EXHIBIT 4.2
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AMENDED AND RESTATED DECLARATION OF TRUST
of
Imperial Credit Capital Trust I
Dated as of June 9, 1997
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CROSS REFERENCE TABLE*
Section of Trust
Indenture Act of Section of
1939, as amended Agreement
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310(a).................................................................6.3
310(b).........................................................6.3(c); 6.3(d)
310(c)...........................................................Inapplicable
311(a).................................................................2.2(b)
311(b).................................................................2.2(b)
311(c)...........................................................Inapplicable
312(a).................................................................2.2(a)
312(b).................................................................2.2(b)
312(c)...........................................................Inapplicable
313(a).................................................................2.3
313(b).................................................................2.3
313(c).................................................................2.3
313(d).................................................................2.3
314(a).................................................................2.4
314(b)...........................................................Inapplicable
314(c).................................................................2.5
314(d)...........................................................Inapplicable
314(e).................................................................2.5
314(f)...........................................................Inapplicable
315(a).........................................................3.9(b); 3.10(a)
315(b)..................................................................2.7(a)
315(c)..................................................................3.9(a)
315(d)..................................................................3.9(b)
316(a).....................................................2.6; 7.6(b); 7.7(c)
316(b)...........................................................Inapplicable
316(c)...........................................................Inapplicable
317(a)...................................................................3.16
317(b)...........................................................Inapplicable
318(a)................................................................2.1(c)
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* This Cross-Reference Table does not constitute part of the Agreement and
shall not have any bearing upon the interpretation of any of its terms or
provisions.
TABLE OF CONTENTS
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ARTICLE 1
INTERPRETATION AND DEFINITIONS................ 1
SECTION 1.1 Interpretation and Definitions...................... 1
Additional Interest.............................................. 2
Affiliate........................................................ 2
Applicable Distribution Rate..................................... 2
Authorized Officer............................................... 2
Beneficial Owners................................................ 2
Business Day..................................................... 2
Business Trust Act............................................... 2
Cedel............................................................ 3
Certificate...................................................... 3
Certificate of Trust............................................. 3
Change of Control................................................ 3
Closing Date..................................................... 3
Code............................................................. 3
Commission....................................................... 3
Common Securities Holder......................................... 3
Common Security.................................................. 4
Common Security Certificate...................................... 4
Corporate Trust Office........................................... 4
Covered Person................................................... 4
Debenture Issuer................................................. 4
Debenture Issuer Indemnified Person.............................. 4
Debenture Trustee................................................ 4
Debentures....................................................... 4
Delaware Trustee................................................. 4
Depositary....................................................... 4
Depositary Participant........................................... 4
Direct Action.................................................... 4
Distribution..................................................... 4
Distribution Date................................................ 4
DWAC............................................................. 5
Election Date.................................................... 5
Euroclear........................................................ 5
Excess Proceeds.................................................. 5
Fiduciary Indemnified Person..................................... 5
Fiscal Year...................................................... 5
Global Security.................................................. 5
Guarantee........................................................ 5
Holder........................................................... 5
Indemnified Person............................................... 5
Indenture........................................................ 5
Initial Distribution Rate........................................ 5
Initial Purchaser................................................ 5
Investment Company............................................... 6
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Investment Company Act........................................... 6
Investment Company Event......................................... 6
Legal Action..................................................... 6
List of Holders.................................................. 6
Majority in Liquidation Amount................................... 6
Maximum Adjusted Distribution Rate............................... 6
Moody's.......................................................... 6
New Preferred Securities......................................... 6
New Preferred Security Certificate............................... 6
New York Stock Exchange.......................................... 6
Notice of Election............................................... 6
Officers' Certificate............................................ 6
Paying Agent..................................................... 7
Person........................................................... 7
Preferred Security............................................... 7
Preferred Security Certificate................................... 7
Private Placement Legend......................................... 7
Property Account................................................. 7
Property Trustee................................................. 7
Pro Rata......................................................... 7
Qualified Institutional Buyer.................................... 8
Quorum........................................................... 8
Redemption/Distribution Notice................................... 8
Redemption Price................................................. 8
Registration Rights Agreement.................................... 8
Regular Trustee.................................................. 8
Regulation S..................................................... 8
Regulation S Global Security..................................... 8
Related Party.................................................... 8
Remarketing...................................................... 8
Remarketing Agent................................................ 8
Remarketing Agreement............................................ 8
Remarketing Settlement Date...................................... 9
Responsible Officer.............................................. 9
Restricted Global Security....................................... 9
Restricted Period................................................ 9
Restricted Security.............................................. 9
Restricted Subsidiary............................................ 9
Rule 144A........................................................ 9
Rule 3a-5........................................................ 9
Scheduled Remarketing Date....................................... 9
Scheduled Remarketing Settlement Date............................ 9
Senior Notes Guarantee........................................... 10
Securities....................................................... 10
Securities Act................................................... 10
Special Event.................................................... 10
Special Mandatory Redemption..................................... 10
Sponsor.......................................................... 10
Subsidiary Guarantee............................................. 10
Successor Delaware Trustee....................................... 10
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Successor Entity................................................. 10
Successor Property Trustee....................................... 10
Successor Security............................................... 10
Super Majority................................................... 10
Tax Event........................................................ 10
Tax Opinion...................................................... 11
Tax Opinion Redemption........................................... 11
10% in Liquidation Amount........................................ 11
30-year Treasury Rate............................................ 11
Transfer Restricted Securities................................... 11
Transfer Restricted Securities Certificate....................... 11
Transfer Restricted Security Redemption.......................... 11
Trust............................................................ 12
Trust Enforcement Event.......................................... 12
Trust Indenture Act.............................................. 12
Trustee" or "Trustees............................................ 12
Wholly-Owned Restricted Subsidiary............................... 12
ARTICLE 2
TRUST INDENTURE ACT...................... 12
SECTION 2.1 Trust Indenture Act; Application.................... 12
SECTION 2.2 Lists of Holders of Securities...................... 13
SECTION 2.3 Reports by the Property Trustee..................... 13
SECTION 2.4 Periodic Reports to the Property Trustee............ 13
SECTION 2.5 Evidence of Compliance with Conditions Precedent.... 13
SECTION 2.6 Trust Enforcement Events; Waiver.................... 14
SECTION 2.7 Trust Enforcement Event; Notice..................... 15
ARTICLE 3
ORGANIZATION.......................... 16
SECTION 3.1 Name and Organization............................... 16
SECTION 3.2 Office.............................................. 16
SECTION 3.3 Purpose............................................. 16
SECTION 3.4 Authority........................................... 17
SECTION 3.5 Title to Property of the Trust...................... 17
SECTION 3.6 Powers and Duties of the Regular Trustees........... 17
SECTION 3.7 Prohibition of Actions by the Trust and the Trustees 20
SECTION 3.8 Powers and Duties of the Property Trustee........... 21
SECTION 3.9 Certain Duties and Responsibilities of the Property
Trustee............................................. 23
SECTION 3.10 Certain Rights of Property Trustee.................. 25
SECTION 3.11 Delaware Trustee.................................... 28
SECTION 3.12 Execution of Documents.............................. 28
SECTION 3.13 Not Responsible for Recitals or Issuance of
Securities.......................................... 28
SECTION 3.14 Duration of Trust................................... 28
SECTION 3.15 Mergers............................................. 28
SECTION 3.16 Property Trustee May File Proofs of Claim........... 30
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ARTICLE 4
SPONSOR...................................... 31
SECTION 4.1 Responsibilities of the Sponsor..................... 31
SECTION 4.2 Indemnification and Expenses of the Trustees........ 32
ARTICLE 5
TRUST COMMON SECURITIES HOLDER................. 32
SECTION 5.1 Debenture Issuer's Purchase of Common Securities.... 32
SECTION 5.2 Covenants of the Common Securities Holder........... 32
ARTICLE 6
TRUSTEES............................ 33
SECTION 6.1 Number of Trustees.................................. 33
SECTION 6.2 Delaware Trustee; Eligibility....................... 33
SECTION 6.3 Property Trustee; Eligibility....................... 33
SECTION 6.4 Qualifications of Regular Trustees and Delaware
Trustee Generally................................... 34
SECTION 6.5 Initial Regular Trustees............................ 34
SECTION 6.6 Appointment, Removal and Resignation of
Trustees............................................ 35
SECTION 6.7 Vacancies among Trustees............................ 36
SECTION 6.8 Effect of Vacancies................................. 36
SECTION 6.9 Meetings............................................ 36
SECTION 6.10 Merger, Conversion, Consolidation or
Succession to Business.............................. 37
ARTICLE 7
THE SECURITIES......................... 37
SECTION 7.1 General Provisions Regarding Securities............. 37
SECTION 7.2 Distributions....................................... 39
SECTION 7.3 Redemption of Securities............................ 41
SECTION 7.4 Redemption Procedures............................... 42
SECTION 7.5 Remarketing......................................... 43
SECTION 7.6 Voting Rights of Preferred Securities............... 46
SECTION 7.7 Voting Rights of Common Securities.................. 48
SECTION 7.8 Paying Agent........................................ 49
SECTION 7.9 Transfer of Securities.............................. 49
SECTION 7.10 Mutilated, Destroyed, Lost or Stolen Certificates... 50
SECTION 7.11 Deemed Security Holders............................. 51
SECTION 7.12 Global Securities................................... 51
SECTION 7.13 Restrictive Legend.................................. 54
SECTION 7.14 Special Transfer Provisions......................... 56
SECTION 7.15 Change of Control................................... 59
SECTION 7.16 Asset Sales......................................... 60
ARTICLE 8
DISSOLUTION AND TERMINATION OF TRUST.............. 61
SECTION 8.1 issolution and Termination of Trust................. 61
SECTION 8.2 Liquidation Distribution Upon Dissolution of the
Trust............................................... 62
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ARTICLE 9
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, DELAWARE TRUSTEES OR OTHERS....... 62
SECTION 9.1 Liability........................................... 62
SECTION 9.2 Exculpation......................................... 63
SECTION 9.3 Fiduciary Duty...................................... 63
SECTION 9.4 Indemnification..................................... 64
SECTION 9.5 Outside Businesses.................................. 67
ARTICLE 10
ACCOUNTING........................... 67
SECTION 10.1 Fiscal Year........................................ 67
SECTION 10.2 Certain Accounting Matters......................... 67
SECTION 10.3 Banking............................................ 68
SECTION 10.4 Withholding........................................ 68
ARTICLE 11
AMENDMENTS AND MEETINGS.................... 69
SECTION 11.1 Amendments......................................... 69
SECTION 11.2 Meetings of the Holders of Securities; Action
by Written Consent................................. 71
ARTICLE 12
REPRESENTATIONS OF PROPERTY DELAWARE TRUSTEE
AND DELAWARE TRUSTEE...................... 72
SECTION 12.1 Representations and Warranties of the Property
Trustee............................................ 72
SECTION 12.2 Representations and Warranties of the Delaware
Trustee............................................ 73
ARTICLE 13
MISCELLANEOUS.......................... 74
SECTION 13.1 Notices............................................. 74
SECTION 13.2 Governing Law....................................... 74
SECTION 13.3 Intention of the Parties............................ 74
SECTION 13.4 Headings............................................ 75
SECTION 13.5 Successors and Assigns.............................. 75
SECTION 13.6 Partial Enforceability.............................. 75
SECTION 13.7 Counterparts........................................ 75
EXHIBITS
Exhibit A Form of Remarketed Par Security Certificate, Series A
Exhibit B Form of Preferred Security Certificate, Series B
Exhibit C Form of Common Security Certificate
Exhibit D Notice of Remarketing
Exhibit E Notice of Election
v
AMENDED AND RESTATED DECLARATION OF TRUST
THIS AMENDED AND RESTATED DECLARATION OF TRUST ("Declaration"), dated
as of June 9, 1997, by and among Imperial Credit Industries, Inc., a California
corporation, as Sponsor, and Irwin L. Gubman, Kevin E. Villani and Paul B.
Lasiter, as the initial Regular Trustees, Chase Trust Company of California, a
state banking corporation, as the initial Property Trustee and Chase Manhattan
Bank Delaware, a Delaware banking corporation, as the initial Delaware Trustee,
not in their individual capacities but solely as Trustees, and the holders, from
time to time, of undivided beneficial ownership interests in the Trust to be
issued pursuant to this Declaration.
WHEREAS, the Trustees and the Sponsor established Imperial Credit
Capital Trust I (the "Trust"), a business trust under the Business Trust Act (as
defined, together with other capitalized terms, herein) pursuant to a
Declaration of Trust, dated as of May 28, 1997, (the "Original Declaration") and
a Certificate of Trust (the "Certificate of Trust") filed with the Secretary of
State of the State of Delaware on May 28, 1997; and
WHEREAS, the sole purpose of the Trust shall be to issue and sell
certain securities representing undivided beneficial ownership interests in the
assets of the Trust, to invest the proceeds from such sales in the Debentures
(as defined herein) issued by the Debenture Issuer and to engage in only those
activities necessary or incidental thereto; and
WHEREAS, all of the Trustees and the Sponsor, by this Declaration,
amend and restate each and every term and provision of the Original Declaration.
NOW, THEREFORE, it being the intention of the parties hereto to
continue the Trust as a business trust under the Business Trust Act and that
this Declaration constitute the governing instrument of such business trust, the
Trustees hereby declare that all assets contributed to the Trust be held in
trust for the benefit of the Holders, from time to time, of the Securities
representing undivided beneficial ownership interests in the assets of the Trust
issued hereunder, subject to the provisions of this Declaration.
ARTICLE 1
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Interpretation and Definitions.
------------------------------
Unless the context otherwise requires:
(a) capitalized terms used in this Declaration but not defined in the
preamble above have the respective meanings assigned to them in this Section
1.1;
2
(b) a term defined anywhere in this Declaration has the same meaning
throughout;
(c) all references to "the Declaration" or "this Declaration" are to
this Declaration as modified, supplemented or amended from time to time;
(d) all references in this Declaration to Articles, Sections,
Recitals and Exhibits are to Articles and Sections of, or Recitals and Exhibits
to, this Declaration unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the same meaning
when used in this Declaration unless otherwise defined in this Declaration or
unless the context otherwise requires;
(f) a reference to the singular includes the plural and vice versa
and a reference to any masculine form of a term shall include the feminine form
of a term, as applicable; and
(g) the following terms have the following meanings:
"Additional Interest" has the meaning specified in the Indenture.
"Adjusted Distribution Rate" has the meaning specified in Section
7.2(a)(ii).
"Affiliate" has the same meaning as given to that term in Rule 405 of
the Securities Act or any successor rule thereunder.
"Applicable Distribution Rate" has the meaning specified in Section
7.2.
"Authorized Officer" of a Person means any Person that is expressly
authorized to bind such Person.
"Beneficial Owners" means, for Preferred Securities represented by a
Global Security, the person who acquires an interest in the Preferred Securities
which is reflected on the records of the Depositary through the Depositary
Participants.
"Business Day" means any day other than a Saturday or Sunday or a day
on which banking institutions in The City of New York are authorized or required
by law or executive order to remain closed or a day on which the Corporate Trust
Office of the Debenture Trustee, or the principal corporate trust office of the
Property Trustee, is closed for business.
"Business 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,
or any successor legislation.
"Cedel" means Cedel, S.A.
3
"Certificate" means a Common Security Certificate or a Preferred
Security Certificate.
"Certificate of Trust" has the meaning specified in the Recitals
hereto.
"Change of Control" means the occurrence of one or more of the
following events: (i) a person or entity or group (as that term is used in
Section 13(d)(3) of the Exchange Act) of persons or entities shall have become
the beneficial owner of majority of the securities of the Debenture Issuer
ordinarily having the right to vote in the election of directors; (ii) during
any consecutive two-year period, individuals who at the beginning of such period
constituted the Board of Directors of the Debenture Issuer (together with any
directors who are members of such Board of Directors of the Debenture Issuer on
the date hereof and any new directors whose election by such Board of Directors
of the Debenture Issuer or whose nomination for election by the shareholders of
the Debenture Issuer was approved by a vote of 66 2/3% of the directors then
still in office who were either directors at the beginning of such period or
whose election or nomination for election was previously so approved) cease for
any reason to constitute a majority of the Board of Directors of the Debenture
Issuer then in office; (iii) any sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all, or substantially all,
the assets of the Debenture Issuer and its Restricted Subsidiaries, taken as a
whole, to any person or entity or group (as so defined) of persons, or entities
(other than to any Wholly Owned Restricted Subsidiary of the Debenture Issuer);
(iv) the merger or consolidation of the Debenture Issuer with or into another
corporation or the merger of another corporation into the Debenture Issuer with
the effect that immediately after such transaction any person or entity or group
(as so defined) of persons or entities shall have become the beneficial owner of
securities of the surviving corporation of such merger or consolidation
representing a majority of the combined voting power of the outstanding
securities of the surviving corporation ordinarily having the right to vote in
the election of directors; or (v) the adoption of a plan relating to the
liquidation or dissolution of the Debenture Issuer.
"Closing Date" means the date on which the Preferred Securities are
issued and sold.
"Code" means the Internal Revenue Code of 1986, as amended from time
to time, or any successor legislation. A reference to a specific section of the
Code refers not only to such specific section but also to any corresponding
provision of any federal tax statute enacted after the date of this Declaration,
as such specific section or corresponding provision is in effect on the date of
application of the provisions of this Declaration containing such reference.
"Commission" means the Securities and Exchange Commission.
"Common Securities Holder" means Imperial Credit Industries, Inc. in
its capacity as purchaser and holder of all of the Common Securities issued by
the Trust.
"Common Security" has the meaning specified in Section 7.1
4
"Common Security Certificate" means a definitive certificate in fully
registered form representing a Common Security, substantially in the form of
Exhibit C hereto.
"Corporate Trust Office" means the office of the Debenture Trustee at
which the corporate trust business of the Debenture Trustee shall, at any
particular time, be principally administered, which office at the date of
execution of this Declaration is located at 101 California Street, Suite 2125,
San Francisco, California 94111.
"Covered Person" means (a) any officer, director, shareholder,
partner, member, representative, employee or agent of (i) the Trust or (ii) the
Trust's Affiliates; and (b) any Holder of Securities.
"Debenture Issuer" means Imperial Credit Industries, Inc. in its
capacity as issuer of the Debentures under the Indenture.
"Debenture Issuer Indemnified Person" means (a) any Regular Trustee;
(b) any Affiliate of any Regular Trustee; (c) any officers, directors,
shareholders, members, partners, employees, representatives or agents of any
Regular Trustee or any Affiliate thereof; or (d) any officer, employee or agent
of the Trust or its Affiliates.
"Debenture Trustee" means Chase Trust Company of California, in its
capacity as trustee under the Indenture until a successor is appointed
thereunder, and thereafter means such successor trustee.
"Debentures" means the Resettable Rate Debentures, Series A, to be
issued by the Debenture Issuer and to be held by the Property Trustee, or the
Resettable Rate Debentures, Series B, issued in exchange therefor.
"Delaware Trustee" has the meaning set forth in Section 6.2.
"Depositary" means, with respect to Securities issuable in whole or in
part in the form of one or more Global Securities, a clearing agency registered
under the Exchange Act that is designated to act as Depositary for such
Securities.
"Depositary Participant" means a member of, or participant in, the
Depositary.
"Direct Action" has the meaning specified in Section 3.8(e).
"Distribution" means a distribution payable to Holders of Securities
in accordance with Section 7.2.
"Distribution Date" means each date on which Distributions are payable
in accordance with Sections 7.2(b) and (c).
"DWAC" means Deposit and Withdrawal At Custodian Service.
5
"Election Date", with respect to any Scheduled Remarketing Date, means
the second Business Day prior thereto.
"Euroclear" means Morgan Guaranty Trust Company of New York, Brussels
office, as operator of the Euroclear System.
"Excess Proceeds" has the meaning specified in the Indenture.
"Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time, or any successor legislation.
"Fiduciary Indemnified Person" has the meaning specified in Section
9.4(b).
"Fiscal Year" has the meaning specified in Section 11.1.
"Global Security" means a fully registered, global Preferred Security
Certificate.
"Guarantee" means the guarantee agreement of the Sponsor in respect of
the Preferred Securities and the Common Securities.
"Guarantors" has the meaning specified in the Indenture.
"Holder" means a Person in whose name a Certificate representing a
Security is registered, such Person being a beneficial owner within the meaning
of the Business Trust Act; provided, however, that in determining whether the
Holders of the requisite liquidation amount of Preferred Securities have voted
on any matter provided for in this Declaration, then for the purpose of such
determination only (and not for any other purpose hereunder), if the Preferred
Securities remain in the form of one or more Global Securities and if the
Depositary which is the holder of such Global Securities has sent an omnibus
proxy to the Trust assigning voting rights to Depositary Participants to whose
accounts the Preferred Securities are credited on the record date, the term
"Holders" shall mean such Depositary Participants acting at the direction of
Beneficial Owners.
"Indemnified Person" means a Debenture Issuer Indemnified Person or a
Fiduciary Indemnified Person.
"Indenture" means the Indenture dated as of June 9, 1997, among the
Debenture Issuer and the Debenture Trustee, and any indenture supplemental
thereto pursuant to which the Debentures are to be issued.
"Initial Distribution Rate" has the meaning specified in Section 7.2.
"Initial Purchaser" means Lehman Brothers Inc.
6
"Investment Company" means an investment company as defined in the
Investment Company Act and the regulations promulgated thereunder.
"Investment Company Act" means the Investment Company Act of 1940, as
amended from time to time, or any successor legislation.
"Investment Company Event" means the receipt by the Trust of an
opinion of counsel, rendered by a law firm having a recognized national
securities practice, to the effect that, as a result of the occurrence of a
change in law or regulation or a change in interpretation or application of law
or regulation by any legislative body, court, governmental agency or regulatory
authority (a "Change in 1940 Act Law"), the Trust is or will be considered an
"investment company" that is required to be registered under the Investment
Company Act, which Change in 1940 Act Law becomes effective on or after the
Closing Date.
"Legal Action" has the meaning specified in Section 3.6(g).
"List of Holders" has the meaning specified in Section 2.2(a).
"Majority in Liquidation Amount" means, except as provided in the
terms of the Preferred Securities or by the Trust Indenture Act, Holder(s) of
outstanding Securities, voting together as a single class, or, as the context
may require, Holders of outstanding Preferred Securities or Holders of
outstanding Common Securities, voting separately as a class, who are the record
owners of more than 50% of the aggregate liquidation amount (including the
stated amount that would be paid on redemption, liquidation or otherwise, plus
accumulated and unpaid Distributions to the date upon which the voting
percentages are determined) of all outstanding Securities of the relevant class.
"Maximum Adjusted Distribution Rate" means the rate per annum,
determined on the Scheduled Remarketing Date by the Remarketing Agent in its
discretion, equal to the greater of (a) the 30-year Treasury Rate plus 600 basis
points and (b) a nationally-recognized high-yield index rate for similarly-rated
issues, plus 100 basis points.
"Moody's" means Moody's Investors Service, Inc. or any successor
thereto.
"New Preferred Securities" has the meaning specified in Section 7.1.
"New Preferred Security Certificate" has the meaning specified in
Section 7.1.
"New York Stock Exchange" means the New York Stock Exchange, Inc. or
any successor thereto.
"Notice of Election" has the meaning specified in Section 7.5.
"Officers' Certificate" means, with respect to any Person, a
certificate signed by two Authorized Officers of such Person on behalf of such
Person. Any Officers' Certificate
7
delivered with respect to compliance with a condition or covenant provided for
in this Declaration 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 on behalf of such Person in rendering
the Officers' Certificate;
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such officer
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(d) a statement as to whether, in the opinion of each such officer
and on behalf of such Person, such condition or covenant has been complied with;
provided, that the term "Officers' Certificate", when used with reference to
Regular Trustees who are natural persons, shall mean a certificate signed by two
of the Regular Trustees which otherwise satisfies the foregoing requirements.
"Paying Agent" has the meaning specified in Section 3.8(h).
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof or any other entity of whatever nature.
"Preferred Security" has the meaning specified in Section 7.1.
"Preferred Security Certificate" means a definitive certificate in
fully registered form representing a Preferred Security, substantially in the
form of Exhibit A, in the case of Transfer Restricted Securities or Exhibit B,
in the case of New Preferred Securities.
"Private Placement Legend" has the meaning specified in Section 314 of
the Indenture.
"Property Account" has the meaning specified in Section 3.8(c).
"Property Trustee" means the Trustee meeting the eligibility
requirements set forth in Section 6.3.
"Pro Rata" means pro rata to each Holder of Securities according to
the aggregate liquidation amount of the Securities held by the relevant Holder
in relation to the aggregate liquidation amount of all Securities outstanding.
8
"Qualified Institutional Buyer" or "QIB" has the meaning specified in
Rule 144A under the Securities Act.
