EXHIBIT 4(q)
AMENDED AND RESTATED TRUST AGREEMENT
OF
DTE ENERGY TRUST II
Dated as of June 1, 2004
CROSS REFERENCE TABLE(1)
Section of Trust Indenture Act
of 1939, as amended Section of Agreement
310(a) ....................................................... 5.3(a)
310(b) ....................................................... 5.3(c), 5.3(d)
310(c) ....................................................... Inapplicable
311(a) ....................................................... 2.2(b)
311(b) ....................................................... 2.2(b)
311(c) ....................................................... Inapplicable
312(a) ....................................................... 2.2(a)
312(b) ....................................................... 2.2(b)
312(c) ....................................................... Inapplicable
313........................................................... 2.3
314(a) ....................................................... 2.4, 2.7, 3.6(e)
314(b) ....................................................... Inapplicable
314(c) ....................................................... 2.5
314(d) ....................................................... Inapplicable
314(e) ....................................................... 2.5
314(f) ....................................................... Inapplicable
315(a) ....................................................... 3.9(b); 3.10(a)
315(b) ....................................................... 2.7(a)
315(c) ....................................................... 3.9(a)
315(d) ....................................................... 3.9(b)
316(a) ....................................................... 2.6
316(b) ....................................................... 2.6
316(c) ....................................................... 3.6(e)
317(a) ....................................................... 3.8(h)
317(b) ....................................................... 3.8(c); 7.2(a)
318........................................................... 2.1(c)
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(1) This Cross-Reference Table does not constitute part of the Agreement and
shall not have any bearing upon the interpretation of any of its terms or
provisions.
Table of Contents
Page
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ARTICLE I
INTERPRETATION AND DEFINITIONS
Section 1.1 Definitions.......................................................................... 1
ARTICLE II
TRUST INDENTURE ACT
Section 2.1 Trust Indenture Act; Application..................................................... 8
Section 2.2 Lists of Holders of Securities....................................................... 9
Section 2.3 Reports by the Property Trustee...................................................... 9
Section 2.4 Periodic Reports to Property Trustee................................................. 9
Section 2.5 Evidence of Compliance With Conditions Precedent..................................... 10
Section 2.6 Events of Default; Waiver............................................................ 10
Section 2.7 Event of Default; Notice............................................................. 12
ARTICLE III
ORGANIZATION
Section 3.1 Name................................................................................. 12
Section 3.2 Office............................................................................... 13
Section 3.3 Purposes............................................................................. 13
Section 3.4 Authority............................................................................ 13
Section 3.5 Title to Property of the Trust....................................................... 14
Section 3.6 Powers and Duties of the Administrative Trustees..................................... 14
Section 3.7 Prohibition of Actions by the Trust and the Trustees................................. 17
Section 3.8 Powers and Duties of the Property Trustee............................................ 18
Section 3.9 Certain Duties and Responsibilities of the Property Trustee.......................... 20
Section 3.10 Certain Rights of the Property Trustee.............................................. 22
Section 3.11 Delaware Trustee.................................................................... 24
Section 3.12 Not Responsible for Recitals or Issuance of Securities.............................. 24
Section 3.13 Duration of Trust................................................................... 24
Section 3.14 Mergers............................................................................. 24
ARTICLE IV
SPONSOR
Section 4.1 Sponsor's Purchase of Common Securities.............................................. 26
Section 4.2 Covenants of the Sponsor............................................................. 26
Section 4.3 Rights and Responsibilities of the Sponsor........................................... 27
Section 4.4 Right to Proceed..................................................................... 27
Section 4.5 Expenses............................................................................. 27
ARTICLE V
TRUSTEES
Section 5.1 Number of Trustees................................................................... 28
Section 5.2 Delaware Trustee..................................................................... 29
Section 5.3 Property Trustee; Eligibility........................................................ 29
Section 5.4 Certain Qualifications of Administrative Trustees and Delaware Trustee Generally..... 30
Section 5.5 Administrative Trustees.............................................................. 30
Section 5.6 Appointment; Removal and Resignation of Trustees..................................... 30
Section 5.7 Vacancies Among Trustees............................................................. 32
Section 5.8 Effect of Vacancies.................................................................. 32
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Section 5.9 Meetings............................................................................. 32
Section 5.10 Delegation of Power................................................................. 33
Section 5.11 Merger, Conversion, Consolidation or Succession to Business......................... 33
ARTICLE VI
DISTRIBUTIONS
Section 6.1 Distributions........................................................................ 34
ARTICLE VII
ISSUANCE OF SECURITIES
Section 7.1 General Provisions Regarding Securities.............................................. 34
Section 7.2 Paying Agent and Registrar........................................................... 37
ARTICLE VIII
TERMINATION OF TRUST
Section 8.1 Termination of Trust................................................................. 38
ARTICLE IX
TRANSFER OF INTERESTS
Section 9.1 Transfer of Securities............................................................... 39
Section 9.2 Transfer or Exchange of Certificates................................................. 40
Section 9.3 Deemed Security Holders.............................................................. 40
Section 9.4 Book Entry Interests................................................................. 40
Section 9.5 Notices to Clearing Agency........................................................... 41
Section 9.6 Appointment of Successor Clearing Agency............................................. 41
Section 9.7 Definitive Trust Preferred Security Certificates..................................... 42
Section 9.8 Mutilated, Destroyed, Lost or Stolen Certificates.................................... 42
ARTICLE X
LIMITATION OF LIABILITY OF HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
Section 10.1 Liability........................................................................... 43
Section 10.2 Exculpation......................................................................... 43
Section 10.3 Fiduciary Duty...................................................................... 44
Section 10.4 Indemnification..................................................................... 44
Section 10.5 Outside Businesses.................................................................. 47
Section 10.6 Trustees' Fees and Expenses......................................................... 47
ARTICLE XI
ACCOUNTING
Section 11.1 Fiscal Year......................................................................... 47
Section 11.2 Certain Accounting Matters.......................................................... 48
Section 11.3 Banking............................................................................. 48
Section 11.4 Withholding......................................................................... 48
ARTICLE XII
AMENDMENTS AND MEETINGS
Section 12.1 Amendments.......................................................................... 49
Section 12.2 Meetings of the Holders of Securities; Action by Written Consent.................... 51
ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE AND DELAWARE TRUSTEE
Section 13.1 Representations and Warranties of Property Trustee.................................. 52
Section 13.2 Representations and Warranties of Delaware Trustee.................................. 53
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ARTICLE XIV
MISCELLANEOUS
Section 14.1 Notices............................................................................. 54
Section 14.2 Governing Law....................................................................... 55
Section 14.3 Intention of the Parties............................................................ 55
Section 14.4 Headings............................................................................ 55
Section 14.5 Successors and Assigns.............................................................. 55
Section 14.6 Partial Enforceability.............................................................. 55
Section 14.7 Entire Agreement.................................................................... 56
Section 14.8 Remedies............................................................................ 56
Section 14.9 Counterparts........................................................................ 56
EXHIBIT A Terms and Conditions of Securities
EXHIBIT A-1 Form of Trust Originated Preferred Security Certificate
EXHIBIT A-2 Form of Common Security Certificate
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AMENDED AND RESTATED
TRUST AGREEMENT
OF
DTE ENERGY TRUST II
AMENDED AND RESTATED TRUST AGREEMENT (the "Agreement") dated and effective
as of June 1, 2004, among the Trustees (as defined herein), for the benefit of
the Holders (as defined herein), and the Sponsor (as defined herein).
WHEREAS, certain of the Trustees and the Sponsor created DTE Energy Trust
II (the "Trust"), a Delaware statutory trust under the Statutory Trust Act (as
defined herein), pursuant to a Trust Agreement dated as of November 28, 2001
(the "Original Agreement"), and a Certificate of Trust filed with the Secretary
of State of the State of Delaware on November 29, 2001;
WHEREAS, prior to the date hereof, no Securities (as defined herein) have
been issued;
WHEREAS, all of the Trustees and the Sponsor, by this Agreement, intend to
amend and restate each and every term and provision of the Original Agreement;
NOW, THEREFORE, it being the intention of the parties hereto to continue
the Trust as a Delaware statutory trust under the Statutory Trust Act and to
constitute this as the governing instrument of the Trust, in consideration of
the mutual covenants herein contained and other good and valuable consideration,
the receipt of which is hereby acknowledged, the parties, intending to be
legally bound, hereby agree as follows:
ARTICLE I
INTERPRETATION AND DEFINITIONS
Section 1.1 Definitions
Unless the context otherwise requires or unless specified in an Exhibit
hereto:
(a) each capitalized term used in this Agreement but not defined in the
preamble has the respective meaning assigned to it in this Section 1.1;
(b) a term defined anywhere in this Agreement has the same meaning
throughout;
(c) all references to "the Agreement" or "this Agreement" are to this
Agreement as modified, supplemented or amended from time to time, and include
Exhibits to this Agreement;
(d) all references in this Agreement to Articles, Sections and Exhibits
are to Articles and Sections of and Annexes and Exhibits to this Agreement
unless otherwise specified;
(e) a term defined in the Trust Indenture Act, either directly or by
reference therein, has the same meaning when used in this Agreement unless
otherwise defined in this Agreement;
(f) a reference to the singular includes the plural and vice versa;
(g) the words "include," "includes" and "including" shall be deemed to be
followed by the phrase "without limitation;"
(h) all accounting terms used but not defined herein have the meanings
assigned to them in accordance with United States generally accepted accounting
principles as in effect at the time of computation; and
(i) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
Article, Section, Exhibit or other subdivision.
