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Exhibit 4.12
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Form of
AMENDED AND RESTATED DECLARATION OF TRUST
AETNA CAPITAL TRUST [ ],
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Dated as of , 19
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TABLE OF CONTENTS
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ARTICLE 1
DEFINITIONS
SECTION 1.01. Definitions.......................................2
ARTICLE 2
TRUST INDENTURE ACT
SECTION 2.01. Trust Indenture Act; Application..................9
SECTION 2.02. Lists of Holders of Preferred Securities..........9
SECTION 2.03. Reports by the Property Trustee...................9
SECTION 2.04. Periodic Reports to Property Trustee.............10
SECTION 2.05. Evidence of Compliance with Conditions Precedent.10
SECTION 2.06. Events of Default; Waiver........................10
SECTION 2.07. Disclosure of Information........................12
ARTICLE 3
ORGANIZATION
SECTION 3.01. Name.............................................13
SECTION 3.02. Office...........................................13
SECTION 3.03. Issuance of the Trust Securities.................13
SECTION 3.04. Purchase of Debentures...........................14
SECTION 3.05. Purpose..........................................14
SECTION 3.06. Authority........................................15
SECTION 3.07. Title to Property of the Trust...................15
SECTION 3.08. Powers and Duties of the Regular Trustees........15
SECTION 3.09. Prohibition of Actions by Trust and Trustees.....18
SECTION 3.10. Powers and Duties of the Property Trustee........19
SECTION 3.11. Delaware Trustee.................................22
SECTION 3.12. Certain Rights and Duties of the Property
Trustee .........................................22
SECTION 3.13. Registration Statement and Related Matters.......25
SECTION 3.14. Filing of Amendments to Certificate of Trust.....26
SECTION 3.15. Execution of Documents by Regular Trustees.......26
SECTION 3.16. Trustees Not Responsible for Recitals or
Issuance of Securities...........................26
SECTION 3.17. Duration of Trust................................26
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ARTICLE 4
THE SPONSOR
SECTION 4.01. Purchase of Common Securities by Services........27
SECTION 4.02. Expenses.........................................27
ARTICLE 5
TRUSTEES
SECTION 5.01. Number of Trustees; Qualifications...............28
SECTION 5.02. Appointment, Removal and Resignation of Trustees.30
SECTION 5.03. Vacancies among Trustees.........................32
SECTION 5.04. Effect of Vacancies..............................32
SECTION 5.05. Meetings.........................................32
SECTION 5.06. Delegation of Power..............................33
SECTION 5.07. Other Activities.................................33
ARTICLE 6
DISTRIBUTIONS
SECTION 6.01. Distributions....................................34
ARTICLE 7
ISSUANCE OF SECURITIES
SECTION 7.01. General Provisions Regarding Securities..........34
ARTICLE 8
TERMINATION OF TRUST
SECTION 8.01. Termination of Trust.............................36
ARTICLE 9
TRANSFER OF INTERESTS
SECTION 9.01. Transfer of Securities...........................37
SECTION 9.02. Transfer of Certificates.........................37
SECTION 9.03. Deemed Security Holders..........................38
SECTION 9.04. Book Entry Interests.............................38
SECTION 9.05. Notices to Holders of Certificates...............39
SECTION 9.06. Appointment of Successor Clearing Agency.........39
SECTION 9.07. Definitive Preferred Securities Certificates.....39
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SECTION 9.08. Mutilated, Destroyed, Lost or
Stolen Certificates .............................40
ARTICLE 10
LIMITATION OF LIABILITY; INDEMNIFICATION
SECTION 10.01. Exculpation.....................................40
SECTION 10.02. Indemnification.................................41
ARTICLE 11
ACCOUNTING
SECTION 11.01. Fiscal Year.....................................41
SECTION 11.02. Certain Accounting Matters......................41
SECTION 11.03. Banking.........................................43
SECTION 11.04. Withholding.....................................43
ARTICLE 12
AMENDMENTS AND MEETINGS
SECTION 12.01. Amendments......................................43
SECTION 12.02. Meetings of the Holders of Securities;
Action by Written Consent.......................45
ARTICLE 13
REPRESENTATIONS OF PROPERTY TRUSTEE AND DELAWARE TRUSTEE
SECTION 13.01. Representations and Warranties of
Property Trustee ...............................47
ARTICLE 14
MISCELLANEOUS
SECTION 14.01. Notices.........................................48
SECTION 14.02. Undertaking for Costs...........................50
SECTION 14.03. Governing Law...................................50
SECTION 14.04. Headings........................................50
SECTION 14.05. Partial Enforceability..........................51
SECTION 14.06. Counterparts....................................51
SECTION 14.07. Intention of the Parties........................51
SECTION 14.08. Successors and Assigns..........................51
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EXHIBIT A: CERTIFICATE OF TRUST
EXHIBIT B: TERMS OF PREFERRED SECURITIES
EXHIBIT C: TERMS OF COMMON SECURITIES
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AMENDED AND RESTATED
DECLARATION OF TRUST
OF
AETNA CAPITAL TRUST [ ]
__________, 19__
AMENDED AND RESTATED DECLARATION OF TRUST ("Declaration") dated and
effective as of __________, 199__ by the undersigned trustees (together with all
other Persons from time to time duly appointed and serving as trustees in
accordance with the provisions of this Declaration, the "Trustees"), Aetna
Services, Inc., a Connecticut corporation, as trust sponsor ("Services" or the
"Sponsor"), Aetna Inc., a Connecticut corporation ("Aetna"), and by the holders,
from time to time, of undivided beneficial interests in the assets of the Trust
to be issued pursuant to this Declaration.
WHEREAS, the Sponsor and the Trustees entered into a Declaration of Trust
dated as of May 7, 1998 (the "Original Declaration") in order to establish a
statutory business trust (the "Trust") under the Business Trust Act (as
hereinafter defined);
WHEREAS, the Certificate of Trust (the "Certificate of Trust") of the
Trust was filed with the office of the Secretary of State of the State of
Delaware on May 7, 1998;
WHEREAS, the Trustees and the Sponsor desire to continue the Trust
pursuant to the Business Trust Act, for the purpose of, as described more fully
in Sections 3.03 and 3.04 hereof, (i) issuing and selling Preferred Securities
(as defined herein) representing preferred undivided beneficial interests in the
assets of the Trust for cash and investing the proceeds thereof in Debentures
(as hereinafter defined) of Services issued under the Indenture (as hereinafter
defined) to be held as assets of the Trust and (ii) issuing and selling Common
Securities (as hereinafter defined) representing common undivided beneficial
interests in the assets of the Trust to Services in exchange for cash and
investing the proceeds thereof in additional Debentures issued under the
Indenture to be held as assets of the Trust; and
WHEREAS, Aetna has agreed to assume certain responsibilities under this
Declaration;
NOW, THEREFORE, it being the intention of the parties hereto that the
Trust constitute a business trust under the Business Trust Act, that the
Original
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Declaration be amended and restated in its entirety as provided herein and that
this Declaration constitute the governing instrument of such business trust, the
Trustees declare that all assets referred to in clauses (i) and (ii) of the
previous Whereas clause purchased by the Trust will be held in trust for the
benefit of the Holders (as defined herein) from time to time, of the
Certificates (as defined herein) representing undivided beneficial interests in
the assets of the Trust issued hereunder, subject to the provisions of this
Declaration.
ARTICLE 1
DEFINITIONS
SECTION 1.01. Definitions.
(a) Capitalized terms used in this Declaration but not defined in the
preamble above have the respective meanings assigned to them in this Section
1.01;
(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
Amended and Restated Declaration of Trust (including Exhibits A, B and C hereto
(the "Exhibits")) as modified, supplemented or amended from time to time;
(d) all references in this Declaration to Articles and Sections and
Exhibits are to Articles and Sections of and Exhibits to this Declaration unless
otherwise specified;
(e) a term defined in the Trust Indenture Act has the same meaning when
used in this Declaration unless otherwise defined in this Declaration or unless
the context otherwise requires; and
(f) a reference to the singular includes the plural and vice versa.
"Aetna" means Aetna Inc., a Connecticut corporation, or any successor
entity in a merger, to its rights and obligations under this Declaration.
"Affiliate" has the same meaning as given to that term in Rule 405 of the
Securities Act or any successor rule thereunder.
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"Book Entry Interest" means a beneficial interest in a Global Certificate
registered in the name of a Clearing Agency or a nominee thereof, ownership and
transfers of which shall be maintained and made through book entries by such
Clearing Agency as described in Section 9.04.
"Business Day" means any day other than a day on which banking
institutions in New York, New York are authorized or required by law to close.
"Business Trust Act" means Chapter 38 of Title 12 of the Delaware Code, 12
Del. Code ss. 3801 et seq., as it may be amended from time to time.
"Certificate" means a Common Security Certificate or a Preferred Security
Certificate.
"Certificate of Trust" has the meaning set forth in the second WHEREAS
clause above.
"Clearing Agency" means an organization registered as a "Clearing Agency"
pursuant to Section 17A of the Exchange Act that is acting as depository for the
Preferred Securities and in whose name or in the name of a nominee of that
organization, shall be registered a Global Certificate and which shall undertake
to effect book entry transfers and pledges of the Preferred Securities.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time the Clearing
Agency effects book entry transfers and pledges of securities deposited with the
Clearing Agency.
"Closing Date" means the Closing Date as specified in the Underwriting
Agreement, which date is also the date of execution and delivery of this
Declaration.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, or any successor legislation. A reference to a specific section ((Sec.))
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 Security" has the meaning specified in Section 7.01(b).
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"Common Security Certificate" means a definitive certificate in fully
registered form representing a Common Security substantially in the form of
Annex I to Exhibit C.
"Covered Person" means (i) any officer, director, shareholder, partner,
member, representative, employee or agent of the Trust or its Affiliates, (ii)
any officer, director, shareholder, employees, representatives or agents of
Aetna or its Affiliates and (iii) the Holders from time to time of the
Securities.
"Debenture Trustee" means The First National Bank of Chicago, as trustee
under the Indenture until a successor is appointed thereunder and thereafter
means such successor trustee.
"Debentures" means the series of Junior Subordinated Debentures issued by
Services under the Indenture to the Property Trustee and entitled the "____%
Junior Subordinated Debentures due [ ]".
"Definitive Preferred Security Certificates" has the meaning set forth in
Section 9.04.
"Delaware Trustee" has the meaning set forth in Section 5.01(a)(iii).
"Depositary Agreement" means the agreement among the Trust, the Property
Trustee, Aetna and Services dated as of the Closing Date, as the same may be
amended or supplemented from time to time.
"Distribution" means a distribution payable to Holders of Securities in
accordance with Section 6.01.
"DTC" means The Depository Trust Company, the initial Clearing Agency.
"Event of Default" in respect of the Securities means an Indenture Event
of Default has occurred and is continuing in respect of the Debentures.
"Exchange Act" means the Securities Exchange Act of 1934, as amended from
time to time or any successor legislation.
"Fiscal Year" has the meaning specified in Section 11.01.
"Global Certificate" has the meaning set forth in Section 9.04.
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"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.
"Indemnified Person" means any Trustee, any Affiliate of any Trustee, any
officers, directors, shareholders, members, partners, employees, representatives
or agents of any Trustee, or any employee or agent of the Trust or its
Affiliates.
"Indenture" means the Indenture dated as of __________ __, 199__ among and
between Services, Aetna and the Debenture Trustee as supplemented by the [ ]
Supplemental Indenture thereto dated as of , pursuant to which the
Debentures are to be issued by Services and to be guaranteed by Aetna.
"Indenture Event of Default" means an event or condition defined as an
"Event of Default" with respect to the Debentures under Section 6.01(a) of the
Indenture has occurred and is continuing.
"Investment Company" means an investment company as defined in the
Investment Company Act.
"Investment Company Act" means the Investment Company Act of 1940, as
amended from time to time or any successor legislation.
"Legal Action" has the meaning specified in Section 3.08(g).
"Liquidation Distribution" has the meaning set forth in Exhibits B and C
hereto establishing the terms of the Securities.
"Majority in liquidation amount of the Securities" means, except as
otherwise required by the Trust Indenture Act and except as provided in the
penultimate paragraph of paragraph 5 of Exhibit B hereto, Holder(s) of
outstanding Securities voting together as a single class or, as the context may
require, Holder(s) of outstanding Preferred Securities or Common Securities
voting separately as a class, who are the record owners of a relevant class of
Securities whose liquidation amount (including the stated amount that would be
paid on redemption, liquidation or otherwise, plus accrued and unpaid
Distributions to the date upon which the voting percentages are determined)
represents more than 50% of the liquidation amount of all outstanding Securities
of such class.
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"Ministerial Action" has the meaning set forth in the terms of the
Securities as set forth in Exhibits B and C hereto.
"Option Closing Date" means the Option Closing Date as specified in the
Underwriting Agreement.
"Original Declaration" has the meaning set forth in the first WHEREAS
clause above.
"Paying Agent" has the meaning specified in Section 3.10(i).
"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 Guarantee" means the Guarantee Agreement dated as of
__________, 199__ of Services and Aetna in respect of the Preferred Securities.
"Preferred Security" has the meaning specified in Section 7.01(b).
"Preferred Security Beneficial Owner" means, with respect to a Book Entry
Interest, a Person who is the beneficial owner of such Book Entry Interest, as
reflected on the books of the Clearing Agency, or on the books of a Person
maintaining an account with such Clearing Agency (directly as a Clearing Agency
Participant or as an indirect participant, in each case in accordance with the
rules of such Clearing Agency).
"Preferred Security Certificate" means a definitive certificate in fully
registered form representing a Preferred Security substantially in the form of
Annex I to Exhibit B.
"Property Trustee" means the Trustee meeting the eligibility requirements
set forth in Section 5.01(c) and having the duties set forth for the Property
Trustee herein.
"Property Account" has the meaning specified in Section 3.10(c)(i).
"Quorum" means a majority of the Regular Trustees or, if there are only
two Regular Trustees, both such Regular Trustees.
"Regular Trustee" means any Trustee other than the Property Trustee and
the Delaware Trustee.
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"Related Party" means any direct or indirect wholly owned subsidiary of
Services or Aetna or any other Person which owns, directly or indirectly, 100%
of the outstanding voting securities of Services or Aetna.
"Resignation Request" has the meaning specified in Section 5.02(d).
"Responsible Officer" means, with respect to the Property Trustee, any
officer of the Property Trustee assigned to administer corporate trust matters
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.
"Rule 3a-7" means Rule 3a-7 under the Investment Company Act or any
successor rule thereunder.
"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.
"66-2/3% in liquidation amount of the Securities" means, except as
otherwise required by the Trust Indenture Act and except as provided in the
penultimate paragraph of paragraph 5 of Exhibit B hereto, Holder(s) of
outstanding Securities voting together as a single class or, as the context may
require, Holder(s) of outstanding Preferred Securities or Common Securities,
voting separately as a class, who are the record owners of a relevant class of
Securities whose liquidation amount (including the stated amount that would be
paid on redemption, liquidation or otherwise, plus accrued and unpaid
Distributions to the date upon which the voting percentages are determined)
represents 66-2/3% or more of the liquidation amount of all outstanding
Securities of such class.
"Special Event" has the meaning set forth in the terms of the Securities
as set forth in Exhibits B and C hereto.
"Sponsor" or "Services" means Aetna Services, Inc., a Connecticut
corporation, or any successor entity in a merger, in its capacity as sponsor of
the Trust.
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"Successor Delaware Trustee" has the meaning specified in Section
5.02(b)(ii).
"Successor Property Trustee" means a successor Trustee possessing the
qualifications to act as Property Trustee under Section 5.01(c).
"10% in liquidation amount of the Securities" means, except as otherwise
required by the Trust Indenture Act and except as provided in the penultimate
paragraph of paragraph 5 of Exhibit B hereto, Holder(s) of outstanding
Securities voting together as a single class or, as the context may require,
Holder(s) of outstanding Preferred Securities or Common Securities, voting
separately as a class, who are the record owners of a relevant class of
Securities whose liquidation amount (including the stated amount that would be
paid on redemption, liquidation or otherwise, plus accrued and unpaid
Distributions to the date upon which the voting percentages are determined)
represents 10% or more of the liquidation amount of all outstanding Securities
of such class.
"Treasury Regulations" means the income tax regulations including
temporary and proposed regulations, promulgated under the Code by the United
States Treasury, as such regulations may be amended from time to time (including
corresponding provisions of succeeding regulations).
"Trustee" or "Trustees" means each Person who has signed this Declaration
as a trustee, so long as such Person shall continue in office in accordance with
the terms hereof, and all other Persons who may from time to time be duly
appointed, qualified and serving as Trustees in accordance with the provisions
hereof, and references herein to a Trustee or the Trustees shall refer to such
Person or Persons solely in their capacity as trustees hereunder.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended.
"Underwriting Agreement" means the Underwriting Agreement dated as of
__________, 199__ among the Trust, the Sponsor and Aetna, as representative of
the several underwriters named therein.
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ARTICLE 2
TRUST INDENTURE ACT
SECTION 2.01. 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) if and to the extent that any provision of this Declaration limits,
qualifies or conflicts with the duties imposed by ss.ss.310 to 317, inclusive,
of the Trust Indenture Act, such imposed duties shall control;
(c) the Property Trustee, to the extent permitted by applicable law and/or
the rules and regulations of the Commission, shall be the only Trustee which is
a trustee for the purposes of the Trust Indenture Act; and
(d) the application of the Trust Indenture Act to this Declaration shall
not affect the nature of the Securities as equity securities representing
undivided beneficial interests in the assets of the Trust.
SECTION 2.02. Lists of Holders of Preferred Securities.
(a) Each of the Sponsor and the Regular Trustees on behalf of the Trust
shall provide the Property Trustee with such information as is required under
ss. 312(a) of the Trust Indenture Act at the times and in the manner provided in
ss. 312(a); and
(b) the Property Trustee shall comply with its obligations under ss.ss.
310(b), 311 and 312(b) of the Trust Indenture Act.
SECTION 2.03. Reports by the Property Trustee.
Within 60 days after May 15 of each year, the Property Trustee shall
provide to the Holders of the Securities such reports as are required by ss. 313
of the Trust Indenture Act, if any, in the form, in the manner and at the times
provided by ss. 313 of the Trust Indenture Act. The Property Trustee shall also
comply with the requirements of ss. 313(d) of the Trust Indenture Act.
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SECTION 2.04. Periodic Reports to Property Trustee.