"Quorum" means a majority of the Regular Trustees or, if there are
only two Regular Trustees, both of them.
"Redemption/Distribution Notice" has the meaning set forth in Section
7.4(a).
"Redemption Price" means the amount for which the Securities will be
redeemed, which amount will equal (i) the redemption price paid by the Debenture
Issuer to repay or redeem, in whole or in part, the Debentures held by the Trust
plus an amount equal to accumulated and unpaid Distributions on such Securities
through the date of their redemption or (ii) such lesser amount as will be
received by the Trust in respect of the Debentures so repaid or redeemed.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated the date hereof, among the Debenture Issuer, the Trust, the
Guarantors and the Remarketing Agent for the benefit of themselves and the
Holders, as the same may be amended from time to time in accordance with the
terms thereof.
"Regular Trustee" means any Trustee other than the Property Trustee
and the Delaware Trustee.
"Regulation S" means Regulation S under the Securities Act and any
successor regulation thereto.
"Regulation S Global Security" means any Global Security or Securities
evidencing Preferred Securities that are to be traded pursuant to Regulation S.
"Related Party" means, with respect to the Sponsor, any direct or
wholly owned subsidiary of the Sponsor or any Person that owns, directly or
indirectly, 100% of the outstanding voting securities of the Sponsor.
"Remarketing" means the operation of the procedures for remarketing
specified in Section 7.5.
"Remarketing Agent" means such agent or agents as the Debenture Issuer
may appoint from time to time for the purpose of remarketing the Preferred
Securities, as set forth in the Remarketing Agreement.
"Remarketing Agreement" means the Remarketing Agreement, dated June 9,
1997, among the Trust, the Debenture Issuer and Lehman Brothers Inc., as the
same may be amended, supplemented or modified from time to time.
9
"Remarketing Settlement Date" means the Scheduled Remarketing
Settlement Date on which purchases and sales of Preferred Securities pursuant to
a Remarketing are consummated.
"Responsible Officer" means, with respect to the Property Trustee, any
officer within the Corporate Trust Office of the Property Trustee, including any
vice-president, any assistant vice-president, the secretary, any assistant
secretary, the treasurer, any assistant treasurer or other officer of the
Corporate Trust Office of the Property Trustee customarily performing functions
similar to those performed by any of the above designated officers and also
means, with respect to a particular corporate trust matter, any other officer to
whom such matter is referred because of that officer's knowledge of and
familiarity with the particular subject.
"Restricted Global Security" means any Global Security or Securities
evidencing Preferred Securities that are to be traded pursuant to Rule 144A.
"Restricted Period" has the meaning specified in Section 7.15.
"Restricted Security" has the meaning assigned to such term in Rule
144(a)(3), as amended from time to time or any successor rule, under the
Securities Act.
"Restricted Subsidiary" has the meaning specified in the Declaration.
"Rule 144A" means Rule 144A, as amended from time to time or any
successor rule, under the Securities Act.
"Rule 3a-5" means Rule 3a-5 under the Investment Company Act or any
successor rule thereunder.
"Scheduled Remarketing Date" means the third Business Day prior to any
Scheduled Remarketing Settlement Date.
"Scheduled Remarketing Settlement Date" means June 14, 2002, or such
other date determined pursuant to this definition, unless a Trust Enforcement
Event has occurred and is continuing on the 25th Business Day prior to such
Scheduled Remarketing Settlement Date, in which case the Scheduled Remarketing
Settlement Date shall be the 30th Business Day after the date of cure or waiver
of such Trust Enforcement Event; provided, that if (x) purchases and sales of
Preferred Securities pursuant to a Remarketing are not consummated on any
Scheduled Remarketing Settlement Date for any reason (including the Debenture
Issuer's failure to make the deposit required pursuant to Section 3.05 of the
Indenture in the event of a Special Mandatory Redemption) other than the
occurrence and continuance of any other Trust Enforcement Event or if (y) the
Debenture Issuer fails to redeem Debentures in connection with a Tax Opinion
Redemption after cancelling the Remarketing, the next Scheduled Remarketing
Settlement Date shall be the 30th Business Day after such Scheduled Remarketing
Settlement Date.
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"Senior Notes Guarantee" means the Trust's guarantee of the $200
million aggregate principle amount of the Debenture Issuer's 9 7/8% Senior Notes
due 2007.
"Securities" means the Common Securities and the Preferred Securities.
"Securities Act" means the Securities Act of 1933, as amended from
time to time, or any successor legislation.
"Special Event" means a Tax Event or an Investment Company Event.
"Special Mandatory Redemption" has the meaning specified in Section
7.3.
"Sponsor" means Imperial Credit Industries, Inc., a California
corporation, or any successor entity in a merger, consolidation or amalgamation,
in its capacity as sponsor of the Trust.
"Subsidiary Guarantee" means the guarantee, by the Trust, of the
Debenture Issuer's obligations to pay principal, premium, if any, and interest
on the Debentures.
"Successor Delaware Trustee" has the meaning specified in Section
6.6(b).
"Successor Entity" has the meaning specified in Section 3.15(b)(i).
"Successor Property Trustee" has the meaning specified in Section
6.6(b).
"Successor Security" has the meaning specified in Section 3.15(b)(i)b.
"Super Majority" has the meaning set forth in Section 2.6(a)(ii).
"Tax Event" means the receipt by the Debenture Issuer of an opinion of
independent tax counsel to the Debenture Issuer, experienced in such matters, to
the effect that, as a result of any amendment to, change in or announced
proposed change in the laws (or any regulations thereunder) of the United States
or any political subdivision or taxing authority thereof or therein, or as a
result of any official administrative pronouncement or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
adopted or which proposed change, pronouncement or decision is announced on or
after the Closing Date, there is more than an insubstantial risk that (i) the
Trust is, or will be within 90 days of the date of such opinion, subject to the
United States federal income tax with respect to income received or accrued on
the Debentures, (ii) interest payable by the Debenture Issuer on such Debentures
is not, or within 90 days of the date of such opinion, will not be deductible by
the Debenture Issuer, in whole or in part, for United States federal income tax
purposes, or (iii) the Trust is, or will be within 90 days of the date of such
opinion, subject to more than a de minimus amount of other taxes, duties or
other governmental charges.
11
"Tax Opinion" means an opinion of an independent tax counsel to the
Debenture Issuer experienced in such matters to the effect that, as a result of
(a) any amendment to, or change (including any announced proposed change) in,
the laws (or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein, or (b) any official
administrative pronouncement or judicial decision interpreting or applying such
laws or regulations, which amendment or change is effective or such proposed
change, pronouncement or decision is announced on or after the date of original
issuance of the Securities, that it is more likely than not that (i) the Trust
will be, following the Remarketing Settlement Date, subject to United States
federal income tax with respect to interest accrued or received on the
Debentures, (ii) the Trust will be, following the Remarketing Settlement Date,
subject to more than a de minimis amount of taxes, duties or other governmental
charges, or (iii) interest payable to the Trust on the Debentures, following the
Remarketing Settlement Date, will not be deductible, in whole or in part, by the
Debenture Issuer for United States federal income tax purposes.
"Tax Opinion Redemption" means a redemption of Debentures, on a
Scheduled Remarketing Settlement Date, following receipt of a Tax Opinion, as
specified in Section 3.10 of the Indenture.
"10% in Liquidation Amount" means, except as provided in the terms of
the Preferred Securities or by the Trust Indenture Act, Holder(s) of outstanding
Securities, voting together as a single class, or, as the context may require,
Holders of outstanding Preferred Securities or Holders of outstanding Common
Securities, voting separately as a class, who are the record owners of 10% or
more of the aggregate liquidation amount (including the stated amount that would
be paid on redemption, liquidation or otherwise, plus accumulated and unpaid
Distributions to the date upon which the voting percentages are determined) of
all outstanding Securities of the relevant class.
"30-year Treasury Rate" means the rate per annum equal to the semi-
annual equivalent yield to maturity of the U.S. Treasury security used, in
accordance with customary financial practice, as the benchmark pricing bond in
pricing new issues of corporate debt securities of 30-year maturities on the
Scheduled Remarketing Date.
"Transfer Restricted Securities" has the meaning specified in Section
7.1.
"Transfer Restricted Securities Certificate" has the meaning specified
in Section 7.1.
"Transfer Restricted Security Redemption" means a redemption, on the
Remarketing Settlement Date, of Debentures issued in exchange for Securities
that were not exchanged pursuant to an Exchange Offer, if any, as specified in
Section 3.11 of the Indenture.
"Treasury Regulations" means the income tax regulations, including
temporary and proposed regulations, promulgated under the Code by the United
States Treasury, as such regulations may be amended from time to time (including
corresponding provisions of succeeding regulations).
12
"Trust" has the meaning specified in the Recitals hereto.
"Trust Enforcement Event" in respect of the Securities means an
Indenture Event of Default has occurred and is continuing in respect of the
Debentures.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended from time to time, or any successor legislation.
"Trustee" or "Trustees" means each Person who has signed this
Declaration as a trustee, so long as such Person shall continue in office in
accordance with the terms hereof, and all other Persons who may from time to
time be duly appointed, qualified and serving as Trustees in accordance with the
provisions hereof, and references herein to a Trustee or the Trustees shall
refer to such Person or Persons solely in their capacity as trustees hereunder.
"Wholly-Owned Restricted Subsidiary" has the meaning specified in the
Declaration.
ARTICLE 2
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application.
--------------------------------
(a) This Declaration is subject to the provisions of the Trust
Indenture Act that are required to be part of this Declaration and shall, to the
extent applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is a Trustee
for the purposes of the Trust Indenture Act.
(c) If and to the extent that any provision of this Declaration
conflicts with the duties imposed by Sections 310 to 317, inclusive, of the
Trust Indenture Act, such imposed duties shall control.
(d) The application of the Trust Indenture Act to this Declaration
shall not affect the Trust's classification as a grantor trust for United States
federal income tax purposes and shall not affect the nature of the Securities as
equity securities representing undivided beneficial ownership interests in the
assets of the Trust.
SECTION 2.2 Lists of Holders of Securities.
------------------------------
(a) Each of the Sponsor and the Regular Trustees on behalf of the
Trust shall provide the Property Trustee (i), except while the Preferred
Securities are represented by one or more Global Securities, at least one
Business Day prior to the date for payment of Distributions,
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a list, in such form as the Property Trustee may reasonably require, of the
names and addresses of the Holders of the Securities ("List of Holders") as of
the record date relating to the payment of such Distributions, and (ii) at any
other time, within 30 days of receipt by the Trust of a written request from the
Property Trustee for a List of Holders as of a date no more than 15 days before
such List of Holders is given to the Property Trustee; provided that neither the
Sponsor nor the Regular Trustees on behalf of the Trust shall be obligated to
provide such List of Holders at any time the List of Holders does not differ
from the most recent List of Holders given to the Property Trustee by the
Sponsor and the Regular Trustees on behalf of the Trust. The Property Trustee
shall preserve, in as current a form as is reasonably practicable, all
information contained in Lists of Holders given to it or which it receives in
the capacity as Paying Agent (if acting in such capacity), provided that the
Property Trustee may destroy any List of Holders previously given to it on
receipt of a new List of Holders.
(b) The Property Trustee shall comply with its obligations under, and
shall be entitled to the benefits of, Sections 311(a), 311(b) and 312(b) of the
Trust Indenture Act.
SECTION 2.3 Reports by the Property Trustee.
-------------------------------
Within 60 days after May 15 of each year (commencing with the year of
the first anniversary of the issuance of the Preferred Securities), the Property
Trustee shall provide to the Holders of the Preferred Securities such reports as
are required by Section 313 of the Trust Indenture Act, if any, in the form and
in the manner provided by Section 313 of the Trust Indenture Act. The Property
Trustee shall also comply with the requirements of Section 313(d) of the Trust
Indenture Act.
SECTION 2.4 Periodic Reports to the Property Trustee.
----------------------------------------
Each of the Sponsor and the Regular Trustees on behalf of the Trust
shall provide to the Property Trustee such documents, reports and information as
required by Section 314 of the Trust Indenture Act (if any) and the compliance
certificate required by Section 314 of the Trust Indenture Act in the form, in
the manner and at the times required by Section 314 of the Trust Indenture Act.
SECTION 2.5 Evidence of Compliance with Conditions Precedent.
------------------------------------------------
Each of the Sponsor and the Regular Trustees on behalf of the Trust
shall provide to the Property Trustee such evidence of compliance with any
conditions precedent, if any, provided for in this Declaration that relate to
any of the matters set forth in Section 314(c) of the Trust Indenture Act. Any
certificate or opinion required to be given by an officer pursuant to Section
314(c)(1) may be given in the form of an Officers' Certificate.
SECTION 2.6 Trust Enforcement Events; Waiver.
--------------------------------
(a) The Holders of a Majority in Liquidation Amount of the Preferred
Securities may, by vote or written consent, on behalf of the Holders of all of
the Preferred Securities, waive
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any past Trust Enforcement Event in respect of the Preferred Securities and its
consequences, provided that, if the underlying Indenture Event of Default:
(i) is not waivable under the Indenture, the Trust Enforcement
Event under the Declaration shall also not be waivable; or
(ii) requires the consent or vote of greater than a majority in
principal amount of the holders of the Debentures (a
"Super Majority") to be waived under the Indenture, the
related Trust Enforcement Event under the Declaration may
only be waived by the vote or written consent of the
Holders of at least the proportion in liquidation amount
of the Preferred Securities that the relevant Super
Majority represents of the aggregate principal amount of
the Debentures outstanding.
The foregoing provisions of this Section 26 shall be in lieu of
Section 316(a)(1)(B) of the Trust Indenture Act and such Section 316(a)(1)(B) of
the Trust Indenture Act is hereby expressly excluded from this Declaration and
the Securities, as permitted by the Trust Indenture Act. Upon such waiver, any
such default shall cease to exist, and any Trust Enforcement Event with respect
to the Preferred Securities arising therefrom shall be deemed to have been
cured, for every purpose of this Declaration and the Preferred Securities, but
no such waiver shall extend to any subsequent or other Trust Enforcement Event
with respect to the Preferred Securities or impair any right consequent thereon.
Any waiver by the Holders of the Preferred Securities of a Trust Enforcement
Event with respect to the Preferred Securities shall also be deemed to
constitute a waiver by the Holders of the Common Securities of any such Trust
Enforcement Event with respect to the Common Securities for all purposes of this
Declaration without any further act, vote, or consent of the Holders of the
Common Securities.
(b) The Holders of a Majority in Liquidation Amount of the Common
Securities may, by vote or written consent, on behalf of the Holders of all of
the Common Securities, waive any past Trust Enforcement Event with respect of
the Common Securities and its consequences, provided that, if the underlying
Indenture Event of Default:
(i) is not waivable under the Indenture, except where the
Holders of the Common Securities are deemed to have waived
such Trust Enforcement Event under the Declaration as
provided below in this Section 2.6(b), the Trust
Enforcement Event under the Declaration shall also not be
waivable; or
(ii) requires the consent or vote of a Super Majority to be
waived under the Indenture, except where the Holders of
the Common Securities are deemed to have waived such Trust
Enforcement Event under the Declaration as provided below
in this Section 2.6(b), the Trust Enforcement Event under
the Declaration may only be waived by the vote or written
consent of the Holders of at least the proportion in
liquidation amount of the Common Securities that the
relevant Super Majority
15
represents of the aggregate principal amount of
the Debentures outstanding;
provided further, each Holder of Common Securities will be deemed to have waived
any Trust Enforcement Event and all Trust Enforcement Events with respect to the
Common Securities and the consequences thereof until all Trust Enforcement
Events with respect to the Preferred Securities have been cured, waived or
otherwise eliminated, and until such Trust Enforcement Events with respect to
the Preferred Securities have been so cured, waived or otherwise eliminated, the
Property Trustee will be deemed to be acting solely on behalf of the Holders of
the Preferred Securities and only the Holders of the Preferred Securities will
have the right to direct the Property Trustee in accordance with the terms of
the Securities. The foregoing provisions of this Section 2.6(b) shall be in lieu
of Sections 316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act and such
Sections 316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act are hereby
expressly excluded from this Declaration and the Securities, as permitted by the
Trust Indenture Act. Subject to the foregoing provisions of this Section 2.6(b),
upon such cure, waiver or other elimination, any such default shall cease to
exist and any Trust Enforcement Event with respect to the Common Securities
arising therefrom shall be deemed to have been cured for every purpose of this
Declaration, but no such waiver shall extend to any subsequent or other Trust
Enforcement Event with respect to the Common Securities or impair any right
consequent thereon.
(c) A waiver of an Indenture Event of Default by the Property Trustee
at the direction of the Holders of the Preferred Securities constitutes a waiver
of the corresponding Trust Enforcement Event with respect to the Preferred
Securities under this Declaration. The foregoing provisions of this Section
2.6(c) shall be in lieu of Section 316(a)(1)(B) of the Trust Indenture Act and
such Section 316(a)(1)(B) of the Trust Indenture Act is hereby expressly
excluded from this Declaration and the Securities, as permitted by the Trust
Indenture Act.
SECTION 2.7 Trust Enforcement Event; Notice.
-------------------------------
(a) The Property Trustee shall, within 90 days after the occurrence
of a Trust Enforcement Event, transmit by mail, first class postage prepaid, to
the Holders of the Securities, notices of all defaults with respect to the
Securities actually known to a Responsible Officer of the Property Trustee,
unless such defaults have been cured before the giving of such notice (the term
"defaults" for the purposes of this Section 2.7(a) being hereby defined to be an
Indenture Event of Default, not including any periods of grace provided for
therein and irrespective of the giving of any notice provided therein); provided
that, except for a default in the payment of principal of (or premium, if any)
or interest on any of the Debentures, the Property Trustee shall be protected in
withholding such notice if and so long as a Responsible Officer of the Property
Trustee in good faith determines that the withholding of such notice is in the
interests of the Holders of the Securities.
(b) The Property Trustee shall not be deemed to have knowledge of any
default except:
16
(i) a default under Sections 6.01(i) or 6.01(iii) of the
Indenture; or
(ii) any default as to which the Property Trustee shall have
received written notice or of which a Responsible Officer
of the Property Trustee charged with the administration of
this Declaration shall have actual knowledge.
ARTICLE 3
ORGANIZATION
SECTION 3.1 Name and Organization.
---------------------
The Trust hereby created is named "Imperial Credit Capital Trust I" as
such name may be modified from time to time by the Regular Trustees following
written notice to the Holders of Securities. The Trust's activities may be
conducted under the name of the Trust or any other name deemed advisable by the
Regular Trustees.
SECTION 3.2 Office.
------
The address of the principal office of the Trust is c/o the Debenture
Issuer, 23550 Hawthorne Boulevard, Building One, Suite 110, Torrance California
90505. On 10 Business Days' written notice to the Holders of Securities, the
Regular Trustees may designate another principal office.
SECTION 3.3 Purpose.
-------
The exclusive purposes and functions of the Trust are (a) to issue and
sell Securities and use the gross proceeds from such sale to acquire the
Debentures, and (b) except as otherwise limited herein, to engage in only those
other activities necessary or incidental thereto. The Trust shall not borrow
money, issue debt or reinvest proceeds derived from investments, pledge any of
its assets or otherwise undertake (or permit to be undertaken) any activity that
would cause the Trust not to be classified as a grantor trust for United States
federal income tax purposes.
By the acceptance of this Trust, none of the Trustees, the Sponsor,
the Holders of the Preferred Securities or Common Securities or the Preferred
Securities Beneficial Owners will take any position for United States federal
income tax purposes which is contrary to the classification of the Trust as a
grantor trust.
SECTION 3.4 Authority.
---------
Subject to the limitations provided in this Declaration and to the
specific duties of the Property Trustee, the Regular Trustees shall have
exclusive authority to carry out the purposes of the Trust. An action taken by
the Regular Trustees in accordance with their powers
17
shall constitute the act of and serve to bind the Trust and an action taken by
the Property Trustee on behalf of the Trust in accordance with its powers shall
constitute the act of and serve to bind the Trust. In dealing with the Trustees
acting on behalf of the Trust, no person shall be required to inquire into the
authority of the Trustees to bind the Trust. Persons dealing with the Trust are
entitled to rely conclusively on the power and authority of the Trustees as set
forth in this Declaration.
(a) Except as expressly set forth in this Declaration and except if a
meeting of the Regular Trustees is called with respect to any matter over which
the Regular Trustees have power to act, any power of the Regular Trustees may be
exercised by, or with the consent of, any one such Regular Trustee.
(b) Unless otherwise determined by the Regular Trustees, and except
as otherwise required by the Business Trust Act or applicable law, any Regular
Trustee is authorized to execute on behalf of the Trust any documents which the
Regular Trustees have the power and authority to cause the Trust to execute
pursuant to Section 3.6(b), provided, that the registration statements referred
to in Section 3.6(b)(i), including any amendments thereto, shall be signed by or
on behalf of a majority of the Regular Trustees; and
(c) a Regular Trustee may, by power of attorney consistent with
applicable law, delegate to any other natural person over the age of 21 his or
her power for the purposes of signing any documents which the Regular Trustees
have power and authority to cause the Trust to execute pursuant to Section 3.6.
SECTION 3.5 Title to Property of the Trust.
------------------------------
Except as provided in Section 3.8 with respect to the Debentures and
the Property Account or as otherwise provided in this Declaration, legal title
to all assets of the Trust shall be vested in the Trust. The Holders shall not
have legal title to any part of the assets of the Trust, but shall have an
undivided beneficial ownership interest in the assets of the Trust.
SECTION 3.6 Powers and Duties of the Regular Trustees.
-----------------------------------------
The Regular Trustees shall have the exclusive power, duty and
authority to cause the Trust to engage in the following activities:
(a) to issue and sell the Preferred Securities and the Common
Securities in accordance with this Declaration; provided, however, that the
Trust may issue no more than two series of Preferred Securities (which will
consist exclusively of the Transfer Restricted Securities and the New Preferred
Securities) and no more than one series of Common Securities, and, provided
further, that there shall be no interests in the Trust other than the
Securities, and the issuance of Securities shall be limited to a one-time,
simultaneous issuance of both Transfer Restricted Securities and Common
Securities on the Closing Date and a one-time issuance of New Preferred
Securities pursuant to an exchange offer required pursuant to the Registration
Rights Agreement;
18
(b) in connection with the issue and sale of the Preferred
Securities, at the direction of the Sponsor, to:
(i) execute and file with the Commission one or more
registration statements on the applicable forms prepared
by the Sponsor, including any amendments thereto,
pertaining to the Preferred Securities, the Guarantee and
the Debentures;
(ii) if deemed necessary or desirable by the Sponsor, execute
and file an application, prepared by the Sponsor, to the
New York Stock Exchange or any other national stock
exchange or the NASDAQ Stock Market for listing of any
Preferred Securities, the Guarantee and the Debentures;
(iii) if deemed necessary or desirable by the Sponsor, execute
and file with the Commission a registration statement on
Form 8-A, including any amendments thereto, prepared by
the Sponsor, relating to the registration of the Preferred
Securities, the Guarantee and the Debentures under Section
12(b) of the Exchange Act;
(iv) execute and file any documents prepared by the Sponsor, or
take any acts as determined by the Sponsor to be
necessary, in order to qualify or register all or part of
the Preferred Securities in any State in which the Sponsor
has determined to qualify or register such Preferred
Securities for sale;
(v) execute and deliver a purchase agreement and other related
agreements providing for the sale of the Preferred
Securities to the Initial Purchaser;
(vi) execute and deliver the Registration Rights Agreement;
(vii) execute and deliver the Remarketing Agreement;
(viii) execute and enter into the Indenture;
(ix) execute and deliver the Subsidiary Guarantee; and
(x) execute and deliver the Senior Notes Guarantee.
