 314(c) of the Trust
Indenture Act shall comply with Section 314(e) of the Trust Indenture Act.
SECTION 8.17. NUMBER OF TRUSTEES
(a) The number of Trustees shall initially be four; provided that
the Depositor by written instrument may increase or decrease the number of
Administrative Trustees.
(b) If a Trustee ceases to hold office for any reason and the number
of Administrative Trustees is not reduced pursuant to Section 8.17(a), or if the
number of Trustees is increased pursuant to Section 8.17(a), a vacancy shall
occur. The vacancy shall be filled with a Trustee appointed in accordance with
Section 8.10.
(c) The death, resignation, retirement, removal, bankruptcy,
incompetence or incapacity to perform the duties of a Trustee shall not operate
to annul the Trust. Whenever a vacancy in the number of Administrative Trustees
shall occur, until such vacancy is filled by the appointment of an
Administrative Trustee in accordance with Section 8.10, the Administrative
Trustees in office, regardless of their number (and notwithstanding any other
provision of this Trust Agreement), shall have all powers granted to the
Administrative Trustees and shall discharge the duties imposed upon the
Administrative Trustees by this Trust Agreement.
49
SECTION 8.18. DELEGATION OF POWER
(a) Any Administrative Trustee may, by power of attorney consistent
with applicable law, delegate to any other natural person over the age of 21 his
or her power for the purpose of executing any documents contemplated in Section
2.07(A), including any registration statement or amendment thereto filed with
the Commission, or making any other governmental filing; and
(b) The Administrative Trustees shall have power to delegate from
time to time to such of their number the doing of such things and the execution
of such instruments either in the name of the Trust or the names of the
Administrative Trustees or otherwise as the Administrative 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 8.19. ENFORCEMENT OF RIGHTS OF PROPERTY TRUSTEE BY
SECURITYHOLDERS
If (i) the Trust fails to pay Distributions in full on the Preferred
Securities for more than five consecutive years at any one time, or (ii) an
Event of Default occurs and is continuing, then the Holders of Preferred
Securities will rely on the enforcement by the Property Trustee of its rights
against the Company as the holder of the Junior Subordinated Debentures. In
addition, the Holders of a majority in aggregate Liquidation Amount of the
Preferred Securities will have the right to direct the time, method, and place
of conducting any proceeding for any remedy available to the Property Trustee or
to direct the exercise of any trust or power conferred upon the Property Trustee
under this Trust Agreement, including the right to direct the Property Trustee
to exercise the remedies available to it as a holder of the Junior Subordinated
Debentures; provided that such direction shall not be in conflict with any rule
of law or with this Trust Agreement, and could not involve the Property Trustee
in personal liability in circumstances where reasonable indemnity would not be
adequate. If the Property Trustee fails to enforce its rights under the Junior
Subordinated Debentures, a Holder of Preferred Securities may, to the fullest
extent permitted by applicable law, institute a legal proceeding against the
Company to enforce its rights under this Trust Agreement without first
instituting any legal proceeding against the Property Trustee or any other
Person, including the Trust; it being understood and intended that no one or
more of such Holders shall have any right in any manner whatsoever by virtue of,
or by availing of, any provision of this Trust Agreement to affect, disturb or
prejudice the rights of any other of such Holders or to obtain or to seek to
obtain priority or preference over any other of such Holders or to enforce any
right under this Trust Agreement, except in the manner herein provided and for
the equal and ratable benefit of all such Holders. Notwithstanding the
foregoing, a Holder of Preferred Securities may institute a legal proceeding
directly against the Company, without first instituting a legal proceeding
against or requesting or directing that action be taken by the Property Trustee
or any other Person, for enforcement of payment to such Holder of principal of
or interest on the Junior Subordinated Debentures having a principal amount
equal to the aggregate stated liquidation amount of the Preferred Securities of
such Holder on or after the due dates therefor specified or provided for in the
Junior Subordinated Debentures. The Company shall be subrogated to all rights of
the Holders of Preferred Securities in respect of any amounts paid to such
Holders by the Company pursuant to this Section.
50
SECTION 8.20. DELAWARE TRUSTEE
(a) Notwithstanding any other provision of this Trust Agreement, the
Delaware Trustee shall not be entitled to exercise any powers, nor shall the
Delaware Trustee have any of the duties and responsibilities of the
Administrative Trustees or the Property Trustee described in this Trust
Agreement. The Delaware Trustee shall be a trustee for the sole and limited
purpose of fulfilling the requirements of ss.3807 of the Delaware Statutory
Trust Act.
(b) It is expressly understood and agreed by the parties hereto that
in fulfilling its obligations as Delaware Trustee hereunder on behalf of the
Trust (i) any agreements or instruments executed and delivered by The Bank of
New York (Delaware) are executed and delivered not in its individual capacity
but solely as Delaware Trustee under this Trust Agreement in the exercise of the
powers and authority conferred and vested in it, (ii) each of the
representations, undertakings and agreements herein made on the part of the
Trust is made and intended not as representations, warranties, covenants,
undertakings and agreements by The Bank of New York (Delaware) in its individual
capacity but is made and intended for the purpose of binding only the Trust, and
(iii) under no circumstances shall The Bank of New York (Delaware) in its
individual capacity be personally liable for the payment of any indebtedness or
expenses of the Trust or be liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken by the Trust under this
Trust Agreement, except if such breach or failure is due to any gross negligence
or willful misconduct of the Delaware Trustee.