Each of the Sponsor, Aetna and the Regular Trustees on behalf of the Trust
shall provide to the Property Trustee, the Commission and the Holders of the
Securities, as applicable, such documents, reports and information as required
by ss. 314(a)(1)-(3) (if any) of the Trust Indenture Act and the compliance
certificates required by ss. 314(a)(4) and (c) of the Trust Indenture Act, any
such certificates to be provided in the form, in the manner and at the times
required by ss. 314(a)(4) and (c) of the Trust Indenture Act (provided that any
certificate to be provided pursuant to ss. 314(a)(4) of the Trust Indenture Act
shall be provided within 120 days of the end of each Fiscal Year).
SECTION 2.05. Evidence of Compliance with Conditions Precedent.
Each of the Sponsor, Aetna 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 which relate to
any of the matters set forth in ss. 314(c) of the Trust Indenture Act. Any
certificate or opinion required to be given pursuant to ss. 314(c) shall comply
with ss. 314(e) of the Trust Indenture Act.
SECTION 2.06. Events of Default; Waiver.
(a) Subject to Section 2.06(c), Holders of Preferred Securities may, by
vote of at least a Majority in liquidation amount of the Preferred Securities
(A) in accordance with the terms of the Preferred Securities, direct the time,
method and place of conducting any proceeding for any remedy available to the
Property Trustee, or exercising any trust or power conferred upon the Property
Trustee, or (B) on behalf of the Holders of all Preferred Securities, waive any
past Event of Default in respect of the Preferred Securities and its
consequences; provided that if the Event of Default arises out of an Indenture
Event of Default:
(i) which is not waivable under the Indenture, the Event of Default
under this Declaration shall also be not waivable; or
(ii) which requires the consent or vote of (1) holders of Debentures
representing a specified percentage greater than a majority in principal
amount of the Debentures, or (2) each holder of Debentures, the Event of
Default under this Declaration may only be waived by, in the case of
clause (1) above, the vote of Holders of Preferred Securities representing
such specified percentage of the aggregate liquidation amount of the
Preferred Securities or, in the case of clause (2) above, each Holder of
Preferred Securities.
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Upon such waiver, any such default shall cease to exist, and any Event of
Default with respect to the Preferred Securities arising therefrom shall be
deemed to have been cured for every purpose of this Declaration, but no such
waiver shall extend to any subsequent or other default or Event of Default with
respect to the Preferred Securities or impair any right consequent thereon.
(b) Subject to Section 2.06(c), Holders of Common Securities may by vote
of at least a Majority in liquidation amount of the Common Securities, (A) in
accordance with the terms of the Common Securities, direct the time, method and
place of conducting any proceeding for any remedy available to the Property
Trustee or exercising any trust or power conferred upon the Property Trustee or
(B) on behalf of the Holders of all of the Common Securities, waive any past
Event of Default with respect to the Common Securities and its consequences,
provided that, if the Event of Default arises out of an Indenture Event of
Default:
(i) which is not waivable under the Indenture, except where the
Holders of the Common Securities are deemed to have waived such Event of
Default under the Declaration as provided below, the Event of Default
under this Declaration shall also not be waivable; or
(ii) which requires the consent or vote of (1) holders of Debentures
representing a specified percentage greater than a majority in principal
amount of the Debentures or (2) each holder of Debentures, except where
the holders of the Common Securities are deemed to have waived such Event
of Default under this Declaration as provided below, the Event of Default
under this Declaration may only be waived by, in the case of clause (1)
above, the vote of Holders of Common Securities representing such
specified percentage of the aggregate liquidation amount of the Common
Securities or, in the case of clause (2) above, each holder of Common
Securities; and
provided, further, that each Holder of Common Securities will be deemed to have
waived any Event of Default with respect to the Common Securities and its
consequences until all Events of Default with respect to the Preferred
Securities have been cured, waived by the Holders of Preferred Securities as
provided in this Declaration or otherwise eliminated and until all Events of
Default 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 this Declaration or the Securities. In the event
that any Event of Default with respect to the Preferred Securities is waived by
the Holders of Preferred Securities as
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provided in this Declaration, the Holders of Common Securities agree that such
waiver shall also constitute the waiver of such Event of Default with respect to
the Common Securities for all purposes under this Declaration without any
further act, vote or consent of the Holders of the Common Securities. Subject to
the foregoing provisions of this Section 2.06(b), upon such waiver, any such
default shall cease to exist and any Event of Default with respect to the Common
Securities arising therefrom shall be deemed to have been cured for every
purpose of this Declaration, but no such waiver shall extend to any subsequent
or other default or Event of Default with respect to the Common Securities or
impair any right consequent thereon.
(c) The right of any Holder of Securities to receive payment of
Distributions on the Securities in accordance with this Declaration and the
terms of the Securities set forth in Exhibits B and C on or after the respective
payment dates therefor, or to institute suit for the enforcement of any such
payment on or after such payment dates, shall not be impaired without the
consent of such Holder.
(d) As provided in the terms of the Securities set forth in Exhibits B and
C hereto, a waiver of an Indenture Event of Default by the Property Trustee at
the written direction of the Holders of the Preferred Securities constitutes a
waiver of the corresponding Event of Default under this Declaration in respect
of the Securities.
SECTION 2.07. Disclosure of Information.
The disclosure of information as to the names and addresses of the Holders
of the Securities in accordance with ss. 312 of the Trust Indenture Act,
regardless of the source from which such information was derived, shall not be
deemed to be a violation of any existing law, or any law hereafter enacted which
does not specifically refer to ss. 312 of the Trust Indenture Act, nor shall the
Property Trustee be held accountable by reason of mailing any material pursuant
to a request made under ss. 312(b) of the Trust Indenture Act.
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ARTICLE 3
ORGANIZATION
SECTION 3.01. Name.
The Trust continued by this Declaration is named "Aetna Capital Trust [ ]"
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 3.02. Office.
The address of the principal office of the Trust is c/o Aetna Inc., 151
Farmington Avenue, Hartford, Connecticut 06156. Upon ten days' written notice to
the Holders, the Regular Trustees may change the location of the Trust's
principal office. At any time, the Regular Trustees may designate another
registered agent and/or registered office.
SECTION 3.03. Issuance of the Trust Securities.
On __________, 199_ the Sponsor, on behalf of the Trust and pursuant to
the Original Declaration, executed and delivered the Underwriting Agreement. On
the Closing Date and contemporaneously with the execution and delivery of this
Declaration, the Regular Trustees, on behalf of the Trust, shall execute and
deliver to (i) the underwriters named in the Underwriting Agreement, a Global
Certificate, registered in the name of the nominee of the initial Clearing
Agency as specified in Section 9.04, in an aggregate amount of ___________
Preferred Securities having an aggregate liquidation amount of $__________,
against receipt of the aggregate purchase price of such Preferred Securities of
$___________, and (ii) the Sponsor, Common Securities Certificates, registered
in the name of the Sponsor, in an aggregate amount of ________ Common Securities
having an aggregate liquidation amount of $____________, against receipt of the
aggregate purchase price of such Common Securities of $___________.(1) In the
event and to the extent the over allotment option granted by the Trust pursuant
to the Underwriting Agreement is exercised by such underwriters, on the Option
Closing Date the Regular Trustees, on behalf of the Trust, shall execute and
deliver to such underwriters a Global Certificate, registered in the name of the
nominee of the initial Clearing Agency as specified in Section 9.04, in an
aggregate amount of up to ___________ Preferred
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(1) See Section 4.01.
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Securities having an aggregate liquidation amount of up to $___________, against
receipt of the aggregate purchase price of such Preferred Securities of up to
$__________.
SECTION 3.04. Purchase of Debentures.
On the Closing Date and contemporaneously with the execution and delivery
of this Declaration, the Regular Trustees, on behalf of the Trust, shall
purchase from the Sponsor with the proceeds received by the Trust from the sale
of the Securities on such date pursuant to Section 3.03, at a purchase price of
100% of the principal amount thereof, Debentures, registered in the name of the
Property Trustee and having an aggregate principal amount equal to $___________,
and, in satisfaction of the purchase price for such Debentures, the Regular
Trustee, on behalf of the Trust, shall deliver or cause to be delivered to the
Sponsor the sum of $___________. In the event the over allotment option granted
by the Trust with respect to the Preferred Securities pursuant to the
Underwriting Agreement is exercised by the underwriters named therein, on the
Option Closing Date the Regular Trustees, on behalf of the Trust, shall purchase
from the Sponsor with the proceeds received by the Trust from the sale of the
Preferred Securities on such date pursuant to Section 3.03, at a purchase price
of 100% of the principal amount thereof, additional Debentures, registered in
the name of the Property Trustee and having an aggregate principal amount of up
to $__________, and, in satisfaction of the purchase price for such Debentures,
the Regular Trustees, on behalf of the Trust, shall deliver or cause to be
delivered to the Sponsor an amount equal to the aggregate principal amount of
the Debentures being purchased.
SECTION 3.05. Purpose.
The exclusive purposes and functions of the Trust are: (a)(i) to issue and
sell Preferred Securities for cash and use the proceeds of such sales to acquire
from Services Debentures issued under the Indenture having an aggregate
principal amount equal to the aggregate liquidation amount of the Preferred
Securities so issued and sold; (ii) to enter into such agreements and
arrangements as may be necessary in connection with the sale of Preferred
Securities to the initial purchasers thereof (including the Underwriting
Agreement) and to take all action, and exercise such discretion, as may be
necessary or desirable in connection therewith and to file such registration
statements or make such other filings under the Securities Act, the Exchange Act
or state securities or "Blue Sky" laws as may be necessary or desirable in
connection therewith and the issuance of the Preferred Securities; and (iii) to
issue and sell Common Securities to Services for cash and use the proceeds of
such sale to purchase as trust assets an equal aggregate principal amount of
Debentures issued under the Indenture;
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and (b) except as otherwise limited herein, to engage in only those other
activities necessary, convenient or incidental thereto. The Trust shall not
borrow money, issue debt or reinvest proceeds derived from investments, pledge
any of its assets or at any time while the Securities are outstanding, otherwise
undertake (or permit to be undertaken) any activity that would result in or
cause the Trust to be treated as anything other than a grantor trust for United
States federal income tax purposes.
SECTION 3.06. Authority.
Subject to the limitations provided in this Declaration and to the
specific duties of the Property Trustee, the Regular Trustees shall have
exclusive and complete authority to carry out the purposes of the Trust. An
action taken by the Regular Trustees in accordance with their powers shall
constitute the act of and serve to bind the Trust and an action taken by the
Property Trustee 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.
SECTION 3.07. Title to Property of the Trust.
Except as provided in Section 3.10 with respect to the Debentures and the
Property Account or unless 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
individual undivided beneficial interest in the assets of the Trust.
SECTION 3.08. Powers and Duties of the Regular Trustees.
The Regular Trustees shall have the exclusive power, authority and duty to
cause the Trust, and shall cause the Trust, to engage in the following
activities:
(a) to issue Preferred Securities and Common Securities, in each case in
accordance with this Declaration; provided, however, that the Trust may issue no
more than one series of Preferred Securities and no more than one series of
Common Securities, and, provided further, that there shall be no interests in
the Trust other than the Securities and the issuance of Securities shall be
limited to (x) a one-time, simultaneous issuance of both Preferred Securities
and Common Securities on the Closing Date and (y) any subsequent issuance of
Preferred Securities on the Option Closing Date pursuant to an exercise of the
over-allotment option granted to underwriters in the Underwriting Agreement;
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(b) in connection with the issuance of the Preferred Securities, at the
direction of the Sponsor, to effect or cause to be effected the filings, and to
execute or cause to be executed, the documents, set forth in Section 3.13 and to
execute, deliver and perform on behalf of the Trust the Depositary Agreement;
(c) to acquire as trust assets Debentures with the proceeds of the sale of
the Preferred Securities and Common Securities; provided, however, that the
Regular Trustees shall cause legal title to all of the Debentures to be vested
in, and 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 Common
Securities;
(d) subject to Section 3.13, to cause the Trust to enter into the
Underwriting Agreement and such other agreements and arrangements as may be
necessary or desirable in connection with the sale of Preferred Securities to
the initial purchasers thereof and the consummation thereof, and to take all
action, and exercise all discretion, as may be necessary or desirable in
connection with the consummation thereof;
(e) to give the Sponsor, Aetna and the Property Trustee prompt written
notice of the occurrence of a Special Event; provided, that the Regular Trustees
shall consult with the Sponsor and the Property Trustee before taking or
refraining to take any Ministerial Action in relation to a Special Event;
(f) to establish a record date with respect to all actions to be taken
hereunder that require a record date be established, including for the purposes
of Section 316(c) of the Trust Indenture Act and with respect to Distributions,
voting rights, redemptions, and exchanges, and to issue relevant notices to
Holders of the Preferred Securities and Common Securities as to such actions and
applicable record dates;
(g) to bring or defend, pay, collect, compromise, arbitrate, resort to
legal action or otherwise adjust claims or demands of or against the Trust
("Legal Action"), unless pursuant to Section 3.10(e), the Property Trustee has
the exclusive power to bring such Legal Action;
(h) to employ or otherwise engage employees and agents (who may be
designated as officers with titles) and managers, contractors, advisors and
consultants and pay reasonable compensation for such services;
(i) to cause the Trust to comply with the Trust's obligations under the
Trust Indenture Act;
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(j) to give the certificate to the Property Trustee required by ss.
314(a)(4) of the Trust Indenture Act, which certificate may be executed by any
Regular Trustee;
(k) to incur expenses which are necessary or incidental to carrying 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, the Regular Trustees hereby initially appointing the
Property Trustee for such purposes;
(m) to take all actions and perform such duties as may be required of the
Regular Trustee pursuant to this Declaration, including, without limitation, the
terms of the Securities set forth in Exhibits B and C hereto;
(n) to execute all documents or instruments, perform all duties and powers
and do all things for and on behalf of the Trust in all matters necessary or
incidental to the foregoing;
(o) to take all action which 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 Securities or
to enable the Trust to effect the purposes for which the Trust has been created;
(p) to take all action, not inconsistent with this Declaration or with
applicable law, which the Regular Trustees determine in their discretion to be
reasonable and necessary or desirable in carrying out the activities of the
Trust as set out in this Section 3.08, in order that:
(i) the Trust will not be deemed to be an Investment Company
required to be registered under the Investment Company Act;
(ii) the Trust will not be classified for United States federal
income tax purposes as an association taxable as a corporation or a
partnership and will be treated as a grantor trust for United States
federal income tax purposes; and
(iii) the Trust will comply with any requirements imposed by any
taxing authority on holders of instruments treated as indebtedness for
United States federal income tax purposes;
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provided that such action does not adversely affect the interests of Holders;
(q) 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
(r) subject to the requirements of Rule 3a-7 and ss. 317(b) of the Trust
Indenture Act, to appoint one or more Paying Agents in addition to the Property
Trustee.
The Regular Trustees must exercise the powers set forth in this Section
3.08 in a manner which is consistent with the purposes and functions of the
Trust set out in Section 3.05 and the Regular Trustees shall not take any action
which is inconsistent with the purposes and functions of the Trust set forth in
Section 3.05.
Subject to this Section 3.08, the Regular Trustees shall have none of the
powers nor any of the authority of the Property Trustee set forth in Section
3.10.
SECTION 3.09. Prohibition of Actions by Trust and Trustees.
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 not cause the Trust to:
(a) invest any proceeds received by the Trust from holding the Debentures
but shall promptly distribute from the Property Account all such proceeds to
Holders of Securities pursuant to the terms of this Declaration and of the
Securities;
(b) acquire any assets other than as expressly provided herein;
(c) possess Trust property for other than a Trust purpose;
(d) make any loans, other than loans represented by the Debentures;
(e) possess any power or otherwise act in such a way as to vary the Trust
assets or the terms of the Securities in any way whatsoever;
(f) issue any securities or other evidences of beneficial ownership of, or
beneficial interests in, the Trust other than the Securities;
(g) incur any indebtedness for borrowed money; or
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(h) (i) direct the time, method and place of exercising any trust or power
conferred upon the Debenture Trustee with respect to the Debentures, (ii) waive
any past default that is waivable under this Declaration or the Indenture, (iii)
exercise any right to rescind or annul any declaration that the principal of all
of the Debentures shall be due and payable or (iv) consent to any amendment,
modification or termination of this Declaration, the Indenture or the
Debentures, where such consent shall be required, unless in the case of this
clause (h) the Property Trustee shall have received an unqualified opinion of
nationally recognized independent tax counsel recognized as expert in such
matters to the effect that such action will not cause the Trust to be classified
for United States federal income tax purposes as an association taxable as a
corporation or partnership and that the Trust will continue to be classified as
a grantor trust for United States federal income tax purposes.
SECTION 3.10. 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 (acting in such capacity) 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 Article V. Such vesting and cessation of title shall be effective whether
or not conveyancing documents have been executed and delivered.
(b) The Property Trustee shall not transfer its right, title and interest
in the Debentures to the Regular Trustees or, if the Property Trustee does not
also act as the Delaware Trustee, the Delaware Trustee.
(c) The Property Trustee shall:
(i) establish and maintain a segregated non-interest bearing bank
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 on 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, without any further acts of the Property Trustee or the Regular
Trustees, promptly make payments to the Holders of the Preferred
Securities and Common Securities from the Property Account in accordance
with Section 6.01. Funds in the Property Account shall be held uninvested,
and without liability for interest thereon, until disbursed in accordance
with this Declaration. The Property Account shall be an account which is
maintained with a banking institution whose long term
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unsecured indebtedness is rated by a "nationally recognized statistical
rating organization", as such term is defined for purposes of Rule
436(g)(2) under the Securities Act, at least equal to (but in no event
less than "A" or the equivalent) the rating assigned to the Preferred
Securities by a nationally recognized statistical rating organization, and
may include the Property Trustee;
(ii) engage in such ministerial activities as shall be necessary or
appropriate to effect promptly the redemption of the Preferred Securities
and the Common Securities to the extent the Debentures are redeemed or
mature;
(iii) upon notice of distribution issued by the Regular Trustees in
accordance with the terms of the Preferred Securities and the Common
Securities, engage in such ministerial activities as shall be necessary or
appropriate to effect promptly the distribution pursuant to terms of the
Securities of Debentures to Holders of Securities upon the occurrence of a
Special Event; and
(iv) have the legal power to exercise all of the rights, powers and
privileges of a holder of the Debentures under the Indenture and, if an
Event of Default occurs and is continuing, the Property Trustee, subject
to Section 2.06(b), shall for the benefit of the Holders of the
Securities, enforce its rights as holder of the Debentures under the
Indenture, subject to the rights of the Holders of the Preferred
Securities pursuant to the terms of this Declaration, the Business Trust
Act and the Trust Indenture Act.