(c) to acquire the Debentures with the proceeds of the sale of the
Preferred Securities and the Common Securities; provided, however, that the
Regular Trustees shall cause legal title to the Debentures to be held of record
in the name of the Property Trustee for the benefit of the Holders of the
Preferred Securities and the Holders of the Common Securities;
(d) to give the Sponsor and the Property Trustee prompt written
notice of the occurrence of a Special Event; provided that the Regular Trustees
shall consult with the Sponsor
19
and the Property Trustee before taking or refraining from taking any action in
relation to any such Special Event;
(e) to establish a record date with respect to all actions to be
taken hereunder that require a record date be established, including and with
respect to, for the purposes of Section 316(c) of the Trust Indenture Act,
Distributions, voting rights, redemptions and exchanges, and to issue relevant
notices to the Holders of Preferred Securities and Holders of Common Securities
as to such actions and applicable record dates;
(f) to take all actions and perform such duties as may be required of
the Regular Trustees pursuant to the terms of this Declaration and the
Securities;
(g) to bring or defend, pay, collect, compromise, arbitrate, resort
to legal action or otherwise adjust claims or demands of or against the Trust
("Legal Action"), including seeking relief under the federal bankruptcy laws
unless pursuant to Section 3.8(e), the Property Trustee has the exclusive power
to bring such Legal Action;
(h) to employ or otherwise engage employees and agents (who may be
designated as officers with titles) and managers, contractors, advisors and
consultants to conduct only those services that the Regular Trustees have
authority to conduct directly, and to and pay reasonable compensation for such
services;
(i) to cause the Trust to comply with the Trust's obligations under
the Trust Indenture Act;
(j) to give the certificate required by Section 314(a)(4) of the
Trust Indenture Act to the Property Trustee, which certificate may be executed
by any Regular Trustee;
(k) to incur expenses that are necessary or incidental to carry out
any of the purposes of the Trust;
(l) to act as, or appoint another Person to act as, registrar and
transfer agent for the Securities;
(m) to give prompt written notice to the Holders of the Securities of
any notice received from the Debenture Issuer of its election to defer payments
of interest on the Debentures as authorized by the Indenture;
(n) to take all action that may be necessary or appropriate for the
preservation and the continuation of the Trust's valid existence, rights,
franchises and privileges as a statutory business trust under the laws of the
State of Delaware and of each other jurisdiction in which such existence is
necessary to protect the limited liability of the Holders of the Preferred
Securities and the Holders of the Common Securities or to enable the Trust to
effect the purposes for which the Trust was created;
20
(o) to take any action, not inconsistent with applicable law, that
the Regular Trustees determine in their discretion to be necessary or desirable
in carrying out the purposes and functions of the Trust as set out in Section
3.3 or the activities of the Trust as set out in this Section 3.6, including,
but not limited to:
(i) causing the Trust not to be deemed to be an Investment
Company required to be registered under the Investment
Company Act;
(ii) causing the Trust to be classified as a grantor trust for
United States federal income tax purposes; and
(iii) cooperating with the Debenture Issuer to ensure that the
Debentures will be treated as indebtedness of the
Debenture Issuer for United States federal income tax
purposes.
(p) 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 Regular Trustees, on behalf of the
Trust; and
(q) to execute all documents or instruments, perform all duties and
powers, and do all things for and on behalf of the Trust in all matters
necessary or incidental to the foregoing.
The Regular Trustees shall exercise the powers set forth in this
Section 3.6 in a manner that is consistent with the purposes and functions of
the Trust set out in Section 3.3, and the Regular Trustees shall have no power
to, and shall not, take any action that is inconsistent with the purposes and
functions of the Trust set forth in Section 3.3.
Subject to this Section 3.6, the Regular Trustees shall have none of
the powers or the authority of the Property Trustee set forth in Section 3.8.
Any expenses incurred by the Regular Trustees pursuant to this
Section 3.6 shall be reimbursed by the Debenture Issuer.
SECTION 3.7 Prohibition of Actions by the Trust and the Trustees.
----------------------------------------------------
(a) The Trust shall not, and the Trustees (including the Property
Trustee) shall cause the Trust not to engage in any activity other than as
required or authorized by this Declaration. In particular, the Trust shall not
and the Trustees (including the Property Trustee) shall cause the Trust not to:
(i) invest any proceeds received by the Trust from holding the
Debentures, but shall distribute all such proceeds to
Holders of Securities pursuant to the terms of this
Declaration and of the Securities;
(ii) acquire any assets other than as expressly provided
herein;
21
(iii) possess Trust property for other than a Trust purpose;
(iv) make any loans or incur any indebtedness;
(v) possess any power or otherwise act in such a way as to
vary the Trust assets;
(vi) possess any power or otherwise act in such a way as to
vary the terms of the Securities in any way whatsoever
(except to the extent expressly authorized in this
Declaration or by the terms of the Securities);
(vii) issue any securities or other evidences of beneficial
ownership of, or beneficial interest in, the Trust other
than the Securities; or
(viii) other than as provided in this Declaration or by the terms
of the Securities, (A) direct the time, method and place
of exercising any trust or power conferred upon the
Debenture Trustee with respect to the Debentures, (B)
waive any past default that is waivable under the
Indenture, (C) exercise any right to rescind or annul any
declaration that the principal of all the Debentures shall
be due and payable, or (D) consent to any amendment,
modification or termination of the Indenture or the
Debentures where such consent shall be required unless the
Trust shall have received an opinion of counsel to the
effect that such modification will not cause more than an
insubstantial risk that the Trust will be deemed an
Investment Company required to be registered under the
Investment Company Act, or the Trust will not be
classified as a grantor trust for United States federal
income tax purposes;
(ix) take any action inconsistent with the status of the Trust
as a grantor trust for United States federal income tax
purposes; or
(x) revoke any action previously authorized or approved by
vote of the Holders of the Preferred Securities.
SECTION 3.8 Powers and Duties of the Property Trustee.
-----------------------------------------
(a) The legal title to the Debentures shall be owned by and held of
record in the name of the Property Trustee in trust for the benefit of the Trust
and the Holders of the Securities. The right, title and interest of the
Property Trustee to the Debentures shall vest automatically in each Person who
may hereafter be appointed as Property Trustee in accordance with Section 6.6.
Such vesting and cessation of title shall be effective whether or not
conveyancing documents with regard to the Debentures have been executed and
delivered.
22
(b) The Property Trustee shall not transfer its right, title and
interest in the Debentures to the Regular Trustees or to the Delaware Trustee
(if the Property Trustee does not also act as Delaware Trustee).
(c) The Property Trustee shall:
(i) establish and maintain a segregated non-interest bearing
trust account (the "Property Account") in the name of and
under the exclusive control of the Property Trustee on
behalf of the Holders of the Securities and, upon the
receipt of payments of funds made in respect of the
Debentures held by the Property Trustee, deposit such
funds into the Property Account and make payments to the
Holders of the Preferred Securities and Holders of the
Common Securities from the Property Account in accordance
with Section 7.2. Funds in the Property Account shall be
held uninvested until disbursed in accordance with this
Declaration. The Property Account shall be an account
that is maintained with a banking institution the rating
on whose long-term unsecured indebtedness is at least
equal to the rating assigned to the Preferred Securities
by a "nationally recognized statistical rating
organization", within the meaning of Rule 436(g)(2) under
the Securities Act;
(ii) engage in such ministerial activities as shall be
necessary or appropriate to effect the redemption of the
Preferred Securities and the Common Securities to the
extent the Debentures are redeemed or mature; and
(iii) upon written notice of distribution issued by the Regular
Trustees in accordance with the terms of the Securities,
engage in such ministerial activities as so directed and
as shall be necessary or appropriate to effect the
distribution of the Debentures to Holders of Securities
upon the occurrence of a Special Event.
(d) The Property Trustee shall take all actions and perform such
duties as may be specifically required of the Property Trustee pursuant to the
terms of this Declaration and the Securities.
(e) The Property Trustee shall take any Legal Action which arises out
of or in connection with a Trust Enforcement Event of which a Responsible
Officer of the Property Trustee has actual knowledge or the Property Trustee's
duties and obligations under this Declaration or the Trust Indenture Act;
provided however, that if a Trust Enforcement Event has occurred and is
continuing and such event is attributable to the failure of the Debenture Issuer
to pay interest or principal on the Debentures on the date such interest or
principal is otherwise payable (or in the case of redemption, on the redemption
date), then a Holder of Preferred Securities may directly institute a proceeding
for enforcement of payment to such Holder of the principal of or interest on
Debentures having a principal amount equal to the aggregate
23
liquidation amount of the Preferred Securities of such Holder (a "Direct
Action") on or after the respective due date specified in the Debentures.
(f) The Property Trustee shall continue to serve as a Trustee until
either:
(i) the Trust has been completely liquidated and the proceeds
of the liquidation distributed to the Holders of
Securities pursuant to the terms of the Securities; or
(ii) a Successor Property Trustee has been appointed and has
accepted that appointment in accordance with Section 6.6.
(g) The Property Trustee shall have the legal power to exercise all
of the rights, powers and privileges of a holder of Debentures under the
Indenture and, if a Trust Enforcement Event actually known to a Responsible
Officer of the Property Trustee occurs and is continuing, the Property Trustee
shall, for the benefit of Holders of the Securities, enforce its rights as
holder of the Debentures subject to the rights of the Holders pursuant to the
terms of such Securities.
(h) The Property Trustee may authorize one or more Persons (each, a
"Paying Agent") to pay Distributions, redemption payments or liquidation
payments on behalf of the Trust with respect to all Securities and any such
Paying Agent shall comply with Section 317(b) of the Trust Indenture Act. Any
Paying Agent may be removed by the Property Trustee at any time and a successor
Paying Agent or additional Paying Agents may be appointed at any time by the
Property Trustee.
(i) Subject to this Section 3.8, the Property Trustee shall have none
of the duties, liabilities, powers or the authority of the Regular Trustees set
forth in Section 3.6.
The Property Trustee shall exercise the powers set forth in this
Section 3.8 in a manner that is consistent with the purposes and functions of
the Trust set out in Section 3.3, and the Property Trustee shall have no power
to, and shall not, take any action that is inconsistent with the purposes and
functions of the Trust set out in Section 3.3.
SECTION 3.9 Certain Duties and Responsibilities of the Property
---------------------------------------------------
Trustee.
- -------
(a) The Property Trustee, before the occurrence of any Trust
Enforcement Event and after the curing of all Trust Enforcement Events that may
have occurred, shall undertake to perform only such duties as are specifically
set forth in this Declaration and no implied covenants shall be read into this
Declaration against the Property Trustee. In case a Trust Enforcement Event has
occurred (that has not been cured or waived pursuant to Section 2.6) of which a
Responsible Officer of the Property Trustee has actual knowledge, the Property
Trustee shall exercise such of the rights and powers vested in it by this
Declaration, and use the same degree of care and skill in their exercise, as a
prudent person would exercise or use under the circumstances in the conduct of
his or her own affairs.
24
(b) No provision of this Declaration shall be construed to relieve
the Property Trustee from liability for its own negligent action, its own
negligent failure to act or its own willful misconduct, except that:
(i) prior to the occurrence of a Trust Enforcement Event and
after the curing or waiving of all such Trust Enforcement
Events that may have occurred:
a. the duties and obligations of the Property Trustee
shall be determined solely by the express provisions of
this Declaration and the Property Trustee shall not be
liable except for the performance of such duties and
obligations as are specifically set forth in this
Declaration, and no implied covenants or obligations
shall be read into this Declaration against the
Property Trustee; and
b. in the absence of bad faith on the part of the Property
Trustee, the Property Trustee may conclusively rely, as
to the truth of the statements and the correctness of
the opinions expressed therein, upon any certificates
or opinions furnished to the Property Trustee and
conforming to the requirements of this Declaration; but
in the case of any such certificates or opinions that
by any provision hereof are specifically required to be
furnished to the Property Trustee, the Property Trustee
shall be under a duty to examine the same to determine
whether or not they conform to the requirements of this
Declaration;
(ii) the Property Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer of
the Property Trustee, unless it shall be proved that the
Property Trustee was negligent in ascertaining the
pertinent facts;
(iii) the Property Trustee shall not be liable with respect to
any action taken or omitted to be taken by it without
negligence, in good faith in accordance with the direction
of the Holders of not less than a Majority in Liquidation
Amount of the Securities relating to the time, method and
place of conducting any proceeding for any remedy
available to the Property Trustee, or exercising any trust
or power conferred upon the Property Trustee under this
Declaration;
(iv) no provision of this Declaration shall require the
Property Trustee to expend or risk its own funds or
otherwise incur personal financial liability in the
performance of any of its duties or in the exercise of any
of its rights or powers, if it shall have reasonable
grounds for believing that the repayment of such funds or
liability is not reasonably assured to it under the terms
of this Declaration or indemnity reasonably satisfactory
to the
25
Property Trustee against such risk or liability is not
reasonably assured to it;
(v) the Property Trustee's sole duty with respect to the
custody, safe-keeping and physical preservation of the
Debentures and the Property Account shall be to deal with
such property in a similar manner as the Property Trustee
deals with similar property for its own account, subject
to the protections and limitations on liability afforded
to the Property Trustee under this Declaration and the
Trust Indenture Act;
(vi) the Property Trustee shall have no duty or liability for
or with respect to the value, genuineness, existence or
sufficiency of the Debentures or the payment of any taxes
or assessments levied thereon or in connection therewith;
(vii) the Property Trustee shall not be liable for any interest
on any money received by it except as it may otherwise
agree with the Sponsor. Money held by the Property Trustee
need not be segregated from other funds held by it except
in relation to the Property Account maintained by the
Property Trustee pursuant to Section 3.8(c)(i) and except
to the extent otherwise required by law; and
(viii) the Property Trustee shall not be responsible for
monitoring the compliance by the Regular Trustees or the
Sponsor with their respective duties under this
Declaration, nor shall the Property Trustee be liable for
any default or misconduct of the Regular Trustees or the
Sponsor.
SECTION 3.10 Certain Rights of Property Trustee.
----------------------------------
(a) Subject to the provisions of Section 3.9:
(i) the Property Trustee may conclusively rely and shall be
fully protected in acting or refraining from acting upon
any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of
indebtedness or other paper or document believed by it to
be genuine and to have been signed, sent or presented by
the proper party or parties;
(ii) any direction or act of the Sponsor or the Regular
Trustees contemplated by this Declaration shall be
sufficiently evidenced by an Officers' Certificate;
(iii) whenever in the administration of this Declaration, the
Property Trustee shall deem it desirable that a matter be
proved or established before taking, suffering or omitting
any action hereunder, the Property Trustee (unless
26
other evidence is herein specifically prescribed) may, in
the absence of bad faith on its part, request and
conclusively rely upon an Officers' Certificate which,
upon receipt of such request, shall be promptly delivered
by the Sponsor or the Regular Trustees;
(iv) the Property Trustee shall have no duty to see to any
recording, filing or registration of any instrument
(including any financing or continuation statement or any
filing under tax or securities laws) or any rerecording,
refiling or registration thereof;
(v) the Property Trustee may consult with counsel of its
choice or other experts and the advice or opinion of such
counsel and experts with respect to legal matters or
advice within the scope of such experts' area of expertise
shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it
hereunder in good faith and in accordance with such advice
or opinion, such counsel may be counsel to the Sponsor or
any of its Affiliates, and may include any of its
employees. The Property Trustee shall have the right at
any time to seek instructions concerning the
administration of this Declaration from any court of
competent jurisdiction;
(vi) the Property Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this
Declaration at the request or direction of any Holder,
unless such Holder shall have provided to the Property
Trustee security and indemnity, reasonably satisfactory to
the Property Trustee, against the costs, expenses
(including attorneys, fees and expenses and the expenses
of the Property Trustee's agents, nominees or custodians)
and liabilities that might be incurred by it in complying
with such request or direction, including such reasonable
advances as may be requested by the Property Trustee;
provided that, nothing contained in this Section 3.10(a)
shall be taken to relieve the Property Trustee, upon the
occurrence of an Indenture Event of Default, of its
obligation to exercise the rights and powers vested in it
by this Declaration;
(vii) the Property Trustee shall not be bound to make any
investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other
paper or document, but the Property Trustee, in its
discretion, may make such further inquiry or investigation
into such facts or matters as it may see fit;
(viii) the Property Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either
directly or by or through agents, custodians, nominees or
attorneys and the Property Trustee shall not be
27
responsible for any misconduct or negligence on the part
of any agent or attorney appointed with due care by it
hereunder;
(ix) any action taken by the Property Trustee or its agents
hereunder shall bind the Trust and the Holders of the
Securities, and the signature of the Property Trustee or
its agents alone shall be sufficient and effective to
perform any such action and no third party shall be
required to inquire as to the authority of the Property
Trustee to so act or as to its compliance with any of the
terms and provisions of this Declaration, both of which
shall be conclusively evidenced by the Property Trustee's
or its agent's taking such action;
(x) whenever in the administration of this Declaration the
Property Trustee shall deem it desirable to receive
instructions with respect to enforcing any remedy or right
or taking any other action hereunder, the Property Trustee
(i) may request instructions from the Holders of the
Securities which instructions may only be given by the
Holders of the same proportion in liquidation amount of
the Securities as would be entitled to direct the Property
Trustee under the terms of the Securities in respect of
such remedy, right or action, (ii) may refrain from
enforcing such remedy or right or taking such other action
until such instructions are received, and (iii) shall be
protected in conclusively relying on or acting in or
accordance with such instructions;
(xi) except as otherwise expressly provided by this
Declaration, the Property Trustee shall not be under any
obligation to take any action that is discretionary under
the provisions of this Declaration; and
(xii) the Property Trustee shall not be liable for any action
taken, suffered or omitted to be taken by it without
negligence, in good faith and reasonably believed by it to
be authorized or within the discretion, rights or powers
conferred upon it by this Declaration.
(b) No provision of this Declaration shall be deemed to impose any
duty or obligation on the Property Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it, in any
jurisdiction in which it shall be illegal, or in which the Property Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts, or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Property Trustee
shall be construed to be a duty.
SECTION 3.11 Delaware Trustee.
----------------
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Notwithstanding any other provision of this Declaration other than
Section 6.2, the Delaware Trustee shall not be entitled to exercise any powers,
nor shall the Delaware Trustee have any of the duties and responsibilities of
the Regular Trustees or the Property Trustee described in this Declaration.
Except as set forth in Section 6.2, the Delaware Trustee shall be a Trustee for
the sole and limited purpose of fulfilling the requirements of Section 3807 of
the Business Trust Act.
SECTION 3.12 Execution of Documents.
----------------------
Unless otherwise determined by the Regular Trustees, and except as
otherwise required by the Business Trust Act, any Regular Trustee is authorized
to execute on behalf of the Trust any documents that the Regular Trustees have
the power and authority to execute pursuant to Section 3.6.
SECTION 3.13 Not Responsible for Recitals or Issuance of Securities.
------------------------------------------------------
The recitals contained in this Declaration and the Securities shall be
taken as the statements of the Sponsor, and the Trustees do not assume any
responsibility for their correctness. The Trustees make no representations as
to the value or condition of the property of the Trust or any part thereof. The
Trustees make no representations as to the validity or sufficiency of this
Declaration, the Securities, the Debentures or the Indenture.
SECTION 3.14 Duration of Trust.
-----------------
The Trust shall exist until terminated pursuant to the provisions of
Article 8 hereof.
SECTION 3.15 Mergers.
-------
(a) The Trust may not consolidate, amalgamate, merge with or into, or
be replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other body, except as
described in Section 3.15(b) and (c).
(b) The Trust may, at the request of the Sponsor and with the consent
of the Regular Trustees or, if there are more than two, a majority of the
Regular Trustees and without the consent of the Holders of the Securities, the
Delaware Trustee or the Property Trustee, consolidate, amalgamate, merge with or
into, or be replaced by or convey, transfer or lease its properties
substantially as an entirety to a trust organized as such under the laws of any
State; provided, that:
(i) if the Trust is not the successor, such successor entity
(the "Successor Entity") either:
a. expressly assumes all of the obligations of the Trust
with respect to the Securities; or
29
b. substitutes for the Preferred Securities other
securities having substantially the same terms as the
Preferred Securities (the "Successor Securities") so
long as the Successor Securities rank the same as the
Preferred Securities rank in priority with respect to
Distributions and payments upon liquidation, redemption
and otherwise;
(ii) the Debenture Issuer expressly appoints a trustee of such
Successor Entity that possesses the same powers and duties
as the Property Trustee as the holder of the Debentures;
(iii) the Preferred Securities or any Successor Securities are
listed, or any Successor Securities will be listed upon
notification of issuance, on any national securities
exchange or with any other or organization on which the
Preferred Securities are then listed or quoted;
(iv) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not cause the Preferred
Securities (including any Successor Securities) to be
downgraded by any nationally recognized statistical rating
organization;
(v) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect
the rights, preferences and privileges of the Holders of
the Preferred Securities (including any Successor
Securities) in any material respect;
(vi) such Successor Entity has a purpose identical to that of
the Trust;
(vii) prior to such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease the Sponsor has
received an opinion of independent counsel to the Trust
experienced in such matters to the effect that:
a. such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect
the rights, preferences and privileges of the Holders
of the Preferred Securities (including any Successor
Securities) in any material respect;
b. following such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease neither the
Trust nor the Successor Entity will be required to
register as an Investment Company; and
c. following such merger, consolidation, amalgamation or
replacement, the Trust (or the Successor Entity) will
continue to be
30
classified as a grantor trust for United States federal
income tax purposes;
(viii) the Sponsor or any permitted successor or assignee owns
all of the Common Securities and guarantees the
obligations of such Successor Entity under the Successor
Securities at least to the extent provided by the
Preferred Securities Guarantee; and
(ix) such Successor Entity expressly assumes all of the
obligations of the Trust with respect to the Trustees.
(c) Notwithstanding Section 3.15(b), 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 Successor
Entity to be classified as other than a grantor trust for United States federal
income tax purposes and each Holder of the Securities not to be treated as
owning an undivided interest in the Debentures.
SECTION 3.16 Property Trustee May File Proofs of Claim.
-----------------------------------------
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
similar judicial proceeding relative to the Trust or any other obligor upon the
Securities or the property of the Trust or of such other obligor or their
creditors, the Property Trustee (irrespective of whether any Distributions on
the Securities shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the Property Trustee shall
have made any demand on the Trust for the payment of any past due Distributions)
shall be entitled and empowered, to the fullest extent permitted by law, by
intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount of any
Distributions owing and unpaid in respect of the Securities (or, if the
Securities are original issue discount Securities, such portion of the
liquidation amount as may be specified in the terms of such Securities) and to
file such other papers or documents as may be necessary or advisable in order to
have the claims of the Property Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Property Trustee, its
and counsel) and of the Holders allowed in such judicial proceeding, and
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
31
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Property Trustee and, in the event the
Property Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Property Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Property Trustee, its
agents and counsel, and any other amounts due the Property Trustee.
Nothing herein contained shall be deemed to authorize the Property
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement adjustment or compensation affecting the
Securities or the rights of any Holder thereof or to authorize the Property
Trustee to vote in respect of the claim of any Holder in any such proceeding.
ARTICLE 4
SPONSOR
SECTION 4.1 Responsibilities of the Sponsor.
-------------------------------
In connection with the issue and sale of the Preferred Securities, the
Sponsor shall have the exclusive right and responsibility to engage in the
following activities:
(a) to prepare for filing by the Trust with the Commission one or
more registration statements on the applicable forms, including any amendments
thereto, pertaining to the Preferred Securities, the Guarantee and the
Debentures;
(b) 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 the Trust, and
advise the Trust of actions it must take, and prepare for execution and filing
any documents to be executed and filed by the Trust, as the Sponsor deems
necessary or advisable in order to comply with the applicable laws of any such
States;
(c) to prepare any filing by the Trust of an application to the New
York Stock Exchange or any other national stock exchange or the NASDAQ Stock
Market for listing, if such filing is determined to be necessary or desirable by
the Sponsor;
(d) to prepare any filing by the Trust with the Commission of a
registration statement on Form 8-A, including any amendments thereto, if such
filing is determined to be necessary or desirable by the Sponsor;
(e) to negotiate the terms of a purchase agreement and other related
agreements providing for the sale of the Preferred Securities to the Initial
Purchaser;
32
(f) to negotiate the terms of the Registration Rights Agreement; and
(g) to negotiate the terms of the Remarketing Agreement.
SECTION 4.2 Indemnification and Expenses of the Trustees.
--------------------------------------------
The Sponsor, in its capacity as Debenture Issuer, agrees to indemnify
the Property Trustee and the Delaware Trustee for, and to hold each of them
harmless against, any loss, liability or expense incurred without negligence or
bad faith on the part of the Property Trustee or the Delaware Trustee, as the
case may be, arising out of or in connection with the acceptance or
administration of the trust or trusts hereunder, including the costs and
expenses of defending either of them against any claim or liability in
connection with the exercise or performance of any of their respective powers or
duties hereunder; the provisions of this Section 4.2 shall survive the
resignation or removal of the Delaware Trustee or the Property Trustee or the
termination of this Declaration.
ARTICLE 5
TRUST COMMON SECURITIES HOLDER
SECTION 5.1 Debenture Issuer's Purchase of Common Securities.
------------------------------------------------
On the Closing Date, the Trust will sell and the Debenture Issuer will
purchase all of the Common Securities issued by the Trust, for an amount at
least equal to 3% of the capital of the Trust, at the same time as the Preferred
Securities are sold. The aggregate stated liquidation amount of Common
Securities outstanding at any time shall be not less than 3% of the capital of
the Trust.
SECTION 5.2 Covenants of the Common Securities Holder.