ARTICLE IX
TERMINATION AND LIQUIDATION
SECTION 9.01. TERMINATION UPON EXPIRATION DATE
The Trust shall automatically terminate on December 1, 2043 (the
"Expiration Date") or earlier pursuant to Section 9.02.
SECTION 9.02. EARLY TERMINATION
Upon the first to occur of any of the following events (such first
occurrence, an "Early Termination Event"), the Trust shall be dissolved and
terminated in accordance with the terms hereof:
(i) the occurrence of a Bankruptcy Event in respect of the
Depositor, dissolution or liquidation of the Depositor, or the
dissolution of the Trust pursuant to judicial decree;
(ii) the delivery of written direction to the Property Trustee
by the Depositor at any time (which direction is optional and wholly
within the discretion of the Depositor) to terminate the Trust and
distribute the Junior Subordinated Debentures to Securityholders as
provided in Section 9.04; and
51
(iii) the payment at maturity or redemption of all of the
Junior Subordinated Debentures, and the consequent redemption of all
of the Preferred Securities.
SECTION 9.03. TERMINATION
The respective obligations and responsibilities of the Trust and the
Trustees created hereby shall terminate upon the latest to occur of the
following: (a) the distribution by the Property Trustee to Securityholders upon
the liquidation of the Trust pursuant to Section 9.04, or upon the redemption of
all of the Trust Securities pursuant to Section 4.04, of all amounts or
instruments required to be distributed hereunder upon the final payment of the
Trust Securities; (b) the payment of any expenses owed by the Trust; and (c) the
discharge of all administrative duties of the Administrative Trustees, including
the performance of any tax reporting obligations with respect to the Trust or
the Securityholders.
SECTION 9.04. LIQUIDATION
(a) If any Early Termination Event specified in clause (ii) of
Section 9.02 occurs, the Trust shall be liquidated and the Property Trustee
shall distribute the Junior Subordinated Debentures to the Securityholders as
provided in this Section 9.04.
(b) In connection with a distribution of the Junior Subordinated
Debentures, each Holder of Trust Securities shall be entitled to receive, after
the satisfaction of liabilities to creditors of the Trust (as evidenced by a
certificate of the Administrative Trustees), a Like Amount of Junior
Subordinated Debentures. Notice of liquidation shall be given by the Property
Trustee by first-class mail, postage prepaid, mailed not later than 30 nor more
than 60 days prior to the Liquidation Date to each Holder of Trust Securities at
such Holder's address appearing in the Securities Register. All notices of
liquidation shall:
(i) state the Liquidation Date;
(ii) state that from and after the Liquidation Date, the Trust
Securities will no longer be deemed to be Outstanding and any Trust
Securities Certificates not surrendered for exchange will be deemed
to represent a Like Amount of Junior Subordinated Debentures; and
(iii) provide such information with respect to the mechanics by
which Holders may exchange Trust Securities Certificates for Junior
Subordinated Debentures as the Administrative Trustees or the
Property Trustee shall deem appropriate.
(c) In order to effect the liquidation of the Trust and distribution
of the Junior Subordinated Debentures to Securityholders, the Property Trustee
shall establish a record date for such distribution (which shall be not more
than 45 days prior to the Liquidation Date) and, either itself acting as
exchange agent or through the appointment of a separate exchange agent, shall
establish such procedures as it shall deem appropriate to effect the
distribution of Junior Subordinated Debentures in exchange for the Outstanding
Trust Securities Certificates.
52
(d) After the Liquidation Date, (i) the Trust Securities will no
longer be deemed to be Outstanding, (ii) certificates representing a Like Amount
of Junior Subordinated Debentures will be issued to Holders of Trust Securities
Certificates, upon surrender of such certificates to the Administrative Trustees
or their agent for exchange, (iii) any Trust Securities Certificates not so
surrendered for exchange will be deemed to represent a Like Amount of Junior
Subordinated Debentures, accruing interest at the rate provided for in the
Junior Subordinated Debentures from the last Distribution Payment Date on which
a Distribution was made on such Trust Certificates until such certificates are
so surrendered (and until such certificates are so surrendered, no payments of
interest or principal will be made to Holders of Trust Securities Certificates
with respect to such Junior Subordinated Debentures) and (iv) all rights of
Securityholders holding Trust Securities will cease, except the right of such
Securityholders to receive Junior Subordinated Debentures upon surrender of
Trust Securities Certificates.
(e) The Depositor will use its best efforts to have the Junior
Subordinated Debentures that are distributed in exchange for the Preferred
Securities to be listed on such securities exchange as the Preferred Securities
are then listed. The Depositor may elect to have the Junior Subordinated
Debentures issued in book-entry form to the Clearing Agency or its nominee
pursuant to a Certificate Depository Agreement.