"Administrative Trustee" has the meaning set forth in Section 5.1.
"Affiliate" has the meaning given to that term in Rule 405 under the
Securities Act or any successor rule thereunder.
"Agent" means any Paying Agent or Registrar.
"Authorized Newspaper" means a daily newspaper, in the English language,
customarily published on each day that is a Business Day in The City of New York
and of general circulation in The City of New York.
"Authorized Officer" of a Person means any Person that is authorized to
bind such Person.
"Book Entry Interest" means a beneficial interest in a Global Certificate
registered in the name of a Clearing Agency or its nominee, ownership and
transfers of which shall be maintained and made through book entries by a
Clearing Agency as described in Section 9.4.
"Business Day" means any day that is not a Saturday, Sunday, a day on
which banking institutions in The City of New York are permitted or required by
any applicable law or executive order to close, or a day on which the Corporate
Trust Office of the Property Trustee or the Debenture Trustee is closed for
business.
"Certificate" means a Common Security Certificate or a Trust Preferred
Security Certificate.
"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
Trust 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 Trust Preferred Securities.
Unless otherwise specified in the Terms and Conditions, DTC shall be the initial
Clearing Agency.
"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.
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"Closing Date" means the "First Time of Delivery" under the Underwriting
Agreement, and, if not the First Time of Delivery, the "Subsequent Time of
Delivery."
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, or any successor legislation.
"Commission" means the Securities and Exchange Commission, as from time to
time constituted and existing under the Exchange Act, or, if at any time after
the execution of this instrument such commission is not existing and performing
the duties now assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.
"Common Security" has the meaning set forth in Section 7.1(a).
"Common Securities Guarantee" means the guarantee agreement dated as of
the date hereof and executed and delivered by the Sponsor for the benefit of the
Holders of the Common Securities, as such agreement may be modified,
supplemented or amended from time to time.
"Common Securities Agreement" means the Common Securities Subscription
Agreement, dated the date hereof, between the Trust and the Sponsor.
"Common Security Certificate" means a definitive certificate in fully
registered form representing a Common Security, which shall be prepared by the
Sponsor and a specimen of which shall be substantially in the form attached
hereto as Exhibit A-2.
"Company Indemnified Person" means (a) any Administrative Trustee; (b) any
Affiliate of any Administrative Trustee; (c) any officers, directors,
shareholders, members, partners, employees, representatives or agents of any
Administrative Trustee or any Affiliate of any Administrative Trustee; or (d)
any officer, employee or agent of the Trust or its Affiliates.
"Corporate Trust Office" means the office of the Property Trustee in The
City of New York at which the corporate trust business of the Property Trustee
shall, at any particular time, be principally administered, which office at the
date of execution of this Agreement is located at BNY Midwest Trust Company, 2
N. LaSalle Street, Suite 1020, Chicago, IL 60602, Attention: Corporate Trust.
"Covered Person" means: (a) any officer, director, shareholder, partner,
member, representative, employee or agent of (i) the Trust or (ii) the Trust's
Affiliates; and (b) any Holder of Securities.
"Creditor" has the meaning set forth in Section 4.5.
"Debenture Event of Default" means an event of default under the
Debentures.
"Debenture Issuer" means DTE Energy Company, a Michigan corporation, or
any successor entity, in its capacity as issuer of the Debentures under the
Indenture.
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"Debenture Trustee" means BNY Midwest Trust Company, an Illinois trust
corporation, as trustee under the Indenture with respect to the Debentures until
a successor is appointed thereunder, and thereafter means such successor
trustee.
"Debentures" means the debt securities to be purchased by the Trust
specified in the Terms and Conditions.
"Delaware Trustee" has the meaning set forth in Section 5.2.
"Direction" by a Person means a written direction signed:
(a) if the Person is a natural person, by that Person; or
(b) in any other case, in the name of such Person by one or more
Authorized Officers of that Person.
"Direct Action" has the meaning set forth in Section 3.8(e).
"Distribution" has the meaning set forth in the Terms and Conditions.
"DTC" means The Depository Trust Company or any successor entity.
"Event of Default" means a Debenture Event of Default has occurred and is
continuing.
"Exchange Act" means the Securities Exchange Act of 1934, as amended from
time to time, or any successor legislation.
"Fiduciary Indemnified Person" means (a) the Property Trustee, (b) the
Delaware Trustee, (c) any Affiliate of the Property Trustee or the Delaware
Trustee, and (d) any officers, directors, shareholders, members, partners,
employees, representatives, custodians, nominees or agents of the Property
Trustee or the Delaware Trustee.
"Global Certificate" has the meaning set forth in Section 9.4.
"Holder" or "holder" means a Person in whose name a Security is
registered, such Person being a beneficial owner within the meaning of the
Statutory Trust Act.
"Indemnified Person" means a Company Indemnified Person or a Fiduciary
Indemnified Person.
"Indenture" means the Indenture specified in the Terms and Conditions,
between the Debenture Issuer and the Debenture Trustee, under which the
Debentures are issued, as such indenture may be modified, supplemented or
amended from time to time, and includes any indenture supplemental thereto with
respect to the Debentures.
"Investment Company" means an entity required to register as an investment
company under the Investment Company Act.
4
"Investment Company Act" means the Investment Company Act of 1940, as
amended from time to time, or any successor legislation.
"Legal Action" has the meaning set forth in Section 3.6(g).
"Majority in liquidation amount" with respect to Securities of any class
means, except as provided elsewhere in this Agreement or by the Trust Indenture
Act, more than 50% of the aggregate liquidation amount (including the stated
amount that would be paid on redemption, liquidation or otherwise, plus any
accrued and unpaid Distributions to the date upon which the voting or written
consent percentages are determined) of all outstanding Securities of such class.
"Officers' Certificate" means, with respect to (i) the Sponsor, a
certificate signed by the Chairman of the Board, a Vice Chairman, the President
or a Vice President, and by the Treasurer, an Assistant Treasurer, the
Controller, an Assistant Controller, the Secretary or an Assistant Secretary of
the Sponsor and (ii) any other Person, a certificate signed by any two
Authorized Officers of such Person. Any Officers' Certificate delivered with
respect to compliance with a condition or covenant provided for in this
Agreement shall comply with Section 314 of the Trust Indenture Act and shall
include:
(a) a statement that the individuals signing the Officers' Certificate
have read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation upon which the statements or opinions contained in such Officers'
Certificate are based;
(c) a statement that, in the opinion of each such individual, he or she
has made such examination or investigation as, in such individual's opinion, is
necessary to enable such individual to express an informed opinion as to whether
or not such covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of such individuals, such
condition or covenant has been complied with.
"Outstanding," with respect to any Securities, means, as of the date of
determination, all Securities theretofore executed and delivered under this
Agreement, except:
(a) Trust Preferred Securities theretofore cancelled by the Property
Trustee or delivered to the Property Trustee for cancellation or Common
Securities theretofore cancelled by an Administrative Trustee or delivered to
the Administrative Trustees for cancellation;
(b) Securities for whose payment, repayment or redemption money in the
necessary amount and currency has been theretofore deposited with the Property
Trustee or any Paying Agent for the Holders of such Securities, provided that if
such Securities are to be repaid or redeemed, notice of such repayment or
redemption has been duly given pursuant to this Agreement;
(c) Securities which have been paid or in exchange for or in lieu of
which other securities have been executed and delivered pursuant to this
Agreement; and
5
(d) if the Securities are convertible or exchangeable into other
securities or other property, Securities converted or exchanged as contemplated
by this Agreement if such other securities have or other property has been
either (i) delivered to the Holders of such Securities in accordance with this
Agreement or (ii) deposited with and are held by the Property Trustee or any
Paying Agent in trust for the Holders of such Securities in accordance with this
Agreement, provided in the case of this clause (ii) that any applicable notice
of conversion or exchange has been duly given to the Holders thereof pursuant to
this Agreement;
provided, however, that in determining whether the Holders of the requisite
liquidation amount of outstanding Trust Preferred Securities have given any
request, demand, authorization, direction, notice, consent or waiver hereunder,
Trust Preferred Securities owned by the Sponsor or any Administrative Trustee or
any Affiliate of the Sponsor or any Administrative Trustee shall be disregarded
and deemed not to be outstanding, except that (i) in determining whether any
Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Trust Preferred
Securities that such Trustee actually knows to be so owned shall be so
disregarded and (ii) the foregoing shall not apply at any time when all of the
outstanding Trust Preferred Securities are owned by the Sponsor, one or more of
the Trustees and/or any such Affiliate. Trust Preferred Securities so owned
which have been pledged in good faith may be regarded as outstanding if the
pledgee establishes to the satisfaction of the Administrative Trustees the
pledgee's right so to act with respect to such Trust Preferred Securities and
that the pledgee is not the Sponsor or any Affiliate of the Sponsor.