-----------------------------------------
For so long as the Preferred Securities remain outstanding, the Common
Securities Holder will covenant (i) to maintain, directly or indirectly, 100%
ownership of the Common Securities, (ii) to cause the Trust to remain a
statutory business trust and not to voluntarily dissolve, wind up, liquidate or
be terminated, except as permitted by this Declaration, (iii) to use its
commercially reasonable efforts to ensure that the Trust will not be an
investment company for purposes of the Investment Company Act, and (iv) to take
no action which would be reasonably likely to cause the Trust to be classified
as an association or a publicly traded partnership taxable as a corporation for
United States federal income tax purposes.
33
ARTICLE 6
TRUSTEES
SECTION 6.1 Number of Trustees.
------------------
The number of Trustees initially shall be five, and:
(a) at any time before the issuance of any Securities, the Sponsor
may, by written instrument, increase or decrease the number of Trustees; and
(b) after the issuance of any Securities, the number of Trustees may
be increased or decreased by vote of the Holders of a Majority in Liquidation
Amount of the Common Securities voting as a class at a meeting of the Holders of
the Common Securities or by written consent in lieu of such meeting; provided
that the number of Trustees shall be at least three; and provided further that
(1) the Delaware Trustee, in the case of a natural person, shall be a person who
is a resident of the State of Delaware or that, if not a natural person, is an
entity which has its principal place of business in the State of Delaware and
otherwise meets the requirements of applicable law; (2) at least one Regular
Trustee is an employee or officer of, or is affiliated with, the Sponsor; and
(3) one Trustee shall be the Property Trustee for so long as this Declaration is
required to qualify as an indenture under the Trust Indenture Act, and such
Trustee may also serve as Delaware Trustee if it meets the applicable
requirements.
SECTION 6.2 Delaware Trustee; Eligibility.
-----------------------------
If required by the Business Trust Act, one Trustee (the "Delaware
Trustee") shall be:
(a) a natural person who is a resident of the State of Delaware; or
(b) if not a natural person, an entity which has its principal place
of business in the State of Delaware, and otherwise meets the requirements of
applicable law,
provided that, if the Property Trustee has its principal place of business in
the State of Delaware and otherwise meets the requirements of applicable law,
then the Property Trustee shall also be the Delaware Trustee and Section 3.11
shall have no application.
SECTION 6.3 Property Trustee; Eligibility.
-----------------------------
(a) There shall at all times be one Trustee which shall act as
Property Trustee which shall:
(i) not be an Affiliate of the Sponsor; and
34
(ii) be a corporation organized and doing business under the
laws of the United States of America or any State or
Territory thereof or of the District of Columbia, or a
corporation or other Person permitted by the Commission to
act as an institutional trustee under the Trust Indenture
Act, authorized under such laws to exercise corporate
trust owners, having a combined capital and surplus of at
least 50 million U.S. dollars ($50,000,000), and subject
to supervision or examination by federal, State,
Territorial or District of Columbia authority. If such
corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of the
supervising or examining authority referred to above, then
for the purposes of this Section 6.3(a)(ii), the combined
capital and surplus of such corporation shall be deemed to
be its combined capital and surplus as set forth in its
most recent report of condition so published.
(b) If at any time the Property Trustee shall cease to be eligible to
so act under Section 6.3(a), the Property Trustee shall immediately resign in
the manner and with the effect set forth in Section 6.6(c).
(c) If the Property Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture Act, the
Property Trustee and the Holder of the Common Securities (as if it were the
obligor referred to in Section 310(b) of the Trust Indenture Act) shall in all
respects comply with the provisions of Section 310(b) of the Trust Indenture
Act.
(d) The Guarantee shall be deemed to be specifically described in
this Declaration for purposes of clause (i) of the first proviso contained in
Section 310(b) of the Trust Indenture Act.
SECTION 6.4 Qualifications of Regular Trustees and Delaware Trustee
-------------------------------------------------------
Generally.
- ---------
Each Regular Trustee and the Delaware Trustee (unless the Property
Trustee also acts as Delaware Trustee) shall be either a natural person who is
at least 21 years of age or a legal entity that shall act through one or more
Authorized Officers.
SECTION 6.5 Initial Regular Trustees.
------------------------
The initial Regular Trustees shall be:
Irwin L. Gubman, Kevin E. Villani and Paul B. Lasiter, the business
address of all of whom is c/o the Debenture Issuer, 23550 Hawthorne Boulevard,
Building One, Suite 110, Torrance California 90505.
35
SECTION 6.6 Appointment, Removal and Resignation of Trustees.
------------------------------------------------
(a) Subject to Section 6.6(b), Trustees may be appointed or removed
without cause at any time:
(i) until the issuance of any Securities, by written
instrument executed by the Sponsor; and
(ii) after the issuance of any Securities, by vote of the
Holders of a Majority in Liquidation Amount of the Common
Securities voting as a class at a meeting of the Holders
of the Common Securities.
(b) The Trustee that acts as Property Trustee shall not be removed in
accordance with Section 66 until a successor Trustee possessing the
qualifications to act as Property Trustee under Section 3.8(h) (a "Successor
Property Trustee") has been appointed and has accepted such appointment by
written instrument executed by such Successor Property Trustee and delivered to
the Regular Trustees and the Sponsor. The Trustee that acts as Delaware Trustee
shall not be removed in accordance with Section 6.6(a) until a successor Trustee
possessing the qualifications to act as Delaware Trustee under Sections 6.2 and
6.4 (a "Successor Delaware Trustee") has been appointed and has accepted such
appointment by written instrument executed by such Successor Delaware Trustee
and delivered to the Regular Trustees and the Sponsor.
(c) A Trustee appointed to office shall hold office until his or its
successor shall have been appointed, until his death or its dissolution or until
his or its removal or resignation. Any Trustee may resign from office (without
need for prior or subsequent accounting) by an instrument in writing signed by
the Trustee and delivered to the Sponsor and the Trust, which resignation shall
take effect upon such delivery or upon such later date as is specified therein;
provided, however, that:
(i) No such resignation of the Trustee that acts as the
Property Trustee shall be effective:
a. until a Successor Property Trustee has been appointed
and has accepted such appointment by instrument
executed by such Successor Property Trustee and
delivered to the Trust, the Sponsor and the resigning
Property Trustee; or
b. until the assets of the Trust have been completely
liquidated and the proceeds thereof distributed to the
holders of the Securities; and
(ii) no such resignation of the Trustee that acts as the
Delaware Trustee shall be effective until a Successor
Delaware Trustee has been appointed and has accepted such
appointment by instrument executed by such Successor
36
Delaware Trustee and delivered to the Trust, the Sponsor
and the resigning Delaware Trustee.
(d) The Holders of the Common Securities shall use their best efforts
to promptly appoint a Successor Delaware Trustee or Successor Property Trustee,
as the case may be, if the Property Trustee or the Delaware Trustee delivers an
instrument of resignation in accordance with this Section 6.6.
(e) If no Successor Property Trustee or Successor Delaware Trustee,
as the case may be, shall have been appointed and accepted appointment as
provided in this Section 6.6 within 60 days after delivery to the Sponsor and
the Trust of an instrument of resignation or removal, the resigning or removed
Property Trustee or Delaware Trustee, as applicable, may petition any court of
competent jurisdiction for appointment of a Successor Property Trustee or
Successor Delaware Trustee, as applicable. Such court may thereupon, after
prescribing such notice, if any, as it may deem proper, appoint a Successor
Property Trustee or Successor Delaware Trustee, as the case may be.
(f) No Property Trustee or Delaware Trustee shall be liable for the
acts or omissions to act of any Successor Property Trustee or Successor Delaware
Trustee, as the case may be.
SECTION 6.7 Vacancies among Trustees.
------------------------
If a Trustee ceases to hold office for any reason and the number of
Trustees is not reduced pursuant to Section 6.1, or if the number of Trustees is
increased pursuant to Section 6.1, a vacancy shall occur. A resolution
certifying the existence of such vacancy by the Regular Trustees or, if there
are more than two, a majority of the Regular Trustees shall be conclusive
evidence of the existence of such vacancy. The vacancy shall be filled with a
Trustee appointed in accordance with Section 6.6.
SECTION 6.8 Effect of Vacancies.
-------------------
The death, resignation, retirement, removal, bankruptcy, dissolution,
liquidation, incompetence or incapacity to perform the duties of a Trustee shall
not operate to annul the Trust. Whenever a vacancy in the number of Regular
Trustees shall occur, until such vacancy is filled by the appointment of a
Regular Trustee in accordance with Section 6.6, the Regular Trustees in office,
regardless of their number, shall have all the powers granted to the Regular
Trustees and shall discharge all the duties imposed upon the Regular Trustees by
this Declaration.
SECTION 6.9 Meetings.
--------
If there is more than one Regular Trustee, meetings of the Regular
Trustees shall be held from time to time upon the call of any Regular Trustee.
Regular meetings of the Regular Trustees may be held at a time and place fixed
by resolution of the Regular Trustees. Notice of
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any in-person meetings of the Regular Trustees shall be hand delivered or
otherwise delivered in writing (including by facsimile, with a hard copy by
overnight courier) not less than 48 hours before such meeting. Notice of any
telephonic meetings of the Regular Trustees shall be hand delivered or otherwise
delivered in writing (including by facsimile, with a hard copy by overnight
courier) not less than 24 hours before a meeting. Notices shall contain a brief
statement of the time, place and anticipated purposes of the meeting. The
presence (whether in person or by telephone) of a Regular Trustee at a meeting
shall constitute a waiver of notice of such meeting except where a Regular
Trustee attends a meeting for the express purpose of objecting to the
transaction of any activity on the ground that the meeting has not been lawfully
called or convened. Unless provided otherwise in this Declaration, any action
of the Regular Trustees may be taken at a meeting by vote of a majority of the
Regular Trustees present (whether in person or by telephone) and eligible to
vote with respect to such matter, provided that a Quorum is present, or without
a meeting by the unanimous written consent of the Regular Trustees. In the
event there is only one Regular Trustee, any and all action of such Regular
Trustee shall be evidenced by a written consent of such Regular Trustee.
SECTION 6.10 Merger, Conversion, Consolidation or Succession to
--------------------------------------------------
Business.
- --------
Any corporation into which the Property Trustee, the Delaware Trustee
or any Regular Trustee that is not a natural person, may be merged or converted
or with such Trustee may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which such Trustee shall be a party, or
any corporation succeeding to all or substantially all the corporate trust
business of such Trustee, shall be the successor of such Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto.
ARTICLE 7
THE SECURITIES
SECTION 7.1 General Provisions Regarding Securities.
---------------------------------------
(a) The Regular Trustees shall on behalf of the Trust issue a class
of preferred capital securities representing undivided beneficial ownership
interests in the assets of the Trust (the "Transfer Restricted Securities"), a
class of preferred capital securities to be issued only in exchange for the
Transfer Restricted Securities (the "New Preferred Securities," and, together
with the Transfer Restricted Securities, the "Preferred Securities"), and one
class of common securities representing undivided beneficial ownership interests
in the assets of the Trust (the "Common Securities").
(i) Preferred Securities. The Preferred Securities of the
Trust have an aggregate liquidation amount with respect to
the assets of the Trust of $70,000,000 and a liquidation
amount with respect to the assets of the Trust of $1,000
per Preferred Security. The Transfer Restricted Preferred
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Securities are hereby designated for identification
purposes only as the Remarketed Par Securities, Series A,
of the Trust and the New Preferred Securities are hereby
designated for identification purposes only as the
Preferred Securities, Series B, of the Trust. The
Transfer Restricted Preferred Security Certificates and
the New Preferred Security Certificates evidencing the
Preferred Securities, respectively, shall be substantially
in the form of Exhibits A and B to the Declaration, with
such changes and additions thereto or deletions therefrom
as may be required by ordinary usage, custom or practice
or to conform to the rules of any stock exchange on which
the Preferred Securities are listed or quoted.
(ii) Common Securities. The Common Securities of the Trust
have an aggregate liquidation amount with respect to the
assets of the Trust of $2,165,000 and a liquidation amount
with respect to the assets of the Trust of $1,000 per
Common Security. The Common Securities are hereby
designated for purposes of identification only as the
Common Securities of the Trust. The Common Security
Certificates evidencing the Common Securities shall be
substantially in the form of Exhibit C to the Declaration,
with such changes and additions thereto or deletions
therefrom as may be required by ordinary usage, custom or
practice.
(b) Payment of Distributions on, and the Redemption Price of, the
Preferred Securities and the Common Securities, as applicable, shall be made Pro
Rata based on the liquidation amount of such Preferred Securities and Common
Securities; provided, however, that if on any date on which such Distributions
or the Redemption Price is payable, an Indenture Event of Default shall have
occurred and be continuing, no payment of any Distribution on, or Redemption
Price payable in respect of, any of the Common Securities, and no other payment
on account of the redemption, liquidation or other acquisition of such Common
Securities, shall be made unless payment in full in cash of all accumulated and
unpaid Distributions on all of the outstanding Preferred Securities for all
distribution periods terminating on or prior thereto, or in the case of amounts
payable on redemption the full amount of the Redemption Price of all of the
outstanding Preferred Securities then called for redemption, shall have been
made or provided for, and all funds available to the Property Trustee shall
first be applied to the payment in full in cash of all Distributions on, or the
Redemption Price of, the Preferred Securities then due and payable. The Trust
shall issue no securities or other interests in the assets of the Trust other
than the Preferred Securities and the Common Securities.
(c) The Certificates shall be signed on behalf of the Trust by a
Regular Trustee. Such signature shall be the manual or facsimile signature of
any present or any future Regular Trustee. In case a Regular Trustee of the
Trust who shall have signed any of the Certificates shall cease to be such
Regular Trustee before the Certificates so signed shall be delivered by the
Trust, such Certificates nevertheless may be delivered as though the person who
signed such Certificates had not ceased to be such Regular Trustee; and any
Certificate may be signed on behalf of the Trust by such persons who, at the
actual date of execution of such Certificate, shall be the Regular Trustees of
the Trust, although at the date of the execution and delivery of the
39
Declaration any such person was not such a Regular Trustee. Certificates shall
be printed, lithographed or engraved or may be produced in any other manner as
is reasonably acceptable to the Regular Trustees, as evidenced by their
execution thereof, and may have such letters, numbers or other marks of
identification or designation and such legends or endorsements as the Regular
Trustees may deem appropriate, or as may be required to comply with any law or
with any rule or regulation of any stock exchange on which Securities may be
listed, or to conform to usage.
A Certificate representing Preferred Securities shall not be valid
until authenticated by the manual signature of an authorized officer of the
Property Trustee. Such signature shall be conclusive evidence that such
Certificate has been authenticated under this Declaration.
Upon a written order of the Trust signed by one Regular Trustee, the
Property Trustee shall authenticate the Certificates representing Preferred
Securities for original issue. The aggregate number of Preferred Securities
outstanding at any time shall not exceed the liquidation amount set forth in
Section 7.1(a)(i).
The Property Trustee may appoint an authenticating agent acceptable to
the Trust to authenticate Certificates. An authenticating agent may
authenticate Certificates whenever the Property Trustee may do so. Each
reference in this Declaration to authentication by the Property Trustee includes
authentication by such agent. An authenticating agent has the same rights as
the Property Trustee to deal with the Sponsor or an Affiliate of the Sponsor.
(d) The consideration received by the Trust for the issuance of the
Securities shall constitute a contribution to the capital of the Trust and shall
not constitute a loan to the Trust.
(e) Upon issuance of the Securities as provided in this Declaration,
the Securities so issued shall be deemed to be validly issued, and subject to
the terms hereof, fully paid and non-assessable beneficial ownership interests
in the assets of the Trust.
(f) Every Person, by virtue of having become a Holder or a Preferred
Security Beneficial Owner in accordance with the terms of this Declaration,
shall be deemed to have expressly assented and agreed to the terms of, and shall
be bound by, this Declaration and the terms of the Securities, the Guarantee,
the Indenture and the Debentures.
(g) The holders of the Securities shall have no preemptive or similar
rights.
SECTION 7.2 Distributions.
-------------
(a) Holders of Securities shall be entitled to receive cumulative
cash Distributions at the following rates (each, an "Applicable Distribution
Rate") of the stated liquidation amount of $1,000 per Security:
40
(i) from the Closing Date to but excluding the Remarketing Settlement
Date, at the rate per annum equal to 10-1/4% (the "Initial Distribution
Rate"); and
(ii) from the Remarketing Settlement Date, if any, to but excluding
the date of redemption, if any, thereof, at the rate per annum (the
"Adjusted Distribution Rate") that results from the Remarketing consummated
on the Remarketing Settlement Date. The Adjusted Distribution Rate shall
not exceed the Maximum Adjusted Distribution Rate.
At all times, the interest rate payable on the Debentures pursuant to
Section 4.01(c) of the Indenture shall equal the Applicable Distribution Rate.
(b) (i) Distributions on the Securities shall be cumulative, shall
accumulate from the date of initial issuance and shall be payable semi-annually,
in arrears, on each June 15 (June 14 in 2002) and December 15, commencing
December 15, 1997, and on the Scheduled Remarketing Settlement Date (each, a
"Distribution Date"), when, as and if available for payment, by each Property
Trustee, except as otherwise described below. Distributions are payable only to
the extent that payments are made in respect of the Debentures held by the
Property Trustee and to the extent the Trust has funds available for the payment
of such Distributions in the Property Account. The amount of Distributions
payable for any period shall be computed (i) for any full 180-day semi-annual
Distribution period on the basis of a 360-day year of twelve 30-day months, (ii)
for any period shorter than a full 180-day semi-annual distribution period for
which Distributions are computed, on the basis of a 30-day month and (iii) for
periods of less than a month, the actual number of days elapsed per 30-day
month. Subject to Section 7.1(b), Distributions shall be made on the Preferred
Securities and the Common Securities on a Pro Rata basis.
(ii) Distributions not paid on the scheduled Distribution Date will
accumulate and compound semi-annually at the Applicable Distribution Rate in
effect at the beginning of the related interest period ("Compounded
Distributions"). "Distributions" shall mean ordinary cumulative Distributions
together with any Compounded Distributions.
(iii) If and to the extent that the Debenture Issuer makes a payment
of interest (including Additional Interest, premium and/or principal on the
Debentures held by the Property Trustee (the amount of any such payment being a
"Payment Amount"), the Property Trustee shall and is directed, to the extent
funds are available for that purpose, to make a Pro Rata distribution of the
Payment Amount to Holders, subject to Section 7.1(b).
(c) Distributions on the Securities shall be payable to the Holders
thereof as they appear on the register of the Trust as of the close of business
on the June 1 and December 1 next preceding the relevant Distribution Date. The
relevant record dates for the Common Securities shall be the same as for the
Preferred Securities. At all times, the Distribution Dates shall correspond to
the interest payment dates on the Debentures. Distributions payable on any
Securities that are not punctually paid on any Distribution Date, as a result of
the Debenture Issuer having failed to make a payment under the Debentures, shall
cease to be payable to the Person in whose name such Securities are registered
on the relevant record date, and such
41
defaulted Distribution will instead be payable to the Person in whose name such
Securities are registered on the special record date or other specified date
determined in accordance with this Declaration. If any date on which
Distributions are payable on the Securities is not a Business Day, then payment
of the Distribution payable on such date will be made on the next succeeding day
that is a Business Day (and without any interest or other payment in respect of
any such delay), except that, if such Business Day is in the next succeeding
calendar year, such payment shall be made on the immediately preceding Business
Day, in each case with the same force and effect as if made on such payment
date.
(d) In the event that there is any money or other property held by or
for the Trust that is not accounted for hereunder, such property shall be
distributed Pro Rata among the Holders of the Securities.
SECTION 7.3 Redemption of Securities.
------------------------
(a) Upon the repayment or redemption, in whole or in part, of the
Debentures held by the Trust, whether at the stated maturity of the Debentures
or upon earlier redemption as provided in the Indenture, the proceeds from such
repayment or redemption shall be simultaneously applied Pro Rata (subject to
Section 7.1(b) of this Declaration) to redeem Securities having an aggregate
liquidation amount equal to the aggregate principal amount of the Debentures so
repaid or redeemed at the Redemption Price. Except with respect to a Special
Mandatory Redemption, Holders shall be given not less than 30 nor more than 60
days notice of such redemption in accordance with Section 7.4 below.
(b) If, at any time, a Special Event shall occur and be continuing,
the Regular Trustees may, within 90 days following the occurrence of such
Special Event, elect to dissolve the Trust upon not less than 30 nor more than
60 days' notice and, after satisfaction of liabilities to creditors, if any,
cause the Debentures to be distributed to the holders of the Securities in
liquidation of the Trust.
(c) On the date fixed for any distribution of Debentures, upon
dissolution of the Trust, (i) the Securities will no longer be deemed to be
outstanding and (ii) certificates representing Securities will be deemed to
represent the Debentures having an aggregate principal amount equal to the
stated liquidation amount of, and bearing accrued and unpaid interest equal to
accumulated and unpaid Distributions on, such Securities until such certificates
are presented to the Sponsor or its agent for transfer or reissuance.
(d) If, by 4:00 p.m., New York City time, on any Scheduled
Remarketing Date, the Remarketing Agent is unable to remarket, at a price of
$1,000 per Preferred Security, all of the Preferred Securities tendered or
deemed tendered for purchase in the Remarketing on such Scheduled Remarketing
Date, (i) such unsold Preferred Securities shall be exchanged on the related
Scheduled Remarketing Settlement Date with the Trust for Debentures having an
aggregate principal amount equal to the aggregate liquidation amount of such
unsold Preferred Securities and such Debentures shall be immediately redeemed by
the Debenture Issuer, unless (ii) as a result of such redemption, less than
$25.0 million principal amount of Debentures would
42
remain outstanding, in which latter event, the Debenture Issuer shall redeem on
such Scheduled Remarketing Settlement Date all of the outstanding Debentures. In
the case of either such redemption (a "Special Mandatory Redemption"), the
redemption price of the Debentures shall be 100% of the principal amount of the
Debentures so redeemed.
SECTION 7.4 Redemption Procedures.
---------------------
(a) Except with respect to a Special Mandatory Redemption (which
shall not be governed by this Section 7.4(a)), notice of any redemption of, or
notice of distribution of Debentures in exchange for, the Securities (a
"Redemption/Distribution Notice"), will be given by the Trust by mail to each
Holder of Securities to be redeemed or exchanged not fewer than 30 nor more than
60 days before the date fixed for redemption or exchange thereof which, in the
case of a redemption, will be the date fixed for redemption of the Debentures.
For purposes of the calculation of the date of redemption or exchange and the
dates on which notices are given pursuant to this Section 7.4(a), a
Redemption/Distribution Notice shall be deemed to be given on the day such
notice is first mailed by first-class mail, postage prepaid, to Holders of
Securities. Each Redemption/ Distribution Notice shall be addressed to the
Holders of Securities at the address of each such Holder appearing in the
register of the Trust. No defect in the Redemption/Distribution Notice or in
the mailing of either thereof with respect to any Holder shall affect the
validity of the redemption or exchange proceedings with respect to any other
Holder.
(b) If fewer than all the outstanding Securities are to be so
redeemed, the Securities will be redeemed Pro Rata and the Preferred Securities
to be redeemed will be redeemed as described in Section 7.4(c) below. The Trust
may not redeem the Securities in part unless all accumulated and unpaid
Distributions to the date of redemption have been paid in full on all Securities
then outstanding. For all purposes of this Declaration, unless the context
otherwise requires, all provisions relating to the redemption of Preferred
Securities shall relate, in the case of any Preferred Security redeemed or to be
redeemed only in part, to the portion of the aggregate liquidation amount of
Preferred Securities which has been or is to be redeemed.
(c) Subject to the Trust's fulfillment of the notice requirements set
forth in Section 7.4(a) above, if Securities are to be redeemed (including a
redemption of Securities following a Special Mandatory Redemption of all of the
Debentures), then (i) with respect to Preferred Securities represented by one or
more Global Securities, by 12:00 noon, New York City time, on the redemption
date, to the extent funds are available, the Property Trustee will deposit
irrevocably with the Depositary or its nominee (or successor Clearing Agency or
its nominee) funds sufficient to pay the applicable Redemption Price with
respect to such Preferred Securities and will give the Depositary irrevocable
instructions and authority to pay the Redemption Price to the Holders of such
Preferred Securities and (ii) with respect to Securities not represented by one
or more Global Securities, the Trust, to the extent funds are available, will
irrevocably deposit with the Paying Agent such funds sufficient to pay the
relevant Redemption Price to the Holders of such Securities and will give the
Paying Agent irrevocable instructions and authority to pay the applicable
Redemption Price by check mailed to the address of the relevant Holder appearing
on the register of the Trust on the redemption date. If any date fixed
43
for redemption of Securities is not a Business Day, then payment of the
Redemption Price payable on such date will be made on the next succeeding day
that is a Business Day (and without any interest or other payment in respect of
any such delay) except that, if such Business Day falls in the next calendar
year, such payment will be made on the immediately preceding Business Day, in
each case with the same force and effect as if made on such date fixed for
redemption. If payment of the Redemption Price in respect of any Securities is
improperly withheld or refused and not paid either by the Property Trustee or by
the Sponsor as guarantor pursuant to the Guarantee, Distributions on such
Securities will continue to accumulate at the then Applicable Distribution Rate
in effect from the original redemption date to the actual date of payment, in
which case the actual payment date will be considered the date fixed for
redemption for purposes of calculating the Redemption Price. For these
purposes, the applicable Redemption Price shall not include Distributions which
are being paid to Holders who were Holders on a relevant record date. If notice
of redemption has been given and funds deposited as required, then immediately
prior to the close of business on the date of such deposit or payment,
Distributions will cease to accrue on the Securities called for redemption and
all rights of Holders of such Securities so called for redemption will cease,
except the right of the Holders to receive the Redemption Price, but without
interest on such Redemption Price, and from and after the date fixed for
redemption, such Securities will cease to be outstanding.