SECTION 9.05. BANKRUPTCY
If an Early Termination Event specified in clause (i) of Section 9.02
has occurred, the Trust shall be liquidated. The Property Trustee shall
distribute the Junior Subordinated Debentures to the Securityholders as provided
in Section 9.04, unless such distribution is determined by the Administrative
Trustees not to be practical, in which event the Holders will be entitled to
receive out of the assets of the Trust available for distribution to
Securityholders, after satisfaction of liabilities to creditors, an amount equal
to the Liquidation Amount per Trust Security plus accrued and unpaid
Distributions thereon to the date of payment (such amount being the "Liquidation
Distribution"). If such Liquidation Distribution can be paid only in part
because the Trust has insufficient assets available to pay in full the aggregate
Liquidation Distribution, then, subject to the next succeeding sentence, the
amounts payable by the Trust on the Trust Securities shall be paid on a pro rata
basis (based upon Liquidation Amounts). The Holder of the Common Securities will
be entitled to receive Liquidation Distributions upon any such dissolution,
winding-up or termination pro rata (determined as aforesaid) with Holders of
Preferred Securities, except that, if an Indenture Event of Default has occurred
and is continuing, the Preferred Securities shall have a priority over the
Common Securities.
SECTION 9.06. CERTIFICATE OF CANCELLATION
A Certificate of Cancellation ("Certificate") to terminate and dissolve
the Trust (as permitted hereby) may be signed by any Administrative Trustee,
individually, in such capacity so long as such Certificate fully complies with
all legal requirements.
53
ARTICLE X
REMARKETING PROCEDURES
SECTION 10.01. ELECTION TO REMARKET
If the Company, and the Administrative Trustees acting at the direction
of the Company, elect to conduct a Remarketing, the Trust, not less than 20 nor
more than 35 Business Days prior to the related Election Date, is required
pursuant to Section 4.02(b) to give the written notice of proposed Remarketing
of the Preferred Securities to the Clearing Agency, the Property Trustee, the
Indenture Trustee, the Remarketing Agent and the Calculation Agent. If the
Preferred Securities are not issued in global, fully registered form to the
Clearing Agency, such notice shall be delivered to the Holders instead of the
Clearing Agency. As required by Section 4.02(b), such notice will describe the
Remarketing and will indicate the length of the proposed new Fixed Rate Period,
the proposed Remarketing Date and any redemption provisions that will apply
during such new Fixed Rate Period. At any time prior to the Election Date, the
Company and the Administrative Trustees may elect to terminate a Remarketing by
giving the Clearing Agency (or the Holders, as applicable), the Remarketing
Agent, the Property Trustee, the Indenture Trustee and the Calculation Agent
written notice of such termination.
SECTION 10.02. NOTICE OF ELECTION
(a) Not later than 4:00 P.M., New York City time, on an Election
Date, each Holder of Preferred Securities may give, through the facilities of
the Clearing Agency in the case of Book-Entry Preferred Securities Certificates,
a written notice to the Property Trustee of its election ("Notice of Election")
(i) to retain and not to have all or any portion of the Preferred Securities
owned by it remarketed in the Remarketing or (ii) to tender all or any portion
of such Preferred Securities for purchase in the Remarketing (such portion, in
either case, is to be in the Liquidation Amount of $1,000 or any integral
multiple thereof). Any Notice of Election given to the Property Trustee will be
irrevocable and may not be conditioned upon the level at which the Fixed Rate is
established in the Remarketing. Promptly after 4:30 P.M., New York City time, on
such Election Date, the Property Trustee, based on the Notices of Election
received by it through the Clearing Agency (or from the Holders, if Definitive
Preferred Securities Certificates have been issued) prior to such time, will
notify the Administrative Trustees, the Company and the Remarketing Agent of the
number of Preferred Securities to be retained by holders of Preferred Securities
and the number of Preferred Securities tendered for purchase in the Remarketing.
(b) If any Holder of Preferred Securities gives a Notice of Election
to tender Preferred Securities as described in 10.02(a), the Preferred
Securities so subject to such Notice of Election will be deemed tendered for
purchase in the Remarketing, notwithstanding any failure by such Holder to
deliver or properly deliver such Preferred Securities to the Remarketing Agent
for purchase. If any Holder of Preferred Securities fails timely to deliver a
Notice of Election, as described above, such Preferred Securities will be deemed
tendered for purchase in such Remarketing, notwithstanding such failure or the
failure by such Holder to deliver or properly deliver such Preferred Securities
to the Remarketing Agent for purchase.
54
(c) The right of each Holder of Preferred Securities to have
Preferred Securities tendered for purchase in the Remarketing shall be limited
to the extent that (i) the Remarketing Agent conducts a Remarketing pursuant to
the terms of the Remarketing Agreement, (ii) Preferred Securities tendered have
not been called for redemption, (iii) the Remarketing Agent is able to find a
purchaser or purchasers for tendered Preferred Securities at a Fixed Rate and
(iv) such purchaser or purchasers deliver the purchase price therefor to the
Remarketing Agent.
(d) Any Holder of Preferred Securities that desires to continue to
retain a number of Preferred Securities, but only if the Fixed Rate is not less
than a specified rate per annum, shall submit a Notice of Election to tender
such Preferred Securities pursuant to this Section 10.02 and separately notify
the Remarketing Agent of its interest at the telephone number set forth in the
notice of Remarketing delivered pursuant to Section 10.01. If such Holder so
notifies the Remarketing Agent, the Remarketing Agent will give priority to such
Holder's purchase of such number of Preferred Securities in the Remarketing
providing that the Fixed Rate is not less than such specified rate.