"Paying Agent" has the meaning set forth in Section 7.2(a).
"Payment Amount" has the meaning set forth in Section 6.1.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever nature.
"Pricing Agreement" means the pricing agreement for the offering and sale
of Trust Preferred Securities, including any amendments or supplements thereto,
entered into in accordance with the Underwriting Agreement.
"Property Trustee" means the Trustee meeting the eligibility requirements
set forth in Section 5.3.
"Property Trustee Account" has the meaning set forth in Section 3.8(c).
"Quorum" means, with respect to the Administrative Trustees, a majority of
the Administrative Trustees or, if there are only two Administrative Trustees,
both of them or, if there is only one Administrative Trustee, such Person.
"Registrar" has the meaning set forth in Section 7.2(b).
6
"Related Party" means, with respect to the Sponsor, any direct or indirect
wholly owned subsidiary of the Sponsor or any other Person that owns, directly
or indirectly, 100% of the outstanding voting securities of the Sponsor.
"Responsible Officer" means, with respect to the Property Trustee, any
officer within the Corporate Trust Office of the Property Trustee with direct
responsibility for the Property Trustee's obligations under this Agreement and
also means, with respect to a particular corporate trust matter, any other
officer to whom such matter is referred because of that officer's knowledge of
and familiarity with the particular subject.
"Securities" means the Common Securities and the Trust Preferred
Securities.
"Securities Guarantees" means the Common Securities Guarantee and the
Trust Preferred Securities Guarantee.
"Securities Act" means the Securities Act of 1933, as amended from time to
time, or any successor legislation.
"Sponsor" means DTE Energy Company, a Michigan corporation, or any
successor entity, in its capacity as sponsor of the Trust.
"State" means any of the 50 states in the United States or the District of
Columbia.
"Statutory Trust Act" means Chapter 38 of Title 12 of the Delaware Code,
12 Del. C. Section 3801, et seq., as it may be amended from time to time, or any
successor legislation.
"Subordinated Debenture Agreement" means the Subordinated Debenture
Purchase Agreement, dated the date hereof, between the Sponsor and the Trust
"Successor Delaware Trustee" has the meaning set forth in Section
5.6(b)(ii).
"Successor Entity" has the meaning set forth in Section 3.14(b)(i).
"Successor Property Trustee" has the meaning set forth in Section
3.8(f)(ii).
"Super Majority" has the meaning set forth in Section 2.6(a)(ii).
"10% in liquidation amount" with respect to either the Common Securities
or the Trust Preferred Securities means, except as provided elsewhere in this
Agreement or by the Trust Indenture Act, 10% or more of the aggregate
liquidation amount (including the stated amount that would be paid on
redemption, liquidation or otherwise, plus any accrued and unpaid Distributions
to the date upon which the voting percentages are determined) of all such
outstanding Common Securities or Trust Preferred Securities.
"Terms and Conditions" means the terms and conditions of the Common
Securities and the Trust Preferred Securities in the form attached hereto as
Exhibit A.
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"Trustee" or "Trustees" means each Person who has signed this Agreement as
a trustee, so long as such Person shall continue in office in accordance with
the terms hereof, and all other Persons who may from time to time be duly
appointed, qualified and serving as Trustees in accordance with the provisions
hereof, and references herein to a Trustee or the Trustees shall refer to such
Person or Persons solely in their capacity as trustees hereunder.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended
from time to time, or any successor legislation.
"Trust Preferred Security" has the meaning set forth in Section 7.1(a).
"Trust 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).
"Trust Preferred Security Certificate" means a certificate representing a
Trust Preferred Security, which shall be prepared by the Sponsor and a specimen
of which shall be substantially in the form attached hereto as Exhibit A-1.
"Trust Preferred Securities Guarantee" means the guarantee agreement dated
as of the date hereof executed and delivered by the Sponsor and BNY Midwest
Trust Company, as trustee, for the benefit of the Holders of the Trust Preferred
Securities, as such agreement may be modified, supplemented or amended from time
to time.
"Trust Property" means (a) the Debentures, (b) any cash on deposit in, or
owing to, the Property Trust Account, and (c) all proceeds and rights in respect
of the foregoing or any other property and assets for the time being held or
deemed to be held by the Property Trustee pursuant to this Agreement.
"Underwriting Agreement" means the underwriting agreement for the offering
and sale of Trust Preferred Securities, including any amendments or supplements
thereto, and "Underwriters" means the underwriters party to the Underwriting
Agreement.
ARTICLE II
TRUST INDENTURE ACT
Section 2.1 Trust Indenture Act; Application.
(a) This Agreement is subject to the provisions of the Trust Indenture Act
that are required to be part of this Agreement and shall, to the extent
applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is a trustee for
the purposes of the Trust Indenture Act.
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(c) If and to the extent that any provision of this Agreement limits,
qualifies or conflicts with the duties imposed by Sections 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.
(d) Any application of the Trust Indenture Act to this Agreement shall not
affect the nature of the Securities as equity securities representing undivided
beneficial interests in the assets of the Trust.
Section 2.2 Lists of Holders of Securities.
(a) In accordance with Section 312(a) of the Trust Indenture Act, the
Administrative Trustees, on behalf of the Trust, shall provide to the Property
Trustee:
(i) within 14 days after each record date for payment of
Distributions or such other dates as are set forth in the Terms and
Conditions, a list, in such form as the Property Trustee may reasonably
require, of the names and addresses of the Holders of the Securities
("List of Holders") as of such date, provided that the Administrative
Trustees, on behalf of the Trust, shall not be obligated to provide such
List of Holders at any time that the Property Trustee is the Registrar or
the List of Holders does not differ from the most recent List of Holders
given to the Property Trustee by the Administrative Trustees on behalf of
the Trust; and
(ii) at any other time, within 30 days of receipt by the Trust of a
written request by the Property Trustee for a List of Holders as of a date
no more than 14 days before such List of Holders is given to the Property
Trustee. The Property Trustee shall preserve, in as current a form as is
reasonably practicable, all information contained in the Lists of Holders
given to it or which it receives in the capacity as Paying Agent or
Registrar (if acting in such capacity), provided that the Property Trustee
may destroy any List of Holders previously given to it on receipt of a new
List of Holders.
(b) The Property Trustee shall comply with its obligations under Sections
311(a), 311(b) and 312(b) of the Trust Indenture Act.
Section 2.3 Reports by the Property Trustee.
Within 60 days after June 15 of each year, commencing with June 15, 2005,
the Property Trustee shall provide to the Holders of the Trust Preferred
Securities such reports as are required by Section 313 of the Trust Indenture
Act, if any, in the form and in the manner provided by Section 313 of the Trust
Indenture Act. The Property Trustee shall also comply with the requirements of
Section 313(d) of the Trust Indenture Act.
Section 2.4 Periodic Reports to Property Trustee.
The Administrative Trustees, on behalf of the Trust, shall provide to the
Property Trustee such documents, reports and information as required by Section
314 of the Trust Indenture Act (if any) and the compliance certificate required
by Section 314 of the Trust Indenture Act in the form, in the manner and at the
times required by Section 314 of the Trust Indenture Act.
9
Section 2.5 Evidence of Compliance With Conditions Precedent.
Each of the Sponsor and the Administrative Trustees, on behalf of the
Trust, shall provide to the Property Trustee such evidence of compliance with
any conditions precedent, if any, provided for in this Agreement that relate to
any of the matters set forth in Section 314(c) of the Trust Indenture Act. Any
certificate or opinion required to be given by an officer pursuant to Section
314(c)(1) may be given in the form of an Officers' Certificate.
Section 2.6 Events of Default; Waiver.
(a) The Holders of not less than a Majority in liquidation amount of Trust
Preferred Securities may, by vote or written consent, on behalf of the Holders
of all of the Trust Preferred Securities, waive any past Event of Default in
respect of the Trust Preferred Securities and its consequences, provided that,
if the corresponding Debenture Event of Default:
(i) is not waivable under the Debentures, the Event of Default
under this Agreement shall also not be waivable; or
(ii) requires the consent or action of greater than a majority in
principal amount of the holders of the Debentures (a "Super Majority"), to
be waived under the Indenture, the Event of Default under this Agreement
may only be waived by the consent or action of the same Super Majority in
aggregate liquidation amount of Holders of the Trust Preferred Securities.
The foregoing provisions of this Section 2.6(a) shall be in lieu of Section
316(a)(1)(B) of the Trust Indenture Act and such Section 316(a)(1)(B) of the
Trust Indenture Act is hereby expressly excluded from this Agreement and the
Securities, as permitted by the Trust Indenture Act. Upon such waiver, any such
Debenture Event of Default shall cease to exist, and any Event of Default with
respect to the Trust Preferred Securities arising therefrom shall be deemed to
have been cured, for every purpose of this Agreement, but no such waiver shall
extend to any subsequent or other default or Event of Default with respect to
the Trust Preferred Securities or impair any right consequent thereon. Any
waiver by the Holders of the Trust Preferred Securities of an Event of Default
with respect to the Trust Preferred Securities shall also be deemed to
constitute a waiver by the Holders of the Common Securities of any such Event of
Default with respect to the Common Securities for all purposes of this Agreement
without any further act, vote, or consent of the Holders of the Common
Securities.