Neither the Regular Trustees nor the Trust shall be required to
register or cause to be registered the transfer of any Securities that have been
called for redemption, except in the case of any Securities being redeemed in
part, any portion thereof not to be redeemed.
(d) Subject to the foregoing and applicable law (including, without
limitation, United States federal securities laws), the Debenture Issuer or its
subsidiaries may at any time and from time to time purchase outstanding
Preferred Securities by tender, in the open market or by private agreement.
SECTION 7.5 Remarketing.
-----------
(a) (i) If the Debenture Issuer receives a Tax Opinion at least 35
Business Days prior to an Election Date, the Debenture Issuer may cancel the
Remarketing by giving, to the Property Trustee, the Depositary and the
Remarketing Agent, written notice of such cancellation.
(ii) If the Debenture Issuer does not receive such a Tax Opinion or if
the Debenture Issuer does not elect to cancel the Remarketing after receiving
such Tax Opinion, the Trust shall give a Notice of Remarketing of the Preferred
Securities, substantially in the form attached as, or containing substantially
the information contained in, Exhibit D to this Declaration to the Depositary,
with copies to the Property Trustee and the Remarketing Agent, not less than 20
nor more than 35 Business Days prior to the Election Date. If the Debenture
Issuer is required to redeem Debentures (and thus Preferred Securities) in
connection with a Transfer Restricted Security Redemption, Holders of such
Preferred Securities shall receive notice of such redemption at or prior to the
time when the Notice of Remarketing of the Preferred Securities shall be given
to the Depositary, and such Holders shall not tender their Preferred Securities
for purchase in the Remarketing.
44
(b) Not later than 4:00 P.M., New York City time, on the Election
Date, each holder of Preferred Securities may give a Notice of Election,
substantially in the form attached as, or containing substantially the
information contained in, Exhibit E to this Declaration ("Notice of Election"),
to the Property Trustee of its election (i) to retain and not to have all or any
portion of the Preferred Securities owned by it remarketed in the Remarketing to
be conducted on the Scheduled Remarketing Date or (ii) to tender all or any
portion of such Preferred Securities for purchase in such Remarketing (such
portion, in either case, shall be in the liquidation amount of $1,000 or any
integral multiple thereof). Any Notice of Election given to the Property
Trustee shall be irrevocable and may not be conditioned upon the level at which
the Adjusted Distribution Rate is established in the Remarketing. Promptly
after 4:30 P.M., New York City time, on the Election Date, the Property Trustee,
based on the Notices of Election received by it through the Depositary prior to
such time, shall notify the Trust, the Debenture Issuer and the Remarketing
Agent of the number of Preferred Securities to be retained by Holders and the
number of Preferred Securities tendered for purchase in the Remarketing. Under
Section 4 of the Remarketing Agreement, the Company, in its capacity as
Debenture Issuer, shall be liable for, and shall pay, any and all costs and
expenses incurred in connection with the Remarketing and the Trust shall not be
liable for such costs and expenses.
(c) If any Holder gives a Notice of Election to tender Preferred
Securities as described in clause (ii) of Section 7.5(b), the Preferred
Securities so subject to such Notice of Election shall 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 in Section 7.5(b), such Preferred Securities
shall be deemed tendered for purchase in the Remarketing, notwithstanding such
failure or the failure by such Holder to deliver or properly deliver Preferred
Securities to the Remarketing Agent for purchase.
(d) The right of each Holder to have Preferred Securities tendered
for purchase 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 an Adjusted Distribution Rate that does not exceed the
Maximum Adjusted Distribution Rate and (iv) such purchaser or purchasers deliver
the purchase price therefor to the Remarketing Agent.
(e) Prior to 4:00 P.M., New York City time, on the Scheduled
Remarketing Date, the Remarketing Agent shall determine the Adjusted
Distribution Rate, which shall 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 rate per annum, if any, not
exceeding the Maximum Adjusted Distribution Rate that will enable it to remarket
all Preferred Securities tendered or deemed tendered for purchase at a price of
$1,000 per Preferred Security. Notwithstanding the foregoing, if the
Remarketing Agent is able to remarket some, but is unable to remarket all, of
the Preferred Securities tendered or deemed tendered for purchase in the
Remarketing, the Adjusted Distribution Rate shall be the highest rate, not
exceeding the Maximum Adjusted Distribution Rate, required to remarket the
Preferred Securities sold in the
45
Remarketing. If holders submit Notices of Election to retain all of the
Securities then outstanding, the Adjusted Distribution Rate shall 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 Scheduled
Remarketing Date with respect to such Notice of Election.
(f) If the Remarketing Agent is unable to remarket by 4:00 P.M., New
York City time, on the Scheduled Remarketing Date, all Preferred Securities
tendered or deemed tendered for purchase at a price of $1,000 per Security, each
holder that tendered Preferred Securities for sale shall sell a number of
Preferred Securities on a pro rata basis, to the extent practicable, or by lot,
as determined by the Remarketing Agent in its sole discretion, based on the
number of orders to purchase Preferred Securities in the Remarketing. If the
allocation procedures described in the preceding sentence would result in the
sale of a fraction of a Preferred Security, the Remarketing Agent shall, in its
sole discretion, round up or down the number of Preferred Securities sold by
each holder in the Remarketing so that each Preferred Security sold in the
Remarketing will be a whole Preferred Security and the total number of Preferred
Securities sold equals the total number of Preferred Securities purchased in the
Remarketing.
(g) By approximately 4:30 P.M., New York City time, on the Scheduled
Remarketing Date, the Remarketing Agent shall advise, by telephone (i) the
Depositary, the Property Trustee, the Debenture Trustee, the Trust and the
Sponsor of the Adjusted Distribution Rate determined in the Remarketing and the
number of Preferred Securities sold in the Remarketing, (ii) each purchaser (or
the Depositary Participant thereof) of the Adjusted Distribution Rate determined
in the Remarketing and the number of Preferred Securities such purchaser is to
purchase and (iii) each purchaser to give instructions to its Depositary
Participant to pay the purchase price on the Scheduled Remarketing Settlement
Date in same day funds against delivery of the Preferred Securities purchased
through the facilities of the Depositary.
(h) In accordance with the Depositary's normal procedures, on the
Remarketing Settlement Date, the transactions described above with respect to
each Preferred Security tendered for purchase and sold in the Remarketing shall
be executed through the Depositary, if the Depositary or its nominee is the
Holder of such Preferred Securities, as authorized in accordance with Section
7.5(h), and the accounts of the respective Depositary Participants shall be
debited and credited and such Preferred Securities delivered by book entry as
necessary to effect purchases and sales of such Preferred Securities. The
Depositary shall make payment in accordance with its normal procedures.
(i) If any holder selling Preferred Securities in the Remarketing
fails to deliver such Preferred Securities, the Depositary 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 shall be determined by such Depositary
Participant, and delivery of such lesser number of Preferred Securities shall
constitute good delivery.
46
(j) 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 Sponsor nor the Remarketing Agent shall be obligated in
any case to provide funds to make payment upon tender of Preferred Securities
for Remarketing.
SECTION 7.6 Voting Rights of Preferred Securities.
-------------------------------------
(a) Except as provided under this Article VII and as otherwise
required by the Business Trust Act, the Trust Indenture Act and other applicable
law, the Holders of the Preferred Securities shall have no voting rights.
(b) Subject to the requirement of the Property Trustee obtaining a
tax opinion in certain circumstances set forth in Section 7.6(d) below, the
Holders of a Majority in Liquidation Amount of the Preferred Securities shall
have the right to direct the time, method and place of conducting any proceeding
for any remedy available to the Property Trustee, or to direct the exercise of
any trust or power conferred upon the Property Trustee under the Declaration,
including the right to direct the Property Trustee, as Holder of the Debentures,
to (i) exercise the remedies available to it under the Indenture as a Holder of
the Debentures, (ii) consent to any amendment or modification of the Indenture
or the Debentures where such consent shall be required or (iii) waive any past
default and its consequences that is waivable under the Indenture; provided,
however, that if an Indenture Event of Default has occurred and is continuing,
then the Holders of 25% of the aggregate liquidation amount of the Preferred
Securities may direct the Property Trustee to declare the principal of and
interest on the Debentures due and payable; provided, further, that where a
consent or action under the Indenture would require the consent or act of the
Holders of more than a majority of the aggregate principal amount of Debentures
affected thereby, only the Holders of the percentage of the aggregate stated
liquidation amount of the Preferred Securities which is at least equal to the
percentage required under the Indenture may direct the Property Trustee to give
such consent to take such action.
(c) If the Property Trustee fails to enforce its rights under the
Debentures after a Holder of Preferred Securities has made a written request,
such Holder of Preferred Securities may institute a legal proceeding directly
against the Debenture Issuer to enforce the Property Trustee's rights under the
Indenture without first instituting any legal proceeding against the Property
Trustee or any other person or entity. In addition, if a Trust Enforcement
Event has occurred and is continuing and such event is attributable to the
failure of the Debenture Issuer to make any interest, principal or other
required payments when due under the Indenture, then a Holder of Preferred
Securities may directly institute a Direct Action on or after the respective due
date specified in the Debentures.
(d) The Property Trustee shall notify all Holders of the Preferred
Securities of any notice of any Indenture Event of Default received from the
Debenture Issuer with respect to the Debentures. Such notice shall state that
such Indenture Event of Default also constitutes a Trust Enforcement Event.
Except with respect to directing the time, method, and place of conducting a
proceeding for a remedy, the Property Trustee shall be under no obligation to
take any of the actions described in clause 7.6(b)(i) and (ii) above unless the
Property Trustee has
47
obtained an opinion of independent tax counsel to the effect that the Trust will
not fail to be classified as a grantor trust for United States federal income
tax purposes, as a result of such action, and each Holder will be treated as
owning an undivided beneficial ownership interest in the Debentures.
(e) In the event the consent of the Property Trustee, as the Holder
of the Debentures, is required under the Indenture with respect to any amendment
or modification of the Indenture, the Property Trustee shall request the
direction of the Holders of the Securities with respect to such amendment or
modification and shall vote with respect to such amendment or modification as
directed by a Majority in Liquidation Amount of the Securities voting together
as a single class; provided, however, that where a consent under the Indenture
would require the consent of the Holders of more than a majority of the
aggregate principal amount of the Debentures, the Property Trustee may only give
such consent at the direction of the Holders of at least the same proportion in
aggregate stated liquidation amount of the Securities. The Property Trustee
shall not take any such action in accordance with the directions of the Holders
of the Securities unless the Property Trustee has obtained an opinion of
independent tax counsel to the effect that the Trust will not be classified as
other than a grantor trust for United States federal income tax purposes, as a
result of such action, and each Holder will be treated as owning an undivided
beneficial ownership interest in the Debentures.
(f) A waiver of an Indenture Event of Default with respect to the
Debentures will constitute a waiver of the corresponding Trust Enforcement
Event.
(g) Any required approval or direction of Holders of Preferred
Securities may be given at a separate meeting of Holders of Preferred Securities
convened for such purpose, at a meeting of all of the Holders of Securities or
pursuant to written consent. The Regular Trustees shall cause a notice of any
meeting at which Holders of Preferred Securities are entitled to vote, or of any
matter upon which action by written consent of such Holders is to be taken, to
be mailed to each Holder of record of Preferred Securities. Each such notice
shall include a statement setting forth the following information: (i) the date
of such meeting or the date by which such action is to be taken; (ii) a
description of any resolution proposed for adoption at such meeting on which
such Holders are entitled to vote or of such matter upon which written consent
is sought; and (iii) instructions for the delivery of proxies or consents.
(h) No vote or consent of the Holders of Preferred Securities shall
be required for the Trust to redeem and cancel Preferred Securities or
distribute Debentures in accordance with the Declaration.
(i) Notwithstanding that Holders of Preferred Securities are entitled
to vote or consent under any of the circumstances described above, any of the
Securities that are owned at such time by the Debenture Issuer, the Trustees or
any entity directly or indirectly controlled by, or under direct or indirect
common control with, the Debenture Issuer or any Trustee, shall not be entitled
to vote or consent and shall, for purposes of such vote or consent, be treated
as if such Securities were not outstanding.
48
(j) Holders of the Preferred Securities shall have no rights to
appoint or remove the Trustees, who may be appointed, removed or replaced solely
by the Debenture Issuer, as the Holder of all of the Common Securities. If an
Indenture Event of Default has occurred and is continuing, the Property Trustee
and the Delaware Trustee may be removed at such time by a Majority in
Liquidation Amount of the Preferred Securities.
SECTION 7.7 Voting Rights of Common Securities.
----------------------------------
(a) Except as provided under Section 6.1(b) or this Section 7.7 or as
otherwise required by the Business Trust Act, the Trust Indenture Act or other
applicable law or provided by the Declaration, the Holders of the Common
Securities shall have no voting rights.
(b) The Holders of the Common Securities shall be entitled, in
accordance with Article V of the Declaration, to vote to appoint, remove or
replace any Trustee or to increase or decrease the number of Trustees.
(c) Subject to Section 2.6 of the Declaration and only after all
Trust Enforcement Events with respect to the Preferred Securities have been
cured, waived, or otherwise eliminated and subject to the requirement of the
Property Trustee obtaining a tax opinion in certain circumstances set forth in
this paragraph (c), the Holders of a Majority in Liquidation Amount of the
Common Securities have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Property Trustee, or
direct the exercise of any trust or power conferred upon the Property Trustee
under the Declaration, including the right to direct the Property Trustee, as
Holder of the Debentures, to (i) exercise the remedies available to it under the
Indenture as a Holder of the Debentures, (ii) consent to any amendment or
modification of the Indenture or the Debentures where such consent shall be
required or (iii) waive any past default and its consequences that is waivable
under the Indenture; provided, however, that where a consent or action under the
Indenture would require the consent or act of the Holders of more than a
majority of the aggregate principal amount of Debentures affected thereby, only
the Holders of the percentage of the aggregate stated liquidation amount of the
Common Securities which is at least equal to the percentage required under the
Indenture may direct the Property Trustee to have such consent or take such
action. Except with respect to directing the time, method, and place of
conducting a proceeding for a remedy, the Property Trustee shall be under no
obligation to take any of the actions described in clause 7.7(c)(i) and (ii)
above unless the Property Trustee has obtained an opinion of independent tax
counsel to the effect that, as a result of such action, for United States
federal income tax purposes the Trust will not fail to be classified as a
grantor trust and each Holder will be treated as owning an undivided beneficial
ownership interest in the Debentures.
(d) If the Property Trustee fails to enforce its rights under the
Debentures after a Holder of Common Securities has made a written request, such
Holder of Common Securities may directly institute a legal proceeding directly
against the Debenture Issuer to enforce the Property Trustee's rights under the
Debentures without first instituting any legal proceeding against the Property
Trustee or any other person or entity.
49
(e) A waiver of an Indenture Event of Default with respect to the
Debentures will constitute a waiver of the corresponding Trust Enforcement
Event.
(f) Any required approval or direction of Holders of Common
Securities may be given at a separate meeting of Holders of Common Securities
convened for such purpose, at a meeting of all of the Holders of Securities or
pursuant to written consent. The Regular Trustees will cause a notice of any
meeting at which Holders of Trust Common Securities are entitled to vote, or of
any matter on which action by written consent of such Holders is to be taken, to
be mailed to each Holder of record of Common Securities. Each such notice will
include a statement setting forth the following information: (i) the date of
such meeting or the date by which such action is to be taken; (ii) a description
of any resolution proposed for adoption at such meeting on which such Holders
are entitled to vote or of such matter upon which written consent is sought; and
(iii) instructions for the delivery of proxies or consents.
(g) No vote or consent of the Holders of the Common Securities will
be required for the Trust to redeem and cancel Common Securities or to
distribute Debentures in accordance with the Declaration and the terms of the
Securities.
SECTION 7.8 Paying Agent.
------------
In the event that any Preferred Securities are not in book-entry only
form, the Trust shall maintain in the Borough of Manhattan, City of New York,
State of New York, an office or agency where the Trust Preferred Securities may
be presented for payment ("Paying Agent"). The Trust may appoint the paying
agent and may appoint one or more additional paying agents in such other
locations as it shall determine. The term "Paying Agent" includes any
additional paying agent. The Trust may change any Paying Agent without prior
notice to the Holders. The Trust shall notify the Property Trustee of the name
and address of any Paying Agent not a party to this Declaration. If the Trust
fails to appoint or maintain another entity as Paying Agent, the Property
Trustee shall act as such. The Trust or any of its Affiliates may act as Paying
Agent. Chase Trust Company of California shall initially act as Paying Agent
for the Preferred Securities and the Common Securities. In the event the
Property Trustee shall no longer be the Paying Agent, the Regular Trustees shall
appoint a successor (which shall be a bank or trust company acceptable to the
Regular Trustees and the Debenture Issuer) to act as Paying Agent. The Paying
Agent shall be permitted to resign as Paying Agent upon 30 days' written notice
to the Property Trustee and the Debenture Issuer.
SECTION 7.9 Transfer of Securities.
----------------------
(a) The Trust shall cause to be kept at the Corporate Trust Office of
the Property Trustee a register (the register maintained in such office being
herein sometimes referred to as the "Security Register") in which, subject to
such reasonable regulations as it may prescribe, the Trust shall provide for the
registration of Preferred Securities and of transfers of Preferred Securities.
The Property Trustee is hereby appointed "Security Registrar" for the purpose of
registering Preferred Securities and transfers of Preferred Securities as herein
provided.
50
(b) Upon surrender for registration of transfer of any Security at an
office or agency of the Trust designated for such purpose, the Trust shall
execute, and the Property Trustee shall authenticate and deliver, in the name of
the designated transferee or transferees, one or more new Securities of any
authorized denominations and of a like aggregate principal amount.
(c) At the option of the Holder, Securities may be exchanged for
other Securities of any authorized denominations and of a like aggregate
principal amount, upon surrender of the Securities to be exchanged at such
office or agency. Whenever any Securities are so surrendered for exchange, the
Trust shall execute, and the Property Trustee shall authenticate and deliver,
the Securities which the Holder making the exchange is entitled to receive.
(d) Every Security presented or surrendered for registration of
transfer or for exchange shall (if so required by the Trust or the Property
Trustee) be duly endorsed, or be accompanied by a written instrument of transfer
in form satisfactory to the Trust and the Security Registrar duly executed, by
the Holder thereof or his attorney duly authorized in writing.
(e) No service charge shall be made for any registration of transfer
or exchange of Securities, but the Trust may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
with any registration of transfer or exchange of Securities.
(f) If the Securities are to be redeemed in part (other than pursuant
to a Special Mandatory Redemption), the Trust shall not be required (A) to
issue, register the transfer of or exchange any Securities during a period
beginning at the opening of business 15 days before the day of the mailing of a
notice of redemption of any such Securities selected for redemption under
Section 7.4 and ending at the close of business on the day of such mailing, or
(B) to register the transfer or exchange of any Security so selected for
redemption in whole or in part, except the unredeemed portion of any Security
being redeemed in part.
SECTION 7.10 Mutilated, Destroyed, Lost or Stolen Certificates.
-------------------------------------------------
If:
(a) any mutilated Certificates should be surrendered to the Regular
Trustees, or if the Regular Trustees shall receive evidence to their
satisfaction of the destruction, loss or theft of any Certificate; and
(b) there shall be delivered to the Regular Trustees such security or
indemnity as may be required by them to keep each of them, the Sponsor and the
Trust harmless, then, in the absence of notice that such Certificate shall have
been acquired by a bona fide purchaser, any Regular Trustee on behalf of the
Trust shall execute and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
denomination. In connection with the issuance of any new Certificate under this
Section 7.10, the Regular Trustees may require the payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
therewith. Any duplicate Certificate issued pursuant to this
51
Section shall constitute conclusive evidence of an ownership interest in the
relevant Securities, as if originally issued, whether or not the lost, stolen or
destroyed Certificate shall be found at any time.
SECTION 7.11 Deemed Security Holders.
-----------------------
The Trustees may treat the Person in whose name any Certificate shall
be registered on register of the Trust as the sole holder of such Certificate
and of the Securities represented by such Certificate for purposes of receiving
Distributions and for all other purposes whatsoever and, accordingly, shall not
be bound to recognize any equitable or other claim to or interest in such
Certificate or in the Securities represented by such Certificate on the part of
any Person, whether or not the Trust shall have actual or other notice thereof.
SECTION 7.12 Global Securities.
-----------------
The Transfer Restricted Securities shall be, and the New Preferred
Securities may be, issued as Global Securities, Preferred Securities are to be
issued in the form of one or more Global Securities, then the Trust shall
execute and the Property Trustee shall authenticate and deliver one or more
Global Securities that (i) shall represent and shall be denominated in an amount
equal to the aggregate liquidation amount of all of the Preferred Securities to
be issued in the form of Global Securities and not yet cancelled, (ii) shall be
registered in the name of the Depositary for such Global Security or Preferred
Securities or the nominee of such Depositary, and (iii) shall be delivered by
the Property Trustee to such Depositary or pursuant to such Depositary's
instructions. Global Securities shall bear a legend substantially to the
following effect:
"This Remarketed Preferred Security is a Global Security within the
meaning of the Declaration hereinafter referred to and is registered in the name
of The Depository Trust Company, a New York corporation (the "Depositary"), or a
nominee of the Depositary. This Remarketed Preferred Security is exchangeable
for Remarketed Preferred Securities registered in the name of a person other
than the Depositary or its nominee only in the limited circumstances described
in the Declaration and no transfer of this Remarketed Preferred Security (other
than a transfer of this Remarketed Preferred Security as a whole by the
Depositary to a nominee of the Depositary or by a nominee of the Depositary to
the Depositary or another nominee of the Depositary) may be registered except in
limited circumstances.
Unless this Remarketed Preferred Security Certificate is presented by
an authorized representative of the Depositary to Imperial Credit Capital Trust
I or its agent for registration of transfer, exchange or payment, and any
Remarketed Preferred Security Certificate issued is registered in the name of
Cede & Co. or such other name as registered by an authorized representative of
the Depositary (and any payment hereon is made to Cede & Co. or to such other
entity as is requested by an authorized representative of the Depositary), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL since the registered owner hereof, Cede & Co., has an interest
herein."
52
Preferred Securities not represented by a Global Security issued in
exchange for all or a part of a Global Security pursuant to this Section 7.12
shall be registered in such names and in such authorized denominations as the
Depositary, pursuant to instructions from its direct or indirect participants or
otherwise, shall instruct the Property Trustee. Upon execution and
authentication, the Property Trustee shall deliver such Preferred Securities not
represented by a Global Security to the persons in whose names such definitive
Preferred Securities are so registered.
At such time as all interests in Global Securities have been redeemed,
repurchased or cancelled, such Global Securities shall be, upon receipt thereof,
cancelled by the Property Trustee in accordance with standing procedures of the
Depositary. At any time prior to such cancellation, if any interest in Global
Securities is exchanged for Preferred Securities not represented by a Global
Security, redeemed, cancelled or transferred to a transferee who receives
Preferred Securities not represented by a Global Security therefor or any
Preferred Security not represented by a Global Security is exchanged or
transferred for part of Global Securities, the principal amount of such Global
Securities shall, in accordance with the standing procedures of the Depositary,
be reduced or increased, as the case may be, and an endorsement shall be made on
such Global Securities by the Property Trustee to reflect such reduction or
increase.
The Trust and the Property Trustee may for all purposes, including the
making of payments due on the Preferred Securities, deal with the Depositary as
the authorized representative of the Holders for the purposes of exercising the
rights of Holders hereunder. The rights of the owner of any beneficial interest
in a Global Security shall be limited to those established by law and agreements
between such owners and depository participants or Euroclear and Cedel;
provided, that no such agreement shall give any rights to any person against the
Trust or the Property Trustee without the written consent of the parties so
affected. Multiple requests and directions from and votes of the Depositary as
holder of Preferred Securities in global form with respect to any particular
matter shall not be deemed inconsistent to the extent they do not represent an
amount of Preferred Securities in excess of those held in the name of the
Depositary or its nominee.