(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, including, without limitation, the Securities set forth in
Exhibits B and C hereto.
(e) The Property Trustee shall take any Legal Action which arises out of
or in connection with an Event of Default or the Property Trustee's duties and
obligations under this Declaration, the Business Trust Act or the Trust
Indenture Act.
(f) All moneys deposited in the Property Account, and all Debentures held
by the Property Trustee for the benefit of the Holders of the Securities will
not be subject to any right, charge, security interest, lien or claim of any
kind in favor of, or for the benefit of the Property Trustee or its agents or
their creditors.
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(g) The Property Trustee shall, within 90 days after the occurrence of a
default with respect to the Securities, transmit by mail, first class postage
prepaid, to the holders of the Securities, as their names and addresses appear
upon the register, notice of all defaults with respect to the Securities known
to the Property Trustee, unless such defaults shall have been cured before the
giving of such notice (the term "defaults" for the purposes of this Section
3.10(g) being hereby defined to be an Indenture Event of Default, not including
any periods of grace provided for in the Indenture and irrespective of the
giving of any notice provided therein); provided, that, except in the case of
default in the payment of the 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 the board of directors, the executive committee or
a trust committee of directors and/or Responsible Officers, of the Property
Trustee in good faith determines that the withholding of such notice is in the
interests of the Holders of the Securities. The Property Trustee shall not be
deemed to have knowledge of any default, except (i) a default in the payment of
principal, premium or interest on the Debentures or (ii) any default as to which
the Property Trustee shall have received written notice or a Responsible Officer
charged with the administration of this Declaration shall have obtained written
notice.
(h) The Property Trustee shall continue to serve as a Trustee until
either:
(i) the Trust has been completely liquidated and the proceeds
thereof distributed to the Holders of Securities pursuant to the terms of
the Securities; or
(ii) a Successor Property Trustee has been appointed and accepted
that appointment in accordance with Article 5.
(i) The Property Trustee shall act as paying agent in respect of the
Common Securities and, if the Preferred Securities are not in book entry
only form, the Preferred Securities and, subject to Section 3.08(r), 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 the Preferred Securities. Any such Paying Agent
shall comply with ss. 317(b) of the Trust Indenture Act. Any Paying Agent
may be removed by the Property Trustee, after consultation with the
Regular Trustees, at any time and a successor Paying Agent or additional
Paying Agents may be appointed at any time by the Property Trustee,
subject to Section 3.08(r).
(j) The Property Trustee shall give prompt written notice to the Holders
of the Securities of any notice received by it from Services of its election to
defer
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payments of interest on the Debentures by extending the interest payment period
with respect thereto.
(k) Subject to this Section 3.10, the Property Trustee shall have none of
the powers or the authority of the Regular Trustees set forth in Section 3.08.
(l) The Property Trustee shall exercise the powers, duties and rights set
forth in this Section 3.10 and Section 3.12 in a manner which is consistent with
the purposes and functions of the Trust set out in Section 3.05, and the
Property Trustee shall not take any action which is inconsistent with the
purposes and functions of the Trust set forth in Section 3.05.
SECTION 3.11. Delaware Trustee.
Notwithstanding any other provision of this Declaration other than Section
5.01(a)(iii), 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 Trustees described in this Declaration. Except as set forth in Section
5.01(a)(iii), the Delaware Trustee shall be a Trustee for the sole and limited
purpose of fulfilling the requirements of ss. 3807(a) of the Business Trust Act.
No implied covenants or obligations shall be read into this Declaration against
the Delaware Trustee.
SECTION 3.12. Certain Rights and Duties of the Property Trustee.
(a) The Property Trustee, before the occurrence of an Event of Default and
after the curing of all Events of Default that may have occurred, shall
undertake to perform only such duties as are specifically set forth in this
Declaration, and no implied covenants shall be read into this Declaration
against the Property Trustee. In case an Event of Default has occurred (that has
not been cured or waived pursuant to Section 2.06, the Property Trustee shall
exercise such of the rights and powers vested in it by this Declaration, and use
the same degree of care and skill in their exercise, as a prudent person would
exercise or use under the circumstances in the conduct of his or her own
affairs.
(b) No provision of this Declaration shall be construed to relieve the
Property Trustee from liability for its own negligent action, its own negligent
failure to act or its own willful misconduct, except that:
(i) prior to the occurrence of an Event of Default and after the
curing or waiving of all such Events of Default that may have occurred:
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(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 in good faith in accordance with
the direction of the Holders as provided herein relating to the time,
method and place of conducting any proceeding for any remedy available to
the Property Trustee hereunder or under the Indenture, or exercising any
trust or power conferred upon the Property Trustee under this Declaration;
and
(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
ground for believing that the repayment of such funds or liability is not
reasonably assured to it under the terms of this Declaration or adequate
indemnity against such risk or liability is not reasonably assured to it.
(c) Subject to the provisions of Sections 3.12(a) and 3.12(b):
(i) whenever in the administration of this Declaration, the Property
Trustee shall deem it desirable that a matter be proved or
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established prior to taking, suffering or omitting any action hereunder,
the Property Trustee (unless other evidence is herein specifically
prescribed) may, in the absence of bad faith on its part and, if the Trust
is excluded from the definition of Investment Company solely by means of
Rule 3a-7, subject to the requirements of Rule 3a-7, request and rely upon
a certificate, which shall comply with the provisions of ss. 314(e) of the
Trust Indenture Act, signed by any two of the Regular Trustees or by an
authorized officer of the Sponsor, as the case may be;
(ii) The Property Trustee (A) may consult with counsel (which may be
counsel to the Sponsor or any of its Affiliates and may include any of its
employees) selected by it in good faith and with due care and the written
advice or opinion of such counsel with respect to legal matters shall be
full and complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in good faith and in reliance
thereon and in accordance with such advice and opinion and (B) shall have
the right at any time to seek instructions concerning the administration
of this Declaration from any court of competent jurisdiction;
(iii) The Property Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys and the Property Trustee shall not be responsible for
any misconduct or negligence on the part of any agent or attorney
appointed by it in good faith and with due care;
(iv) 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 Holders, unless such Holders shall have
offered to the Property Trustee reasonable security and indemnity against
the costs, expenses (including attorneys' fees and expenses) and
liabilities that might be incurred by it in complying with such request or
direction; provided that nothing contained in this clause (iv) shall
relieve the Property Trustee of the obligation, upon the occurrence of an
Event of Default (which has not been cured or waived) to exercise such of
the rights and powers vested in it by this Declaration, and to use the
same degree of care and skill in this exercise, as a prudent person would
exercise or use under the circumstances in the conduct of his or her own
affairs; and
(v) Any action taken by the Property Trustee or its agents hereunder
shall bind 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
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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.
SECTION 3.13. Registration Statement and Related Matters.
In accordance with the Original Declaration, Services and the Trustees
have authorized and directed, and hereby confirm the authorization of, Services,
as the sponsor of the Trust, (i) to file with the Commission and execute, in
each case on behalf of the Trust, (a) the Registration Statement on Form S-3
(File No. 333-07657) (the "1933 Act Registration Statement") including any
amendments thereto and any further pre-effective or post-effective amendments to
such Registration Statement, relating to the registration under the Securities
Act of the Preferred Securities of the Trust and (b) a Registration Statement on
Form 8-A or other appropriate form (the "1934 Act Registration Statement")
(including all pre-effective and post-effective amendments thereto) relating to
the registration of the Preferred Securities of the Trust under Section 12(b) of
the Exchange Act; (ii) to prepare and file with the New York Stock Exchange and
execute on behalf of the Trust a listing application and all other applications,
statements, certificates, agreements and other instruments as shall be necessary
or desirable to cause the Preferred Securities to be listed on the New York
Stock Exchange; (iii) to prepare and file and execute on behalf of the Trust
such applications, reports, surety bonds, irrevocable consents, appointments of
attorney for service of process and other papers and documents as shall be
necessary or desirable to register the Preferred Securities under the securities
or "Blue Sky" laws of such jurisdictions as Services on behalf of the Trust, may
deem necessary or desirable and (iv) to negotiate the terms of and to execute on
behalf of the Trust the Underwriting Agreement. In the event that any filing
referred to in clauses (i)-(iii) above is required by the rules and regulations
of the Commission, the New York Stock Exchange or state securities or blue sky
laws, to be executed on behalf of the Trust by the Trustees, the Regular
Trustees, in their capacities as Trustees of the Trust, are hereby authorized
and directed to join in any such filing and to execute on behalf of the Trust
any and all of the foregoing, it being understood that the Property Trustee and
the Delaware Trustee, in their capacities as Trustees of the Trust, shall not be
required to join in any such filing or execute on behalf of the Trust any such
document unless required by the rules and regulations of the Commission, the New
York Stock Exchange or state securities or blue sky laws. In connection with all
of the foregoing, Aetna, Services and each Trustee, solely in its capacity as
Trustee of the Trust, constitute and appoint Richard L. Huber, Alfred P. Quirk,
Jr., Alan M. Bennett and Thomas J. Calvocoressi and each of them, as his, her or
its, as the case may be, true and lawful attorneys-in-fact, and agents, with
full power of substitution and resubstitution, for Aetna, Services or
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such Trustee or in Aetna's, Services' or such Trustee's name, place and stead,
in any and all capacities, to sign any and all amendments (including
post-effective amendments) to the 1933 Act Registration Statement and the 1934
Act Registration Statement and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Commission, granting unto said
attorneys-in-fact and agents full power and authority to do and perform each and
every act and thing requisite and necessary to be done in connection therewith,
as fully to all intents and purposes as Aetna, Services or such Trustee might or
could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents or any of them, or their or his or her substitute
or substitutes, shall do or cause to be done by virtue hereof.
SECTION 3.14. Filing of Amendments to Certificate of Trust.
The Certificate of Trust as filed with the Secretary of State of the State
of Delaware on May 7, 1998 is attached hereto as Exhibit A. On or after the date
of execution of this Declaration, the Trustees shall cause the filing with the
Secretary of State of the State of Delaware of such amendments to the
Certificate of Trust as the Trustees shall deem necessary or desirable.
SECTION 3.15. Execution of Documents by Regular Trustees.
Unless otherwise determined by the Regular Trustees and except as
otherwise required by the Business Trust Act with respect to the Certificate of
Trust or otherwise, a majority of, or if there are only two, both of, the
Regular Trustees are authorized to execute and deliver on behalf of the Trust
any documents which the Regular Trustees have the power and authority to execute
or deliver pursuant to this Declaration.
SECTION 3.16. Trustees 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, Aetna 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 or the Securities.
SECTION 3.17. Duration of Trust.
The Trust, absent termination pursuant to the provisions of Article 8
hereof, shall have existence until ___________, 20__.
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ARTICLE 4
THE SPONSOR
SECTION 4.01. Purchase of Common Securities by Services.
On the Closing Date Services will purchase all of the Common Securities
issued by the Trust at the same time as the Preferred Securities to be issued on
such date are issued, such purchase to be in an amount equal to 3% of the total
capital of the Trust (including for this purpose the maximum amount of Preferred
Securities, if any, which may be issued on the Option Closing Date pursuant to
the exercise of the over allotment option set forth in the Underwriting
Agreement).
SECTION 4.02. Expenses.
(a) In connection with the purchase of the Debentures by the Trust, the
Sponsor (not in its capacity as a Holder, if applicable) and Aetna (not in its
capacity as a Holder, if applicable) shall be jointly and severally responsible
for and shall pay for all debts and obligations (other than with respect to the
Securities) and all costs and expenses of the Trust (including, but not limited
to, costs and expenses relating to the organization of the Trust, the issuance
of the Preferred Securities to initial purchasers thereof, the fees and expenses
(including reasonable counsel fees and expenses) of the Trustees (including any
amounts payable under Article 10), the costs and expenses relating to the
operation of the Trust, including without limitation, costs and expenses of
accountants, attorneys, statistical or bookkeeping services, expenses for
printing and engraving and computing or accounting equipment, paying agent(s),
registrar(s), transfer agent(s), duplicating, travel and telephone and other
telecommunications expenses and costs and expenses incurred in connection with
the disposition of Trust assets).
(b) In connection with the purchase of the Debentures by the Trust, the
Sponsor (not in its capacity as a Holder, if applicable) and Aetna (not in its
capacity as a Holder, if applicable) will jointly and severally be responsible
for the payment of any and all taxes (other than United States withholding taxes
attributable to the Trust or its assets) and all liabilities, costs and expenses
with respect to such taxes of the Trust.
(c) The Sponsor's and Aetna's obligations under this Section 4.02 shall be
for the benefit of, and shall be enforceable by, any Person to whom any such
debts, obligations, costs, expenses and taxes are owed (a "Creditor") whether or
not such Creditor has received notice hereof. Any such Creditor may enforce the
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Sponsor's or Aetna's obligations under this Section 4.02 directly against the
Sponsor or Aetna and the Sponsor and Aetna irrevocably waive any right or remedy
to require that any such Creditor take any action against the Trust or any other
Person before proceeding against the Sponsor or Aetna. The Sponsor and Aetna
agree to execute such additional agreements as may be necessary or desirable in
order to give full effect to the provisions of this Section 4.02.
ARTICLE 5
TRUSTEES
SECTION 5.01. Number of Trustees; Qualifications.
(a) The number of Trustees initially shall be five (5). At any time (i)
before the issuance of the Securities, the Sponsor may, by written instrument,
increase or decrease the number of, and appoint, remove and replace the,
Trustees, and (ii) after the issuance of the Securities the number of Trustees
may be increased or decreased solely by, and Trustees may be appointed, removed
or replaced solely by, vote of Holders of Common Securities representing a
Majority in liquidation amount of the Common Securities voting as a class;
provided that in any case:
(i) the number of Trustees shall be at least five (5) unless the
Trustee that acts as the Property Trustee also acts as the Delaware
Trustee, in which cases the number of Trustees shall be at least three
(3);
(ii) at least a majority of the Trustees shall at all times be
officers, directors or employees of Services or Aetna;
(iii) if required by the Business Trust Act, one Trustee (the
"Delaware Trustee") shall be either a natural person who is a resident of
the State of Delaware or, if not a natural person, an entity which has its
principal place of business in the State of Delaware and otherwise is
permitted to act as a Trustee hereunder under the laws of the State of
Delaware, except that if the Property Trustee has its principal place of
business in the State of Delaware and otherwise is permitted to act as a
Trustee hereunder under the laws of the State of Delaware, then the
Property Trustee shall also be the Delaware Trustee and Section 3.09 shall
have no application; and
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(iv) there shall at all times be a Property Trustee hereunder which
shall satisfy the requirements of Section 5.01(c).
Each Trustee shall be either a natural person at least 21 years of age or a
legal entity which shall act through one or more duly appointed representatives.
(b) The initial Regular Trustees shall be:
Alan M. Bennett
Alfred P. Quirk, Jr.
John L. Bridge
c/o Aetna Inc.
151 Farmington Avenue
Hartford, Connecticut 06156
(c) There shall at all times be one Trustee which shall act as Property
Trustee. In order to act as Property Trustee hereunder, such Trustee shall:
(i) not be an Affiliate of the Sponsor;
(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 Person permitted by the
Commission to act as an institutional trustee under the Trust Indenture
Act, authorized under such laws to exercise corporate trust powers, having
a combined capital and surplus of at least $50,000,000, 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 5.01(c)(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; and
(iii) if the Trust is excluded from the definition of an Investment
Company solely by reason of Rule 3a-7 and to the extent Rule 3a-7 requires
a trustee having certain qualifications to hold title to the "eligible
assets" (as defined in Rule 3a-7) of the Trust, the Property Trustee shall
possess those qualifications.
If at any time the Property Trustee shall cease to satisfy the
requirements of clauses (i)-(iii) above, the Property Trustee shall immediately
resign in the
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manner and with the effect set out in Section 5.02(d). If the Property Trustee
has or shall acquire any "conflicting interest" within the meaning of ss. 310(b)
of the Trust Indenture Act, the Property Trustee and the Holders of the Common
Securities (as if such Holders were the obligor referred to in ss. 310(b) of the
Trust Indenture Act) shall in all respects comply with the provisions of ss.
310(b) of the Trust Indenture Act. The Preferred Guarantee shall be deemed to be
specifically described in this Declaration for the purposes of clause (i) of the
first proviso contained in ss. 310(b) of the Trust Indenture Act.
The initial Trustee which shall serve as the Property Trustee is The First
National Bank of Chicago, a National Banking Association, whose address is as
set forth in Section 14.01(b).
(d) The initial Trustee which shall serve as the Delaware Trustee is First
Chicago Delaware Inc., a Delaware corporation, whose address is as set forth in
Section 14.01(c).
(e) Any action taken by Holders of Common Securities pursuant to this
Article 5 shall be taken at a meeting of Holders of Common Securities convened
for such purpose or by written consent as provided in Section 12.02.
(f) No amendment may be made to this Section 5.01 which would change any
rights with respect to the number, existence or appointment and removal of
Trustees, except with the consent of each Holder of Common Securities.
SECTION 5.02. Appointment, Removal and Resignation of Trustees.
(a) Subject to Section 5.02(b), Trustees may be appointed or removed
without cause at any time:
(i) until the issuance of the Securities, by written instrument
executed by the Sponsor; and
(ii) after the issuance of the Securities by vote of the Holders of
a Majority in liquidation amount of the Common Securities voting as a
class.
(b) (i) The Trustee that acts as Property Trustee shall not be removed in
accordance with Section 5.02(a) until a Successor Property Trustee possessing
the qualifications to act as Property Trustee under Section 5.01(c) has been
appointed and has accepted such appointment by written instrument executed by
such Successor Property Trustee and delivered to the Regular Trustees, the
Sponsor and the Property Trustee being removed; and
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(ii) the Trustee that acts as Delaware Trustee shall not be removed
in accordance with Section 5.02(a) until a successor Trustee possessing
the qualifications to act as Delaware Trustee under Section 5.01(a)(iii)
(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, the Sponsor and the
Delaware Trustee being removed.
(c) A Trustee appointed to office shall hold office until his successor
shall have been appointed or until his death, removal or resignation.
(d) Any Trustee may resign from office (without need for prior or
subsequent accounting) by an instrument (a "Resignation Request") 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 until:
(A) a Successor Property Trustee possessing the qualifications
to act as Property Trustee under Section 5.01(c) 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) if the Trust is excluded from the definition of an
Investment Company solely by reason of Rule 3a-7, 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 Delaware Trustee and delivered to the Trust, the Sponsor and the
resigning Delaware Trustee.