The Holders of a Majority in liquidation amount of the Trust Preferred
Securities shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Property Trustee or to
direct the exercise of any trust or power conferred upon the Property Trustee,
including the right to direct the Property Trustee, as the holder of the
Debentures, to exercise the remedies available to it under the Indenture with
respect to the Debentures; provided, however, that (subject to the provisions of
Section 3.9) the Property Trustee shall have the right to decline to follow any
such direction if the Property Trustee shall determine that the action so
directed would be unjustly prejudicial to the Holders not taking part in such
direction or if the Property Trustee, being advised by competent legal counsel,
determines that the action or proceeding so directed may not lawfully be taken
or if the Property
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Trustee, in good faith, by its board of directors or trustees, executive
committee, or a trust committee of directors or trustees, and/or Responsible
Officers, shall determine that the action or proceeding so directed would
involve the Property Trustee in personal liability.
(b) The Holders of a Majority in liquidation amount of the Common
Securities may, by vote or written consent, on behalf of the Holders of all of
the Common Securities, waive any past Event of Default in respect of the
Securities and its consequences, provided that, if the corresponding Debenture
Event of Default:
(i) is not waivable under the Debentures, except where the Holders
of the Common Securities are deemed to have waived such Event of Default
under this Agreement as provided elsewhere in this Section 2.6, the Event
of Default under this Agreement shall also not be waivable; or
(ii) requires the consent or action of a Super Majority to be
waived, except where the Holders of the Common Securities are deemed to
have waived such Event of Default under this Agreement as provided below
in this Section 2.6, under the Indenture, the Event of Default under this
Agreement may only be waived by the consent or action of the same Super
Majority in aggregate liquidation amount of Holders of the Common
Securities;
provided further, that, notwithstanding (i) or (ii) above, each Holder of the
Common Securities shall be deemed to have waived any such Event of Default and
its consequences until all Events of Default with respect to the Trust Preferred
Securities have been cured, waived or otherwise eliminated, and until such
Events of Default have been so cured, waived or otherwise eliminated, the
Property Trustee will be deemed to be acting solely on behalf of the Holders of
the Trust Preferred Securities and only the Holders of the Trust Preferred
Securities will have the right to direct the Property Trustee in accordance with
the terms of this Agreement and the Securities. The foregoing provisions of this
Section 2.6(b) shall be in lieu of Sections 316(a)(1)(A) and 316(a)(1)(B) and of
the Trust Indenture Act and such Sections 316(a)(1)(A) and 316(a)(1)(B) of the
Trust Indenture Act are hereby expressly excluded from this Agreement and the
Securities, as permitted by the Trust Indenture Act. Subject to the foregoing
provisions of this Section 2.6(b), upon such waiver, any such Debenture Event of
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 Agreement, but no such waiver shall extend to any subsequent or
other default or Event of Default with respect to the Common Securities or
impair any right consequent thereon.
(c) A waiver of a Debenture Event of Default by the Property Trustee at
the direction of the Holders of the Trust Preferred Securities constitutes a
waiver of the corresponding Event of Default with respect to the Trust Preferred
Securities under this Agreement. Any waiver of a Debenture Event of Default by
the Property Trustee at the direction of the Holders of the Trust Preferred
Securities shall also be deemed to constitute a waiver by the Holders of the
Common Securities of the corresponding Event of Default under this Agreement
with respect to the Common Securities for all purposes of this Agreement without
further act, vote or consent of the Holders of the Common Securities. The
foregoing provisions of this Section 2.6(c) shall be in lieu of Section
316(a)(1)(B) of the Trust Indenture Act and such Section 316(a)(1)(B) of the
Trust Indenture
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Act is hereby expressly excluded from this Agreement and the Securities, as
permitted by the Trust Indenture Act.
(d) The right of any Holder to receive payment of Distributions in
accordance with this Agreement and the terms of the Securities 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 each such Holder.
Section 2.7 Event of Default; Notice.
(a) The Property Trustee shall, within 90 days after a Responsible Officer
of the Property Trustee obtains actual knowledge of the occurrence of a default,
transmit by mail, first class postage prepaid, to the Holders of the Securities,
notices of all defaults known to the Property Trustee other than defaults that
have been cured or waived before the giving of such notice (the term "defaults"
for the purposes of this Section 2.7(a) being hereby defined to include
Debenture Events of Default, not including any periods of grace provided for
therein and irrespective of the giving of any notice provided therein); provided
that, except for a default in the payment of principal of (or premium, if any)
or interest on, or in the delivery of any cash, securities or other property in
exchange for or upon conversion or redemption of or otherwise in accordance with
the terms of, any Debenture or the Securities, the Property Trustee shall be
protected in withholding such notice if and so long as a Responsible Officer of
the Property Trustee in good faith determines that the withholding of such
notice is in the interests of the Holders of the Securities.
(b) The Property Trustee shall not be deemed to have knowledge of any
default except:
(i) a default under Sections 501(1) and 501(2) of the Indenture;
(ii) any failure to deliver any cash, securities or other property
in exchange for or upon conversion or redemption of or otherwise in
accordance with the terms of the Debentures or the Securities; and
(iii) any default as to which the Property Trustee shall have
received written notice or of which a Responsible Officer of the Property
Trustee shall have actual knowledge.
(c) The Sponsor and the Administrative Trustee shall file annually within
30 days after June 15 of each year, commencing with June 15, 2005, with the
Property Trustee in accordance with Section 314(a)(4) of the Trust Indenture Act
a certification as to whether or not they are in compliance with all the
conditions applicable to them under this Agreement.
ARTICLE III
ORGANIZATION
Section 3.1 Name.
The Trust is named "DTE Energy Trust II," as such name may be modified
from time to time in accordance with the Statutory Trust Act. The Administrative
Trustees shall give prompt
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written notice of any change in the name of the Trust to the Delaware Trustee,
the Property Trustee and the Holders of the Securities. The Trust's activities
may be conducted under the name of the Trust or any other name deemed advisable
by the Administrative Trustees.
Section 3.2 Office.
The address of the principal office of the Trust is c/o DTE Energy
Company, 2000 2nd Avenue, Detroit, Michigan 48226-1279. On ten Business Days
prior written notice to the Property Trustee and Holders of the Securities, the
Administrative Trustees may designate another principal office.
Section 3.3 Purposes.
The exclusive purposes and functions of the Trust are and the Trust shall
have the power and authority (a) to issue and sell the Securities and use the
gross proceeds from such sale to purchase, acquire and hold the Debentures and
to own property and conduct its business all as described herein and in the
Prospectus (as defined in the Underwriting Agreement) (b) to enter into and
perform its obligations under the Underwriting Agreement, the Pricing Agreement,
the Subordinated Debenture Agreement, the Common Securities Agreement, and each
other document to which the Trust is a party in connection herewith and (c) to
engage in only those other activities necessary or incidental thereto. The Trust
shall not borrow money, issue debt or reinvest proceeds derived from
investments, pledge any of its assets, execute mortgages or otherwise undertake
(or permit to be undertaken) any activity that would cause the Trust not to be
classified for United States federal income tax purposes as a grantor trust. It
is the intent of the parties to this Agreement for the Trust to be classified as
a grantor trust for United States federal income tax purposes under Subpart E of
Subchapter J of the Code, pursuant to which the owners of the Trust Preferred
Securities and the Common Securities will be the owners of the Trust for United
States federal income tax purposes, and such owners will include directly in
their gross income the income, gain, deduction or loss of the Trust as if the
Trust did not exist. By the acceptance of this Agreement, neither the Trustees
nor the Sponsor or the Holders of the Trust Preferred Securities or Common
Securities will take any position for United States federal income tax purposes,
or permit the Trust to make any election, which is contrary to the
classification of the Trust as a grantor trust.
Section 3.4 Authority.
Subject to the limitations provided in this Agreement and to the specific
duties of the Property Trustee, the Administrative Trustees shall have exclusive
and complete authority to carry out the purposes of the Trust. An action taken
by the Administrative 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 on behalf of the Trust in accordance with its powers shall constitute
the act of and serve to bind the Trust. In dealing with the Trustees acting on
behalf of the Trust, no Person shall be required to inquire into the authority
of the Trustees to bind the Trust. Persons dealing with the Trust are entitled
to rely conclusively on the power and authority of the Trustees as set forth in
this Agreement.
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Section 3.5 Title to Property of the Trust.
Except as provided in Section 3.8 with respect to the Trust Property and
the Property Trustee Account or as otherwise provided in this Agreement, legal
title to all assets of the Trust shall be vested in the Trust. A Holder shall
not have legal title to any part of the assets of the Trust, but shall have an
undivided beneficial interest in the assets of the Trust.