If at any time the Depositary for any Preferred Securities represented
by one or more Global Securities notifies the Trust that it is unwilling or
unable to continue as Depositary for such Preferred Securities or if at any time
the Depositary for such Preferred Securities shall no longer be eligible under
this Section 7.12, the Trust shall appoint a successor Depositary with respect
to such Preferred Securities. If a successor Depositary for such Preferred
Securities is not appointed by the Trust within 90 days after the Trust receives
such notice or becomes aware of such ineligibility, the Trust's election that
such Preferred Securities be represented by one or more Global Securities shall
no longer be effective and the Trust shall execute, and the Property Trustee
will authenticate and deliver, Preferred Securities in definitive registered
form, in any authorized denominations, in an aggregate liquidation amount equal
to the principal amount of the Global Security or Preferred Securities
representing such Preferred Securities in exchange for such Global Security or
Preferred Securities.
53
After a Remarketing, the Trust may at any time and in its sole
discretion determine that the Preferred Securities issued in the form of one or
more Global Securities shall no longer be represented by a Global Security or
Preferred Securities. In such event the Trust shall execute, and the Property
Trustee, shall authenticate and deliver, Preferred Securities in definitive
registered form, in any authorized denominations, in an aggregate liquidation
amount equal to the principal amount of the Global Security or Preferred
Securities representing such Preferred Securities, in exchange for such Global
Security or Preferred Securities.
Notwithstanding any other provisions of this Declaration (other than
the provisions set forth in Section 7.9), Global Securities may not be
transferred as a whole except by the Depositary to a nominee of the Depositary
or by a nominee of the Depositary to the Depositary or another nominee of the
Depositary or by the Depositary or any such nominee to a successor Depositary or
a nominee of such successor Depositary.
Interests of beneficial owners in a Global Security may be transferred
or exchanged for Preferred Securities not represented by a Global Security and
Preferred Securities not represented by a Global Security may be transferred or
exchange for Global Securities in accordance with rules of the Depositary and
the provisions of Section 7.14.
Any Preferred Security in global form may be endorsed with or have
incorporated in the text thereof such legends or recitals or changes not
inconsistent with the provisions of this Declaration as may be required by the
Depositary or by the National Association of Securities Dealers, Inc. in order
for the Preferred Securities to be tradeable on the PORTAL Market or as may be
required for the Preferred Securities to be tradeable on any other market
developed for trading of securities pursuant to Rule 144A or required to comply
with any applicable law or any regulation thereunder or with Regulation S or
with the rules and regulations of any securities exchange upon which the
Preferred Securities may be listed or traded or to conform with any usage with
respect thereto, or to indicate any special limitations or restrictions to which
any particular Preferred Securities are subject.
Any Preferred Security in global form may be endorsed with or have
incorporated in the text thereof such legends or recitals or changes not
inconsistent with the provisions of this Declaration as may be required by the
Depositary or by the National Association of Securities Dealers, Inc. in order
for the Preferred Securities to be tradeable on the PORTAL Market or as may be
required for the Preferred Securities to be tradeable on any other market
developed for trading of securities pursuant to Rule 144A or required to comply
with any applicable law or any regulation thereunder or with Regulation S or
with the rules and regulations of any securities exchange upon which the
Preferred Securities may be listed or traded or to conform with any usage with
respect thereto, or to indicate any special limitations or restrictions to which
any particular Preferred Securities are subject.
SECTION 7.13 Restrictive Legend.
------------------
(a) Each Global Security and Preferred Security not represented by a
Global Security that constitutes a Restricted Security shall bear the following
legend (the "Private
54
Placement Legend") on the face thereof until two years after the later of the
date of original issue and the last date on which the Sponsor or any affiliate
of the Sponsor was the owner of such Preferred Securities (or any predecessor
thereto) (the "Resale Restriction Termination Date"), unless otherwise agreed by
the Trust and the Holder thereof:
"THIS SECURITY (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS AND NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION
HEREIN MAY BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS
SECURITY IS HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON THE EXEMPTION
FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE
144A THEREUNDER. THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF,
REPRESENTS, ACKNOWLEDGES AND AGREES FOR THE BENEFIT OF THE TRUST THAT: (I)
IT HAS ACQUIRED A "RESTRICTED" SECURITY WHICH HAS NOT BEEN REGISTERED UNDER
THE SECURITIES ACT; (II) IT WILL NOT OFFER, SELL OR OTHERWISE TRANSFER THIS
SECURITY PRIOR TO THE LATER OF THE DATE WHICH IS TWO YEARS AFTER THE DATE
OF ORIGINAL ISSUANCE HEREOF AND THE LAST DATE ON WHICH THE TRUST OR ANY
AFFILIATE OF THE TRUST WAS THE OWNER OF SUCH RESTRICTED SECURITIES (OR ANY
PREDECESSOR) EXCEPT (A) TO THE TRUST, (B) PURSUANT TO A REGISTRATION
STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C)
FOR SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A,
TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN
A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (D) OUTSIDE THE UNITED
STATES IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 904 UNDER THE
SECURITIES ACT, OR (E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND, IN EACH CASE, IN
ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES OR ANY APPLICABLE JURISDICTION; AND (III) IT WILL, AND EACH
SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THIS
SECURITY OF THE RESALE RESTRICTIONS SET FORTH IN (II) ABOVE. ANY OFFER,
SALE OR OTHER DISPOSITION PURSUANT TO THE FOREGOING CLAUSES (II)(D) AND (E)
IS SUBJECT TO THE RIGHT OF THE ISSUER OF THIS SECURITY AND THE PROPERTY
TRUSTEE FOR SUCH REMARKETED PREFERRED SECURITIES TO REQUIRE THE DELIVERY OF
AN OPINION OF COUNSEL, CERTIFICATIONS OR OTHER INFORMATION ACCEPTABLE TO
THEM IN FORM AND SUBSTANCE."
55
Any Preferred Security (or security issued in exchange or substitution
therefor) as to which such restrictions on transfer shall have expired in
accordance with their terms may, upon satisfaction of the requirements of
Section 7.14(b) and surrender of such Preferred Security for exchange to the
Preferred Security Registrar in accordance with the provisions of this Section
7.13(a), be exchanged for a new Preferred Security or Preferred Securities, of
like tenor and aggregate liquidation amount, which shall not bear the
restrictive legend required by this Section 7.13(a).
Upon any sale or transfer of any Restricted Security (including any
interest in a Global Security) (i) that is effected pursuant to an effective
registration statement under the Securities Act or (ii) in connection with which
the Property Trustee receives certificates and other information (including an
opinion of counsel, if requested) reasonably acceptable to the Company and the
Property Trustee to the effect that such security will no longer be subject to
the resale restrictions under federal and state securities laws, then (A) in the
case of a Restricted Security in definitive form, the Preferred Security
registrar or co-registrar shall permit the holder thereof to exchange such
Restricted Security for a security that does not bear the legend set forth in
Section 7.13(a), and shall rescind any such restrictions on transfer and (B) in
the case of Restricted Securities represented by a Global Security, such
Preferred Security shall no longer be subject to the restrictions contained in
the legend set forth in Section 7.13(a) (but still subject to the other
provisions hereof). In addition, any Preferred Security (or security issued in
exchange or substitution therefor) as to which the restrictions on transfer
described in the legend set forth in Section 7.13(a) have expired by their
terms, may, upon surrender thereof (in accordance with terms of this Indenture)
together with such certifications and other information (including an opinion of
counsel having substantial experience in practice under the Securities Act and
otherwise reasonably acceptable to the Company, addressed to the Company and the
Property Trustee and in form acceptable to the Company, to the effect that the
transfer of such Restricted Security has been made in compliance with Rule 144
or such successor provision) acceptable to the Company and the Property Trustee
as either of them may reasonably require, be exchanged for a new Preferred
Security or Preferred Securities of like tenor and aggregate liquidation amount,
which shall not bear the restrictive legends set forth in Section 7.13(a).
SECTION 7.14 Special Transfer Provisions.
---------------------------
(a) At any time after the Remarketing Settlement Date at the request
of the Beneficial Owner of a Preferred Security in global form, such Beneficial
Owner shall be entitled to obtain a definitive Preferred Security upon written
request to the Property Trustee in accordance with the standing instructions and
procedures existing between the Depositary and the Property Trustee for the
issuance thereof. Any transfer after the Remarketing Settlement Date of a
beneficial interest in a Preferred Security in global form which cannot be
effected through book-entry settlement must be effected by the delivery to the
transferee (or its nominee) of a definitive Preferred Security or Preferred
Securities registered in the name of the transferee (or its nominee) on the
books maintained by the Security Registrar. With respect to any such transfer,
the Property Trustee shall cause, in accordance with the standing instructions
and procedures existing between the Depositary and the Property Trustee, the
aggregate liquidation amount of the Global Security to be reduced and, following
such reduction, the Property Trustee
56
shall cause definitive Preferred Securities in the appropriate aggregate
liquidation amount in the name of such transferee (or its nominee) and bearing
such restrictive legends as may be required by this Declaration to be delivered.
In connection with any such transfer, the Property Trustee may request such
representations and agreements relating to the restrictions on transfer of such
Preferred Securities from such transferee (or such transferee's nominee) as the
Property Trustee may reasonably require.
(b) So long as the Preferred Securities are eligible to be held as
Global Preferred Securities, or unless otherwise required by law, upon any
transfer of a definitive Preferred Security to a QIB in accordance with Rule
144A, unless otherwise requested by the transferor, and upon receipt of the
definitive Preferred Security being so transferred, together with a
certification from the transferor that the transferor reasonably believes the
transferee is a QIB (or other evidence satisfactory to the Property Trustee),
the Property Trustee shall make an endorsement on the Restricted Global Security
to reflect an increase in the aggregate liquidation amount of the Restricted
Global Security, and the Property Trustee shall cancel such definitive Preferred
Security and cause, in accordance with the standing instructions and procedures
existing between the Depositary and the Property Trustees, the aggregate
liquidation amount of Preferred Securities represented by the Restricted Global
Security to be increased accordingly.
(c) So long as the Preferred Securities are eligible for book-entry
settlement, or unless otherwise required by law, upon any transfer of a
definitive Preferred Security in accordance with Regulation S, if requested by
the transferor, and upon receipt of the definitive Preferred Security or
Preferred Securities being so transferred, together with a certification from
the transferor that the transfer was made in accordance with Rule 903 or 904 of
Regulation S or Rule 144 under the Preferred Securities Act (or other evidence
satisfactory to the Property Trustee), the Property Trustee shall make an
endorsement on the Regulation S Global Security to reflect an increase in the
aggregate liquidation amount of the Preferred Securities represented by the
Regulation S Global Security, the Property Trustee shall cancel such definitive
Preferred Security or Preferred Securities and cause, in accordance with the
standing instructions and procedures existing between the Depositary and the
Property Trustee, the aggregate liquidation amount of Preferred Securities
represented by the Regulation S Global Security to be increased accordingly.
(d) If a holder of a beneficial interest in the Restricted Global
Security wishes at any time to exchange its interest in the Restricted Global
Security for an interest in the Regulation S Global Security, or to transfer its
interest in the Restricted Global Security to a person who wishes to take
delivery thereof in the form of an interest in the Regulation S Global Security,
such holder may, subject to the rules and procedures of the Depositary and to
the requirements set forth in the following sentence, exchange or cause the
exchange or transfer or cause the transfer of such interest for an equivalent
beneficial interest in the Regulation S Global Security. Upon receipt by the
Property Trustee, as transfer agent of (1) instructions given in accordance with
the Depositary's procedures from or on behalf of a holder of a beneficial
interest in the Restricted Global Security, directing the Property Trustee (via
DWAC), as transfer agent, to credit or cause to be credited a beneficial
interest in the Regulation S Global Security in an amount equal to the
beneficial interest in the Restricted Global Security to be exchanged or
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transferred, (2) a written order given in accordance with the Depositary's
procedures containing information regarding the Euroclear or Cedel account to be
credited with such increase and the name of such account, and (3) a certificate
given by the holder of such beneficial interest stating that the exchange or
transfer of such interest has been made pursuant to and in accordance with Rule
903 or Rule 904 of Regulation S or Rule 144 under the Preferred Securities Act
(or other evidence satisfactory to the Property Trustee), the Property Trustee,
as transfer agent, shall promptly deliver appropriate instructions to the
Depositary (via DWAC), its nominee, or the custodian for the Depositary, as the
case may be, to reduce or reflect on its records a reduction of the Restricted
Global Security by the aggregate liquidation amount of the beneficial interest
in such Restricted Global Security to be so exchanged or transferred from the
relevant participant, and the Property Trustee, as transfer agent, shall
promptly deliver appropriate instructions (via DWAC) to the Depositary, its
nominee, or the custodian for the Depositary, as the case may be, concurrently
with such reduction, to increase or reflect on its records an increase of the
liquidation amount of such Regulation S Global Security by the aggregate
liquidation amount of the beneficial interest in such Restricted Global Security
to be so exchanged or transferred, and to credit or cause to be credited to the
account of the person specified in such instructions (who may be Morgan Guaranty
Trust Company of New York, Brussels office, as operator of Euroclear or Cedel or
another agent member of Euroclear or Cedel, or both, as the case may be, acting
for and on behalf of them) a beneficial interest in such Regulation S Global
Security equal to the reduction in the liquidation amount of such Restricted
Global Security.
(e) If a holder of a beneficial interest in the Regulation S Global
Security wishes at any time to exchange its interest in the Regulation S Global
Security for an interest in the Restricted Global Security, or to transfer its
interest in the Regulation S Global Security to a person who wishes to take
delivery thereof in the form of an interest in the Restricted Global Security,
such holder may, subject to the rules and procedures of Euroclear or Cedel and
the Depositary, as the case may be, and to the requirements set forth in the
following sentence, exchange or cause the exchange or transfer or cause the
transfer of such interest for an equivalent beneficial interest in such
Restricted Global Security. Upon receipt by the Property Trustee, as transfer
agent of (l) instructions given in accordance with the
procedures of Euroclear or Cedel and the Depositary, as the case may be, from or
on behalf of a beneficial owner of an interest in the Regulation S Global
Security directing the Property Trustee, as transfer agent, to credit or cause
to be credited a beneficial interest in the Restricted Global Security in an
amount equal to the beneficial interest in the Regulation S Global Security to
be exchanged or transferred, (2) a written order given in accordance with the
procedures of Euroclear or Cedel and the Depositary, as the case may be,
containing information regarding the account with the Depositary to be credited
with such increase and the name of such account, and (3) prior to the expiration
of the Restricted Period, a certificate given by the holder of such beneficial
interest and stating that the person transferring such interest in such
Regulation S Global Security reasonably believes that the person acquiring such
interest in the Restricted Global Security is a QIB and is obtaining such
beneficial interest in a transaction meeting the requirements of Rule 144A and
any applicable securities laws of any state of the United States or any other
jurisdiction (or other evidence satisfactory to the Property Trustee), the
Property Trustee, as transfer agent, shall promptly deliver (via DWAC)
appropriate instructions to the Depositary, its nominee, or the custodian for
the Depositary, as the case may be, to reduce or reflect on its records a
reduction of
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the Regulation S Global Security by the aggregate liquidation amount of the
beneficial interest in such Regulation S Global Security to be exchanged or
transferred, and the Property Trustee, as transfer agent, shall promptly deliver
(via DWAC) appropriate instructions to the Depositary, its nominee, or the
custodian for the Depositary, as the case may be, concurrently with such
reduction, to increase or reflect on its records an increase of the liquidation
amount of the Restricted Global Security by the aggregate liquidation amount of
the beneficial interest in the Regulation S Global Security to be so exchanged
or transferred, and to credit or cause to be credited to the account of the
person specified in such instructions a beneficial interest in the Restricted
Global Security equal to the reduction in the liquidation amount of the
Regulation S Global Security. After the expiration of the Restricted Period,
the certification requirement set forth in clause (3) of the second sentence of
this Section 7.14(e) will no longer apply to such exchanges and transfers.
(f) Any beneficial interest in one of the Global Securities that is
transferred to a person who takes delivery in the form of an interest in the
other Global Security will, upon transfer, cease to be an interest in such
Global Security and become an interest in the other Global Security and,
accordingly, will thereafter be subject to all transfer restrictions and other
procedures applicable to beneficial interests in such other Global Security for
as long as it remains such an interest.
(g) Prior to or on the 40th day after the later of the commencement
of the offering of the Preferred Securities and the Closing Date (the
"Restricted Period"), beneficial interests in a Regulation S Global Security may
only be held through Morgan Guaranty Trust Company of New York, Brussels office,
as operator of Euroclear or Cedel or another agent member of Euroclear and Cedel
acting for and on behalf of them, unless delivery is made through the Restricted
Global Security in accordance with the certification requirements hereof.
During the Restricted Period, interests in the Regulation S Global Security, may
be exchanged for interests in the Restricted Global Security or for definitive
Preferred Securities only in accordance with the certification requirements
described above.
SECTION 7.15 Change of Control.
-----------------
Upon the occurrence of a Change of Control on or prior to the
Remarketing Settlement Date, each holder of Preferred Securities will have the
right to require the Trust to cause all or any part (equal to $1,000 liquidation
amount or any integral multiple thereof) of the Preferred Securities to be
exchanged for an equivalent principal amount of Debentures. Promptly
thereafter, such Debentures shall be repurchased by the Debenture Issuer, as
described below (the "Change of Control Offer"), at an offer price in cash equal
to 101% of the aggregate principal amount thereof plus accrued and unpaid
interest thereon to the date of purchase (the "Change of Control Payment").
Within 10 days following any Change of Control, the Debenture Issuer
shall notify the Trust of such Change of Control and the Trust shall mail a
notice to each holder describing the transaction or transactions that constitute
the Change of Control and offering to exchange the Preferred Securities for the
Debentures pursuant to the procedures required by the
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Declaration and described in such notice. The Trust and the Debenture Issuer
shall comply with the requirements of Rule 14e-1 under the Exchange Act and any
other securities laws and regulations thereunder to the extent such laws and
regulations are applicable in connection with the exchange of the Preferred
Securities and the repurchase of the Debentures as a result of a Change of
Control.
The Change of Control Offer shall remain open for a period of 20
Business Days following its commencement and no longer, except to the extent
that a longer period is required by applicable law (the "Change of Control Offer
Period"). No later than five Business Days after the termination of the Change
of Control Offer Period (the "Change of Control Purchase Date"), the Trust shall
accept all Preferred Securities tendered in response to the Change of Control
Offer and the Debenture Issuer shall repurchase all Debentures exchanged for
such Preferred Securities. Payment for the Debentures exchanged for any
Preferred Securities so accepted shall be made in the same manner as interest
payments are made under the Indenture.
On the Change of Control Purchase Date, the Trust shall, to the extent
lawful, (a) accept for exchange all Preferred Securities or portions thereof
properly tendered pursuant to the Change of Control Offer, (b) deliver or cause
to be delivered to the Property Trustee the Securities so accepted together with
a certificate of the Regular Trustees stating the aggregate liquidation amount
of Securities or portions thereof being exchanged by the Trust and (c) the Trust
shall then exchange, for such Preferred Securities, Debentures having an
equivalent aggregate principal amount. The Debenture Issuer will promptly
deposit with the Indenture Trustee an amount equal to the Change of Control
Payment in respect of all Preferred Securities or portions thereof so exchanged.
The Indenture Trustee shall promptly mail to each holder of Preferred Securities
so exchanged the Change of Control Payment for such Preferred Securities, and
the Trust shall promptly authenticate and mail (or cause to be transferred by
book entry) to each holder a new Preferred Security equal in liquidation amount
to any unexchanged portion of the Preferred Securities surrendered, if any;
provided that each such new Preferred Securities will be in a liquidation amount
of $1,000 or an integral multiple thereof. The Trust and the Debenture Issuer
shall publicly announce the results of the Change of Control Offer on or as soon
as practicable after the Change of Control Payment Date.
SECTION 7.16 Asset Sales
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If the aggregate amount of Excess Proceeds under Section 4.07 of the
Indenture exceeds $5.0 million, the Trust shall be required to make an offer to
all holders of Preferred Securities (an "Asset Sale Offer") to exchange, for
such Preferred Securities the maximum principal amount of Debentures that may be
exchanged under Section 4.07 of the Indenture out of the Excess Proceeds, which
Debentures shall then be repurchased by the Debenture Issuer at a price equal to
100% of the principal amount thereof plus accrued and unpaid interest thereon to
the date of purchase.
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An Asset Sale Offer will remain open for a period of 20 Business Days
following its commencement and no longer, except to the extent that a longer
period is required by applicable law (the "Asset Sale Offer Period"). No later
than five Business Days after the termination of the Asset Sale Offer Period
(the "Asset Sale Purchase Date"), the Trust will accept for exchange up to the
liquidation amount of Preferred Securities required to be exchanged pursuant to
this Section (the "Asset Sale Offer Amount") or, if less than the Asset Sale
Offer Amount has been tendered, all Preferred Securities tendered in response to
the Asset Sale Offer.
If the Asset Sale Purchase Date is on or after a Distribution record
date and on or before the related Distribution payment date, any accumulated and
unpaid Distributions and Additional Distributions, if any, shall be paid to the
Person in whose name a Preferred Security is registered at the close of business
on such record date, and no additional Distributions or Additional
Distributions, if any, shall be payable to holders who tender Preferred
Securities pursuant to the Asset Sale Offer.
On or before the Asset Sale Purchase Date, the Trust shall, to the
extent lawful, accept for exchange, on a pro rata basis to the extent necessary,
the Asset Sale Offer Amount of Preferred Securities or portions thereof tendered
pursuant to the Asset Sale Offer, or if less than the Asset Sale Offer Amount
has been tendered, all Preferred Securities tendered, and the Regular Trustees
shall deliver to the Property Trustee a certificate stating that such Preferred
Securities or portions thereof were accepted for exchange by the Trustee in
accordance with the terms of this covenant. Promptly following such exchange,
the Debenture Issuer shall (but in any case not later than five days after the
Asset Sale Purchase Date) mail or deliver to each tendering holder an amount
equal to the purchase price of the Debentures exchanged with such holder by the
Trust, and the Trust shall promptly issue a new Preferred Security, and the
Trust shall authenticate and mail or deliver such new Preferred Security to such
holder, in a liquidation amount equal to any unexchanged portion of the
Preferred Security surrendered. Any Preferred Security not so accepted shall be
promptly mailed or delivered by the Trust to the holder thereof. The Trust and
the Debenture Issuer shall publicly announce the results of the Asset Sale Offer
on the Asset Sale Purchase Date.
ARTICLE 8
DISSOLUTION AND TERMINATION OF TRUST
SECTION 8.1 Dissolution and Termination of Trust.
------------------------------------
(a) The Trust shall dissolve upon the earliest of:
(i) the bankruptcy of the Holder of the Common Securities or
the Sponsor;
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(ii) the filing of a certificate of dissolution or its
equivalent with respect to the Sponsor; and the filing of
a certificate of cancellation with respect to the Trust
after obtaining the consent of the Holders of at least a
Majority in Liquidation Amount of the Securities to the
filing of a certificate of cancellation with respect to
the Trust or the revocation of the Sponsor's charter and
the expiration of 90 days after the date of revocation
without a reinstatement thereof;
(iii) the entry of a decree of judicial dissolution of the
Sponsor or the Trust;
(iv) the time when all of the Securities shall have been called
for redemption and the amounts then due shall have been
paid to the Holders in accordance with the terms of the
Securities;
(v) upon the election of the Regular Trustees, following the
occurrence and continuation of a Special Event pursuant to
which the Trust shall have been dissolved in accordance
with the terms of the Securities, and all of the
Debentures shall have been distributed to the Holders of
Securities in exchange for all of the Securities; or
(vi) the time when all of the Regular Trustees and the Sponsor
shall have consented to termination of the Trust provided
such action is taken before the issuance of any
Securities.
(b) As soon as is practicable after the occurrence of an event
referred to in Section 81 and upon completion of the winding up and liquidation
of the Trust, the Trustees shall terminate the Trust by filing a certificate of
cancellation with the Secretary of State of the State of Delaware.
(c) The provisions of Section 39 and Article 10 shall survive the
termination of the Trust.
SECTION 8.2 Liquidation Distribution Upon Dissolution of the Trust.