(e) If no Successor Property Trustee or Successor Delaware Trustee shall
have been appointed and accepted appointment as provided in this Section 5.02
within 60 days after delivery to the Sponsor and the Trust of a Resignation
Request, the resigning Property Trustee or Delaware Trustee may petition any
court of competent jurisdiction for appointment of a Successor Property Trustee
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or Successor Delaware Trustee. Such court may thereupon after such notice, if
any, as it may deem proper and prescribe, appoint a Successor Property Trustee
or Successor Delaware Trustee, as the case may be.
SECTION 5.03. Vacancies among Trustees.
If a Trustee ceases to hold office for any reason and the number of
Trustees is not reduced pursuant to Section 5.01 or if the number of Trustees is
increased pursuant to Section 5.01, a vacancy shall occur. A resolution
certifying the existence of such vacancy by 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 the requirements of this
Article 5.
SECTION 5.04. Effect of Vacancies.
The death, resignation, retirement, removal, bankruptcy, dissolution,
liquidation, incompetence or incapacity to perform the duties of a Trustee, or
any one of them, shall not operate to annul the Trust. Whenever a vacancy in the
number of Regular Trustees shall occur until such vacancy is filled as provided
in this Article 5, 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 5.05. Meetings.
Meetings of the Regular Trustees shall be held from time to time upon the
call of any Trustee. Regular meetings of the Regular Trustees may be held at a
time and place fixed by resolution of the Regular Trustees. Notice of any in-
person meeting 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
meeting of the Regular Trustees or any committee thereof shall be hand delivered
or otherwise delivered in writing (including by facsimile, with a hard copy by
overnight courier) not less than 24 hours before such 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
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with respect to such matter; provided that a Quorum is present, or without a
meeting by the unanimous written consent of the Regular Trustees.
SECTION 5.06. Delegation of Power.
(a) Any Regular Trustee may, by power of attorney consistent with
applicable law, delegate to any other natural person over the age of 21 his or
her power for the purpose of executing any registration statement or amendment
thereto or other document or schedule filed with the Commission or making any
other governmental filing (including, without limitation to filings referred to
in Section 3.13).
(b) The Regular Trustees shall have power to delegate from time to time to
such of their number or to officers of the Trust the doing of such things and
the execution of such instruments either in the name of the Trust or the names
of the Regular Trustees or otherwise as the Regular Trustees may deem expedient,
to the extent such delegation is not prohibited by applicable law or contrary to
the provisions of the Trust, as set forth herein.
SECTION 5.07. Other Activities.
Subject to Section 5.01(c) (with respect to the Property Trustee), the
Sponsor and any 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 business of the Trust, and the Trust and the Holders shall
have no rights by virtue of this Declaration in and to such independent ventures
or the income or profits derived therefrom, and the pursuit of any such venture,
even if competitive with the business of the Trust, shall not be deemed wrongful
or improper. Neither the Sponsor, nor any Trustee, shall be obligated to present
any particular investment or other opportunity to the Trust even if such
opportunity is of a character that, if presented to the Trust, could be taken by
the Trust, and the Sponsor or any 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 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 Sponsory 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 6
DISTRIBUTIONS
SECTION 6.01. Distributions.
Holders shall receive periodic distributions, redemption payments and
liquidation distributions in accordance with the applicable terms of the
relevant Holder's Securities ("Distributions"). Distributions shall be made to
the Holders of Preferred Securities and Common Securities in accordance with the
terms of the Securities as set forth in Exhibits B and C hereto. If and to the
extent that Services makes a payment of interest (including Compounded Interest
(as defined in the Indenture)), premium and 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 promptly make a Distribution of
the Payment Amount to Holders in accordance with the terms of the Securities as
set forth in Exhibits B and C hereto.
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ARTICLE 7
ISSUANCE OF SECURITIES
SECTION 7.01. General Provisions Regarding Securities.
(a) The Regular Trustees shall issue on behalf of the Trust securities in
fully registered form representing undivided beneficial interests in the assets
of the Trust in accordance with Section 7.01(b) and for the consideration
specified in Section 3.03.
(b) The Regular Trustees shall issue on behalf of the Trust one class of
preferred securities representing undivided beneficial interests in the assets
of the Trust having such terms as are set forth in Exhibit B (the "Preferred
Securities") which terms are incorporated by reference in, and made a part of,
this Declaration as if specifically set forth herein, and one class of common
securities representing undivided beneficial interests in the assets of the
Trust having such terms as are set forth in Exhibit C (the "Common Securities")
which terms are incorporated by reference in, and made a part of, this
Declaration as if specifically set forth herein. The Trust shall have 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 the Regular
Trustees (or if there are more than two Regular Trustees by any two of the
Regular Trustees). Such signatures may be the manual or facsimile signatures of
the present or any future Regular Trustee. Typographical and other minor errors
or defects in any such reproduction of any such signature shall not affect the
validity of any Certificate. In case any Regular Trustee of the Trust who shall
have signed any of the Certificates shall cease to be such Regular Trustee
before the Certificate so signed shall be delivered by the Trust, such
Certificate nevertheless may be delivered as though the person who signed such
Certificate had not ceased to be such Regular Trustee; and any Certificate may
be signed on behalf of the Trust by such persons as, at the actual date of the
execution of such Certificate, shall be the Regular Trustees of the Trust,
although at the date of the execution and delivery of the 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 made
pursuant thereto or with any rule or
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regulation of any stock exchange on which Securities may be listed, or to
conform to usage. Pending the preparation of definitive Certificates, the
Regular Trustees on behalf of the Trust may execute temporary Certificates
(printed, lithographed or typewritten), in substantially the form of the
definitive Certificates in lieu of which they are issued, but with such
omissions, insertions and variations as may be appropriate for temporary
Certificates, all as may be determined by the Regular Trustees. Each temporary
Certificate shall be executed by the Regular Trustees on behalf of the Trust
upon the same conditions and in substantially the same manner, and with like
effect, as definitive Certificates. Without unnecessary delay, the Regular
Trustees on behalf of the Trust will execute and furnish definitive Certificates
and thereupon any or all temporary Certificates may be surrendered to the
transfer agent and registrar in exchange therefor (without charge to the
Holders). Each Certificate whether in temporary or definitive form shall be
countersigned by the manual or facsimile signature of an authorized signatory of
the Person acting as registrar and transfer agent for the Securities, which
shall initially be the Property Trustee.
(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, fully paid and
non-assessable.
(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.
(g) Upon issuance of the Securities as provided in this Declaration, the
Regular Trustees on behalf of the Trust shall return to Services the $10
constituting initial trust assets as set forth in the Original Declaration.
ARTICLE 8
TERMINATION OF TRUST
SECTION 8.01. Termination of Trust.
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This Declaration and the Trust shall terminate and be of no further force
or effect when:
(i) all of the Securities shall have been called for redemption and
the amounts necessary for redemption thereof shall have been paid to the
Holders of Securities in accordance with the terms of the Securities; or
(ii) all of the Debentures shall have been distributed to the
Holders of Securities in exchange for all of the Securities in accordance
with the terms of the Securities; or
(iii) upon the expiration of the term of the Trust as set forth in
Section 3.17,
and a certificate of cancellation is filed by the Trustees with the Secretary of
State of the State of Delaware. The Trustees shall so file such a certificate as
soon as practicable after the occurrence of an event referred to in this Section
8.01.
The provisions of Sections 3.12 and 4.02 and Article 10 shall survive the
termination of the Trust.
ARTICLE 9
TRANSFER OF INTERESTS
SECTION 9.01. Transfer of Securities.
(a) Securities may only be transferred, in whole or in part, in accordance
with the terms and conditions set forth in this Declaration. Any transfer or
purported transfer of any Security not made in accordance with this Declaration
shall be null and void.
(b) Subject to this Article 9, Preferred Securities shall be freely
transferable.
(c) Subject to this Article 9, Services and any Related Party may only
transfer Common Securities to Services or a Related Party; provided that any
such transfer shall be subject to the condition that the transferor shall have
obtained (1) either a ruling from the Internal Revenue Service or an unqualified
written opinion addressed to the Trust and delivered to the Trustees of
nationally recognized independent tax counsel experienced in such matters to the
effect that
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such transfer will not (i) cause the Trust to be treated as issuing a class of
interests in the Trust differing from the class of interests represented by the
Common Securities originally issued to Services, (ii) result in the Trust
acquiring or disposing of, or being deemed to have acquired or disposed of, an
asset, or (iii) result in or cause the Trust to be treated as anything other
than a grantor trust for United States federal income tax purposes and (2) an
unqualified written opinion addressed to the Trust and delivered to the Trustees
of a nationally recognized independent counsel experienced in such matters that
such transfer will not cause the Trust to be an Investment Company or controlled
by an Investment Company.
SECTION 9.02. Transfer of Certificates.
The Regular Trustees shall provide for the registration of Certificates
and of transfers of Certificates, which will be effected without charge but only
upon payment (with such indemnity as the Regular Trustees may require) in
respect of any tax or other government charges which may be imposed in relation
to it. Upon surrender for registration of transfer of any Certificate, the
Regular Trustees shall cause one or more new Certificates to be issued in the
name of the designated transferee or transferees. Every Certificate surrendered
for registration of transfer shall be accompanied by a written instrument of
transfer in form satisfactory to the Regular Trustees duly executed by the
Holder or such Holder's attorney duly authorized in writing. Each Certificate
surrendered for registration of transfer shall be canceled by the Regular
Trustees. A transferee of a Certificate shall be entitled to the rights and
subject to the obligations of a Holder hereunder upon the receipt by such
transferee of a Certificate. By acceptance of a Certificate, each transferee
shall be deemed to have agreed to be bound by this Declaration.
SECTION 9.03. Deemed Security Holders.
The Trustees may treat the Person in whose name any Certificate shall be
registered on the books and records of the Trust as the sole holder of such
Certificate and of the Securities represented by such Certificate for purposes
of receiving Distributions and for all other purposes whatsoever and,
accordingly, shall not be bound to recognize any equitable or other claim to or
interest in such Certificate or in the Securities represented by such
Certificate on the part of any Person, whether or not the Trustees shall have
actual or other notice thereof.
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SECTION 9.04. Book Entry Interests.
Unless otherwise specified in the terms of the Preferred Securities, the
Preferred Securities Certificates, on original issuance (including Preferred
Securities, if any, issued on the Option Closing Date pursuant to the exercise
of the over allotment option set forth in the Underwriting Agreement), will be
issued in the form of one or more, fully registered, global Preferred Security
Certificates (each a "Global Certificate"), to be delivered to DTC, the initial
Clearing Agency, by, or on behalf of, the Trust. Such Global Certificates shall
initially be registered on the books and records of the Trust in the name of
Cede & Co., the nominee of DTC, and no Preferred Security Beneficial Owner will
receive a definitive Preferred Security Certificate representing such Preferred
Security Beneficial Owner's interests in such Global Certificates, except as
provided in Section 9.07. Unless and until definitive, fully registered
Preferred Security Certificates (the "Definitive Preferred Security
Certificates") have been issued to the Preferred Security Beneficial Owners
pursuant to Section 9.07:
(i) the provisions of this Section 9.04 shall be in full force and
effect;
(ii) the Trust and the Trustees shall be entitled to deal with the
Clearing Agency for all purposes of this Declaration (including the
payment of Distributions on the Global Certificates and receiving
approvals, votes or consents hereunder) as the Holder of the Preferred
Securities and the sole holder of the Global Certificates and, except as
set forth herein or in Rule 3a-7 with respect to the Property Trustee,
shall have no obligation to the Preferred Security Beneficial Owners;
(iii) to the extent that the provisions of this Section 9.04
conflict with any other provisions of this Declaration, the provisions of
this Section 9.04 shall control; and
(iv) the rights of the Preferred Security Beneficial Owners shall be
exercised only through the Clearing Agency and shall be limited to those
established by law and agreements between such Preferred Security
Beneficial Owners and the Clearing Agency and/or the Clearing Agency
Participants; provided, that solely for the purposes of determining
whether the Holders of the requisite amount of Preferred Securities have
voted on any matter provided for in this Declaration, so long as
Definitive Preferred Security Certificates have not been issued, the
Trustees may conclusively rely on, and shall be protected in relying on,
any written instrument (including a proxy) delivered to the Trustees by
the Depository setting forth the Preferred Security Beneficial Owners'
votes or assigning the right to vote on any matter to any other Persons
either in whole or in part. DTC will make book entry transfers among the
Clearing Agency Participants and receive and transmit payments of
Distributions on the Global Certificates to such Clearing Agency
Participants.
SECTION 9.05. Notices to Holders of Certificates.
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Whenever a notice or other communication to the Holders is required to be
given under this Declaration, unless and until Definitive Preferred Security
Certificates shall have been issued pursuant to Section 9.07, the relevant
Trustees shall give all such notices and communications, specified herein to be
given to Preferred Securities Holders, to the Clearing Agency and, with respect
to any Preferred Security Certificate registered in the name of a Clearing
Agency or the nominee of a Clearing Agency, the Trustees shall, except as set
forth herein or in Rule 3a-7 with respect to the Property Trustee, have no
notice obligations to the Preferred Security Beneficial Owners.
SECTION 9.06. Appointment of Successor Clearing Agency.
If any Clearing Agency elects to discontinue its services as securities
depository with respect to the Preferred Securities, the Regular Trustees may,
in their sole discretion, appoint a successor Clearing Agency with respect to
the Preferred Securities.
SECTION 9.07. Definitive Preferred Securities Certificates.
If (i) a Clearing Agency elects to discontinue its services as securities
depository with respect to the Preferred Securities and a successor Clearing
Agency is not appointed within 90 days after such discontinuance pursuant to
Section 9.06 or (ii) the Regular Trustees elect after consultation with the
Sponsor to terminate the book entry system through the Clearing Agency with
respect to the Preferred Securities, then (x) Definitive Preferred Security
Certificates shall be prepared by the Regular Trustees on behalf of the Trust
with respect to such Preferred Securities and (y) upon surrender of the Global
Certificates by the Clearing Agency, accompanied by registration instructions,
the Regular Trustees shall cause definitive Preferred Security Certificates to
be delivered to Preferred Security Beneficial Owners in accordance with the
instructions of the Clearing Agency. Neither the Trustees nor the Trust shall be
liable for any delay in delivery of such instructions and each of them may
conclusively rely on and shall be protected in relying on, such instructions.
SECTION 9.08. 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 harmless, then in the absence of notice
that such Certificate shall have been acquired by a bona fide purchaser, any two
Regular Trustees on behalf of the Trust shall execute and deliver, in exchange
for or in lieu of any such
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mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
denomination. In connection with the issuance of any new Certificate under this
Section 9.08, 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 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.
ARTICLE 10
LIMITATION OF LIABILITY; INDEMNIFICATION
SECTION 10.01. Exculpation.
(a) No Indemnified Person shall be liable, responsible or accountable in
damages or otherwise to the Trust or any Covered Person for any loss, damage or
claim incurred by reason of any act or omission performed or omitted by such
Indemnified Person in good faith on behalf of the Trust and in a manner such
Indemnified Person reasonably believed to be within the scope of the authority
conferred on such Indemnified Person by this Declaration or by law, except that
an Indemnified Person shall be liable for any such loss, damage or claim
incurred by reason of such Indemnified Person's gross negligence (but, in the
case of the Property Trustee, subject to Section 2.01) 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.
(c) Pursuant to ss. 3803(a) of the Business Trust Act, the Holders of
Securities, in their capacities as Holders, shall be entitled to the same
limitation of liability that is extended to stockholders of private corporations
for profit organized under the General Corporation Law of the State of Delaware.
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SECTION 10.02. Indemnification.
(a) To the fullest extent permitted by applicable law, the Sponsor shall
indemnify and hold harmless each Indemnified Person from and against any loss,
damage or claim incurred by such Indemnified Person by reason of any act or
omission performed or omitted by such Indemnified Person in good faith on behalf
of the Trust and in a manner such Indemnified Person reasonably believed to be
within the scope of authority conferred on such Indemnified Person by this
Declaration, except that no Indemnified Person shall be entitled to be
indemnified in respect of any loss, damage or claim incurred by such Indemnified
Person by reason of gross negligence (or, in the case of the Property Trustee,
negligence) or willful misconduct with respect to such acts or omissions.
(b) To the fullest extent permitted by applicable law, expenses (including
legal fees) incurred by an Indemnified Person in defending any claim, demand,
action, suit or proceeding shall, from time to time, be advanced by the Sponsor
prior to the final disposition of such claim, demand, action, suit or proceeding
upon receipt by the Sponsor of an undertaking by or on behalf of the Indemnified
Person to repay such amount if it shall be determined that the Indemnified
Person is not entitled to be indemnified as authorized in Section 10.02(a).
(c) The provisions of this Section 10.02 shall survive the termination of
this Declaration or the resignation or removal of any Trustee.
ARTICLE 11
ACCOUNTING
SECTION 11.01. 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 11.02. 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 and records of the Trust,
together with a copy of this Declaration and a certified copy of the Certificate
of Trust, or any amendment
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thereto, shall at all times be maintained at the principal office of the Trust
and shall be open for inspection for any examination by any Holder or its duly
authorized representative for any purpose reasonably related to its interest in
the Trust during normal business hours.
(b) The Regular Trustees shall, as soon as available after the end of each
Fiscal Year of the Trust, cause to be prepared and mailed to each Holder of
Securities unaudited financial statements of the Trust for such Fiscal Year,
prepared in accordance with generally accepted accounting principles; provided
that if the Trust is required to comply with the periodic reporting requirements
of Sections 13(a) or 15(d) of the Exchange Act, such financial statements for
such Fiscal Year shall be examined and reported on by a firm of independent
certified public accountants selected by the Regular Trustees (which firm may be
the firm used by the Sponsor).
(c) The Regular Trustees shall cause to be prepared and mailed to each
Holder of Securities, an annual United States federal income tax information
statement, on such form as is 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 prepared and filed with the
appropriate taxing authority, an annual United States federal income tax return,
on such form as is required by the Code, and any other annual income tax returns
required to be filed by the Regular Trustees on behalf of the Trust with any
state or local taxing authority, such returns to be filed as soon as practicable
after the end of each Fiscal Year of the Trust.
SECTION 11.03. 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 from 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 sole signatories for the Property Account.
SECTION 11.04. Withholding.
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The Trust and the 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 Trust 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 to be withheld was not withheld from a
Distribution, the Trust may reduce subsequent Distributions by the amount of
such withholding.