Section 3.6 Powers and Duties of the Administrative Trustees.
The Administrative Trustees shall have the power, duty and authority,
which shall be exclusive except as otherwise set forth herein, and are hereby
authorized and directed to cause the Trust to engage in the following
activities:
(a) execute, deliver, issue and sell the Trust Preferred Securities and
the Common Securities in accordance with this Agreement; provided, however, that
the Trust may issue no more than one series of Trust Preferred Securities and no
more than one series of Common Securities, and, provided further, that there
shall be no interests in the Trust other than the Securities, and the issuance
of Securities shall be limited to a simultaneous issuance of both Trust
Preferred Securities and Common Securities on each Closing Date;
(b) in connection with the issue and sale of the Trust Preferred
Securities:
(i) assist in filing with the Commission any registration
statement and any prospectus relating to the registration statement on
Form S-3 prepared by the Sponsor, including any amendments or supplements
thereto, pertaining to the Trust Preferred Securities and to take any
other action relating to the registration and sale of the Trust Preferred
Securities under federal and state securities laws;
(ii) execute and file any documents prepared by the Sponsor, or
take any acts as determined by the Sponsor to be necessary in order to
qualify or register all or part of the Trust Preferred Securities in any
State in which the Sponsor has determined to qualify or register such
Trust Preferred Securities for sale;
(iii) execute and file an application, prepared by the Sponsor, to
the New York Stock Exchange, Inc. or any other national stock exchange or
the Nasdaq Stock Market's National Market for listing or quotation of any
Trust Preferred Securities;
(iv) execute and file with the Commission any registration
statement on Form 8-A, including any amendments thereto, prepared by the
Sponsor, relating to the registration of the Trust Preferred Securities
under Section 12(b) or 12(g) of the Exchange Act;
(v) execute and enter into and deliver the Underwriting Agreement
providing for the sale of the Trust Preferred Securities;
(vi) execute and deliver letters, documents or instruments with DTC
and other Clearing Agencies relating to the Trust Preferred Securities;
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(vii) execute and deliver the Common Securities Agreement and the
Subordinated Debenture Agreement;
(viii) execute the Terms and Conditions and attach them to this
Agreement; and
(ix) execute, enter into or file any other instrument, agreement,
certificate or other document negotiated or prepared by the Sponsor on
behalf of the Trust, and to take such other action, in each case as the
Administrative Trustees or any of them deem necessary or incidental (and
not otherwise covered by the power of the other Trustees hereunder or
under the Securities), in connection with the issuance, the sale or the
terms of any Securities and the investment by the Trust in the Trust
Property, including any remarketing, auction or similar agreements;
(c) acquire the Debentures with the proceeds of the sale of the Trust
Preferred Securities and the Common Securities; provided, however, that the
Administrative Trustees shall cause legal title to the Debentures to be acquired
by the Trust on the Closing Date to be held of record in the name of the
Property Trustee for the benefit of the Trust and the Holders of the Trust
Preferred Securities and the Holders of Common Securities;
(d) give the Sponsor and the Property Trustee prompt written notice of the
occurrence of any Special Event (as defined in the Terms and Conditions) or any
event that, in accordance with this Agreement, may require that a notice be sent
to Holders, including events that may result in an Event of Default, or any
redemption, conversion or exchange of or deferral of distributions on the
Securities;
(e) establish a record date with respect to all actions to be taken
hereunder that require a record date be established, including and with respect
to, for the purposes of Section 316(c) of the Trust Indenture Act,
Distributions, voting rights, any repayments, any redemptions, any conversions
and any exchanges, and to issue relevant notices to the Holders of Trust
Preferred Securities and Holders of Common Securities as to such actions and
applicable record dates;
(f) take all actions and perform such duties as may be required of the
Administrative Trustees pursuant to the terms of the Securities and this
Agreement;
(g) to the fullest extent permitted by law, bring or defend, pay, collect,
compromise, arbitrate, resort to legal action, or otherwise adjust claims or
demands of or against the Trust ("Legal Action"), unless pursuant to Section
3.8(e) the Property Trustee has the exclusive power to bring such Legal Action;
(h) 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) cause the Trust to comply with the Trust's obligations under the Trust
Indenture Act;
(j) give the certificate required by Section 314(a)(4) of the Trust
Indenture Act to the Property Trustee, which certificate may be executed by any
Administrative Trustee;
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(k) incur expenses that are necessary, appropriate, convenient or
incidental to carry out any of the purposes of the Trust;
(l) act as, or appoint another Person to act as, Registrar and transfer
agent for the Securities;
(m) take all action that may be necessary or appropriate for the
preservation and the continuation of the Trust's valid existence, rights,
franchises and privileges as a statutory trust under the laws of the State of
Delaware and of each other jurisdiction in which such existence is necessary to
protect the limited liability of the Holders of the Trust Preferred Securities
or to enable the Trust to effect the purposes for which the Trust was created;
(n) take any action, not inconsistent with this Agreement or with
applicable law, that the Administrative Trustees determine in their discretion
to be necessary or incidental in carrying out the activities of the Trust,
including:
(i) causing the Trust not to be deemed to be an Investment Company
required to be registered under the Investment Company Act;
(ii) causing the Trust to be classified for United States federal
income tax purposes as a grantor trust; and
(iii) cooperating with the Debenture Issuer to ensure that the
Debentures will be treated as indebtedness of the Debenture Issuer for
United States federal income tax purposes,
provided, in each case, that such action does not adversely affect the interests
of Holders;
(o) 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 on behalf of the Trust; and
(p) execute all documents or instruments, perform all duties and powers,
and do all things for and on behalf of the Trust in all matters which the
Administrative Trustees deem necessary or incidental to the foregoing.
The Administrative Trustees must exercise the powers set forth in this
Section 3.6 in a manner that is consistent with the purposes of the Trust set
out in Section 3.3. None of the Administrative Trustees shall take any action
that is inconsistent with the purposes of the Trust set forth in Section 3.3.
Subject to this Section 3.6, the Administrative Trustees shall have none
of the powers or the authority of the Property Trustee set forth in Section 3.8.
No permissive power or authority available to the Administrative Trustees shall
be construed to be a duty.
Any expenses incurred by the Administrative Trustees pursuant to this
Section 3.6 shall be reimbursed by the Sponsor.
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The Administrative Trustees shall take all actions on behalf of the Trust
that are not specifically required by this Agreement to be taken by any other
Trustee.
Section 3.7 Prohibition of Actions by the Trust and the Trustees.
(a) The Trust shall not, and the Trustees shall not cause the Trust to,
engage in any activity other than as required or authorized by this Agreement.
In particular, the Trust shall not and the Trustees shall not cause the Trust
to:
(i) invest any proceeds received by the Trust from holding the
Debentures or other Trust Property, but shall distribute all such proceeds
to Holders of Securities pursuant to the terms of this Agreement and of
the Securities;
(ii) acquire or vary any assets other than as expressly provided
herein;
(iii) possess Trust Property for other than a Trust purpose;
(iv) make any loans or incur any indebtedness for borrowed money,
other than loans represented by the Debentures or other Trust Property;
(v) possess any power or otherwise act in such a way as to vary
the Trust assets or the terms of the Securities in any way whatsoever;
(vi) sell, assign, transfer, exchange, mortgage, pledge, set-off or
otherwise dispose of any of the Trust Property or interests therein,
including to Holders, except as provided in this Agreement;
(vii) take or consent to any action that would result in the
placement of a lien on any Trust Property;
(viii) issue any securities or other evidences of beneficial
ownership of, or beneficial interest in, the Trust other than the
Securities; or
(ix) other than as provided in this Agreement, (A) direct or
exercise any remedy, trust or power with respect to the Debentures, or any
other instrument or agreement constituting Trust Property, (B) waive any
past default that is waivable under the Indenture, (C) exercise any right
to rescind or annul any declaration that the principal of or other amounts
payable or other property deliverable under the Debentures shall be due
and payable, or (D) consent to any amendment, modification or termination
of the Indenture or the Debentures, in the case of each of clauses (A)
through (D), (x) without the approval of a Majority in liquidation amount
with respect to the Securities or, where a consent under the Indenture
would require the consent of each holder of Debentures affected thereby,
of each Holder of Securities, and (y) unless the Trust shall have received
an opinion of nationally recognized independent tax counsel to the effect
that the Trust will not, as a result of such action, fail to be classified
as a grantor trust for such purposes.
17
Section 3.8 Powers and Duties of the Property Trustee.
(a) The legal title to the Trust Property shall be owned by and held of
record in the name of the Property Trustee in trust for the benefit of the Trust
and the Holders of the Securities. The right, title and interest of the Property
Trustee to the Trust Property shall vest automatically in each Person who may
hereafter be appointed as Property Trustee in accordance with Section 5.6. Such
vesting and cessation of title shall be effective whether or not conveyancing
documents with regard to the Trust Property have been executed and delivered.
(b) The Property Trustee shall not transfer its right, title and interest
in the Trust Property to the Administrative Trustees or to the Delaware Trustee
(if the Property Trustee does not also act as Delaware Trustee) or, except in
accordance with the provisions of this Agreement and the Securities, any other
Person.