SECTION 10.03. DETERMINATION OF DISTRIBUTION RATE
(a) If Holders submit Notices of Election to retain all of the
Preferred Securities then outstanding, the Fixed Rate will be the rate
determined by the Remarketing Agent, in its sole discretion, as the rate that
would have been established had a Remarketing been held on the related
Remarketing Date.
(b) On any Remarketing Date on which the Remarketing is to be
conducted, the Remarketing Agent will use commercially reasonable efforts to
remarket, at a price equal to 100% of the Liquidation Amount thereof, Preferred
Securities tendered or deemed tendered for purchase. Except as provided in
Section 10.03(a), if, as a result of such efforts, on any Remarketing Date, the
Remarketing Agent has determined that it will be able to remarket all Preferred
Securities tendered or deemed tendered for purchase in the Remarketing at a
Fixed Rate and at a price of $1,000 per Preferred Security, prior to 4:00 P.M.,
New York City time, on such Remarketing Date, the Remarketing Agent will
determine the Fixed Rate, which will be the rate per annum (rounded to the
nearest one-thousandth (0.001) of one percent per annum) which the Remarketing
Agent determines, in its sole judgment, to be the lowest Fixed Rate per annum,
if any, that will enable it to remarket all Preferred Securities tendered or
deemed tendered for Remarketing at a price of $1,000 per Preferred Security.
(c) If the Remarketing Agent is unable to remarket by 4:00 P.M., New
York City time on the third Business Day prior to the Remarketing Settlement
Date, all Preferred Securities tendered or deemed tendered for a purchase at a
price of $1,000 per Preferred Security, the Distribution Rate for the next
Distribution Period shall be the Floating Rate and the new Distribution Period
shall be a Floating Rate Period. In such case, no Preferred Securities will be
sold in the Remarketing and each Holder will continue to hold its Preferred
Securities at such Floating Rate during such Floating Rate Period.
(d) All Preferred Securities tendered or deemed tendered in the
Remarketing will be automatically delivered to the account of the Remarketing
Agent through the facilities of
55
the Clearing Agency against payment of the purchase price therefor on the
Remarketing Settlement Date. The Remarketing Agent will make payment to the
Clearing Agency Participant of each tendering holder of Preferred Securities in
the Remarketing through the facilities of the Clearing Agency by the close of
business on the Remarketing Settlement Date.
In accordance with the Clearing Agency's normal procedures, on the
Remarketing Settlement Date, the transaction described above with respect to
each Preferred Security tendered for purchase and sold in the Remarketing will
be executed through the Clearing Agency Participants, will be debited and
credited and such Preferred Securities delivered by book entry as necessary to
effect purchases and sales of such Preferred Securities. The Clearing Agency is
expected to make payment in accordance with its normal procedures.
This Section 10.03(d) shall not apply if Definitive Preferred
Securities Certificates have been issued.
(e) If any Holder selling Preferred Securities in the Remarketing
fails to deliver such Preferred Securities, the Clearing Agency Participant of
such selling Holder and of any other person that was to have purchased Preferred
Securities in the Remarketing may deliver to any such other person a number of
Preferred Securities that is less than the number of Preferred Securities that
otherwise was to be purchased by such person. In such event, the number of
Preferred Securities to be so delivered will be determined by such Clearing
Agency Participant and delivery of such lesser number of Preferred Securities
will constitute good delivery. This paragraph shall not apply if Definitive
Preferred Securities Certificates have been issued.
The Remarketing Agent is not obligated to purchase any Preferred
Securities that would otherwise remain unsold in a Remarketing. Neither the
Trust, any Trustee, the Company nor the Remarketing Agent shall be obligated in
any case to provide funds to make payment upon tender of Preferred Securities
for Remarketing.
ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.01. GUARANTEE BY THE DEPOSITOR
Subject to the terms and conditions hereof, the Depositor irrevocably
and unconditionally guarantees to each Person to whom the Trust is now or
hereafter becomes indebted or liable (the "Beneficiaries") the full payment,
when and as due, of any and all Obligations (as hereinafter defined) to such
Beneficiaries. As used herein, "Obligations" means any indebtedness, expenses or
liabilities of the Trust, other than obligations of the Trust to pay to Holders
of any Preferred Securities or other similar interests in the Trust the amounts
due such Holders pursuant to the terms of the Preferred Securities or such other
similar interests, as the case may be. This guarantee is intended to be for the
benefit of, and to be enforceable by, all such Beneficiaries, whether or not
such Beneficiaries have received notice hereof.
56
SECTION 11.02. LIMITATION OF RIGHTS OF SECURITYHOLDERS
The death or incapacity of any Person having an interest, beneficial or
otherwise, in a Trust Security shall not operate to terminate this Trust
Agreement, nor entitle the legal representatives or heirs of such Person or any
Securityholder for such Person, to claim an accounting, take any action or bring
any proceeding in and for a partition or winding up of the arrangements
contemplated hereby, nor otherwise affect the rights, obligations and
liabilities of the parties hereto or any of them.