ARTICLE 12
AMENDMENTS AND MEETINGS
SECTION 12.01. Amendments.
(a) Except as otherwise provided in this Declaration or by any applicable
terms of the Securities, this Declaration may be amended by, and only by, a
written instrument executed by a majority of the Regular Trustees; provided,
however, that (i) no amendment to this Declaration shall be made unless the
Regular Trustees shall have obtained (A) either a ruling from the Internal
Revenue Service or a written unqualified opinion of nationally recognized
independent tax counsel experienced in such matters to the effect that such
amendment will not cause the Trust to be classified for United States federal
income tax purposes as an association taxable as a corporation or a partnership
and to the effect that the Trust will continue to be treated as a grantor trust
for purposes of United States federal income taxation and (B) a written
unqualified opinion of nationally recognized independent counsel experienced in
such matters to the effect that such amendment will not cause the Trust to be an
Investment Company which is required to be registered under the Investment
Company Act, (ii) at such time after the Trust has issued any Securities which
remain outstanding, any amendment which would adversely affect the rights,
privileges or preferences of any Holder of Securities may be effected only with
such additional requirements as may be set forth in the terms of such
Securities, (iii) Section 4.02, Section
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9.1(c) and this Section 12.01 shall not be amended without the consent of all
of the Holders of the Securities, (iv) no amendment which adversely affects the
rights, powers and privileges of the Property Trustee or the Delaware Trustee
shall be made without the consent of the Property Trustee or the Delaware
Trustee, as the case may be, (v) Article 4 shall not be amended without the
consent of the Sponsor, and (vi) the rights of Holders of Common Securities
under Article 5 to increase or decrease the number of, and to appoint, replace
or remove, Trustees shall not be amended without the consent of each Holder of
Common Securities.
(b) Notwithstanding Section 12.02(b)(ii), this Declaration may be amended
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
defective or inconsistent with any other provision of this Declaration, (iii) to
add to the covenants, restrictions or obligations of the Sponsor, and (iv) to
conform to any changes in Rule 3a-7 or any change in interpretation or
application of Rule 3a-7 by the Commission, which amendment does not adversely
affect the rights, preferences or privileges of the Holders.
SECTION 12.02. Meetings of the Holders of Securities; Action by Written
Consent.
(a) Meetings of the Holders of Preferred Securities and/or Common
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 Holders of Preferred Securities or Common
Securities, if directed to do so by Holders of at least 25% in liquidation
amount of such class of Securities. Such direction shall be given by delivering
to the Regular Trustees 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
specified Certificates shall be counted for purposes of determining whether the
required percentage set forth in the second sentence of this paragraph has been
met.
(b) Except to the extent otherwise provided in the terms of the
Securities, the following provision shall apply to meetings of Holders of
Securities:
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(i) Notice of any such meeting shall be given by mail to all the
Holders of Securities having a right to vote thereat not less than 7 days
nor more than 60 days prior to 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 Holders of Securities owning not
less than the minimum aggregate liquidation amount of Securities 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 Holders of Securities 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 a Security is entitled to
participate, including waiving notice of any meeting, or voting or
participating at a meeting. No proxy shall be valid after the expiration
of 11 months from the date thereof unless otherwise provided in the proxy.
Every proxy shall be revocable at the pleasure of the Holder of the
Security executing it. Except as otherwise provided herein or in the terms
of the Securities, 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.
(iv) Unless otherwise provided in the Business Trust Act, this
Declaration or the rules of any stock exchange on which the Preferred
Securities are then listed or admitted for trading, 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
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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 13
REPRESENTATIONS OF PROPERTY TRUSTEE AND DELAWARE TRUSTEE
SECTION 13.01. Representations and Warranties of Property Trustee.
(a) The Trustee which 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:
(i) The Property Trustee is a national banking association with
trust powers, duly organized, validly existing and in good standing under
the laws of the United States, with trust power and authority to execute
and deliver, and to carry out and perform its obligations under the terms
of, this Declaration.
(ii) 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. The Declaration has been duly
executed and delivered by the Property Trustee, and constitutes a legal,
valid and binding obligation of the Property Trustee, enforceable against
it in accordance with its terms, subject to applicable bankruptcy,
reorganization, moratorium, insolvency, and other similar laws affecting
creditors' rights generally and to general principles of equity and the
discretion of the court (regardless of whether the enforcement of such
remedies is considered in a proceeding in equity or at law).
(iii) 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 By-laws of the Property Trustee.
(iv) No consent, approval or authorization of, or registration with
or notice to, any banking authority which supervises or regulates the
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Property Trustee is required for the execution, delivery or performance by
the Property Trustee, of this Declaration.
(v) The Property Trustee satisfies the qualifications set forth in
Section 5.01(c).
(b) The Trustee which acts as initial Delaware Trustee represents and
warrants to the Trust and 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 it satisfies the qualifications set forth in Section
5.01(a)(iii).
ARTICLE 14
MISCELLANEOUS
SECTION 14.01. Notices.
All notices provided for in this Declaration shall be in writing, duly
signed by the party giving such notice, and shall be delivered, telecopied or
mailed by first class mail, as follows:
(a) if given to the Trust, in care of the Regular Trustees at the Trust's
mailing address set forth below (or such other address as the Regular Trustees
on behalf of the Trust may give notice of to the Holders of the Securities):
Aetna Capital Trust [ ]
c/o Aetna Inc.
151 Farmington Avenue
Hartford, Connecticut 06156
Attention:Alan M. Bennett
Alfred P. Quirk, Jr.
John L. Bridge
Trustees
Facsimile No: (860) 273-0123
(b) if given to the Property Trustee, at the mailing address of the
Property Trustee set forth below (or such other address as the Property Trustee
may give notice of to the Holders of the Securities):
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The First National Bank of Chicago
153 West 51st Street
5th Floor, Suite 4015
New York, NY 10019
Attention: Corporate Trust Administration
Facsimile No: 212-373-1383
(c) if given to the Delaware Trustee, at the mailing address of the
Delaware Trustee set forth below (or such other address as the Delaware Trustee
may give notice of to the Holders of the Securities):
First Chicago Delaware Inc.
300 King Street
Wilmington, Delaware 19801
Attention: Delaware Trustee,
Corporate Trust Administration
With a copy to:
The First National Bank of Chicago
153 West 51st Street
5th Floor, Suite 4015
New York, NY 10019
Attention: Corporate Trust
Administration
(d) if given to the Holder of the Common Securities, at the mailing
address of the Sponsor set forth below (or such other address as the Holder of
the Common Securities may give notice to the Trust):
Aetna Services, Inc.
151 Farmington Avenue
Hartford, Connecticut 06156
Attention:Corporate Secretary
Facsimile No: 860-273-[ ]
(e) if given to Aetna, at the mailing address of Aetna set forth below (or
such other address as Aetna may give notice to the Trust):
Aetna Inc.
151 Farmington Avenue
Hartford, Connecticut 06156
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Attention:Corporate Secretary
Facsimile No: 860-273-[ ]
(f) if given to any other Holder, at the address set forth on the books
and records of the Trust.
A copy of any notice to the Property Trustee or the Delaware Trustee shall
also be sent to the Trust. All 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 14.02. Undertaking for Costs.
All parties to this Declaration agree, and each Holder of any Securities
by his or her acceptance thereof shall be deemed to have agreed, that any court
may in its discretion require, in any suit for the enforcement of any right or
remedy under this Declaration, or in any suit against the Property Trustee for
any action taken or omitted by it as Property Trustee, the filing by any party
litigant in such suit of an undertaking to pay the costs of such suit, and that
such court may in its discretion assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in such suit, having due regard to
the merits and good faith of the claims or defenses made by such party litigant;
but the provisions of this Section 14.02 shall not apply to any suit instituted
by the Property Trustee, to any suit instituted by any Holder of Preferred
Securities, or group of Holders of Preferred Securities, holding more than 10%
in aggregate liquidation amount of the outstanding Preferred Securities, or to
any suit instituted by any Holder of Preferred Securities for the enforcement of
the payment of the principal of (or premium, if any) or interest on the
Debentures, on or after the respective due dates expressed in such Debentures.
SECTION 14.03. Governing Law.
This Declaration and the rights of the parties hereunder shall be governed
by and interpreted in accordance with the laws of the State of Delaware and all
rights and remedies shall be governed by such laws without regard to principles
of conflict of laws.
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SECTION 14.04. Headings.
Headings contained in this Declaration are inserted for convenience of
reference only and do not affect the interpretation of this Declaration or any
provision hereof.
SECTION 14.05. Partial Enforceability.
If any provision of this Declaration, or the application of such provision
to any Person or circumstance, shall be held invalid, the remainder of this
Declaration, or the application of such provision to persons or circumstances
other than those to which it is held invalid, shall not be affected thereby.
SECTION 14.06. Counterparts.
This Declaration may contain more than one counterpart of the signature
pages and this Declaration may be executed by the affixing of the signature of
the Sponsor and 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.
SECTION 14.07. Intention of the Parties.
It is the intention of the parties hereto that the Trust not be classified
for United States federal income tax purposes as an association taxable as a
corporation or partnership but that the Trust be treated as a grantor trust for
United States federal income tax purposes. The provisions of this Declaration
shall be interpreted to further this intention of the parties.
SECTION 14.08. 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.
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IN WITNESS WHEREOF, the undersigned has caused these presents to be
executed as of the day and year first above written.
Aetna Services, Inc.,
as Sponsor
By:
------------------------------
Name:
Title:
Aetna Inc.
By:
------------------------------
Name:
Title:
- ---------------------------------
Alan M. Bennett
as Trustee
- ---------------------------------
Alfred P. Quirk, Jr.
as Trustee
- ---------------------------------
John L. Bridge
as Trustee
The First National Bank of Chicago
as Property Trustee
By:
------------------------------
Name:
Title:
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First Chicago Delaware Inc.
as Delaware Trustee
By:
------------------------------
Name:
Title:
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STATE OF [ ] )
)
COUNTY OF [ ] )
BEFORE ME, the undersigned authority, on this day of _____________, 199_,
personally appeared _______________ (on behalf of Aetna Services, Inc.),
[ ] (on behalf of Aetna Inc.) and Alan M. Bennett, Alfred P. Quirk, Jr. and
John L. Bridge, each known to me (or proved to me by introduction upon the oath
of a person known to me) to be the person and officer, as the case may be, whose
name is subscribed to the foregoing instrument, and each acknowledged to me that
he executed the same as the act of such are for the purposes and consideration
herein expressed and in the capacity therein stated.
GIVEN UNDER MY HAND AND SEAL THIS _____ day of _________, 199_.
(SEAL)
-------------------------------------
NOTARY PUBLIC, STATE OF [ ]
Print Name:
--------------------------
Commission Expires:
-------------------
59
STATE OF [ ] )
)
COUNTY OF [ ] )
BEFORE ME, the undersigned authority, on this day of _____________, 199_,
personally appeared ________________ of The First National Bank of Chicago known
to me (or proved to me by introduction upon the oath of a person known to me) to
be the person and officer whose names are subscribed to the foregoing
instrument, and acknowledged to me that she executed the same as the act of such
trust for the purposes and consideration herein expressed and in the capacity
therein stated.
GIVEN UNDER MY HAND AND SEAL THIS _____ day of _________, 199_.
(SEAL)
-------------------------------------
NOTARY PUBLIC, STATE OF [ ]
Print Name:
--------------------------
Commission Expires:
-------------------
60
STATE OF [ ] )
)
COUNTY OF [ ] )
BEFORE ME, the undersigned authority, on this day of _____________, 199_,
personally appeared _______________________ of First Chicago Delaware Inc. known
to me (or proved to me by introduction upon the oath of a person known to me) to
be the person and officer whose names are subscribed to the foregoing
instrument, and acknowledged to me that she executed the same as the act of such
trust for the purposes and consideration herein expressed and in the capacity
therein stated.
GIVEN UNDER MY HAND AND SEAL THIS _____ day of _________, 199_.
(SEAL)
-------------------------------------
NOTARY PUBLIC, STATE OF [ ]
Print Name:
--------------------------
Commission Expires:
-------------------
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EXHIBIT A
CERTIFICATE OF TRUST
OF
AETNA CAPITAL TRUST [ ]
THIS Certificate of Trust of Aetna Capital Trust [ ] (the "Trust"), dated
May 7, 1998, is being duly executed and filed by the undersigned, as trustees,
to form a business trust under the Delaware Business Trust Act (12 Del. Code ss.
3801 et seq.).
1. Name. The name of the business trust being formed hereby is Aetna
Capital Trust [ ].
2. Delaware Trustee. The name and business address of the trustee of the
Trust with a principal place of business in the State of Delaware is First
Chicago Delaware Inc., 300 King Street, Wilmington, Delaware 19801.
3. Effective Date. This Certificate of Trust shall be effective as of its
filing.
4. Counterparts. This Certificate of Trust may be executed in one or more
counterparts.
IN WITNESS WHEREOF, the undersigned, being the trustees of the Trust, have
executed this Certificate of Trust as of the date first above written.
First Chicago Delaware, Inc.,
as Delaware Trustee
By: /s/ Sandra L. Caruba
--------------------------------
Name: Sandra L. Caruba
Title: Vice President
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The First National Bank of Chicago,
as Property Trustee
By: /s/ Sandra L. Caruba
--------------------------------
Name: Sandra L. Caruba
Title: Vice President
/s/ Alan M. Bennett
-----------------------------------
Alan M. Bennett,
as Trustee
/s/ Alfred P. Quirk, Jr.
-----------------------------------
Alfred P. Quirk, Jr.
as Trustee
/s/ John L. Bridge
-----------------------------------
John L. Bridge,
as Trustee
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EXHIBIT B
TERMS OF
PREFERRED SECURITIES
Pursuant to Section 7.1 of the Amended and Restated Declaration of Trust
of Aetna Capital Trust [ ] dated as of ____________, 199__ (as amended from time
to time, the "Declaration"), the designations, rights, privileges, restrictions,
preferences and other terms and provisions of the Preferred Securities are set
forth below (each capitalized term used but not defined herein having the
meaning set forth in the Declaration):
1. Designation and Number. Preferred Securities of the Trust with an
aggregate liquidation amount in the assets of the Trust of
___________________________________________ Dollars ($___________) (including up
to _______________________________________________ Dollars ($___________)
issuable upon exercise of the over allotment option set forth in the
Underwriting Agreement) and a liquidation amount in the assets of the Trust of
$25 per Preferred Security, are hereby designated as "____% Preferred Trust
Securities". The Preferred Security Certificates evidencing the Preferred
Securities shall be substantially in the form attached hereto as Annex I, 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. In connection with the
issuance and sale of the Preferred Securities and the Common Securities, the
Trust will purchase as trust assets Debentures of Services having an aggregate
principal amount equal to the aggregate liquidation amount of the Preferred
Securities and Common Securities so issued and bearing interest at an annual
rate equal to the annual Distribution rate on the Preferred Securities and
Common Securities and having payment and redemption provisions which correspond
to the payment and redemption provisions of the Preferred Securities and Common
Securities.
2. Distributions. (a) Distributions payable on each Preferred Security
will be fixed at a rate per annum of ____% (the "Coupon Rate") of the stated
liquidation amount of $25 per Preferred Security. Distributions in arrears for
more than one month will bear interest at the rate per annum of ____% thereof
(to the extent permitted by law), compounded [monthly]. The term "Distributions"
as used in these terms means such periodic cash distributions and any such
interest payable unless otherwise stated. A Distribution will be made by the
Property Trustee only to the extent that interest payments are made in respect
of the Debentures held by the Property Trustee. The amount of Distributions
payable
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for any period will be computed for any [monthly] Distribution period on the
basis of a 360-day year of twelve 30-day months[, and for any Distribution
period shorter or longer than a 30-day month Distribution period for which
Distributions are computed, Distributions will be computed on the basis of the
actual number of days elapsed].
(b) Distributions on the Preferred Securities will be cumulative, will
accrue from ___________, 199__ and will be payable [monthly] in arrears, on the
last day of each month commencing on ________________, 199__, except as
otherwise described below, but only if and to the extent that interest payments
are made in respect of the Debentures held by the Property Trustee. So long as
Services shall not be in default in the payment of interest on the Debentures,
Services has the right under the Indenture for the Debentures to defer payments
of interest by extending the interest payment period from time to time on the
Debentures for a period not exceeding [60] consecutive [monthly] interest
periods (each, an "Extension Period") and, as a consequence, [monthly]
Distributions will continue to accrue with interest thereon (to the extent
permitted by applicable law) at the rate of ____% per annum, compounded
[monthly] during any such Extension Period. Prior to the termination of any such
Extension Period, Services may further extend such Extension Period; provided
that such Extension Period together with all such previous and further
extensions thereof may not exceed [60] consecutive [monthly] interest periods.
Upon the termination of any Extension Period and the payment of all amounts then
due, Services may commence a new Extension Period, subject to the above
requirements. Payments of accrued Distributions will be payable to Holders of
Preferred Securities as they appear on the books and records of the Trust on the
first record date after the end of the Extension Period.
(c) Distributions on the Preferred Securities will be payable promptly by
the Property Trustee (or other Paying Agent) upon receipt of immediately
available funds to the Holders thereof as they appear on the books and records
of the Trust on the relevant record dates. While the Preferred Securities remain
in book-entry only form, the relevant record dates shall be one business day
prior to the relevant Distribution date, and if the Preferred Securities are no
longer in book-entry only form, the relevant record dates will be the fifteenth
(15th) day of the month prior to the relevant Distribution date, which record
and payment dates correspond to the record and interest payment dates on the
Debentures. Distributions payable on any Preferred Securities that are not
punctually paid on any Distribution payment date as a result of Services having
failed to make the corresponding interest payment on the Debentures will
forthwith cease to be payable to the person in whose name such Preferred
Security is registered on the relevant record date, and such defaulted
Distribution will instead be payable to the person in whose name such Preferred
Security is registered on the special record
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date established by the Regular Trustees, which record date shall correspond to
the special record date or other specified date determined in accordance with
the Indenture; provided, however, that Distributions shall not be considered
payable on any Distribution payment date falling within an Extension Period
unless Services has elected to make a full or partial payment of interest
accrued on the Debentures on such Distribution payment date. Subject to any
applicable laws and regulations and the provisions of the Declaration, each
payment in respect of the Preferred Securities will be made as described
paragraph 9 hereof. If any date on which Distributions are payable on the
Preferred 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 date.
(d) All Distributions paid with respect to the Preferred Securities and
the Common Securities will be paid Pro Rata to the Holders thereof entitled
thereto. If an Event of Default has occurred and is continuing, the Preferred
Securities shall have a priority over the Common Securities with respect to
Distributions.