(c) The Property Trustee shall:
(i) establish and maintain one or more segregated non-interest
bearing trust accounts (collectively, the "Property Trustee Account") in
the name of and under the exclusive control of the Property Trustee on
behalf of the Trust and the Holders and, upon the receipt of funds in
respect of the Trust Property, deposit such funds into the Property Trust
Account and, upon the receipt of funds distributed to the Property Trustee
in respect of the Trust Property held by the Property Trustee, deposit
such funds into the Property Trustee Account, and make distributions of
such funds out of the Property Trust Account to the Holders of the Trust
Preferred Securities and the Holders of the Common Securities in
accordance with the terms of this Agreement and the Securities. Funds in
the Property Trustee Account shall be held uninvested until disbursed in
accordance with this Agreement and the Securities. The Property Trustee
Account shall be one or more accounts maintained with one or more banking
institutions (which may include the Property Trustee if it qualifies
hereunder) the rating on whose long-term unsecured indebtedness is rated
at least "A" or above by a "nationally recognized statistical rating
organization," as that term is defined for purposes of Rule 436(g)(2)
under the Securities Act;
(ii) upon receipt of any Trust Property on the Closing Date and the
receipt of any property other than funds distributed to the Property
Trustee in respect of Trust Property held by the Property Trustee, hold
such other property in safe keeping and make distributions of such other
property to the Holders of the Trust Preferred Securities and the Holders
of the Common Securities in accordance with the terms of this Agreement
and the Securities; and
(iii) engage in such ministerial activities as shall be necessary or
incidental to hold the Trust Property in accordance with the provisions
hereof and to effect distributions on and any redemption, repayment,
conversion or exchange of the Trust Preferred Securities or the Common
Securities and the distribution of all or any part of the Trust Property
to Holders in liquidation of the Trust or otherwise, in each case in
accordance with the terms of this Agreement and the Securities.
18
(d) The Property Trustee shall take all actions and perform such duties as
may be specifically required of the Property Trustee pursuant to the terms of
the Securities and this Agreement.
(e) Subject to Section 3.9(a), the Property Trustee shall take any Legal
Action which arises out of or in connection with an Event of Default of which a
Responsible Officer of the Property Trustee has actual knowledge or the Property
Trustee's duties and obligations under this Agreement, the Statutory Trust Act
or the Trust Indenture Act; provided, however, that if the Property Trustee
fails to enforce its rights under this Agreement and the Debentures after a
Holder of Trust Preferred Securities has made a written request, such Holder of
Trust Preferred Securities may, to the fullest extent permitted by applicable
law and subject to the terms of this Agreement and the Indenture, institute a
legal proceeding against the Debenture Issuer without first instituting any
legal proceeding against the Property Trustee or any other Person.
Notwithstanding the foregoing, if an Event of Default has occurred and is
continuing and such event is attributable to the failure of the Debenture Issuer
to pay interest or principal of the Debentures on the date such interest or
principal is otherwise payable (including, in the case of repayment or
redemption, on the repayment or redemption date), and not during an authorized
Extension Period (as defined in the Terms and Conditions), or, if the Debentures
are exchangeable or convertible, the failure of the Debenture Issuer to convert
or exchange the Debentures into or for other property in accordance with the
terms thereof, then a Holder of Trust Preferred Securities may directly
institute a proceeding (a "Direct Action") for enforcement of payment or
delivery to such Holder of the principal of or interest on or other property
deliverable upon the exchange or conversion of Debentures having a principal
amount equal to the aggregate liquidation amount of the Trust Preferred
Securities of such holder on or after the due date specified in the Debentures
equal to the percentage of outstanding securities represented by such Holder's
Securities. In connection with such Direct Action, the rights of the Holders of
Common Securities will be subordinated to the rights of such Holders of Trust
Preferred Securities. Except as provided in the preceding sentences, the Holders
of Trust Preferred Securities will not be able to exercise directly any other
remedy available to the holders of the Debentures.
(f) The Property Trustee shall continue to serve as a Trustee until
either:
(i) the Trust has been completely dissolved and wound up and the
proceeds of the liquidation distributed to the Holders of Securities and
the Trust is terminated, in accordance with the terms of the Securities
and this Agreement; or
(ii) a successor Property Trustee has been appointed and has
accepted that appointment in accordance with Section 5.6 (a "Successor
Property Trustee").
(g) The Property Trustee shall have the legal power to exercise all of the
rights, powers and privileges of the Trust as holder of Debentures under the
Indenture and, if an Event of Default actually known to a Responsible Officer of
the Property Trustee occurs and is continuing, the Property Trustee shall, for
the benefit of Holders of the Securities, enforce the rights of the Trust as
holder of the Debentures subject, in each case, to the rights of the Holders
pursuant to the terms of the Securities and this Agreement.
19
(h) The Property Trustee shall be authorized to undertake any actions set
forth in Section 317(a) of the Trust Indenture Act.
(i) Subject to this Section 3.8, the Property Trustee shall have none of
the duties, liabilities, powers or the authority of the Administrative Trustees
set forth in Section 3.6.
(j) For such time as the Property Trustee is the Paying Agent, the
Property Trustee may authorize one or more Persons to act as additional Paying
Agents and to make distributions, redemption payments or liquidation payments on
behalf of the Trust with respect to all Securities. Any such additional Paying
Agent may be removed by the Property Trustee, at any time, so long as the
Property Trustee remains as Paying Agent and a successor Paying Agent or
additional Paying Agents may be (but are not required to be) appointed at any
time by the Property Trustee.
(k) The Property Trustee must exercise the powers set forth in this
Section 3.8 in a manner that is consistent with the purposes and functions of
the Trust set out in Section 3.3, and the Property Trustee shall not take any
action that is inconsistent with the purposes and functions of the Trust set out
in Section 3.3.
(l) The Property Trustee shall give prompt written notice to the Holders
of the Securities of any notice received by it from the Debenture Issuer of the
Debenture Issuer's election to defer payments of interest on the Debentures by
extending the interest payment period with respect thereto.
Section 3.9 Certain Duties and Responsibilities of the Property Trustee.
(a) The Property Trustee, before the occurrence of any Event of Default
and after the curing or waiver of all Events of Default that may have occurred,
shall undertake to perform only such duties as are specifically set forth in
this Agreement and no implied covenants shall be read into this Agreement
against the Property Trustee. In case an Event of Default has occurred (that has
not been cured or waived pursuant to Section 2.6) of which a Responsible Officer
of the Property Trustee has actual knowledge, the Property Trustee shall
exercise such of the rights and powers vested in it by this Agreement, 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 Agreement shall be construed to relieve the
Property Trustee from liability for its own negligent action, its own negligent
failure to act, its bad faith or its own willful misconduct, except that:
(i) prior to the occurrence of an Event of Default and after the
curing or waiving of all such Events of Default that may have occurred:
(A) the duties and obligations of the Property Trustee
shall be determined solely by the express provisions of this
Agreement and the Property Trustee shall not be liable except
for the performance of such duties and obligations as are
specifically set forth in this Agreement, and
20
no implied covenants or obligations shall be read into this
Agreement 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 Agreement; provided, that in the case of
any such certificates or opinions that by any provision hereof
are specifically required to be furnished to the Property
Trustee, the Property Trustee shall be under a duty to examine
the same to determine whether or not they conform to the
requirements of this Agreement;
(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 of not less than a Majority in liquidation
amount of the Securities relating to the time, method and place of
conducting any proceeding for any remedy available to the Property
Trustee, or exercising any trust or power conferred upon the Property
Trustee under this Agreement;
(iv) no provision of this Agreement shall require the Property
Trustee to expend or risk its own funds or otherwise incur personal
financial liability in the performance of any of its duties or in the
exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that the repayment of such funds or liability is not
reasonably assured to it under the terms of this Agreement or if indemnity
reasonably satisfactory to the Property Trustee against such risk or
liability is not reasonably assured to it;
(v) the Property Trustee's sole duty with respect to the custody,
safe keeping and physical preservation of the Trust Property and the
Property Trustee Account shall be to deal with such property in a manner
that is similar to the manner in which the Property Trustee deals with
similar property for its fiduciary accounts generally, subject to the
protections and limitations on liability afforded to the Property Trustee
under this Agreement, the Statutory Trust Act and the Trust Indenture Act;
(vi) the Property Trustee shall have no duty or liability for or
with respect to the value, genuineness, existence or sufficiency of the
Trust Property or the payment of any taxes or assessments levied thereon
or in connection therewith;
(vii) the Property Trustee shall not be liable for any interest on
any money received by it except as it may otherwise agree in writing with
the Sponsor; money held by the Property Trustee need not be segregated
from other funds held by it except in
21
relation to the Property Trustee Account maintained by the Property
Trustee pursuant to Section 3.8(c)(i) and except to the extent otherwise
required by law; and
(viii) the Property Trustee shall not be responsible for monitoring
the compliance by the Administrative Trustees or the Sponsor with their
respective duties under this Agreement, nor shall the Property Trustee be
liable for any default or misconduct of the Administrative Trustees or the
Sponsor.