SECTION 11.03. AMENDMENT
(a) This Trust Agreement may be amended from time to time by the
Property Trustee and the Holders of a Majority in Liquidation Amount of the
Common Securities, without the consent of any Holder of the Preferred Securities
(i) to cure any ambiguity, correct or supplement any provision herein which may
be inconsistent with any other provision herein, or to make any other provisions
with respect to matters or questions arising under this Trust Agreement;
provided, however, that such amendment shall not adversely affect in any
material respect the interests of any Holder of Trust Securities; (ii) to
facilitate the tendering, remarketing and settlement of the Preferred
Securities, as herein contemplated; (iii) to modify, eliminate or add to any
provisions of this Trust Agreement to such extent as shall be necessary to
ensure that the Trust will not be taxable other than as a grantor trust for
United States federal income tax purposes at any time that any Trust Securities
are Outstanding or to ensure that the Trust will not be required to register as
an investment company under the Investment Company Act; or (iv) in accordance
with the requirements of Section 8.11.
(b) Except as provided in Section 11.03(c) hereof, any provision of
this Trust Agreement may be amended by the Property Trustee and the Holders of a
Majority in Liquidation Amount of the Common Securities with (i) the consent of
Holders of at least a Majority in Liquidation Amount of the Preferred
Securities, and (ii) receipt by the Trustees of an Opinion of Counsel to the
effect that such amendment or the exercise of any power granted to the Trustees
in accordance with such amendment will not affect the Trust's being taxable as a
grantor trust for United States federal income tax purposes or the Trust's
exemption from status of an "investment company" under the Investment Company
Act.
(c) In addition to and notwithstanding any other provision in this
Trust Agreement, without the consent of each affected Securityholder (such
consent being obtained in accordance with Section 6.03 or 6.06 hereof), this
Trust Agreement may not be amended to (i) change the amount or timing of any
Distribution on the Trust Securities or otherwise adversely affect the amount of
any Distribution required to be made in respect of the Trust Securities as of a
specified date; (ii) restrict the right of a Securityholder to institute suit
for the enforcement of any such payment on or after such date; or (iii) change
the consent required pursuant to this Section 11.03.
(d) Notwithstanding any other provisions of this Trust Agreement,
the Trustees shall not enter into or consent to any amendment to this Trust
Agreement which would cause the Trust to fail or cease to qualify for the
exemption from status of an "investment company" under the Investment
57
Company Act of 1940, as amended, afforded by Rule 3a-5 thereunder.
(e) Without the consent of the Depositor, the Calculation Agent or
the Remarketing Agent, this Trust Agreement may not be amended in a manner which
imposes any additional obligation on the Depositor, the Calculation Agent or the
Remarketing Agent, as the case may be. Notwithstanding any other provisions of
this Trust Agreement, the consent of the Delaware Trustee shall be required to
amend any provision of, or add any provision to, this Trust Agreement which
affects the Delaware Trustee's rights, duties, immunities, liabilities or
otherwise. In executing any amendment permitted by this Trust Agreement, the
Trustees shall be entitled to receive, and (subject to Section 8.01) shall be
fully protected in relying upon an Officer's Certificate and an Opinion of
Counsel stating that the execution of such amendment is authorized or permitted
by this Trust Agreement. Any Trustee may, but shall not be obligated to, enter
into any such amendment which affects such Trustee's own rights, duties,
immunities or liabilities under this Trust Agreement or otherwise.
(f) In the event that any amendment to this Trust Agreement is made,
the Administrative Trustees shall promptly provide to the Depositor a copy of
such amendment.
SECTION 11.04. SEPARABILITY
In case any provision in this Trust Agreement or in the Trust
Securities Certificates shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
SECTION 11.05. GOVERNING LAW
THIS TRUST AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF EACH OF THE
SECURITYHOLDERS, THE TRUST AND THE TRUSTEES WITH RESPECT TO THIS TRUST AGREEMENT
AND THE TRUST SECURITIES SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY
THE INTERNAL LAWS OF THE STATE OF DELAWARE.
SECTION 11.06. SUCCESSORS
This Trust Agreement shall be binding upon and shall inure to the
benefit of any successor to both the Trust and the Trustees, including any
successor by operation of law.
SECTION 11.07. HEADINGS
The Article and Section headings are for convenience only and shall not
affect the construction of this Trust Agreement.
SECTION 11.08. NOTICE AND DEMAND
Any notice, demand or other communication which by any provision of
this Trust Agreement is required or permitted to be given or served to or upon
any Securityholder or the Depositor may be given or served in writing by deposit
thereof, first-class postage prepaid, in
58
the United States mail, hand delivery or facsimile transmission, in each case,
addressed, (i) in the case of a Preferred Securityholder, to such Preferred
Securityholder as such Securityholder's name and address appear on the
Securities Register and, (ii) in the case of the Common Securityholder or the
Depositor, to Southwestern Electric Power Company, 1 Riverside Plaza, Columbus,
Ohio 43215, Attention: Treasurer, Facsimile No. (614) 716-1687, or to such other
address as the Common Securityholder or the Depositor may give notice of to the
Property Trustee and the Delaware Trustee. Such notice, demand or other
communication to or upon a Securityholder shall be deemed to have been
sufficiently given or made, for all purposes, upon hand delivery, mailing or
transmission.