(e) In the event that there is any money or other property held by or for
the Trust that is not accounted for under the Declaration, such money or
property shall be distributed Pro Rata among the Holders of the Preferred
Securities and Common Securities.
3. Liquidation Distribution Upon Dissolution. In the event of any
voluntary or involuntary dissolution, winding-up or termination of the Trust,
the Holders of the Preferred Securities and Common Securities at the date of the
dissolution, winding-up or termination, as the case may be, will be entitled to
receive Pro Rata solely out of the assets of the Trust available for
distribution to Holders of Preferred Securities and Common Securities after
satisfaction of liabilities to creditors as provided by applicable law, an
amount equal to the aggregate of the stated liquidation amount of $25 per
Preferred Security and Common Security plus accrued and unpaid Distributions
thereon to the date of payment (such amount being the "Liquidation
Distribution"), unless, in connection with such dissolution, winding-up or
termination, and after satisfaction of liabilities to creditors as provided by
applicable law, Debentures in an aggregate principal amount equal to the
aggregate stated liquidation amount of such Preferred Securities and Common
Securities and bearing accrued and unpaid interest in an amount equal to the
accrued and unpaid Distributions on, such Preferred Securities and Common
Securities, shall be distributed Pro Rata to the
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Holders of the Preferred Securities and Common Securities in exchange for such
Securities.
If, upon any such dissolution, 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 Preferred Securities and Common Securities shall be paid, subject
to the next paragraph, on a Pro Rata basis.
Holders of Common Securities will be entitled to receive Liquidation
Distributions upon any such dissolution Pro Rata with Holders of Preferred
Securities, except that if an Event of Default has occurred and is continuing,
the Preferred Securities shall have a priority over the Common Securities with
respect to such Liquidation Distribution.
4. Redemption and Distribution of Debentures. The Preferred Securities and
Common Securities may only be redeemed if Debentures having an aggregate
principal amount equal to the aggregate liquidation amount of the Preferred
Securities and Common Securities are repaid, redeemed or distributed as set
forth below:
(a) Upon the repayment of the Debentures, in whole or in part, whether at
maturity, upon redemption at any time or from time to time on or after
_________, 20__, the proceeds of such repayment will be promptly applied to
redeem Pro Rata Preferred Securities and Common Securities having an aggregate
liquidation amount equal to the aggregate principal amount of the Debentures so
repaid or redeemed, upon not less than 30 nor more than 60 days' notice, at a
redemption price of $25 per Preferred and Common Security plus an amount equal
to accrued and unpaid Distributions thereon to the date of redemption, payable
in cash (the "Redemption Price"). The date of any such repayment or redemption
of Preferred Securities and Common Securities shall be established to coincide
with the repayment or redemption date of the Debentures.
(b) If fewer than all the outstanding Preferred Securities and Common
Securities are to be so redeemed, the Preferred Securities and the Common
Securities will be redeemed Pro Rata and the Preferred Securities to be redeemed
as described in paragraph 4(f)(ii) below. If a partial redemption would result
in the delisting of the Preferred Securities by any national securities exchange
or other organization on which the Preferred Securities are then listed,
Services pursuant to the Indenture will only redeem Debentures in whole and, as
a result, the Trust may only redeem the Preferred Securities in whole.
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(c) If, at any time, a Tax Event or an Investment Company Event (each as
hereinafter defined, and each a "Special Event") shall occur and be continuing,
the Regular Trustees shall, unless the Debentures are redeemed in the limited
circumstances described below, dissolve the Trust and, after satisfaction of
creditors as provided by applicable law, cause Debentures held by the Property
Trustee having an aggregate principal amount equal to the aggregate stated
liquidation amount of and accrued and unpaid interest equal to accrued and
unpaid Distributions on, and having the same record date for payment as the
Preferred Securities and Common Securities, to be distributed to the Holders of
the Preferred Securities and Common Securities on a Pro Rata basis in
liquidation of such Holders' interests in the Trust, within 90 days following
the occurrence of such Special Event (the "90 Day Period"; provided, however,
that in the case of the occurrence of a Tax Event, as a condition of such
dissolution and distribution, the Regular Trustees shall have received an
opinion of a nationally recognized independent tax counsel experienced in such
matters (a "No Recognition Opinion"), which opinion may rely on any then
applicable published revenue ruling of the Internal Revenue Service, to the
effect that the Holders of the Preferred Securities will not recognize any gain
or loss for United States federal income tax purposes as a result of the
dissolution of the Trust and distribution of Debentures; and provided, further,
that, if and as long as at the time there is available to the Trust the
opportunity to eliminate, within the 90 Day Period, the Special Event by taking
some ministerial action, such as filing a form or making an election, or
pursuing some other similar reasonable measure that has no adverse effect on the
Trust, Services, Aetna or the Holders of the Preferred Securities ("Ministerial
Action"), the Trust will pursue such measure in lieu of dissolution.
If in the case of the occurrence of a Tax Event, (i) the Regular Trustees
have received an opinion (a "Redemption Tax Opinion") of nationally recognized
independent tax counsel experienced in such matters that, as a result of a Tax
Event, there is more than an insubstantial risk that Services would be precluded
from deducting the interest on the Debentures for United States federal income
tax purposes even if the Debentures were distributed to the Holders of Preferred
Securities and Common Securities in liquidation of such Holder's interest in the
Trust as described in this paragraph 4(c) or (ii) the Regular Trustees shall
have been informed by such tax counsel that a No Recognition Opinion cannot be
delivered to the Trust, Services shall have the right at any time, upon not less
than 30 nor more than 60 days' notice, to redeem the Debentures in whole or in
part for cash at the Redemption Price within 90 days following the occurrence of
such Tax Event, and promptly following such redemption Preferred Securities and
Common Securities with an aggregate liquidation amount equal to the aggregate
principal amount of the Debentures so redeemed will be redeemed by the Trust at
the Redemption Price on a Pro Rata basis; provided, however, that,
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if at the time there is available to Services or the Regular Trustees on behalf
of the Trust the opportunity to eliminate, within such 90 day period, the Tax
Event by taking some Ministerial Action, Services or the Regular Trustees on
behalf of the Trust will pursue such measure in lieu of redemption and;
provided, further, that Services shall have no right to redeem the Debentures
while the Regular Trustees on behalf of the Trust are pursuing such Ministerial
Action. The Common Securities will be redeemed Pro Rata with the Preferred
Securities, except that if an Event of Default under the Indenture has occurred
and is continuing, the Preferred Securities will have a priority over the Common
Securities with respect to payment of the Redemption Price.
"Tax Event" means that the Regular Trustees shall have obtained an opinion
of nationally recognized independent tax counsel experienced in such matters (a
"Dissolution Tax Opinion") to the effect that on or after ____________, 199_ as
a result of (a) any amendment to, or change (including any announced prospective
change) in, the laws (or any regulations thereunder) of the United States or any
political subdivision or taxing authority thereof or therein, (b) any amendment
to, or change in, an interpretation or application of any such laws or
regulations by any legislative body, court, governmental agency or regulatory
authority (including the enactment of any legislation and the publication of any
judicial decision or regulatory determination), (c) any interpretation or
pronouncement that provides for a position with respect to such laws or
regulations that differs from the theretofore generally accepted position or (d)
any action taken by any governmental agency or regulatory authority, which
amendment or change is enacted, promulgated, issued or announced or which
interpretation or pronouncement is issued or announced or which action is taken,
in each case on or after _________, 199_, there is more than an insubstantial
risk that (i) the Trust is, or will be within 90 days of the date thereof,
subject to United States federal income tax with respect to income accrued or
received on the Debentures, (ii) the Trust is, or will be within 90 days of the
date thereof, subject to more than a de minimis amount of taxes, duties or other
governmental charges or (iii) interest payable by Services to the Trust on the
Debentures is not, or within 90 days of the date thereof will not be, deductible
by Services for United States federal income tax purposes.
"Investment Company Event" means that the Regular Trustees shall have
received an opinion of nationally recognized independent counsel experienced in
practice under the Investment Company Act that, as a result of the occurrence of
a change in law or regulation or a change in interpretation or application of
law or regulation by any legislative body, court, governmental agency or
regulatory authority (a "Change in 1940 Act Law"), there is more than an
insubstantial risk that the Trust is or will be considered an Investment
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Company which is required to be registered under the Investment Company Act,
which Change in 1940 Act Law becomes effective on or after _________, 199_.
On the date fixed for any distribution of Debentures, upon dissolution of
the Trust, (i) the Preferred Securities will no longer be deemed to be
outstanding and (ii) certificates representing Preferred Securities will be
deemed to represent beneficial interests in the Debentures having an aggregate
principal amount equal to the stated liquidation amount of, and bearing accrued
and unpaid interest equal to accrued and unpaid Distributions on, such Preferred
Securities until such certificates are presented to Services or its agent for
transfer or reissuance.
(d) The Trust may not redeem fewer than all the outstanding Preferred
Securities unless all accrued and unpaid Distributions have been paid on all
Preferred Securities for all [monthly] Distribution periods terminating on or
prior to the date of redemption.
(e) If Debentures are distributed to Holders of the Preferred Securities,
Services, pursuant to the terms of the Indenture, will use its best efforts to
have the Debentures listed on the New York Stock Exchange or on such other
exchange as the Preferred Securities were listed immediately prior to the
distribution of the Debentures.
(f) (i) Notice of any redemption of, or notice of distribution of
Debentures in exchange for, the Preferred Securities and Common Securities (a
"Redemption/Distribution Notice") will be given by the Regular Trustees on
behalf of the Trust by mail to each Holder of Preferred Securities and Common
Securities to be redeemed or exchanged not less than 30 nor more than 60 days
prior to the date fixed for redemption or exchange thereof. For purposes of the
calculation of the date of redemption or exchange and the dates on which notices
are given pursuant to this paragraph (f)(i), a Redemption/Distribution Notice
shall be deemed to be given on the day such notice is first mailed by
first-class mail, postage prepaid, to Holders of Preferred Securities and Common
Securities. Each Redemption/Distribution Notice shall be addressed to the
Holders of Preferred Securities and Common Securities at the address of each
such Holder appearing in the books and records of the Trust. No defect in the
Redemption/Distribution Notice or in the mailing of either thereof with respect
to any Holder shall affect the validity of the redemption or exchange
proceedings with respect to any other Holder.
(ii) In the event that fewer than all the outstanding Preferred Securities
are to be redeemed, the Preferred Securities to be redeemed will be redeemed Pro
Rata from each Holder of Preferred Securities, it being understood that, in
respect of Preferred Securities registered in the name of and held of record by
DTC (or
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successor Clearing Agency) or any other nominee, the Preferred Securities will
be redeemed from, and the distribution of the proceeds of such redemption will
be made to, each Clearing Agency Participant (or person on whose behalf such
nominee holds such securities) in accordance with the procedures applied by such
agency or nominee.
(iii) Subject to paragraph 9 hereof, if the Trust gives a Redemption/
Distribution Notice in respect of a redemption of Preferred Securities as
provided in this paragraph 4 (which notice will be irrevocable) then (A) while
the Preferred Securities are in book-entry only form, with respect to the
Preferred Securities, by 12:00 noon, New York City time, on the redemption date,
provided that Services has paid the Property Trustee, in immediately available
funds, a sufficient amount of cash in connection with the related redemption or
maturity of the Debentures, the Property Trustee will deposit irrevocably with
DTC (or successor Clearing Agency) funds sufficient to pay the applicable
Redemption Price with respect to the Preferred Securities and will give DTC (or
successor Clearing Agency) irrevocable instructions and authority to pay the
Redemption Price to the Holders of the Preferred Securities and (B) if the
Preferred Securities are issued in definitive form, with respect to the
Preferred Securities and provided that Services has paid the Property Trustee,
in immediately available funds, a sufficient amount of cash in connection with
the related redemption or maturity of the Debentures, the Property Trustee will
pay the relevant Redemption Price to the Holders of such Preferred Securities by
check mailed to the address of the relevant Holder appearing on the books and
records of the Trust on the redemption date. If a Redemption/Distribution Notice
shall have been given and funds deposited as required, if applicable, then
immediately prior to the close of business on the redemption date, Distributions
will cease to accrue on the Preferred Securities called for redemption, such
Preferred Securities will no longer be deemed to be outstanding and all rights
of Holders of such Preferred Securities so called for redemption will cease,
except the right of the Holders of such Preferred Securities to receive the
Redemption Price, but without interest on such Redemption Price. Neither the
Trustees nor the Trust shall be required to register or cause to be registered
the transfer of any Preferred Securities which have been so called for
redemption. If any date fixed for redemption of Preferred 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 Preferred Securities is improperly withheld or refused and not paid either by
the Property Trustee or by Services or Aetna pursuant to the Preferred
Securities Guarantee, Distributions on such Preferred Securities will continue
to accrue,
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from the original redemption date to the 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.
(iv) Redemption/Distribution Notices shall be sent by the Regular Trustees
on behalf of the Trust to DTC or its nominee (or any successor Clearing Agency
or its nominee) if the Global Certificates have been issued or, if Definitive
Preferred Security Certificates have been issued, to the Holders of the
Preferred Securities.
(v) Upon the date of dissolution of the Trust and distribution of
Debentures as a result of the occurrence of a Special Event, Preferred Security
Certificates shall be deemed to represent beneficial interests in the Debentures
so distributed, and the Preferred Securities will no longer be deemed
outstanding and may be canceled by the Regular Trustees. The Debentures so
distributed shall have an aggregate principal amount equal to the aggregate
liquidation amount of the Preferred Securities so distributed.
(vi) Subject to the foregoing and applicable law (including, without
limitation, United States federal securities laws), Services, Aetna or any of
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.
5. Voting Rights. (a) Except as provided under paragraph 5(b) below and as
otherwise required by law and the Declaration, the Holders of the Preferred
Securities will have no voting rights.
(b) If any proposed amendment to the Declaration provides for, or the
Regular Trustees otherwise propose to effect, (i) any action that would
adversely affect the powers, preferences or special rights of the Securities,
whether by way of amendment to the Declaration or otherwise, or (ii) the
dissolution, winding-up or termination of the Trust, other than in connection
with the distribution of Debentures held by the Property Trustee, upon the
occurrence of a Special Event or in connection with the redemption of Preferred
Securities as a consequence of a redemption of Debentures, then the Holders of
outstanding Securities will be entitled to vote on such amendment or proposal as
a class and such amendment or proposal shall not be effective except with the
approval of the Holders of Securities representing 66-2/3% in liquidation amount
of such Securities; provided, however, that (A) 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 66-2/3% in liquidation amount
of such class of Securities and (B)
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amendments to the Declaration shall be subject to such further requirements as
are set forth in Sections 12.1 and 12.2 of the Declaration.
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,
modification or termination of the Indenture or the Debentures, the Property
Trustee shall request the written direction of the Holders of the Securities
with respect to such amendment, modification or termination. The Property
Trustee shall vote with respect to such amendment, modification or termination
as directed by a Majority in liquidation amount of the Securities voting
together as a single class; provided that where such amendment, modification or
termination of the Indenture requires the consent or vote of (1) holders of
Debentures representing a specified percentage greater than a majority in
principal amount of the Debentures or (2) each holder of Debentures, the
Property Trustee may only vote with respect to that amendment, modification or
termination as directed by, in the case of clause (1) above, the vote of Holders
of Securities representing such specified percentage of the aggregate
liquidation amount of the Securities, or, in the case of clause (2) above, each
Holder of Securities; and provided, further, that the Property Trustee shall be
under no obligation to take any action in accordance with the directions of the
Holders of Securities unless the Property Trustee shall have received, at the
expense of the Sponsor, an opinion of nationally recognized independent tax
counsel recognized as expert in such matters to the effect that the Trust will
not be classified for United States federal income tax purposes as an
association taxable as a corporation or a partnership on account of such action
and will be treated as a grantor trust for United States federal income tax
purposes following such action.
Subject to Section 2.6 of the Declaration, and the provisions of this and
the next succeeding paragraph, the Holders of a Majority in liquidation amount
of the Preferred Securities, voting separately as a class shall have the right
to (A) on behalf of all Holders of Preferred Securities, waive any past default
that is waivable under the Declaration (subject to, and in accordance with the
Declaration) and (B) direct the time, method and place of conducting any
proceeding for any remedy available to the Property Trustee, or exercising any
trust or power conferred upon the Property Trustee under the Declaration,
including the right to direct the Property Trustee, as the holder of the
Debentures, to (i) direct the time, method and place of conducting any
proceeding for any remedy available to the Debenture Trustee, or exercising any
trust or power conferred on the Debenture Trustee with respect to the
Debentures, (ii) waive any past default that is waivable under Section 6.06 of
the Indenture, or (iii) exercise any right to rescind or annul a declaration
that the principal of all the Debentures shall be due and payable; provided that
where the taking of any action under the Indenture requires the consent or vote
of (1) holders of Debentures representing a
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specified percentage greater than a majority in principal amount of the
Debentures or (2) each holder of Debentures, the Property Trustee may only take
such action if directed by, in the case of clause (1) above, the vote of Holders
of Preferred Securities representing such specified percentage of the aggregate
liquidation amount of the Preferred Securities, or, in the case of clause (2)
above, each Holder of Preferred Securities. The Property Trustee shall not
revoke any action previously authorized or approved by a vote of the Holders of
the Preferred Securities. Other than with respect to directing the time, method
and place of conducting any proceeding for any remedy available to the Property
Trustee or the Debenture Trustee as set forth above, the Property Trustee shall
be under no obligation to take any of the foregoing actions at the direction of
the Holders of Preferred Securities unless the Property Trustee shall have
received, at the expense of the Sponsor, an opinion of nationally recognized
independent tax counsel recognized as expert in such matters to the effect that
the Trust will not be classified for United States federal income tax purposes
as an association taxable as a corporation or a partnership on account of such
action and will be treated as a grantor trust for United States federal income
tax purposes following such action. If the Property Trustee fails to enforce its
rights under the Declaration (including, without limitation, its rights, powers
and privileges as a holder of the Debentures under the Indenture), any Holder of
Preferred Securities may, to the extent permitted by law, after a period of 30
days has elapsed from such Holder's written request to the Property Trustee to
enforce such rights, institute a legal proceeding directly against Services and
Aetna to enforce the Property Trustee's rights under the Declaration, without
first instituting a legal proceeding against the Property Trustee or any other
Person.
A waiver of an Indenture Event of Default by the Property Trustee at the
direction of the Holders of the Preferred Securities will constitute a waiver of
the corresponding Event of Default under the Declaration in respect of the
Securities.