Section 3.10 Certain Rights of the Property Trustee.
(a) Subject to the provisions of Section 3.9:
(i) the Property Trustee may conclusively rely and shall be fully
protected in acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document believed by it to be genuine and
to have been signed, sent or presented by the proper party or parties;
(ii) any direction or act of the Sponsor or the Administrative
Trustees contemplated by this Agreement shall be sufficiently evidenced by
a Direction or an Officers' Certificate;
(iii) whenever in the administration of this Agreement, the Property
Trustee shall deem it desirable that a matter be proved or established
before taking, suffering or omitting any action hereunder, the Property
Trustee (unless other evidence is herein specifically prescribed) may, in
the absence of negligence or bad faith on its part, request and
conclusively rely upon an Officers' Certificate which, upon receipt of
such request, shall be promptly delivered by the Sponsor or the
Administrative Trustees;
(iv) the Property Trustee shall have no duty to see to any
recording, filing or registration of any instrument (including any
financing or continuation statement or any filing under tax or securities
laws) or any rerecording, refiling or registration thereof;
(v) the Property Trustee may consult with competent legal counsel
or other competent experts and the advice or written opinion of such
counsel and experts with respect to legal matters or advice within the
scope of such legal counsel's or experts' area of expertise shall be full
and complete authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in accordance with
such advice or opinion. Such counsel may be counsel to the Sponsor or any
of its Affiliates, and may include any of its employees; and the Property
Trustee shall have the right at any time to seek instructions concerning
the administration of this Agreement from any court of competent
jurisdiction;
(vi) the Property Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Agreement at the request
or direction of any Holder, unless (A) such Holder shall have provided to
the Property Trustee reasonable security and indemnity, reasonably
satisfactory to the Property Trustee, against the reasonable costs,
expenses (including reasonable attorneys' fees and expenses and the
reasonable
22
expenses of the Property Trustee's agents, nominees or custodians) and
liabilities that might be incurred by it in complying with such request or
direction, including such reasonable advances as may be requested by the
Property Trustee and (B) the Property Trustee has obtained the legal
opinions, if any, required by the applicable provisions of this Agreement,
provided that nothing contained in this Section 3.10(a)(vi) shall be taken
to relieve the Property Trustee, upon the occurrence of an Event of
Default, of its obligation to exercise the rights and powers vested in it
by this Agreement;
(vii) the Property Trustee shall be under no obligation to conduct
an investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Property Trustee, in its
discretion, may make such further inquiry or investigation into such facts
or matters as it may see fit;
(viii) the Property Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents, custodians, nominees or attorneys, and the Property Trustee shall
not be responsible for any misconduct or negligence on the part of any
agent or attorney appointed with due care by it hereunder;
(ix) any action taken by the Property Trustee or its agents
hereunder shall bind the Trust and the Holders of the Securities, and the
signature of the Property Trustee or its agents alone shall be sufficient
and effective to perform any such action, and no third party shall be
required to inquire as to the authority of the Property Trustee to so act
or as to its compliance with any of the terms and provisions of this
Agreement, both of which shall be conclusively evidenced by the Property
Trustee's or its agent's taking such action;
(x) whenever in the administration of this Agreement the Property
Trustee shall deem it desirable to receive instructions with respect to
enforcing any remedy or right or taking any other action hereunder, the
Property Trustee (A) may request instructions from the Holders (which
instructions may only be given by the Holders of the same proportion in
liquidation amount of the Securities as would be entitled to direct the
Property Trustee under the terms of the Securities in respect of such
remedy, right or action), (B) may refrain from enforcing such remedy or
right or taking such other action until such instructions are received,
and (C) shall be protected in conclusively relying on or acting in
accordance with such instructions, provided that the Property Trustee
shall not take any action unless it shall have obtained the legal opinions
required by the applicable provisions of this Agreement;
(xi) except as otherwise expressly provided by this Agreement, the
Property Trustee shall not be under any obligation to take any action that
is discretionary under the provisions of this Agreement; and
(xii) the Property Trustee shall not be liable for any action taken,
suffered, or omitted to be taken by it in good faith, without negligence,
and reasonably believed by it
23
to be authorized or within the discretion or rights or powers conferred
upon it by this Agreement.
(b) No provision of this Agreement shall be deemed to impose any duty or
obligation on the Property Trustee to perform any act or acts or exercise any
right, power, duty or obligation conferred or imposed on it, in any jurisdiction
in which it shall be illegal, or in which the Property Trustee shall be
unqualified or incompetent in accordance with applicable law, to perform any
such act or acts, or to exercise any such right, power, duty or obligation. No
permissive power or authority available to the Property Trustee shall be
construed to be a duty.
Section 3.11 Delaware Trustee.
Notwithstanding any other provision of this Agreement other than Section
5.2, the Delaware Trustee shall not be entitled to exercise any powers, nor
shall the Delaware Trustee have any of the duties and responsibilities of the
Trustees (except as required under the Statutory Trust Act) described in this
Agreement. Except as set forth in Section 5.2, the Delaware Trustee shall be a
Trustee for the sole and limited purpose of fulfilling the requirements of
Section 3807 of the Statutory Trust Act. In the event that the Delaware Trustee
shall at any time be required to take any action or perform any duty hereunder,
the Delaware Trustee shall be entitled to the benefits of Section 3.9(b)(ii) and
(viii) and Section 3.10. No implied covenants or obligations shall be read into
this Agreement against the Delaware Trustee.
Section 3.12 Not Responsible for Recitals or Issuance of Securities.
The recitals contained in this Agreement and the Securities shall be taken
as the statements of the Sponsor, and the Trustees do not assume any
responsibility for their correctness. The Trustees make no representations as to
the value or condition of the property of the Trust or any part thereof. The
Trustees make no representations as to the validity or sufficiency of this
Agreement or the Securities.
Section 3.13 Duration of Trust.
The Trust, unless dissolved pursuant to the provisions hereof, shall
dissolve on June 1, 2049.
Section 3.14 Mergers.
(a) The Trust may not consolidate, amalgamate, merge or convert with or
into, or be replaced by, or convey, transfer or lease its properties and assets
as an entirety or substantially as an entirety to, any Person, except for the
sole purpose of changing its domicile and as set forth in Section 3.14(b) and
(c).
(b) Subject to Section 3.14(a), the Trust may, at the request of the
Sponsor, with the consent of the Administrative Trustees or, if there are more
than two, a majority of the Administrative Trustees and without the consent of
the Holders of the Trust Preferred Securities, the Delaware Trustee or the
Property Trustee, consolidate, amalgamate, merge or convert with or into, or be
replaced by a trust organized as such under the laws of any State, provided
that:
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(i) the successor entity (the "Successor Entity") expressly
assumes all of the obligations of the Trust under any agreement to which
the Trust is a party and either:
(A) expressly assumes all of the obligations of the
Trust under the Securities; or
(B) substitutes for the Trust Preferred Securities
other securities having substantially the same terms as the
Trust Preferred Securities (the "Successor Trust Preferred
Securities"), so long as the Successor Trust Preferred
Securities rank the same as the Trust Preferred Securities
rank with respect to distributions of Trust Property and
payments upon liquidation, redemption, repayment and otherwise
and substitutes for the Common Securities other securities
having substantially the same terms as the Common Securities
(the "Successor Common Securities," and together with the
Successor Trust Preferred Securities, the "Successor
Securities"), so long as the Successor Common Securities rank
the same as the Common Securities rank with respect to
distributions of Trust Property and payments upon liquidation,
redemption, repayment and otherwise;
(ii) the Successor Entity has a trustee that possesses
substantially the same powers and duties as the Property Trustee;
(iii) the Trust Preferred Securities or any Successor Securities
will be listed, quoted or included for trading, or any Successor
Securities will be listed, quoted or included for trading upon
notification of issuance if applicable, on any national securities
exchange or with another system on which the Trust Preferred Securities
are then listed, quoted or included for trading;
(iv) such merger, conversion, consolidation, amalgamation or
replacement does not cause the Trust Preferred Securities (including any
Successor Securities) to be downgraded or placed under surveillance for
review by any nationally recognized statistical rating organization;
(v) such merger, conversion, consolidation, amalgamation or
replacement does not adversely affect the rights, preferences and
privileges of the Holders of the Securities (including any Successor
Securities and any Successor Trust Preferred Common Securities) in any
material respect;
(vi) such Successor Entity has a purpose substantially identical to
that of the Trust;
(vii) prior to such merger, conversion, consolidation, amalgamation
or replacement, the Sponsor has received an opinion of a nationally
recognized independent counsel to the Trust experienced in such matters to
the effect that:
(A) such merger, conversion, consolidation,
amalgamation or replacement does not adversely affect the
rights, preferences and
25
privileges of the Holders of the Securities (including any
Successor Securities) in any material respect;
(B) following such merger, conversion, consolidation,
amalgamation or replacement, neither the Trust nor the
Successor Entity will be required to register as an Investment
Company; and
(C) following such merger, conversion, consolidation,
amalgamation or replacement, the Trust (or the Successor
Entity) will continue to be classified as a grantor trust for
United States federal income tax purposes;
(viii) the Sponsor, directly or indirectly, owns all of the
Successor Common Securities and guarantees the obligations of such
Successor Entity under the Successor Trust Preferred Securities at least
to the extent provided by the Securities Guarantees; and
(ix) the Property Trustee has received an Officers' Certificate
from the Sponsor and an opinion of counsel, each to the effect that all
conditions precedent to the transaction as set forth in this Agreement
have been satisfied.