Any notice, demand or other communication which by any provision of
this Trust Agreement is required or permitted to be given or served to or upon
the Trust or the Trustees shall be given in writing addressed as follows: (i)
with respect to the Property Trustee and the Delaware Trustee, The Bank of New
York, 101 Barclay Street, New York, New York 10286, Attention: Corporate Trust
Division, Facsimile No. (212) 815-3272; The Bank of New York (Delaware), White
Clay Center, Route 273, Newark, Delaware 19711, Attention: Corporate Trust
Administration, Facsimile No. (302) 283-8279, as the case may be, or to such
other address as the Property Trustee or the Delaware Trustee may give notice of
to the Depositor; and (ii) with respect to the Administrative Trustees, to them
at the address above for notices to the Depositor, marked Attention:
Administrative Trustees of SWEPCo Capital Trust I, c/o Treasurer. Such notice,
demand or other communication to or upon the Trust or the Trustees shall be
deemed to have been sufficiently given or made only upon actual receipt of the
writing by the applicable Trustee.
Any notice, demand or other communication which by any provision of
this Trust Agreement is required or permitted to be served upon the Calculation
Agent or the Remarketing Agreement shall be given in accordance with the
Calculation Agent Agreement or the Remarketing Agreement, respectively.
SECTION 11.09. AGREEMENT NOT TO PETITION
Each of the Trustees and the Depositor agrees for the benefit of the
Securityholders that, until at least one year and one day after the Trust has
been terminated in accordance with Article IX, it shall not file, or join in the
filing of, a petition against the Trust under any bankruptcy, reorganization,
arrangement, insolvency, liquidation or other similar law (including, without
limitation, the United States Bankruptcy Code) (collectively, "Bankruptcy Laws")
or otherwise join in the commencement of any proceeding against the Trust under
any Bankruptcy Law. In the event the Depositor takes action in violation of this
Section 11.09, the Property Trustee agrees, for the benefit of Securityholders,
that it shall file an answer with the bankruptcy court or otherwise properly
contest the filing of such petition by the Depositor against the Trust or the
commencement of such action and raise the defense that the Depositor has agreed
in writing not to take such action and should be stopped and precluded therefrom
and such other defenses, if any, as counsel for the Trustees or the Trust may
assert. The provisions of this Section 11.09 shall survive the termination of
this Trust Agreement.
59
SECTION 11.10. CONFLICT WITH TRUST INDENTURE ACT
(a) This Trust Agreement is subject to the provisions of the Trust
Indenture Act that are required to be part of this Trustee Agreement and shall,
to the extent applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is a
Trustee for the purposes of the Trust Indenture Act.
(c) If any provision hereof limits, qualifies or conflicts with
another provision hereof which is required to be included in this Trust
Agreement by any of the provisions of the Trust Indenture Act, such required
provision shall control.
(d) The application of the Trust Indenture Act to this Trust
Agreement shall not affect the nature of the Trust Securities as equity
securities representing undivided beneficial interests in the assets of the
Trust.
THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST THEREIN
BY OR ON BEHALF OF A SECURITYHOLDER OR ANY BENEFICIAL OWNER, WITHOUT ANY
SIGNATURE OR FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL
ACCEPTANCE BY THE SECURITYHOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN
SUCH TRUST SECURITY OF ALL THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT AND
AGREEMENT TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND
THE SUBORDINATED INDENTURE AND THE AGREEMENT OF THE TRUST, SUCH SECURITYHOLDER
AND SUCH OTHERS THAT THOSE TERMS AND PROVISIONS SHALL BE BINDING, OPERATIVE AND
EFFECTIVE AS BETWEEN THE TRUST AND SUCH SECURITYHOLDER AND SUCH OTHERS.
IN WITNESS WHEREOF, the parties hereto have executed this Trust Agreement or
have caused this Trust Agreement to be executed on their behalf, all as of the
day and year first above written.
SOUTHWESTERN ELECTRIC POWER COMPANY,
as Depositor
By:
-------------------------------
Name: Wendy G. Hargus
Title: Assistant Treasurer
THE BANK OF NEW YORK,
as Property Trustee
60
By:
---------------------------------
Name:
-------------------------------
Title:
-------------------------------
THE BANK OF NEW YORK (DELAWARE)
as Delaware Trustee
By:
---------------------------------
Name:
-------------------------------
Title:
-------------------------------
------------------------------------
Wendy G. Hargus
as Administrative Trustee
------------------------------------
Jeffrey D. Cross
as Administrative Trustee
61
EXHIBIT A
Unless this certificate is presented by an authorized representative of
The Depository Trust Company, a New York corporation ("DTC"), to SWEPCo Capital
Trust I or its agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or in such other name
as is requested by an authorized representative of DTC (and any payment made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), any transfer, pledge or other use hereof for value or
otherwise by or to any person is wrongful inasmuch as the registered owner
thereof, Cede & Co., has an interest herein.*
Certificate Number Number of Preferred Securities
-------------
P-_ CUSIP NO. 870695 AA 1
Certificate Evidencing Preferred Securities
of
SWEPCo Capital Trust I
Flexible Trust Preferred Securities
(Five Year Initial Fixed Rate Period)
(Liquidation Amount $1,000 per Preferred Security)
SWEPCo Capital Trust I, a statutory trust created under the
laws of the State of Delaware (the "Trust"), hereby certifies that Cede & Co.*
(the "Holder") is the registered owner of _____ (_______) preferred securities
of the Trust representing undivided beneficial interests in the assets of the
Trust and designated the SWEPCo Capital Trust I Flexible Trust Preferred
Securities (Five Year Initial Fixed Rate Period) (Liquidation Amount $1,000 per
Preferred Security) (the "Preferred Securities"). The Preferred Securities are
transferable on the books and records of the Trust, in person or by a duly
authorized attorney, upon surrender of this certificate duly endorsed and in
proper form for transfer as provided in Section 5.04 of the Trust Agreement (as
defined below). The designations, rights, privileges, restrictions, preferences
and other terms and provisions of the Preferred Securities are set forth in, and
this certificate and the Preferred Securities represented hereby are issued and
shall in all respects be subject to the terms and provisions of, the Amended and
Restated Trust Agreement of the Trust, dated as of September 1, 2003, as the
same may be amended from time to time (the "Trust Agreement"), including the
designation of the terms of Preferred Securities as set forth therein. The
holder of this certificate is entitled to the benefits of a guarantee by
Southwestern Electric Power Company, a Delaware corporation (the "Company"),
pursuant to a Guarantee Agreement between the Company and The Bank of New York,
as guarantee trustee, dated as of September 1, 2003, as the same may be amended
from time to time (the "Guarantee"), to the extent provided therein. The Trust
will furnish a copy of the Trust Agreement and the Guarantee to the holder of
this certificate without charge upon written request to the Trust at its
principal place of business or registered office.