------------------------------------------------------
(a) In the event of any voluntary or involuntary dissolution,
winding-up and liquidation of the Trust (each a "Liquidation"), the Holders of
the Preferred Securities on the date of the Liquidation will be entitled to
receive, out of the assets of the Trust available for distribution to Holders of
Securities after satisfaction of the Trusts' liabilities to creditors, if any,
distributions in cash or other immediately available funds in an amount equal to
the aggregate of the stated liquidation amount of $1,000 per Security plus
accrued and unpaid Distributions thereon to the date of payment (such amount
being the "Liquidation Distribution"), unless, in connection with such
Liquidation, Debentures in an aggregate stated liquidation amount equal to the
aggregate stated liquidation amount of, with a distribution rate identical to
the distribution rate of, and accrued and unpaid distributions equal to accrued
and unpaid distributions on, such
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Securities shall be distributed on a Pro Rata basis to the Holders of the
Securities in exchange for such Securities.
(b) If, upon any such Liquidation, the Liquidation Distribution can
be paid only in part because the Trust has insufficient assets available to pay
in full the aggregate Liquidation Distribution, then the amounts payable
directly by the Trust on the Securities shall be paid on a Pro Rata basis. The
Holders of the Common Securities will be entitled to receive distributions upon
any such Liquidation Pro Rata with the Holders of the Preferred Securities
except that if an Indenture Event of Default has occurred and is continuing, the
Preferred Securities shall have a preference over the Common Securities with
regard to such distributions.
ARTICLE 9
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, DELAWARE TRUSTEES OR OTHERS
SECTION 9.1 Liability.
---------
(a) Except as expressly set forth in this Declaration, the Preferred
Securities Guarantee and the terms of the Securities, the Sponsor:
(i) shall not be personally liable for the return of any
portion of the capital contributions (or any return
thereon) of the Holders of the Securities which shall be
made solely from assets of the Trust; and
(ii) shall not be required to pay to the Trust or to any Holder
of Securities any deficit upon dissolution of the Trust or
otherwise.
(b) Pursuant to Section 3803(a) of the Business Trust Act, the
Holders of the Common Securities shall be entitled to the same limitation of
personal liability extended to stockholders of private corporations for profit
organized under the General Corporation Law of the State of Delaware; provided,
however, the Holder of the Common Securities shall be liable for all of the
debts and obligations of the Trust (other than with respect to the Securities)
to the extent not satisfied out of the Trust's assets.
(c) Pursuant to Section 3803(a) of the Business Trust Act, the
Holders of the Preferred Securities shall be entitled to the same limitation of
personal liability extended to stockholders of private corporations for profit
organized under the General Corporation Law of the State of Delaware.
SECTION 9.2 Exculpation.
-----------
(a) No Indemnified Person shall be liable, responsible or accountable
in damages or otherwise to the Trust or any Covered Person for any loss, damage
or claim incurred by reason
63
of any act or omission performed or omitted by such Indemnified Person in good
faith on behalf of the Trust and in a manner such Indemnified Person reasonably
believed to be within the scope of the authority conferred on such Indemnified
Person by this Declaration or by law, except that an Indemnified Person shall be
liable for any such loss, damage or claim incurred by reason of such Indemnified
Person's gross negligence or willful misconduct with respect to such acts or
omissions.
(b) An Indemnified Person shall be fully protected in relying in good
faith upon the records of the Trust and upon such information, opinions, reports
or statements presented to the Trust by any Person as to matters the Indemnified
Person reasonably believes are within such other Person's professional or expert
competence and who has been selected with reasonable care by or on behalf of the
Trust, including information, opinions, reports or statements as to the value
and amount of the assets, liabilities, profits, losses or any other facts
pertinent to the existence and amount of assets from which Distributions to
Holders of Securities might properly be paid.
SECTION 9.3 Fiduciary Duty.
--------------
(a) To the extent that, at law or in equity, an Indemnified Person
has duties (including fiduciary duties) and liabilities relating thereto to the
Trust or to any other Covered Person, an Indemnified Person acting under this
Declaration shall not be liable to the Trust or to an other Covered Person for
its good faith reliance on the provisions of this Declaration. The provisions
of this Declaration, to the extent that they restrict the duties and liabilities
of an Indemnified Person otherwise existing at law or in equity (other than the
duties imposed on the Property Trustee under the Trust Indenture Act), are
agreed by the parties hereto to replace such other duties and liabilities of
such Indemnified Person.
(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises between
any Covered Persons; or
(ii) whenever this Declaration or any other agreement
contemplated herein or therein provides that an
Indemnified Person shall act in a manner that is, or
provides terms that are, fair and reasonable to the Trust
or any Holder of Securities,
the Indemnified Person shall resolve such conflict of interest, take such action
or provide such terms, considering in each case the relative interest of each
party (including its own interest) to such conflict, agreement, transaction or
situation and the benefits and burdens relating to such interests, any customary
or accepted industry practices and any applicable generally accepted accounting
practices or principles. In the absence of bad faith by the Indemnified Person,
the resolution, action or term so made, taken or provided by the Indemnified
Person shall not constitute a breach of this Declaration or any other agreement
contemplated herein or of any duty or obligation of the Indemnified Person at
law or in equity or otherwise.
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(c) Whenever in this Declaration an Indemnified Person is permitted
or required to make a decision:
(i) in its "discretion" or under a grant of similar authority,
the Indemnified Person shall be entitled to consider such
interests and factors as it desires, including its own
interests, and shall have no duty or obligation to give
any consideration to any interest of or factors affecting
the Trust or any other Person; or
(ii) in its "good faith" or under another express standard, the
Indemnified Person shall act under such express standard
and shall not be subject to any other or different
standard imposed by this Declaration or by applicable law.
SECTION 9.4 Indemnification.
---------------
(a)(i) The Debenture Issuer shall indemnify, to the full extent
permitted by law, any Debenture Issuer Indemnified Person who was or is a party
or is threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the Trust) by reason
of the fact that he is or was a Debenture Issuer Indemnified Person against
expenses (including attorney fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the Trust,
and, with respect to any criminal action or proceeding, had no reasonable cause
to believe his conduct was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction or upon a plea of nolo
contendere or its equivalent, shall not, of itself, create a presumption that
the Debenture Issuer Indemnified Person did not act in good faith and in a
manner which he reasonably believed to be in or not opposed to the best
interests of the Trust, and, with respect to any criminal action or proceeding,
had reasonable cause to believe that his conduct was unlawful.
(ii) The Debenture Issuer shall indemnify, to the full extent
permitted by law, any Debenture Issuer Indemnified Person who was or is a party
or is threatened to be made a party to any threatened, pending or completed
action or suit by or in the right of the Trust to procure a judgment in its
favor by reason of the fact that he is or was a Debenture Issuer Indemnified
Person against expenses (including attorneys' fees) actually and reasonably
incurred by him in connection with the defense or settlement of such action or
suit if he acted in good faith and in a manner he reasonably believed to be in
or not opposed to the best interests of the Trust and except that no such
indemnification shall be made in respect of any claim, issue or matter as to
which such Debenture Issuer Indemnified Person shall have been adjudged to be
liable to the Trust unless and only to the extent that the Court of Chancery of
Delaware or the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and
65
reasonably entitled to indemnity for such expenses which such Court of Chancery
or such other court shall deem proper.
(iii) Any indemnification under paragraphs (i) and (ii) of this
Section 9.4(a) (unless ordered by a court) shall be made by the Debenture Issuer
only as authorized in the specific case upon a determination that
indemnification of the Debenture Issuer Indemnified Person is proper in the
circumstances because he has met the applicable standard of conduct set forth in
paragraphs (i) and (ii). Such determination shall be made (1) by the Regular
Trustees by a majority vote of a quorum consisting of such Regular Trustees who
were not parties to such action, suit or proceeding, (2) if such a quorum is not
obtainable, or, even if obtainable, if a quorum of disinterested Regular
Trustees so directs, by independent legal counsel in a written opinion, or (3)
by the Common Security Holder of the Trust.
(iv) Expenses (including attorneys' fees) incurred by a Debenture
Issuer Indemnified Person in defending a civil, criminal, administrative or
investigative action, suit or proceeding referred to in paragraphs (i) and (ii)
of this Section 9.4(a) shall be paid by the Debenture Issuer in advance of the
final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such Debenture Issuer Indemnified Person to repay
such amount if it shall ultimately be determined that he is not entitled to be
indemnified by the Debenture Issuer as authorized in this Section 9.4(a).
Notwithstanding the foregoing, no advance shall be made by the Debenture Issuer
if a determination is reasonably and promptly made (i) by the Regular Trustees
by a majority vote of a quorum of disinterested Regular Trustees, (ii) if such a
quorum is not obtainable, or, even if obtainable, if a quorum of disinterested
Regular Trustees so directs, by independent legal counsel in a written opinion
or (iii) the Common Security Holder of the Trust, that, based upon the facts
known to the Regular Trustees, counsel or the Common Security Holder at the time
such determination is made, such Debenture Issuer Indemnified Person acted in
bad faith or in a manner that such person did not believe to be in or not
opposed to the best interests of the Trust, or, with respect to any criminal
proceeding, that such Debenture Issuer Indemnified Person believed or had
reasonable cause to believe his conduct was unlawful. In no event shall any
advance be made in instances where the Regular Trustees, independent legal
counsel or Common Security Holder reasonably determine that such person
deliberately breached his duty to the Trust or its Common or Preferred Security
Holders.
(v) The indemnification and advancement of expenses provided by, or
granted pursuant to, the other paragraphs of this Section 9.4(a) shall not be
deemed exclusive of any other rights to which those seeking indemnification and
advancement of expenses may be entitled under any agreement, vote of
stockholders or disinterested directors of the Debenture Issuer or Preferred
Security Holders of the Trust or otherwise, both as to action in his official
capacity and as to action in another capacity while holding such office. All
rights to indemnification under this Section 9.4(a) (a) shall be deemed to be
provided by a contract between the Debenture Issuer and each Debenture Issuer
Indemnified Person who serves in such capacity at any time while this Section
9.4(a) is in effect. Any repeal or modification of this Section 9.4(a) shall
not affect any rights or obligations then existing.
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(vi) The Debenture Issuer or the Trust may purchase and maintain
insurance on behalf of any person who is or was a Debenture Issuer Indemnified
Person against any liability asserted against him and incurred by him in any
such capacity, or arising out of his status as such, whether or not the
Debenture Issuer would have the power to indemnify him against such liability
under the provisions of this Section 9.4(a).
(vii) For purposes of this Section 9.4(a), references to "the Trust"
shall include, in addition to the resulting or surviving entity, any constituent
entity (including any constituent of a constituent) absorbed in a consolidation
or merger, so that any person who is or was a director, trustee, officer or
employee of such constituent entity, or is or was serving at the request of such
constituent entity as a director, trustee, officer, employee or agent of another
entity, shall stand in the same position under the provisions of this Section
9.4(a) with respect to the resulting or surviving entity as he would have with
respect to such constituent entity if its separate existence had continued.
(viii) The indemnification and advancement of expenses provided by,
or granted pursuant to, this Section 9.4(a) shall, unless otherwise provided
when authorized or ratified, continue as to a person who has ceased to be a
Debenture Issuer Indemnified Person and shall inure to the benefit of the heirs,
executors and administrators of such a person. The obligation to indemnify as
set forth in this Section 9.4(a) shall survive the satisfaction and discharge of
this Declaration.
(b) The Debenture Issuer agrees to indemnify the (i) Property
Trustee, (ii) the Delaware Trustee, (iii) an Affiliate of the Property Trustee
and the Delaware Trustee, and (iv) any officers, directors, shareholders,
members, partners, employees, representatives, custodians, nominees or agents of
the Property Trustee and the Delaware Trustee (each of the Persons in (i)
through (iv) being referred to as a "Fiduciary Indemnified Person") for, and to
hold each Fiduciary Indemnified Person harmless against, any loss, liability or
expense incurred without negligence or bad faith on its part, arising out of or
in connection with the acceptance or administration of the trust or trusts
hereunder, including the costs and expenses (including reasonable legal fees and
expenses) of defending itself against or investigating any claim or liability in
connection with the exercise or performance of any of its powers or duties
hereunder. The obligation to indemnify as set forth in this Section 9.4(a)
shall survive the satisfaction and discharge of this Declaration.
SECTION 9.5 Outside Businesses.
------------------
Any Covered Person, the Sponsor, the Delaware Trustee and the Property
Trustee may engage in or possess an interest in other business ventures of any
nature or description, independently or with others, similar or dissimilar to
the activities of the Trust, and the Trust and the Holders of Securities shall
have no rights by virtue of this Declaration in and to such independent ventures
or the income or profits derived therefrom, and the pursuit of any such venture,
even if competitive with the activities of the Trust, shall not be deemed
wrongful or improper. No Covered Person, the Sponsor, the Delaware Trustee or
the Property Trustee shall be obligated to present any particular investment or
other opportunity to the Trust even if such
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opportunity is of a character that, if presented to the Trust, could be taken by
the Trust, and any Covered Person, the Sponsor, the Delaware Trustee and the
Property Trustee shall have the right to take for its own account (individually
or as a partner or fiduciary) or to recommend to others any such particular
investment or other opportunity. Any Covered Person, the Delaware Trustee and
the Property Trustee may engage or be interested in any financial or other
transaction with the Sponsor or any Affiliate of the Sponsor, or may act as
depositary for, trustee or agent for, or act on any committee or body of holders
of, securities or other obligations of the Sponsor or its Affiliates.
ARTICLE 10
ACCOUNTING
SECTION 10.1 Fiscal Year.
-----------
The fiscal year ("Fiscal Year") of the Trust shall be the calendar
year, or such other year as is required by the Code.
SECTION 10.2 Certain Accounting Matters.
--------------------------
(a) At all times during the existence of the Trust, the Regular
Trustees shall keep, or cause to be kept, full books of account, records and
supporting documents, which shall reflect in reasonable detail, each transaction
of the Trust. The books of account shall be maintained on the accrual method of
accounting, in accordance with generally accepted accounting principles,
consistently applied. The Trust shall use the accrual method of accounting for
United States federal income tax purposes. The books of account and the records
of the Trust shall be examined by and reported upon as of the end of each Fiscal
Year of the Trust by a firm of independent certified public accountants selected
by the Regular Trustees.
(b) The Regular Trustees shall cause to be prepared and delivered to
each of the Holders of Securities, within 90 days after the end of each Fiscal
Year of the Trust, annual financial statements of the Trust, including a balance
sheet of the Trust as of the end of such Fiscal Year, and the related statements
of income or loss.
(c) The Regular Trustees shall cause to be duly prepared and
delivered to each of the Holders of Securities, an annual United States federal
income tax information statement, required by the Code, containing such
information with regard to the Securities held by each Holder as is required by
the Code and the Treasury Regulations. Notwithstanding any right under the Code
to deliver any such statement at a later date, the Regular Trustees shall
endeavor to deliver all such statements within 30 days after the end of each
Fiscal Year of the Trust.
(d) The Regular Trustees shall cause to be duly prepared and filed
with the appropriate taxing authority, an annual United States federal income
tax return, on a Form 1041 or such other form required by United States federal
income tax law, and any other annual
68
income tax returns required to be filed by the Regular Trustees on behalf of the
Trust with any state or local taxing authority.
SECTION 10.3 Banking.
-------
The Trust shall maintain one or more bank accounts in the name and for
the sole benefit of the Trust; provided, however, that all payments of funds in
respect of the Debentures held by the Property Trustee shall be made directly to
the Property Account and no other funds of the Trust shall be deposited in the
Property Account. The sole signatories for such accounts shall be designated by
the Regular Trustees; provided, however, that the Property Trustee shall
designate the signatories for the Property Account.
SECTION 10.4 Withholding.
-----------
The Trust and the Regular Trustees shall comply with all withholding
requirements under United States federal, state and local law. The Trust shall
request, and the Holders shall provide to the Trust, such forms or certificates
as are necessary to establish an exemption from withholding with respect to each
Holder, and any representations and forms as shall reasonably be requested by
the Trust to assist it in determining the extent of, and in fulfilling, its
withholding obligations. The Regular Trustees shall file required forms with
applicable jurisdictions and, unless an exemption from withholding is properly
established by a Holder, shall remit amounts withheld with respect to the Holder
to applicable jurisdictions. To the extent that the Trust is required to
withhold and pay over any amounts to any authority with respect to distributions
or allocations to any Holder, the amount withheld shall be deemed to be a
distribution in the amount of the withholding to the Holder. In the event of
any claimed over withholding, Holders shall be limited to an action against the
applicable jurisdiction. If the amount required to be withheld was not withheld
from actual Distributions made, the Trust may reduce subsequent Distributions by
the amount of such withholding.
ARTICLE 11
AMENDMENTS AND MEETINGS
SECTION 11.1 Amendments.
----------
(a) Except as otherwise provided in this Declaration or by any
applicable terms of the Securities, this Declaration may only be amended by a
written instrument approved and executed by the Sponsor, the Regular Trustees
(or, if there are more than two Regular Trustees, a majority of the Regular
Trustees), the Property Trustee and the Delaware Trustee.
(b) No amendment shall be made, and any such purported amendment
shall be void and ineffective:
69
(i) unless, in the case of any proposed amendment, the
Property Trustee shall have first received an Officers'
Certificate from each of the Trust and the Sponsor that
such amendment is permitted by, and conforms to, the terms
of this Declaration (including the terms of the
Securities);
(ii) unless, in the case of any proposed amendment which
affects the rights, powers, duties, obligations or
immunities of the Property Trustee, the Property Trustee
shall have first received:
a. an Officers' Certificate from each of the Trust and the
Sponsor that such amendment is permitted by, and
conforms to, the terms of this Declaration (including
the terms of the Securities); and
b. an opinion of counsel (who may be counsel to the
Sponsor or the Trust) that such amendment is permitted
by, and conforms to, the terms of this Declaration
(including the terms of the Securities); and
(iii) to the extent the result of such amendment would be to:
a. cause the Trust to be classified other than as a
grantor trust for United States federal income tax
purposes;
b. reduce or otherwise adversely affect the powers of the
Property Trustee in contravention of the Trust
Indenture Act; or
c. cause the Trust to be deemed to be an Investment
Company required to be registered under the Investment
Company Act.
(c) At such time after the Trust has issued any Securities that
remain outstanding, any amendment that would (i) adversely affect the powers,
preferences or special rights of the Securities, whether by way of amendment to
the Declaration or otherwise or (ii) result in the dissolution, winding-up or
termination of the Trust other than pursuant to the terms of this Declaration or
(iii) change the amount or timing of any distribution of the Securities or
otherwise adversely affect the amount of any distribution required to be made in
respect of the Securities as of a specified date or (iv) restrict the right of a
Holder of Securities to institute suit for the enforcement of any such payment
on or after such date, then the holders of the Securities voting together as a
single class will be entitled to vote on such amendment or proposal and such
amendment or proposal shall not be effective except with the approval of each of
the Holders of the Securities affected thereby; provided that, if any amendment
or proposal referred to in clause (i) above would adversely affect only the
Preferred Securities or the Common Securities, then only the affected class will
be entitled to vote on such amendment or proposal and such amendment or proposal
shall not be effective except with the approval of each of the Holders of such
class of Securities.
70
(d) Section 7.9 and this Section 111 shall not be amended without
the consent of all of the Holders of the Securities.
(e) Article 4 shall not be amended without the consent of the Holders
of a Majority in Liquidation Amount of the Common Securities.
(f) The rights of the Holders of the Common Securities under Article
5 to increase or decrease the number of, and appoint and remove Trustees shall
not be amended without the consent of the Holders of a Majority in Liquidation
Amount of the Common Securities.
(g) Notwithstanding Section 111, this Declaration without the
consent of the Holders of the Securities to:
(i) cure any ambiguity;
(ii) correct or supplement any provision in this Declaration
that may be inconsistent with any other provision of this
Declaration;
(iii) add to the covenants, restrictions or obligations of the
Sponsor;
(iv) to conform to any change in Rule 3a-5 or written change in
interpretation or application of Rule 3a-5 by any
legislative body, court, government agency or regulatory
authority which amendment does not have a material adverse
effect on the rights, preferences or privileges of the
Holders; or
(v) to modify, eliminate and add to any provision of this
Declaration to ensure that the Trust will be classified as
a grantor trust for U.S. federal income tax purposes at
all times that any Securities are outstanding or to ensure
that the Trust will not be required to register as an
Investment Company under the Investment Company Act;
provided, however, that such modification, elimination or
addition would not adversely affect in any material
respect the rights, privileges or preferences of any
Holder of the Securities.
SECTION 11.2 Meetings of the Holders of Securities; Action by Written
--------------------------------------------------------
Consent.
- -------
(a) Meetings of the Holders of any class of Securities may be called
at any time by the Regular Trustees (or as provided in the terms of the
Securities) to consider and act on any matter on which Holders of such class of
Securities are entitled to act under the terms of this Declaration, the terms of
the Securities or the rules of any stock exchange on which the Preferred
Securities are listed or admitted for trading. The Regular Trustees shall call
a meeting of the Holders of such class if directed to do so by the Holders of at
least 10% in Liquidation Amount of such class of Securities. Such direction
shall be given by delivering to the Regular Trustees
71
one or more calls in a writing stating that the signing Holders of Securities
wish to call a meeting and indicating the general or specific purpose for which
the meeting is to be called. Any Holders of Securities calling a meeting shall
specify in writing the Certificates held by the Holders of Securities exercising
the right to call a meeting and only those Securities specified shall be counted
for purposes of determining whether the required percentage set forth in the
second sentence of this paragraph has been met.
(b) Except to the extent otherwise provided in the terms of the
Securities, the following provisions shall apply to meetings of Holders of
Securities:
(i) notice of any such meeting shall be given to all the
Holders of Securities having a right to vote thereat at
least 7 days and not more than 60 days before the date of
such meeting. Whenever a vote, consent or approval of the
Holders of Securities is permitted or required under this
Declaration or the rules of any stock exchange on which
the Preferred Securities are listed or admitted for
trading, such vote, consent or approval may be given at a
meeting of the Holders of Securities. Any action that may
be taken at a meeting of the Holders of Securities may be
taken without a meeting if a consent in writing setting
forth the action so taken is signed by the Holders of
Securities owning not less than the minimum amount of
Securities in liquidation amount that would be necessary
to authorize or take such action at a meeting at which all
Holders of Securities having a right to vote thereon were
present and voting. Prompt notice of the taking of action
without a meeting shall be given to the Holders of
Securities entitled to vote who have not consented in
writing. The Regular Trustees may specify that any
written ballot submitted to the Security Holders for the
purpose of taking any action without a meeting shall be
returned to the Trust within the time specified by the
Regular Trustees;
(ii) each Holder of a Security may authorize any Person to act
for it by proxy on all matters in which a Holder of
Securities is entitled to participate, including waiving
notice of any meeting, or voting or participating at a
meeting. No proxy shall be valid after the expiration of
11 months from the date thereof unless otherwise provided
in the proxy. Every proxy shall be revocable at the
pleasure of the Holder of Securities executing such proxy.
Except as otherwise provided herein, all matters relating
to the giving, voting or validity of proxies shall be
governed by the General Corporation Law of the State of
Delaware relating to proxies, and judicial interpretations
thereunder, as if the Trust were a Delaware corporation
and the Holders of the Securities were stockholders of a
Delaware corporation;
(iii) each meeting of the Holders of the Securities shall be
conducted by the Regular Trustees or by such other Person
that the Regular Trustees may designate; and
72
(iv) unless the Business Trust Act, this Declaration, the terms
of the Securities, the Trust Indenture Act or the listing
rules of any stock exchange on which the Preferred
Securities are then listed for trading, otherwise
provides, the Regular Trustees, in their sole discretion,
shall establish all other provisions relating to meetings
of Holders of Securities, including notice of the time,
place or purpose of any meeting at which any matter is to
be voted on by any Holders of Securities, waiver of any
such notice, action by consent without a meeting, the
establishment of a record date, quorum requirements,
voting in person or by proxy or any other matter with
respect to the exercise of any such right to vote.
ARTICLE 12
REPRESENTATIONS OF PROPERTY DELAWARE TRUSTEE
AND DELAWARE TRUSTEE
SECTION 12.1 Representations and Warranties of the Property Trustee.
------------------------------------------------------
The Trustee that acts as initial Property Trustee represents and
warrants to the Trust and to the Sponsor at the date of this Declaration, and
each Successor Property Trustee represents and warrants to the Trust and the
Sponsor at the time of the Successor Property Trustee's acceptance of its
appointment as Property Trustee that:
(a) the Property Trustee is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation or organization, with trust power and authority to execute and
deliver, and to carry out and perform its obligations under the terms of, this
Declaration;
(b) the Property Trustee satisfies the requirements set forth in
Section 6.3(a);
(c) the execution, delivery and performance by the Property Trustee
of this Declaration has been duly authorized by all necessary corporate action
on the part of the Property Trustee. This Declaration has been duly executed
and delivered by the Property Trustee, and it constitutes a legal, valid and
binding obligation of the Property Trustee, enforceable against it in accordance
with its terms, subject to applicable bankruptcy, reorganization, moratorium,
insolvency and other similar laws affecting creditors' rights generally and to
general principles of equity and the discretion of the court (regardless of
whether the enforcement of such remedies is considered in a proceeding in equity
or at law);
(d) the execution, delivery and performance of this Declaration by
the Property Trustee does not conflict with or constitute a breach of the
articles of association or incorporation, as the case may be, or the by-laws (or
other similar organizational documents) of the Property Trustee; and
73
(e) no consent, approval or authorization of, or registration with or
notice to, any State or federal banking authority is required for the execution,
delivery or performance by the Property Trustee of this Declaration.