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 of the Trust or
pursuant to written consent. The Regular Trustees will 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
will include a statement setting forth (i) the date of such meeting or the date
by which such action is to be taken, (ii) a description of any resolution
proposed for adoption at such meeting on which such Holders are entitled to vote
or of such matter upon which written consent is sought and (iii) instructions
for the delivery of proxies or consents.
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No vote or consent of the Holders of Preferred Securities will be required
for the Trust to redeem and cancel Preferred Securities in accordance with the
Declaration.
Notwithstanding that Holders of Preferred Securities are entitled to vote
or consent under any of the circumstances described above, any of the Preferred
Securities at such time that are owned by Services or by any entity directly or
indirectly controlling or controlled by or under direct or indirect common
control with Services shall not be entitled to vote or consent and shall, for
purposes of such vote or consent, be treated as if they were not outstanding.
Except as provided in this paragraph 5, Holders of the Preferred
Securities will have no rights to increase or decrease the number of Trustees or
to appoint, remove or replace a Trustee, which voting rights are vested solely
in the Holders of the Common Securities.
6. Pro Rata Treatment. A reference in these terms of the Preferred
Securities to any payment, distribution or treatment as being "Pro Rata" shall
mean 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 unless, in
relation to a payment, an Event of Default has occurred and is continuing, in
which case any funds available to make such payment shall be paid first to each
Holder of the Preferred Securities pro rata according to the aggregate
liquidation amount of Preferred Securities held by the relevant Holder relative
to the aggregate liquidation amount of all Preferred Securities outstanding, and
only after satisfaction of all amounts owed to the Holders of the Preferred
Securities, to each Holder of Common Securities pro rata according to the
aggregate liquidation amount of Common Securities held by the relevant Holder
relative to the aggregate liquidation amount of all Common Securities
outstanding.
7. Ranking. The Preferred Securities rank pari passu and payment thereon
will be made Pro Rata with the Common Securities except that where an Event of
Default occurs and is continuing, the rights of Holders of Preferred Securities
to payment in respect of Distributions and payments upon liquidation, redemption
or otherwise rank in priority to the rights of Holders of the Common Securities.
8. Mergers, Consolidations or Amalgamations. The Trust may not
consolidate, amalgamate, merge with or into, or be replaced by, or convey,
transfer or lease its properties and assets to, any corporation or other body.
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9. Transfer, Exchange, Method of Payments. Payment of Distributions and
payments on redemption of the Preferred Securities will be payable, the transfer
of the Preferred Securities will be registrable, and Preferred Securities will
be exchangeable for Preferred Securities of other denominations of a like
aggregate liquidation amount, at the principal corporate trust office of the
Property Trustee in The City of Chicago; provided that payment of Distributions
may be made at the option of the Regular Trustees on behalf of the Trust by
check mailed to the address of the persons entitled thereto and that the payment
on redemption of any Preferred Security will be made only upon surrender of such
Preferred Security to the Property Trustee.
10. Acceptance of Indenture and Preferred Guarantee. Each Holder of
Preferred Securities, by the acceptance thereof, agrees to the provisions of (i)
the Preferred Guarantee, including the subordination provisions therein and (ii)
the Indenture and the Debentures, including the subordination provisions of the
Indenture.
11. No Preemptive Rights. The Holders of Preferred Securities shall have
no preemptive rights to subscribe to any additional Preferred Securities or
Common Securities.
12. Miscellaneous. These terms shall constitute a part of the Declaration.
The Trust will provide a copy of the Declaration and the Indenture to a Holder
without charge on written request to the Trust at its principal place of
business.
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Annex I
[IF THE PREFERRED SECURITY IS TO BE A GLOBAL CERTIFICATE INSERT - This
Preferred Security is a Global Certificate within the meaning of the Declaration
hereinafter referred to and is registered in the name of The Depository Trust
Company ("DTC") or a nominee of DTC. This Preferred Security is exchangeable for
Preferred Securities registered in the name of a person other than DTC or its
nominee only in the limited circumstances described in the Declaration and no
transfer of this Preferred Security (other than a transfer of this Preferred
Security as a whole by DTC to a nominee of DTC or by a nominee of DTC to DTC or
another nominee of DTC) may be registered except in limited circumstances.
Unless this Preferred Security is presented by an authorized
representative of The Depository Trust Company (55 Water Street, New York) to
the Trust or its agent for registration of transfer, exchange or payment, and
any Preferred Security issued is registered in the name of Cede & Co. or such
other name as requested by an authorized representative of The Depository Trust
Company and any payment hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL since the
registered owner hereof, Cede & Co., has an interest herein.]
Number Preferred Securities
----------- -----------
CUSIP NO.
-----------
Certificate Evidencing Preferred Securities
of
Aetna Capital Trust [ ]
____% Preferred Trust Securities
(liquidation amount $25 per Preferred Security)
Aetna Capital Trust [ ], a statutory business trust created under the laws
of the State of Delaware (the "Trust"), hereby certifies that _________ (the
"Holder") is the registered owner of _____ (______) preferred securities of the
Trust representing undivided beneficial interests in the assets of the Trust
77
designated the ____% Preferred Trust Securities (liquidation amount $25 per
Preferred Security) (the "Preferred Securities"). The Preferred Securities are
transferable on the books and records of the Trust, in person or by a duly
authorized attorney, upon surrender of this certificate duly endorsed and in
proper form for transfer. The designations, rights, privileges, restrictions,
preferences and other terms and provisions of the Preferred Securities are set
forth in, and this certificate and the Preferred Securities represented hereby
are issued and shall in all respects be subject to the terms and provisions of,
the Amended and Restated Declaration of Trust of the Trust dated as of
___________, 199_, as the same may be amended from time to time (the
"Declaration") including the designation of the terms of Preferred Securities as
set forth in Exhibit B thereto. The Preferred Securities and the Common
Securities issued by the Trust pursuant to the Declaration represent undivided
beneficial interests in the assets of the Trust, including the Debentures (as
defined in the Declaration) issued by Aetna Services, Inc., a Connecticut
corporation ("Services"), to the Trust pursuant to the Indenture referred to in
the Declaration. The Holder is entitled to the benefits of the Guarantee
Agreement of Services and Aetna Inc. ("Aetna") dated as of __________, 199_ (the
"Guarantee") to the extent provided therein. The Trust will furnish a copy of
the Declaration, the Guarantee and the Indenture to the Holder without charge
upon written request to the Trust at its principal place of business or
registered office.
The Holder of this Certificate, by accepting this Certificate, is deemed
to have (i) agreed to the terms of the Indenture and the Debentures, including
that the Debentures are subordinate and junior in right of payment to all Senior
Indebtedness (as defined in the Indenture) as and to the extent provided in the
Indenture and (ii) agreed to the terms of the Guarantee, including that the
Guarantee ranks (a) pari passu in right of payment with Aetna's and Services'
obligations under other guarantees of preferred securities, (b) subordinate and
junior in right of payment to all other liabilities of Aetna, including the
guarantee under the Indenture of the Debentures, and of Services, including the
Debentures, except those made pari passu or subordinate by their terms, and (c)
senior to all capital stock now or hereafter issued by Aetna or Services and to
any guarantee now or hereafter entered into by Aetna or Services in respect of
any of its or their capital stock.
Upon receipt of this certificate, the Holder is bound by the Declaration
and is entitled to the benefits thereunder.
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IN WITNESS WHEREOF, the undersigned Trustees of the Trust have executed
this certificate this ____ day of __________, 199_.
AETNA CAPITAL TRUST [ ]
By: , as Trustee
-------------------------
Name:
Title: Trustee
By: , as Trustee
-------------------------
Name:
Title: Trustee
Dated:
Countersigned and Registered:
The First National Bank of Chicago
Transfer Agent and Registrar
By:
-------------------------
Authorized Signature
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ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Preferred
Security to:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Insert assignee's social security or tax identification number)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Insert address and zip code of assignee)
and irrevocably appoints
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
agent to transfer this
- --------------------------------------------------------
Preferred Security Certificate on the books of the Trust. The agent may
substitute another to act for him or her.
Date:
------------------------------
Signature:
--------------------------
NOTICE: THE SIGNATURE(S) TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME(S) AS
WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR, WITHOUT ALTERATION
OR ENLARGEMENT OR ANY CHANGE WHATEVER.
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EXHIBIT C
TERMS OF
COMMON SECURITIES
Pursuant to Section 7.1 of the Amended and Restated Declaration of Trust
of Aetna Capital Trust [ ] dated as of ____________, 199__ (as amended from time
to time, the "Declaration"), the designations, rights, privileges, restrictions,
preferences and other terms and provisions of the Common Securities are set
forth below (each capitalized term used but not defined herein having the
meaning set forth in the Declaration):
1. Designation and Number. Common Securities of the Trust with an
aggregate liquidation amount in the assets of the Trust of
__________________________________________ Dollars ($____________) and a
liquidation amount in the assets of the Trust of $25 per Common Security, are
hereby designated as "____% Common Trust Securities". The Common Security
Certificates evidencing the Common Securities shall be substantially in the form
attached hereto as Annex I, with such changes and additions thereto or deletions
therefrom as may be required by ordinary usage, custom or practice. The Common
Securities are to be issued and sold to Aetna Services, Inc. ("Services") in
consideration of $_____________ in cash. In connection with the issuance and
sale of the Preferred Securities and the Common Securities, the Trust will
purchase as trust assets Debentures of Services having an aggregate principal
amount equal to the aggregate liquidation amount of the Preferred Securities and
Common Securities so issued, and bearing interest at an annual rate equal to the
annual Distribution rate on the Preferred Securities and Common Securities and
having payment and redemption provisions which correspond to the payment and
redemption provisions of the Preferred Securities and Common Securities.
2. Distributions. (a) Distributions payable on each Common Security will
be fixed at a rate per annum of ____% (the "Coupon Rate") of the stated
liquidation amount of $25 per Common Security. Distributions in arrears for more
than one month will bear interest at the rate per annum of ____% thereof (to the
extent permitted by applicable law), compounded [monthly]. The term
"Distributions" as used in these terms means such periodic cash distributions
and any such interest payable unless otherwise stated. A Distribution will be
made by the Property Trustee only to the extent that interest payments are made
in respect of the Debentures held by the Property Trustee. The amount of
Distributions payable for any period will be computed for any [monthly]
Distribution period on
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the basis of a 360-day year of twelve 30-day months[, and for any Distribution
period shorter than a 30-day month Distribution period for which Distributions
are computed, Distributions will be computed on the basis of the actual number
of days elapsed].
(b) Distributions on the Common Securities will be cumulative, will accrue
from _________, 199__ and will be payable [monthly] in arrears, on the last day
of each month commencing on __________, 199__, except as otherwise described
below, but only if and to the extent that interest payments are made in respect
of the Debentures held by the Property Trustee. So long as Services shall not be
in default in the payment of interest on the Debentures, Services has the right
under the Indenture for the Debentures to defer payments of interest by
extending the interest payment period from time to time on the Debentures for a
period not exceeding [60] consecutive [monthly] interest periods (each, an
"Extension Period") and, as a consequence, [monthly] Distributions will continue
to accrue with interest thereon (to the extent permitted by applicable law) at
the rate of ____% per annum, compounded [monthly] during any such Extension
Period. Prior to the termination of any such Extension Period, Services may
further extend such Extension Period; provided that such Extension Period
together with all such previous and further extensions thereof may not exceed
[60] consecutive [monthly] interest periods. Upon the termination of any
Extension Period and the payment of all amounts then due, Services may commence
a new Extension Period, subject to the above requirements. Payments of accrued
Distributions will be payable to Holders of Common Securities as they appear on
the books and records of the Trust on the first record date after the end of the
Extension Period.
(c) Distributions on the Common Securities will be payable promptly by the
Property Trustee (or other Paying Agent) upon receipt of immediately available
funds to the Holders thereof as they appear on the books and records of the
Trust on the relevant record dates which will be one business day prior to the
relevant Distribution date unless the Preferred Securities are no longer in
book-entry only form in which event the relevant record dates will be the
fifteenth (15th) day of the month prior to the relevant Distribution date, which
record and payment dates correspond to the record and interest payment dates on
the Debentures. Distributions payable on any Common Securities that are not
punctually paid on any Distribution date as a result of Services having failed
to make the corresponding interest payment on the Debentures will forthwith
cease to be payable to the person in whose name such Common Security is
registered on the relevant record date, and such defaulted Distribution will
instead be payable to the person in whose name such Common Security is
registered on the special record date established by the Regular Trustees, which
record date shall correspond to the special record date or other specified date
determined in
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accordance with the Indenture; provided, however, that Distributions shall not
be considered payable on any Distribution payment date falling within an
Extension Period unless Services has elected to make a full or partial payment
of interest accrued on the Debentures on such Distribution payment date. Subject
to any applicable laws and regulations and the provisions of the Declaration,
each payment in respect of the Common Securities will be made as described in
paragraph 9 hereof. If any date on which Distributions are payable on the Common
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 date.
(d) All Distributions paid with respect to the Common Securities and the
Preferred Securities will be paid Pro Rata to the Holders thereof entitled
thereto. If an Event of Default has occurred and is continuing, the Preferred
Securities shall have a priority over the Common Securities with respect to
Distributions.
(e) In the event that there is any money or other property held by or for
the Trust that is not accounted for under the Declaration, such money or
property shall be distributed Pro Rata among the Holders of the Preferred
Securities and Common Securities.
3. Liquidation Distribution Upon Dissolution. In the event of any
voluntary or involuntary dissolution, winding-up or termination of the Trust,
the Holders of the Preferred Securities and Common Securities at the date of the
dissolution, winding-up or termination, as the case may be, will be entitled to
receive Pro Rata solely out of the assets of the Trust available for
distribution to Holders of Preferred Securities and Common Securities, after
satisfaction of liabilities to creditors as provided by applicable law, an
amount equal to the aggregate of the stated liquidation amount of $25 per
Preferred Security and Common Security plus accrued and unpaid Distributions
thereon to the date of payment (such amount being the "Liquidation
Distribution"), unless, in connection with such dissolution, winding-up or
termination, and after satisfaction of liabilities to creditors as provided by
applicable law, Debentures in an aggregate principal amount equal to the
aggregate stated liquidation amount of such Preferred Securities and Common
Securities bearing accrued and unpaid interest in an amount equal to the accrued
and unpaid Distributions on, such Preferred Securities and Common Securities,
shall be distributed Pro Rata to the Holders of the Preferred Securities and
Common Securities in exchange for such Securities.
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If, upon any such dissolution, 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 Preferred Securities and Common Securities shall be paid, subject
to the next paragraph, on a Pro Rata basis.
Holders of Common Securities will be entitled to receive Liquidation
Distributions upon any such dissolution Pro Rata with Holders of Preferred
Securities, except that if an Event of Default has occurred and is continuing,
the Preferred Securities shall have a priority over the Common Securities with
respect to such Liquidation Distribution.
4. Redemption and Distribution of Debentures. The Preferred Securities and
Common Securities may only be redeemed if Debentures having an aggregate
principal amount equal to the aggregate liquidation amount of the Preferred
Securities and Common Securities are repaid, redeemed or distributed as set
forth below:
(a) Upon the repayment of the Debentures, in whole or in part, whether at
maturity, upon redemption at any time or from time to time on or after
__________, 200_, the proceeds of such repayment will be promptly applied to
redeem Pro Rata Preferred Securities and Common Securities having an aggregate
liquidation amount equal to the aggregate principal amount of the Debentures so
repaid or redeemed, upon not less than 30 nor more than 60 days' notice, at a
redemption price of $25 per Preferred and Common Security plus an amount equal
to accrued and unpaid Distributions thereon to the date of redemption, payable
in cash (the "Redemption Price"). The date of any such repayment or redemption
of Preferred Securities and Common Securities shall be established to coincide
with the repayment or redemption date of the Debentures.
(b) If fewer than all the outstanding Preferred Securities and Common
Securities are to be so redeemed, the Preferred Securities and the Common
Securities will be redeemed Pro Rata and the Common Securities to be redeemed
will be redeemed as described in paragraph 4(e)(ii) below. If a partial
redemption would result in the delisting of the Preferred Securities by any
national securities exchange or other organization on which the Preferred
Securities are then listed, Services pursuant to the Indenture will only redeem
Debentures in whole and, as a result, the Trust may only redeem the Common
Securities in whole.
(c) If, at any time, a Tax Event or an Investment Company Event (each as
hereinafter defined, and each a "Special Event") shall occur and be continuing,
the Regular Trustees shall, unless the Debentures are redeemed in the limited
circumstances described below, dissolve the Trust and, after satisfaction of
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creditors, cause Debentures held by the Property Trustee having an aggregate
principal amount equal to the aggregate stated liquidation amount of and accrued
and unpaid interest equal to accrued and unpaid Distributions on, and having the
same record date for payment as the Preferred Securities and Common Securities,
to be distributed to the Holders of the Preferred Securities and Common
Securities on a Pro Rata basis in liquidation of such Holders' interests in the
Trust, within 90 days following the occurrence of such Special Event (the "90
Day Period"); provided, however, that in the case of the occurrence of a Tax
Event, as a condition of such dissolution and distribution, the Regular Trustees
shall have received an opinion of a nationally recognized independent tax
counsel experienced in such matters (a "No Recognition Opinion"), which opinion
may rely on any then applicable published revenue rulings of the Internal
Revenue Service, to the effect that the Holders of the Preferred Securities will
not recognize any gain or loss for United States federal income tax purposes as
a result of the dissolution of the Trust and distribution of Debentures; and
provided, further, that, if and as long as at the time there is available to the
Trust the opportunity to eliminate, within such 90 Day Period, the Special Event
by taking some ministerial action, such as filing a form or making an election,
or pursuing some other similar reasonable measure that has no adverse effect on
the Trust, Services, Aetna or the Holders of the Preferred Securities
("Ministerial Action") the Trust will pursue such measure in lieu of
dissolution.