A-1
Upon receipt of this certificate, the holder of this certificate is
bound by the Trust Agreement and is entitled to the benefits thereunder.
*Insert in Book-Entry Preferred Securities Certificates only
IN WITNESS WHEREOF, the Administrative Trustees of the Trust have
executed this certificate this ____ day of _______, ____.
SWEPCO CAPITAL TRUST I
By:
---------------------------------
Wendy G. Hargus,
As Administrative Trustee
By:
---------------------------------
Jeffrey D. Cross,
As Administrative Trustee
CERTIFICATE OF AUTHENTICATION
This is one of the Preferred Securities referred to in the
within-mentioned Trust Agreement.
------------------------------------
as Administrative Trustee
A-2
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Preferred
Security to:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Insert assignee's social security or tax identification number)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Insert address and zip code of assignee)
and irrevocably appoints
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
agent to transfer this Preferred Securities Certificate on the books of the
Trust. The agent may substitute another to act for him or her.
Date:
----------------------------------------
Signature:
----------------------------------------
(Sign exactly as your name appears on the other side of this Preferred
Securities Certificate)
A-3
EXHIBIT B
AGREEMENT AS TO EXPENSES AND LIABILITIES
THIS AGREEMENT AS TO EXPENSES AND LIABILITIES (this "Agreement") is
made as of September 1, 2003, between Southwestern Electric Power Company, a
Delaware corporation (the "Company"), and SWEPCo Capital Trust I, a Delaware
statutory trust (the "Trust").
WHEREAS, the Trust intends to issue its Common Securities (the "Common
Securities") to and receive Junior Subordinated Debentures from the Company and
to issue and sell SWEPCo Capital Trust I Flexible Trust Preferred Securities
(the "Preferred Securities") with such powers, preferences and special rights
and restrictions as are set forth in the Amended and Restated Trust Agreement of
the Trust dated as of September 1, 2003 as the same may be amended from time to
time (the "Trust Agreement"); and
WHEREAS, the Company is the issuer of the Junior Subordinated
Debentures.
NOW, THEREFORE, in consideration of the purchase by each holder of the
Preferred Securities, which purchase the Company hereby agrees shall benefit the
Company and which purchase the Company acknowledges will be made in reliance
upon the execution and delivery of this Agreement, the Company and the Trust
hereby agree as follows:
ARTICLE I
Section 1.01. GUARANTEE BY THE COMPANY. Subject to the terms and
conditions hereof, the Company, as obligor of the Junior Subordinated
Debentures, hereby irrevocably and unconditionally guarantees to each person or
entity to whom the Trust is now or hereafter becomes indebted or liable (the
"Beneficiaries") the full payment, when and as due, of any and all Obligations
(as hereinafter defined) to such Beneficiaries. As used herein, "Obligations"
means any indebtedness, expenses or liabilities of the Trust, other than
obligations of the Trust to pay to holders of any Preferred Securities or other
similar interests in the Trust the amounts due such holders pursuant to the
terms of the Preferred Securities or such other similar interests, as the case
may be. This Agreement is intended to be for the benefit of, and to be
enforceable by, all such Beneficiaries, whether or not such Beneficiaries have
received notice hereof.
Section 1.02. TERM OF AGREEMENT. This Agreement shall terminate and be
of no further force and effect upon the date on which there are no Beneficiaries
remaining; provided, however, that this Agreement shall continue to be effective
or shall be reinstated, as the case may be, if at any time any holder of
Preferred Securities or any Beneficiary must restore payment of any sums paid
under the Preferred Securities, under any Obligation, under the Guarantee
Agreement dated the date hereof by the Company and The Bank of New York, as
guarantee trustee, or under this Agreement for any reason whatsoever. This
Agreement is continuing, irrevocable, unconditional and absolute.
B-1
Section 1.03. WAIVER OF NOTICE. The Company hereby waives notice of
acceptance of this Agreement and of any Obligation to which it applies or may
apply, and the Company hereby waives presentment, demand for payment, protest,
notice of nonpayment, notice of dishonor, notice of redemption and all other
notices and demands.