SECTION 12.2 Representations and Warranties of the Delaware Trustee.
------------------------------------------------------
The Trustee that acts as initial Delaware Trustee represents and
warrants to the Trust and to the Sponsor at the date of this Declaration, and
each Successor Delaware Trustee represents and warrants to the Trust and the
Sponsor at the time of the Successor Delaware Trustee's acceptance of its
appointment as Delaware Trustee that:
(a) the Delaware Trustee satisfies the requirements set forth in
Section 6.2 and has the power and authority to execute and deliver, and to carry
out and perform its obligations under the terms of, this Declaration and, if it
is not a natural person, is duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation or organization;
(b) the Delaware Trustee has been authorized to perform its
obligations under the Certificate of Trust and this Declaration. This
Declaration under Delaware law constitutes a legal, valid and binding obligation
of the Delaware Trustee, enforceable against it in accordance with its terms,
subject to applicable bankruptcy, reorganization, moratorium, insolvency and
other similar laws affecting creditors' rights generally and to general
principles of equity and the discretion of the court (regardless of whether the
enforcement of such remedies is considered in a proceeding in equity or at law);
and
(c) no consent, approval or authorization of, or registration with or
notice to, any State or federal banking authority is require for the execution,
delivery or performance by the Delaware Trustee of this Declaration.
74
ARTICLE 13
MISCELLANEOUS
SECTION 13.1 Notices.
-------
All notices provided for in this Declaration shall be in writing, duly
signed by the party giving such notice, and shall be delivered, telecopied or
mailed by registered or certified mail, as follows:
(a) if given to the Trust, in care of the Regular Trustees at the
Trust's mailing address set forth below (or such other address as the Trust may
give notice of to the Property Trustee, the Delaware Trustee and the Holders of
the Securities):
(b) if given to the Delaware Trustee, at the mailing address set
forth below (or such other address as the Delaware Trustee may give notice of to
the Regular Trustees, the Property Trustee and the Holders of the Securities):
(c) if given to the Property Trustee, at its Corporate Trust Office
(or such other address as the Property Trustee may give notice of to the Regular
Trustees, the Delaware Trustee and the Holders of the Securities).
(d) if given to the Holder of the Common Securities, at the mailing
address of the Sponsor set forth below (or such other address as the Holder of
the Common Securities may give notice of to the Property Trustee, the Delaware
Trustee and the Trust):
(e) if given to any other Holder, at the address set forth on the
register of the Trust.
All such notices shall be deemed to have been given when received in person,
telecopied with receipt confirmed or mailed by first class mail, postage prepaid
except that if a notice or other document is refused delivery or cannot be
delivered because of a changed address of which no notice was given, such notice
or other document shall be deemed to have been delivered on the date of such
refusal or inability to deliver.
SECTION 13.2 Governing Law.
-------------
This Declaration and the rights of the parties hereunder shall be
governed by and interpreted in accordance with the laws of the State of
Delaware.
SECTION 13.3 Intention of the Parties.
------------------------
It is the intention of the parties hereto that the Trust be classified
for United States federal income tax purposes as a grantor trust. The
provisions of this Declaration shall be interpreted in a manner consistent with
such classification.
75
SECTION 13.4 Headings.
--------
Headings contained in this Declaration are inserted for convenience of
reference only and do not affect the interpretation of this Declaration or any
provision hereof.
SECTION 13.5 Successors and Assigns.
----------------------
Whenever in this Declaration any of the parties hereto is named or
referred to, the successors and assigns of such party shall be deemed to be
included, and all covenants and agreements in this Declaration by the Sponsor
and the Trustees shall bind and inure to the benefit of their respective
successors and assigns, whether so expressed.
SECTION 13.6 Partial Enforceability.
----------------------
If any provision of this Declaration, or the application of such
provision to any Person or circumstance, shall be held invalid, the remainder of
this Declaration, or the application of such provision to persons or
circumstances other than those to which it is held invalid, shall not be
affected thereby.
SECTION 13.7 Counterparts.
------------
This Declaration may contain more than one counterpart of the
signature page and this Declaration may be executed by the affixing of the
signature of each of the Trustees to one of such counterpart signature pages.
All of such counterpart signature pages shall be read as though one, and they
shall have the same force and effect as though all of the signers had signed a
single signature page.
76
IN WITNESS WHEREOF, the undersigned have caused these presents to be
executed as of the day and year first above written.
IMPERIAL CREDIT INDUSTRIES, INC.,
as Sponsor and Common Securities Holder
BY: /s/ H. Wayne Snavely
______________________________________
Name: H. Wayne Snavely
Title: Chairman
CHASE TRUST COMPANY OF CALIFORNIA
as Property Trustee
BY: /s/ Hans H. Helley
______________________________________
Name: Hans H. Helley
Title: Assistant Vice President
CHASE MANHATTAN BANK DELAWARE
as Delaware Trustee
BY: /s/ John J. Cashin
______________________________________
Name: John J. Cashin
Title: Vice President
IRWIN L. GUBMAN
as Regular Trustee
BY: /s/ Irwin L. Gubman
______________________________________
KEVIN E. VILLANI
as Regular Trustee
BY: /s/ Kevin E. Villani
______________________________________
PAUL B. LASITER
as Regular Trustee
BY: /s/ Paul B. Lasiter
______________________________________
EXHIBIT A
This Remarketed Par Security is a Global Security within the meaning
of the Declaration hereinafter referred to and is registered in the name of The
Depository Trust Company, a New York corporation (the "Depositary"), or a
nominee of the Depositary. This Remarketed Par Security is exchangeable for
Preferred Securities registered in the name of a person other than the
Depositary or its nominee only in the limited circumstances described in the
Declaration and no transfer of this Remarketed Par Security (other than a
transfer of this Remarketed Par Security as a whole by the Depositary to a
nominee of the Depositary or by a nominee of the Depository to the Depositary or
another nominee of the Depositary) may be registered except in limited
circumstances.
Unless this Remarketed Par Security Certificate is presented by an
authorized representative of the Depositary to Imperial Credit Capital Trust I
or its agent for registration of transfer, exchange or payment, and any
Remarketed Par Security Certificate issued is registered in the name of Cede &
Co. or such other name as registered by an authorized representative of the
Depositary (and any payment hereon is made to Cede & Co. or to such other entity
as is requested by an authorized representative of the Depositary), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL since the registered owner hereof, Cede & Co., has an interest
herein.
CERTIFICATE NO. 1 NUMBER OF REMARKETED PAR SECURITIES:
CUSIP NO. _______
CERTIFICATE EVIDENCING REMARKETED PAR SECURITIES
OF
IMPERIAL CREDIT CAPITAL TRUST I
REMARKETED PAR SECURITIES, SERIES A
(ROPES)
(LIQUIDATION AMOUNT $1,000 PER SECURITY)
Imperial Credit Capital Trust I, a statutory business trust formed
under the laws of the State of Delaware (the "Trust"), hereby certifies that
Cede & Co. (the "Holder") is the registered owner of ___ remarketed par
securities of the Trust representing undivided beneficial ownership interests in
the assets of the Trust designated the Remarketed Par Securities, Series A
(liquidation amount $1,000 per Security) (the "Preferred Securities"). The
Preferred Securities are transferable on the register 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 the Declaration (as defined
below). The designation, rights, privileges, restrictions, preferences and
other terms and provisions of the Preferred Securities represented hereby are
issued and shall in all respects be subject to the provisions of the Amended and
Restated Declaration of Trust of the Trust, dated as of June 9, 1997 (as the
same may be amended from time to time (the "Declaration"), among Imperial Credit
Industries, Inc., as Sponsor (the "Sponsor"), Irwin L. Gubman, Kevin E. Villani
and Paul B. Lasiter, as Regular Trustees, Chase Trust Company of California, as
Property Trustee, and Chase Manhattan Bank Delaware, as Delaware Trustee.
Capitalized terms used herein but not defined shall have the meaning given to
them in the Declaration. The Holder is entitled to the benefits of the
Guarantee to the extent described therein. The Sponsor will provide a copy of
the Declaration, the Guarantee and the Indenture to a Holder without charge upon
written request to the Sponsor at its principal place of business.
2
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.
By acceptance, the Holder agrees to treat, for United States federal
income tax purposes, the Debentures as indebtedness and the Preferred Securities
as evidence of undivided indirect beneficial ownership interests in the
Debentures.
IN WITNESS WHEREOF, the Trust has executed this certificate this
day of June, 1997.
IMPERIAL CREDIT CAPITAL TRUST I
By:______________________________________
Name:
Title: Regular Trustee
This is one of the Securities referred to in the within-mentioned
Declaration.
CHASE TRUST COMPANY OF CALIFORNIA
By:______________________________________
Name:
Title:
4
In connection with any transfer of this Security occurring prior to
the date which is the earlier of (i) the date of the declaration by the
Commission of the effectiveness of a registration statement under the Securities
Act covering resales of this Security (which effectiveness shall not have been
suspended or terminated at the date of the transfer) and (ii) two years after
the later of the date of original issue and the last date on which the Sponsor
or any affiliate of the Sponsor was the owner of such Preferred Securities (or
any predecessor thereto) (the "Resale Restriction Termination Date"), the
undersigned confirms that it has not utilized any general solicitation or
general advertising in connection with the transfer:
[CHECK ONE]
---------
(1) __ to the Sponsor or a subsidiary thereof; or
(2) __ pursuant to and in compliance with Rule 144A under the Securities Act
of 1933, as amended; or
(3) __ outside the United States to a "foreign person" in compliance with
Rule 904 of Regulation S under the Securities Act of 1933, as amended;
or
(4) __ pursuant to the exemption from registration provided by Rule 144 under
the Securities Act of 1933, as amended; or
(5) __ pursuant to an effective registration statement under the Securities
Act of 1933, as amended; or
(6) __ pursuant to another available exemption from the registration
requirements of the Securities Act of 1933, as amended.
Unless one of the boxes is checked, the Trustees will refuse to register any of
the Securities evidenced by this certificate in the name of any person other
than the registered Holder thereof; provided, however, that if box (3), (4) or
(6) is checked, the Sponsor or the Trustees may require, prior to registering
any such transfer of the Securities, in its sole discretion, such written legal
opinions, certifications (including an investment letter in the case of box (3))
and other information as the Trustees or the Sponsor has reasonably requested to
confirm that such transfer is being made pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the Securities Act
of 1933, as amended.
If none of the foregoing boxes is checked, the Trustees or Registrar shall not
be obligated to register this Security in the name of any person other than the
Holder hereof unless and until the conditions to any such transfer of
registration set forth herein and in Section 7.12 of the Declaration shall have
been satisfied.
Dated: __________________ Signed:_______________________________________
(Sign exactly as name appears on the other
side of this Security)
Signature Guarantee:______________
5
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED
The undersigned represents and warrants that it is purchasing this
Security for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act
and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Sponsor as the
undersigned has requested pursuant to Rule 144A or has determined not to request
such information and that it is aware that the transferor is relying upon the
undersigned's foregoing representations in order to claim the exemption from
registration provided by Rule 144A.
Dated: ________ __________________________________________________
NOTICE: To be executed by an executive officer
EXHIBIT B
This Preferred Security is a Global Security within the meaning of the
Declaration hereinafter referred to and is registered in the name of The
Depository Trust Company, a New York corporation (the "Depositary"), or a
nominee of the Depositary. This Preferred Security is exchangeable for
Preferred Securities registered in the name of a person other than the
Depositary or its nominee only in the limited circumstances described in the
Declaration and no transfer of this Preferred Security (other than a transfer of
this Preferred Security as a whole by the Depositary to a nominee of the
Depositary or by a nominee of the Depositary to the Depositary or another
nominee of the Depositary) may be registered except in limited circumstances.
Unless this Preferred Security Certificate is presented by an
authorized representative of the Depositary to Imperial Credit Capital Trust I
or its agent for registration of transfer, exchange or payment, and any
Preferred Security Certificate issued is registered in the name of Cede & Co. or
such other name as registered by an authorized representative of the Depositary
(and any payment hereon is made to Cede & Co. or to such other entity as is
requested by an authorized representative of the Depositary), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL since the registered owner hereof, Cede & Co., has an interest herein.
CERTIFICATE NO. 1 NUMBER OF PREFERRED SECURITIES:
CUSIP NO. _______
CERTIFICATE EVIDENCING PREFERRED SECURITIES
OF
IMPERIAL CREDIT CAPITAL TRUST I
PREFERRED SECURITIES, SERIES B
(LIQUIDATION AMOUNT $1,000 PER SECURITY)
Imperial Credit Capital Trust I, a statutory business trust formed
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 ownership interests in the assets of
the Trust designated the Preferred Securities, Series B (liquidation amount
$1,000 per Security) (the "Preferred Securities"). The Preferred Securities are
transferable on the register 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 the Declaration (as defined below). The
designation, rights, privileges, restrictions, preferences and other terms and
provisions of the Preferred Securities represented hereby are issued and shall
in all respects be subject to the provisions of the Amended and Restated
Declaration of Trust of the Trust, dated as of June 9, 1997 (as the same may be
amended from time to time (the "Declaration"), among Imperial Credit Industries,
Inc., as Sponsor (the "Sponsor"), Irwin L. Gubman, Kevin E. Villani and Paul B.
Lasiter, as Regular Trustees, Chase Trust Company of California, as Property
Trustee, and Chase Manhattan Bank Delaware, as Delaware Trustee. Capitalized
terms used herein but not defined shall have the meaning given to them in the
Declaration. The Holder is entitled to the benefits of the Guarantee to the
extent described therein. The Sponsor will provide a copy of the Declaration,
the Guarantee and the Indenture to a Holder without charge upon written request
to the Sponsor at its principal place of business.
2
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.
By acceptance, the Holder agrees to treat, for all United States
income tax purposes, the Debentures as indebtedness and the Preferred Securities
as evidence of undivided indirect beneficial ownership interests in the
Debentures.
3
IN WITNESS WHEREOF, the Trust has executed this certificate this _____
day of ___________, 20__.
IMPERIAL CREDIT CAPITAL TRUST I
By:______________________________________
Name:
Title: Regular Trustee
This is one of the Securities referred to in the within-mentioned
Declaration.
By:______________________________________
Name:
Title:
Exhibit C
THIS CERTIFICATE IS NOT TRANSFERABLE
CERTIFICATE NO. 1 NUMBER OF COMMON SECURITIES: ____
CERTIFICATE EVIDENCING COMMON SECURITIES
OF
IMPERIAL CREDIT CAPITAL TRUST I
COMMON SECURITIES
(LIQUIDATION AMOUNT $1,000 PER COMMON SECURITY)
Imperial Credit Capital Trust I, a statutory business trust formed
under the laws of the State of Delaware (the "Trust"), hereby certifies that
IMPERIAL CREDIT INDUSTRIES, INC. (the "Holder") is the registered owner of
common securities of the Trust representing an undivided beneficial ownership
interest in the assets of the Trust designated the Common Securities
(liquidation amount $1,000 per Common Security) (the "Common Securities"). The
Common Securities are not transferable and any attempted transfer thereof shall
be void. The designation, rights, privileges, restrictions, preferences and
other terms and provisions of the Common Securities represented hereby are
issued and shall in all respects be subject to the provisions of the Amended and
Restated Declaration of Trust of the Trust, dated as of June 9, 1997 (as the
same may be amended from time to time, the "Declaration"), among Imperial Credit
Industries, Inc., as Sponsor, Irwin L. Gubman, Kevin E. Villani and Paul B.
Lasiter, as Regular Trustees, Chase Trust Company, as Property Trustee and Chase
Manhattan Bank, as Delaware Trustee. The Holder is entitled to the benefits of
the Guarantee to the extent described therein. Capitalized terms used herein
but not defined shall have the meaning given them in the Declaration. The
Sponsor will provide a copy of the Declaration, the Guarantee and the Indenture
to a Holder without charge upon written request to the Sponsor at its principal
place of business.
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.
By acceptance, the Holder agrees to treat, for all United States
income tax purposes, the Debentures as indebtedness and the Common Securities as
evidence of an undivided indirect beneficial ownership interest in the
Debentures.
IN WITNESS WHEREOF, the Trust has executed this certificate this
day of June, 1997.
IMPERIAL CREDIT CAPITAL TRUST I
By:____________________________________
Name:
Title: Regular Trustee
3
EXHIBIT D
NOTICE OF REMARKETING
OF
REMARKETED PAR SECURITIES, SERIES A,
OF
IMPERIAL CREDIT CAPITAL TRUST I
HOLDERS MUST RETURN, NO LATER THAN 4:00 P.M., NEW YORK CITY TIME, ON
___________ ___, ____, A NOTICE OF ELECTION REGARDING THEIR DECISION TO
TENDER OR NOT TO TENDER THEIR REMARKETED PAR SECURITIES FOR PURCHASE IN THE
REMARKETING. IF A HOLDER DOES NOT RETURN A NOTICE OF ELECTION BY SUCH
TIME, THE REMARKETED PAR SECURITIES OWNED BY SUCH HOLDER SHALL BE DEEMED TO
BE TENDERED FOR PURCHASE IN THE REMARKETING.
________ ___, 2002
Holders of Remarketed Par Securities, Series A (the "Securities"), of
Imperial Credit Capital Trust I, a Delaware statutory business trust (the
"Trust"), are hereby given notice of remarketing of the Preferred Securities
(the "Remarketing") on June 9, 2002 (the "Scheduled Remarketing Date"). For
your information, we are also enclosing:
(i) an [Offering Memorandum], dated _____ __, 2002, relating to the
Preferred Securities and the Remarketing; and
(ii) a Notice of Election (together with the Offering Memorandum, the
"Remarketing Materials").
HOLDERS ARE URGED TO READ THESE MATERIALS IN THEIR ENTIRETY. THE
FOLLOWING SUMMARY OF THE REMARKETING MATERIALS IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO THE REMARKETING MATERIALS.
On the Scheduled Remarketing Date, Lehman Brothers Inc. (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 in the Remarketing. Prior to 4:00
P.M., New York City time, on the Scheduled Remarketing Date, the Remarketing
Agent will determine the distribution rate to apply to the Preferred Securities
following the Remarketing (the "Adjusted Distribution 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 rate per annum, not exceeding ____ % per annum (the "Maximum Adjusted
Distribution Rate"), that will enable it to remarket all Preferred Securities
tendered or deemed tendered for remarketing at a price of $1,000 per Preferred
Security. Notwithstanding the foregoing, (i) if the Remarketing Agent is
4
able to remarket some, but is unable to remarket all, of the Preferred
Securities tendered or deemed tendered for purchase in the Remarketing, the
Adjusted Distribution Rate will be the highest rate, not exceeding the Maximum
Adjusted Distribution Rate, required to remarket the Preferred Securities sold
in the Remarketing and (ii) if the Remarketing Agent is not able to remarket any
Preferred Securities tendered or deemed tendered in the Remarketing, the
Adjusted Distribution Rate will be the Maximum Adjusted Distribution Rate. If
the purchases and sales of Preferred Securities pursuant to the Remarketing are
not consummated on June 9, 2002, the distribution rate on the Preferred
Securities will be increased as described in the Offering Memorandum.
Each holder is being given the opportunity to complete the enclosed
Notice of Election and indicate irrevocably, no later than 4:00 P.M., New York
City time, on June 9, 2002, whether it wishes (i) to retain and not to have all
or any portion of the Preferred Securities owned by it remarketed in the
Remarketing to be conducted on the Scheduled Remarketing Date or (ii) to tender
all or any portion of such Preferred Securities for purchase in the Remarketing
(such portion, in either case, is required 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 Adjusted Distribution Rate is established in the Remarketing. IF
ANY HOLDER OF PREFERRED SECURITIES FAILS TIMELY TO DELIVER SUCH NOTICE OF
ELECTION, THE PREFERRED SECURITIES OWNED BY IT WILL BE DEEMED TO BE TENDERED FOR
PURCHASE IN THE REMARKETING.
Any holder of Preferred Securities that desires to continue to hold a
number of Preferred Securities, but only if the Adjusted Distribution Rate is
not less than a specified rate per annum, should submit a Notice of Election to
tender such Preferred Securities and separately notify the Remarketing Agent of
its interest at the telephone number set forth below. 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,
provided that the Adjusted Distribution Rate is not less than such specified
rate.
[Include description of procedures for completing and returning the
Notice of Election].
If the Remarketing Agent is unable to remarket all Preferred
Securities tendered or deemed tendered for purchase in the Remarketing at a
price of $1,000 per Preferred Security, on the third Business Day following the
Remarketing (i) such unsold Preferred Securities shall be exchanged with the
Trust for Resettable Rate Debentures, Series A, of Imperial Credit Industries,
Inc. (the "Debentures") having an aggregate principal amount equal to the
aggregate liquidation amount of such unsold Preferred Securities and such
Debentures shall be immediately redeemed by ______ unless (ii) as a result of
such redemption, less than $______ principal amount of Debentures would remain
outstanding, in which event, ______ is required to redeem all of the Debentures.
In either case (a "Special Mandatory Redemption"), the redemption price of the
Debentures will be 100% of the aggregate principal amount of the Debentures so
redeemed. AS A RESULT OF SUCH SPECIAL MANDATORY REDEMPTION, ALL PREFERRED
SECURITIES TENDERED OR DEEMED TENDERED FOR PURCHASE IN THE REMARKETING WILL BE
PURCHASED IN THE REMARKETING OR REDEEMED ON THE REMARKETING SETTLEMENT DATE.
[Include description of where questions or requests for assistance
should be directed.]
5
Very truly yours,
IMPERIAL CREDIT
CAPITAL TRUST I
The Remarketing Agent for the Remarketing is:
LEHMAN BROTHERS INC.
[Address and phone number]
EXHIBIT E
NOTICE OF ELECTION TO TENDER OR RETAIN
REMARKETED PREFERRED SECURITIES, SERIES A,
OF
IMPERIAL CREDIT CAPITAL TRUST I
THIS NOTICE OF ELECTION MUST BE SUBMITTED TO ________________ AT
________________ NO LATER THAN 4:00 P.M., NEW YORK CITY TIME, ON _______
__, ____. IF A HOLDER DOES NOT RETURN A NOTICE OF ELECTION BY SUCH TIME,
THE REMARKETED PREFERRED SECURITIES OWNED BY SUCH HOLDER SHALL BE DEEMED TO
BE TENDERED FOR PURCHASE IN THE REMARKETING.
1. The undersigned holder of Remarketed Preferred Securities, Series A
(the "Preferred Securities"), issued by Imperial Credit Capital Trust I, a
Delaware statutory business trust (the "Trust"), hereby elects [CHECK
APPROPRIATE BOX OR BOXES]:
[_] To tender $__________ aggregate liquidation amount of its Preferred
Securities for purchase in the Remarketing of the Preferred Securities on
_______ __, ____. [insert the total liquidation amount of all Preferred
Securities held by holder or, if holder elects to tender only a portion of
such Preferred Securities, the liquidation amount of such portion, which
must be $1,000 or any integral multiple thereof].
[_] To retain, and to direct the Trust and the Remarketing Agent not to
remarket in the Remarketing, $__________ aggregate liquidation amount of
its Preferred Securities [insert the total liquidation amount of all
Preferred Securities held by holder or, if holder elects to retain only a
portion of such Preferred Securities, the liquidation amount of such
portion, which must be $1,000 or any integral multiple thereof].
2. After its execution and delivery by the undersigned to ___________,
this Notice of Election shall be irrevocable.
3. If the undersigned elects to tender all or any portion of its
Preferred Securities, the undersigned understands that its right to have its
Preferred Securities tendered for purchase shall be limited to the extent that
(i) the Remarketing Agent conducts a Remarketing as described in 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 an Adjusted Distribution Rate
that does not exceed ___% per annum and (iv) such purchaser or purchasers
deliver the purchase price therefor to the Remarketing Agent.
4. Capitalized terms used herein and not otherwise defined shall have the
meanings given to such terms in the Offering Memorandum, dated __________ __,
____ (the "Offering Memorandum").
The undersigned hereby acknowledges receipt of the Notice of
Remarketing, dated __________ __, ____, and the Offering Memorandum.
Dated: _______ __, ____
_________________________________________
2
Name of holder of Preferred Securities as
it is appears on the register of Imperial
Credit Capital Trust I, in every
particular, without alteration,
enlargement or any change whatsoever
____________________________
Witness