If in the case of the occurrence of a Tax Event, (i) the Regular Trustees
have received an opinion (a "Redemption Tax Opinion") of nationally recognized
independent tax counsel experienced in such matters that, as a result of a Tax
Event, there is more than an insubstantial risk that Services would be precluded
from deducting the interest on the Debentures for United States federal income
tax purposes even if the Debentures were distributed to the Holders of Preferred
Securities and Common Securities in liquidation of such Holder's interest in the
Trust as described in this paragraph 4(c) or (ii) the Regular Trustees shall
have been informed by such tax counsel that a No Recognition Opinion cannot be
delivered to the Trust, Services shall have the right at any time, upon not less
than 30 nor more than 60 days' notice, to redeem the Debentures in whole or in
part for cash at the Redemption Price within 90 days following the occurrence of
such Tax Event, and promptly following such redemption Preferred Securities and
Common Securities with an aggregate liquidation amount equal to the aggregate
principal amount of the Debentures so redeemed will be redeemed by the Trust at
the Redemption Price on a Pro Rata basis: provided, however, that, if at the
time there is available to Services or the Regular Trustees on behalf of the
Trust the opportunity to eliminate, within such 90 day period, the Tax Event by
taking some Ministerial Action, Services or the Holders of the Preferred
Securities, Services or the Regular Trustees on behalf of the Trust will pursue
such measure in lieu of redemption; and provided, further, that Services shall
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have no right to redeem the Debentures while the Regular Trustees on behalf of
the Trust are pursuing such Ministerial Action. The Common Securities will be
redeemed Pro Rata with the Preferred Securities, except that if an Event of
Default under the Indenture has occurred and is continuing, the Preferred
Securities will have a priority over the Common Securities with respect to
payment of the Redemption Price.
"Tax Event" means that the Regular Trustees shall have obtained an opinion
of nationally recognized independent tax counsel experienced in such matters (a
"Dissolution Tax Opinion") to the effect that on or after __________, 199_ as a
result of (a) any amendment to, or change (including any announced prospective
change) in, the laws (or any regulations thereunder) of the United States or any
political subdivision or taxing authority thereof or therein, (b) any amendment
to, or change in, an interpretation or application of any such laws or
regulations by any legislative body, court, governmental agency or regulatory
authority (including the enactment of any legislation and the publication of any
judicial decision or regulatory determination), (c) any interpretation or
pronouncement that provides for a position with respect to such laws or
regulations that differs from the theretofore generally accepted position or (d)
any action taken by any governmental agency or regulatory authority, which
amendment or change is enacted, promulgated, issued or announced or which
interpretation or pronouncement is issued or announced or which action is taken,
in each case on or after __________, 199_, there is more than an insubstantial
risk that (i) the Trust is, or will be within 90 days of the date thereof,
subject to United States federal income tax with respect to income accrued or
received on the Debentures, (ii) the Trust is, or will be within 90 days of the
date thereof, subject to more than a de minimis amount of taxes, duties or other
governmental charges or (iii) interest payable by Services to the Trust on the
Debentures is not, or within 90 days of the date thereof will not be, deductible
by Services for United States federal income tax purposes.
"Investment Company Event" means that the Regular Trustees shall have
received an opinion of nationally recognized independent counsel experienced in
practice under the Investment Company Act that, as a result of the occurrence of
a change in law or regulation or a change in interpretation or application of
law or regulation by any legislative body, court, governmental agency or
regulatory authority (a "Change in 1940 Act Law"), there is more than an
insubstantial risk that the Trust is or will be considered an Investment Company
which is required to be registered under the Investment Company Act, which
Change in 1940 Act Law becomes effective on or after __________, 199_.
On the date fixed for any distribution of Debentures, upon dissolution of
the Trust, (i) the Common Securities will no longer be deemed to be outstanding
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and (ii) any certificates representing Common Securities will be deemed to
represent beneficial interests in the Debentures having an aggregate principal
amount equal to the stated liquidation amount of, and bearing accrued and unpaid
interest equal to accrued and unpaid Distributions on, such Common Securities
until such certificates are presented to Aetna or its agent for transfer or
reissuance.
(d) The Trust may not redeem fewer than all the outstanding Common
Securities unless all accrued and unpaid Distributions have been paid on all
Common Securities for all [monthly] Distribution periods terminating on or prior
to the date of redemption.
(e)(i) Notice of any redemption of, or notice of distribution of
Debentures in exchange for, the Preferred Securities and Common Securities (a
"Redemption/Distribution Notice") will be given by the Regular Trustees on
behalf of the Trust by mail to each Holder of Preferred Securities and Common
Securities to be redeemed or exchanged not less than 30 nor more than 60 days
prior to the date fixed for redemption or exchange thereof. For purposes of the
calculation of the date of redemption or exchange and the dates on which notices
are given pursuant to this paragraph (e)(i), a Redemption/Distribution Notice
shall be deemed to be given on the day such notice is first mailed by
first-class mail, postage prepaid, to Holders of Preferred Securities and Common
Securities. Each Redemption/Distribution Notice shall be addressed to the
Holders of Preferred Securities and Common Securities at the address of each
such Holder appearing in the books and records of the Trust. No defect in the
Redemption/Distribution Notice or in the mailing of either thereof with respect
to any Holder shall affect the validity of the redemption or exchange
proceedings with respect to any other Holder.
(ii) In the event that fewer than all the outstanding Common Securities
are to be redeemed, the Common Securities to be redeemed will be redeemed Pro
Rata from each Holder of Common Securities (subject to adjustment to eliminate
fractional Common Securities).
(iii) If the Trust gives a Redemption/ Distribution Notice in respect of a
redemption of Common Securities as provided in this paragraph 4 (which notice
will be irrevocable) then immediately prior to the close of business on the
redemption date, provided that Services has paid to the Property Trustee in
immediately available funds a sufficient amount of cash in connection with the
related redemption or maturity of the Debentures, Distributions will cease to
accrue on the Common Securities called for redemption, such Common Securities
will no longer be deemed to be outstanding and all rights of Holders of such
Common Securities so called for redemption will cease, except the right of the
Holders of such Common Securities to receive the Redemption Price, but without
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interest on such Redemption Price. Neither the Trustees nor the Trust shall be
required to register or cause to be registered the transfer of any Common
Securities which have been so called for redemption. If any date fixed for
redemption of Common 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 Common Securities
is improperly withheld or refused and not paid by the Property Trustee,
Distributions on such Common Securities will continue to accrue, from the
original redemption date to the 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.
(iv) Redemption/Distribution Notices shall be sent by the Regular Trustees
on behalf of the Trust to the Holders of the Common Securities.
(v) Upon the date of dissolution of the Trust and distribution of
Debentures as a result of the occurrence of a Special Event, Common Security
Certificates shall be deemed to represent beneficial interests in the Debentures
so distributed, and the Common Securities will no longer be deemed outstanding
and may be canceled by the Regular Trustees. The Debentures so distributed shall
have an aggregate principal amount equal to the aggregate liquidation amount of
the Common Securities so distributed.
5. Voting Rights. (a) Except as provided under paragraph 5(b) below and as
otherwise required by law and the Declaration, the Holders of the Common
Securities will have no voting rights.
(b) Holders of Common Securities have the sole right under the Declaration
to increase or decrease the number of Trustees, and to appoint, remove or
replace a Trustee, any such increase, decrease, appointment, removal or
replacement to be approved by Holders of Common Securities representing a
Majority in liquidation amount of the Common Securities.
If any proposed amendment to the Declaration provides for, or the Regular
Trustees otherwise propose to effect, (i) any action that would adversely affect
the powers, preferences or special rights of the Securities, whether by way of
amendment to the Declaration or otherwise, or (ii) the dissolution, winding-up
or termination of the Trust, other than in connection with the distribution of
Debentures held by the Property Trustee, upon the occurrence of a Special Event
or in connection with the redemption of Common Securities as a consequence of a
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redemption of Debentures, then the Holders of outstanding Securities will be
entitled to vote on such amendment or proposal as a class and such amendment or
proposal shall not be effective except with the approval of the Holders of
Securities representing 66-2/3% in liquidation amount of such Securities;
provided, however, that (A) 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 66-2/3% in liquidation amount of such class of
Securities, (B) the rights of Holders of Common Securities under Article V of
the Declaration to increase or decrease the number of, and to appoint, replace
or remove, Trustees shall not be amended without the consent of each Holder of
Common Securities, and (C) amendments to the Declaration shall be subject to
such further requirements as are set forth in Sections 12.1 and 12.2 of the
Declaration.
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,
modification or termination of the Indenture or the Debentures, the Property
Trustee shall request the written direction of the Holders of the Securities
with respect to such amendment, modification or termination. The Property
Trustee shall vote with respect to such amendment, modification or termination
as directed by a Majority in liquidation amount of the Securities voting
together as a single class; provided that where such amendment, modification or
termination of the Indenture requires the consent or vote of (1) holders of
Debentures representing a specified percentage greater than a majority in
principal amount of the Debentures or (2) each holder of Debentures, the
Property Trustee may only vote with respect to that amendment, modification or
termination as directed by, in the case of clause (1) above, the vote of Holders
of Securities representing such specified percentage of the aggregate
liquidation amount of the Securities, or, in the case of clause (2) above, each
Holder of Securities; and provided, further, that the Property Trustee shall be
under no obligation to take any action in accordance with the directions of the
Holders of the Securities unless the Property Trustee shall have received, at
the expense of the Sponsor, an opinion of nationally recognized independent tax
counsel recognized as an expert in such matters to the effect that the Trust
will not be classified for United States federal income tax purposes as an
association taxable as a corporation or a partnership on account of such action
and will be treated as a grantor trust for United States federal income tax
purposes following such action.
Subject to Section 2.6 of the Declaration, and the provisions of this and
the next succeeding paragraph, the Holders of a Majority in liquidation amount
of the Common Securities, voting separately as a class shall have the right to
(A) on behalf of all Holders of Common Securities, waive any past default that
is
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89
waivable under the Declaration (subject to, and in accordance with the
Declaration) and (B) direct the time, method, and place of conducting any
proceeding for any remedy available to the Property Trustee, or exercising any
trust or power conferred upon the Property Trustee under the Declaration,
including the right to direct the Property Trustee, as holder of the Debentures,
to (i) direct the time, method and place of conducting any proceeding for any
remedy available to the Debenture Trustee, or exercising any trust or power
conferred on the Debenture Trustee with respect to the Debentures, (ii) waive
any past default and its consequences that is waivable under Section 6.06 of the
Indenture, or (iii) exercise any right to rescind or annul a declaration that
the principal of all the Debentures shall be due and payable; provided that
where the taking of any action under the Indenture requires the consent or vote
of (1) holders of Debentures representing a specified percentage greater than a
majority in principal amount of the Debentures or (e) each holder of Debentures,
the Property Trustee may only take such action if directed by, in the case of
clause (1) above, the vote of Holders of Common Securities representing such
specified percentage of the aggregate liquidation amount of the Common
Securities, or, in the case of clause (2) above, each Holder of Common
Securities. Pursuant to this paragraph, the Property Trustee shall not revoke,
or take any action inconsistent with, any action previously authorized or
approved by a vote of the Holders of the Preferred Securities, and shall not
take any action in accordance with the direction of the Holders of the Common
Securities under this paragraph if the action is prejudicial to the Holders of
Preferred Securities. Other than with respect to directing the time, method and
place of conducting any proceeding for any remedy available to the Property
Trustee or the Debenture Trustee as set forth above, the Property Trustee shall
be under no obligation to take any of the foregoing actions at the direction of
the Holders of Common Securities unless the Properties Trustee shall have
received, at the expense of the Sponsor, an opinion of nationally recognized
independent tax counsel recognized as expert in such matters to the effect that
the Trust will not be classified for United States federal income tax purposes
as an association taxable as a corporation or a partnership on account of such
action and will be treated as a grantor trust for United States income tax
purposes following such action.
Notwithstanding any other provision of these terms, each Holder of Common
Securities will be deemed to have waived any Event of Default with respect to
the Common Securities and its consequences until all Events of Default with
respect to the Preferred Securities have been cured, waived by the Holders of
Preferred Securities as provided in the Declaration or otherwise eliminated, and
until all Events of Default with respect to the Preferred Securities have been
so cured, waived by the Holders of Preferred Securities or otherwise eliminated,
the Property Trustee will be deemed to be acting solely on behalf of the Holders
of Preferred Securities and only the Holders of the Preferred Securities will
have the
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right to direct the Property Trustee in accordance with the terms of the
Declaration or of the Securities. In the event that any Event of Default with
respect to the Preferred Securities is waived by the Holders of Preferred
Securities as provided in the Declaration, the Holders of Common Securities
agree that such waiver shall also constitute the waiver of such Event of Default
with respect to the Common Securities for all purposes under the Declaration
without any further act, vote or consent of the Holders of the Common
Securities.
A waiver of an Indenture Event of Default by the Property Trustee at the
direction of the Holders of the Preferred Securities will constitute a waiver of
the corresponding Event of Default under the Declaration in respect of the
Securities.
Any required approval 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 of the Trust or pursuant to written
consent. The Regular Trustees will cause a notice of any meeting at which
Holders of Common Securities are entitled to vote, or of any matter upon which
action by written consent of such Holders is to be taken, to be mailed to each
Holder of record of Common Securities. Each such notice will include a statement
setting forth (i) the date of such meeting or the date by which such action is
to be taken, (ii) a description of any resolution proposed for adoption at such
meeting on which such Holders are entitled to vote or of such matter upon which
written consent is sought and (iii) instructions for the delivery of proxies or
consents.
No vote or consent of the Holders of Common Securities will be required
for the Trust to redeem and cancel Common Securities in accordance with the
Declaration.
6. Pro Rata Treatment. A reference in these terms of the Common Securities
to any payment, distribution or treatment as being "Pro Rata" shall mean 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 unless, in relation to a
payment, an Event of Default has occurred and is continuing, in which case any
funds available to make such payment shall be paid first to each Holder of the
Preferred Securities pro rata according to the aggregate liquidation amount of
Preferred Securities held by the relevant Holder relative to the aggregate
liquidation amount of all Preferred Securities outstanding, and only after
satisfaction of all amounts owed to the Holders of the Preferred Securities, to
each Holder of Common Securities pro rata according to the aggregate liquidation
amount of Common Securities held by the relevant Holder relative to the
aggregate liquidation amount of all Common Securities outstanding.
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7. Ranking. The Common Securities rank pari passu and payment thereon will
be made Pro Rata with the Preferred Securities except that where an Event of
Default occurs and is continuing, the rights of Holders of Common Securities to
payment in respect of Distributions and payments upon liquidation, redemption or
otherwise are subordinate to the rights of Holders of the Preferred Securities.
8. Mergers, Consolidations or Amalgamations. The Trust may not
consolidate, amalgamate, merge with or into, or be replaced by, or convey,
transfer or lease its properties and assets to, any corporation or other body.
9. Transfers, Exchanges, Method of Payments. Payment of Distributions and
payments on redemption of the Common Securities will be payable, the transfer of
the Common Securities will be registrable, and Common Securities will be
exchangeable for Common Securities of other denominations of a like aggregate
liquidation amount, at the principal corporate trust office of the Property
Trustee in The City of Chicago; provided that payment of Distributions may be
made at the option of the Regular Trustees on behalf of the Trust by check
mailed to the address of the persons entitled thereto and that the payment on
redemption of any Common Security will be made only upon surrender of such
Common Security to the Property Trustee. Notwithstanding the foregoing,
transfers of Common Securities are subject to conditions set forth in Section
9.1(c) of the Declaration.
10. Acceptance of Indenture. Each Holder of Common Securities, by the
acceptance thereof, agrees to the provisions of the Indenture and the
Debentures, including the subordination provisions thereof.
11. No Preemptive Rights. The Holders of Common Securities shall have no
preemptive rights to subscribe to any additional Common Securities or Preferred
Securities.
12. Miscellaneous. These terms shall constitute a part of the Declaration.
The Trust will provide a copy of the Declaration and the Indenture to a Holder
without charge on written request to the Trust at its principal place of
business.
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Annex I
TRANSFER OF THIS CERTIFICATE
IS SUBJECT TO THE CONDITIONS
SET FORTH IN THE DECLARATION
REFERRED TO BELOW
Certificate Number Number of Common Securities
------ ----------
Certificate Evidencing Common Securities
of
Aetna Capital Trust [ ]
____% Common Trust Securities
(liquidation amount $25 per Common Security)
Aetna Capital Trust [ ], a statutory business trust formed under the laws
of the State of Delaware (the "Trust"), hereby certifies that Aetna Services,
Inc. (the "Holder") is the registered owner of ____________________________
(_________) common securities of the Trust representing undivided beneficial
interests in the assets of the Trust designated the "____% Common Trust
Securities" (liquidation amount $25 per Common Security) (the "Common
Securities"). The Common Securities are transferable on the books and records of
the Trust, in person or by a duly authorized attorney, upon surrender of this
certificate duly endorsed and in proper form for transfer and satisfaction of
the other conditions set forth in the Declaration (as defined below) including,
without limitation Section 9.01(c) thereof. The designations, rights,
privileges, restrictions, preferences and other terms and provisions of the
Common Securities are set forth in, and this certificate and the Common
Securities represented hereby are issued and shall in all respects be subject to
the terms and provisions of, the Amended and Restated Declaration of Trust of
the Trust dated as of __________, 199__, as the same may be amended from time to
time (the "Declaration") including the designation of the terms of Common
Securities as set forth in Exhibit C thereto. The Common Securities and the
Preferred Securities issued by the Trust pursuant to the Declaration represent
undivided beneficial interests in the assets of the Trust, including the
Debentures (as defined in the Declaration)
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issued by Aetna Services, Inc., a Connecticut corporation, to the Trust pursuant
to the Indenture referred to in the Declaration. The Trust will furnish a copy
of the Declaration and the Indenture to the Holder without charge upon written
request to the Trust at its principal place of business or registered office.
The Holder of this Certificate, by accepting this Certificate, is deemed
to have agreed to the terms of the Indenture and the Debentures, including that
the Debentures are subordinate and junior in right of payment to all Senior
Indebtedness (as defined in the Indenture) as and to the extent provided in the
Indenture.
Upon receipt of this certificate, the Holder is bound by the Declaration
and is entitled to the benefits thereunder.
IN WITNESS WHEREOF, the undersigned Trustees of the Trust have executed
this certificate this day of , 199_.
--- --------------
AETNA CAPITAL TRUST [ ]
By: , as Trustee
-------------------------
Name:
Title: Trustee
By: , as Trustee
-------------------------
Name:
Title: Trustee
Dated:
Countersigned and Registered:
The First National Bank of Chicago
Transfer Agent and Registrar
By:
-------------------------------
Authorized Signature
2
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ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Common
Security Certificate to:
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(Insert assignee's social security or tax identification number)
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(Insert address and zip code of assignee)
and irrevocably appoints
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agent to transfer this
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Common Security Certificate on the books of the Trust. The agent may substitute
another to act for him or her.
Date:
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Signature: --------------------------------
(Sign exactly as your name appears on the other side of this Common Security
Certificate)
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