Section 1.04. NO IMPAIRMENT. The obligations, covenants, agreements and
duties of the Company under this Agreement shall in no way be affected or
impaired by reason of the happening from time to time of any of the following:
(a) the extension of time for the payment by the Trust of all
or any portion of the Obligations or for the performance of any other
obligation under, arising out of, or in connection with, the
Obligations;
(b) any failure, omission, delay or lack of diligence on the
part of the Beneficiaries to enforce, assert or exercise any right,
privilege, power or remedy conferred on the Beneficiaries with respect
to the Obligations or any action on the part of the Trust granting
indulgence or extension of any kind; or
(c) the voluntary or involuntary liquidation, dissolution,
sale of any collateral, receivership, insolvency, bankruptcy,
assignment for the benefit of creditors, reorganization, arrangement,
composition or readjustment of debt of, or other similar proceedings
affecting, the Trust or any of the assets of the Trust.
There shall be no obligation of the Beneficiaries to give notice to, or obtain
the consent of, the Company with respect to the happening of any of the
foregoing.
Section 1.05. ENFORCEMENT. A Beneficiary may enforce this Agreement
directly against the Company and the Company waives any right or remedy to
require that any action be brought against the Trust or any other person or
entity before proceeding against the Company.
ARTICLE II
Section 2.01. BINDING EFFECT. All guarantees and agreements contained
in this Agreement shall bind the successors, assigns, receivers, trustees and
representatives of the Company and shall inure to the benefit of the
Beneficiaries.
Section 2.02. AMENDMENT. So long as there remains any Beneficiary or
any Preferred Securities of any series are outstanding, this Agreement shall not
be modified or amended in any manner adverse to such Beneficiary or to the
holders of the Preferred Securities.
Section 2.03. NOTICES. Any notice, request or other communication
required or permitted to be given hereunder shall be given in writing by
delivering the same against receipt therefor by facsimile transmission
(confirmed by mail), telex or by registered or certified mail, addressed as
follows (and if so given, shall be deemed given when mailed or upon receipt of
an answer-back, if sent by telex), to-wit:
B-2
SWEPCo Capital Trust I
c/o The Bank of New York
101 Barclay Street, 8W
New York, New York 10286
Facsimile No.: (212) 815-5707
Attention: Corporate Trust Administration
Southwestern Electric Power Company
1 Riverside Plaza
Columbus, Ohio 43215
Facsimile No.: (614) 716-1687
Attention: Treasurer
Section 2.04. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
THIS AGREEMENT is executed as of the date and year first above written.
SOUTHWESTERN ELECTRIC POWER COMPANY
By:
--------------------------------
Wendy G. Hargus
Assistant Treasurer
SWEPCO CAPITAL TRUST I
By:
--------------------------------
Jeffrey D. Cross
as Administrative Trustee
B-3
EXHIBIT C
THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT AS PROVIDED IN THE TRUST
AGREEMENT REFERRED TO HEREIN
Certificate Number C-1 Number of Common Securities
-----------------
Certificate Evidencing Common Securities
of
SWEPCo Capital Trust I
Common Securities
(Liquidation Amount $1,000 per Common Security)
SWEPCo Capital Trust I, a statutory trust created under the laws of the
State of Delaware (the "Trust"), hereby certifies that Southwestern Electric
Power Company (the "Holder") is the registered owner of _____________ (_______)
common securities of the Trust representing undivided beneficial interests in
the assets of the Trust and designated the Common Securities (Liquidation Amount
$1,000 per Common Security) (the "Common Securities"). In accordance with
Section 5.10 of the Trust Agreement (as defined below) the Common Securities are
not transferable, except by operation of law or as permitted by the Trust
Agreement referred to herein, and any attempted transfer hereof shall be void.
The designations, rights, privileges, restrictions, preferences and other terms
and provisions of the Common Securities are set forth in, and this certificate
and the Common Securities represented hereby are issued and shall in all
respects be subject to the terms and provisions of, the Amended and Restated
Trust Agreement of the Trust dated as of September 1, 2003, as the same may be
amended from time to time (the "Trust Agreement"), including the designation of
the terms of the Common Securities as set forth therein. The holder of this
certificate is entitled to the benefits of a guarantee by Southwestern Electric
Power Company, a Delaware corporation (the "Company"), pursuant to a Guarantee
Agreement between the Company and The Bank of New York, as guarantee trustee,
dated as of September 1, 2003, as the same may be amended from time to time (the
"Guarantee"), to the extent provided therein. The Trust will furnish a copy of
the Trust Agreement and the Guarantee to the Holder without charge upon written
request to the Trust at its principal place of business or registered office.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.
IN WITNESS WHEREOF, the Administrative Trustees of the Trust have
executed this certificate this ____ day of __________, ____.
SWEPCo Capital Trust I
By:
--------------------------------
Wendy G. Hargus,
as Administrative Trustee
By:
--------------------------------
Jeffrey D. Cross,
as Administrative Trustee
CERTIFICATE OF AUTHENTICATION
This is one of the Common Securities referred to in the within-mentioned Trust
Agreement.
------------------------------------
as Administrative Trustee
C-2