(c) Notwithstanding Section 3.14(b), the Trust shall not, except with the
consent of Holders of 100% in liquidation amount of the Securities, consolidate,
amalgamate, merge or convert with or into, or be replaced by any other Person or
permit any other Person to consolidate, amalgamate, or merge with or into, or
replace it if such consolidation, amalgamation, merger, conversion, or
replacement would cause the Trust or Successor Entity to be classified as other
than a grantor trust for United States federal income tax purposes.
ARTICLE IV
SPONSOR
Section 4.1 Sponsor's Purchase of Common Securities.
On each Closing Date, the Sponsor shall purchase all of the Common
Securities issued by the Trust, in an amount at least equal to 3.0% of the
Securities of the Trust issued on such Closing Date, at the same time as the
Trust Preferred Securities are sold.
Section 4.2 Covenants of the Sponsor.
For so long as the Trust Preferred Securities remain outstanding, the
Sponsor shall:
(i) cause the Trust to remain a statutory trust and not to
voluntarily dissolve, wind-up, liquidate or terminate, except as permitted
by this Agreement; and
(ii) use its commercially reasonable efforts to ensure that the
Trust will not be (A) required to register as an Investment Company under
the Investment Company Act or (B) classified as other than a grantor trust
for United States federal income tax purposes.
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Section 4.3 Rights and Responsibilities of the Sponsor.
In connection with the issue and sale of the Trust Preferred Securities
and so long as the Securities are outstanding, the Sponsor shall have the right,
authority and responsibility (which shall be exclusive except as otherwise set
forth herein) to engage in the following activities:
(a) determine the Terms and Conditions;
(b) prepare, execute and file on behalf of the Trust with the Commission a
registration statement on Form S-3 and any prospectus or prospectus supplement
relating to such registration statement in relation to the Trust Preferred
Securities, including any amendments thereto;
(c) if deemed necessary or advisable by the Sponsor, determine the States
in which to take appropriate action to qualify or register for sale all or part
of the Trust Preferred Securities and to do any and all such acts on behalf of
the Trust, and prepare, execute and file any documents on behalf of the Trust as
the Sponsor deems necessary or advisable in order to comply with the applicable
laws of any such States;
(d) if deemed necessary or advisable by the Sponsor, prepare, execute and
file on behalf of the Trust an application to the New York Stock Exchange or any
other national stock exchange or the Nasdaq National Market for listing upon
notice of issuance of any Trust Preferred Securities;
(e) if necessary, prepare, execute and file on behalf of the Trust with
the Commission, a registration statement on Form 8-A relating to the
registration of the Trust Preferred Securities under Section 12(b) or 12(g) of
the Exchange Act, including any amendments thereto; and
(f) negotiate and execute the Underwriting Agreement and the Pricing
Agreement, and negotiate any other instrument or agreement which, in the opinion
of the Sponsor, the Trust should be a party to, bound by or a beneficiary of,
including any remarketing, auction or exchange agreement.
Section 4.4 Right to Proceed.
The Sponsor acknowledges the rights of Holders to institute a Direct
Action as set forth in Section 3.8(e) hereto.
Section 4.5 Expenses.
In connection with the offering, sale and issuance of the Debentures to
the Property Trustee and in connection with the sale of the Securities by the
Trust, the Sponsor shall:
(a) pay all costs and expenses relating to the offering, sale and issuance
of the Debentures, including commissions to the underwriters payable pursuant to
the Underwriting Agreement and compensation of the Trustee under the Indenture
in accordance with the provisions of the Indenture;
27
(b) be responsible for and shall pay 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,
maintenance and dissolution of the Trust), the offering, sale and issuance of
the Securities (including commissions to the underwriters in connection
therewith), the fees and expenses (including reasonable counsel fees and
expenses) of the Property Trustee, the Delaware Trustee and the Administrative
Trustees (including any amounts payable under Article X of this Agreement), 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 Agents, Registrars, transfer agents, duplicating,
travel and telephone and other telecommunications expenses and costs and
expenses incurred in connection with the acquisition, financing, and disposition
of Trust assets and the enforcement by the Property Trustee of the rights of the
Holders;
(c) pay 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; and
(d) be primarily liable for any indemnification obligations arising under
Section 10.4 with respect to this Agreement.
The Sponsor's obligations under this Section 4.5 shall be for the benefit
of, and shall be enforceable by, any Person to whom 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 Sponsor's
obligations under this Section 4.5 directly against the Sponsor and the Sponsor
irrevocably waives 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. The Sponsor agrees to execute such additional agreements as may be
necessary or desirable in order to give full effect to the provisions of this
Section 4.5.
ARTICLE V
TRUSTEES
Section 5.1 Number of Trustees.
The number of Trustees initially shall be five (5), and:
(a) at any time before the issuance of any Securities, the Sponsor may, by
written instrument, increase or decrease the number of Trustees; and
(b) after the issuance of any Securities, the number of Trustees may be
increased or decreased by the Holders of a Majority in liquidation amount of the
Common Securities; provided, however, that, the number of Trustees shall in no
event be less than two, provided further that (1) one Trustee shall meet the
requirements of Section 5.2(a) or (b); (2) there shall be at least one Trustee
who is an employee or officer of, or is affiliated with the Sponsor (an
"Administrative Trustee"); and (3) one Trustee shall be the Property Trustee for
so long as this Agreement is required to qualify as an indenture under the Trust
Indenture Act, and such Property Trustee may also serve as Delaware Trustee if
it meets the applicable requirements.
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Section 5.2 Delaware Trustee.
If required by the Statutory Trust Act, one Trustee (the "Delaware
Trustee") shall be:
(a) a natural person who is a resident of the State of Delaware; or
(b) if not a natural person, an entity which has its principal place of
business in the State of Delaware, and otherwise meets the requirements of
applicable law (including Section 3807, of the Statutory Trust Act), provided
that, if the Property Trustee has its principal place of business in the State
of Delaware and otherwise meets the requirements of applicable law, then the
Property Trustee shall also be the Delaware Trustee and Section 3.11 shall have
no application.
(c) The initial Delaware Trustee shall be:
The Bank of New York (Delaware)
White Clay Center (or P.O. Box 6973)
Route 273
Newark, Delaware 19711
Attn: Corporate Trust Trustee Administration
Section 5.3 Property Trustee; Eligibility.
(a) There shall at all times be one Trustee which shall act as Property
Trustee for so long as this Agreement is required to qualify as an Indenture
under the Trust Indenture Act, which shall:
(i) not be an Affiliate of the Sponsor; and
(ii) be a corporation organized and doing business under the laws
of the United States of America or any State or Territory thereof or of
the District of Columbia, or a 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 Fifty million U.S. dollars
($50,000,000), and subject to supervision or examination by Federal,
State, Territorial or District of Columbia authority. If such corporation
publishes reports of condition at least annually, pursuant to law or to
the requirements of the supervising or examining authority referred to
above, then for the purposes of this Section 5.3(a)(ii), the combined
capital and surplus of such corporation shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published.
(b) If at any time the Property Trustee shall cease to be eligible to so
act under Section 5.3(a), the Property Trustee shall immediately resign in the
manner and with the effect set forth in Section 5.6(c).
(c) If the Property Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture Act, the
Property Trustee and the Holder of the Common Securities (as if it were the
obligor referred to in Section 310(b) of the Trust Indenture Act) shall in all
respects comply with the provisions of Section 310(b) of the Trust Indenture
Act.
29
(d) The Trust Preferred Securities Guarantee and the Indenture shall be
deemed to be specifically described in this Agreement and the Indenture for
purposes of clause (i) of the first proviso contained in Section 310(b) of the
Trust Indenture Act.
(e) The Property Trustee on the date hereof shall be:
BNY Midwest Trust Company
2 N. LaSalle Street, Suite 1020
Chicago, IL 60602
Attention: Corporate Trust
Section 5.4 Certain Qualifications of Administrative Trustees and Delaware
Trustee Generally.
Each Administrative Trustee and the Delaware Trustee (unless the Property
Trustee also acts as Delaware Trustee) shall be either a natural person who is
at least 21 years of age or a legal entity that shall act through one or more
Authorized Officers.
Section 5.5 Administrative Trustees.
The initial Administrative Trustees shall be:
K. Hier
N.A. Khouri
D.R. Murphy
(a) Except as otherwise expressly set forth in this Agreement and except
if a meeting of the Administrative Trustees is called in accordance with Section
5.9 with respect to any matter over which the Administrative Trustees have power
to act, any power of the Administrative Trustees may be exercised by, or with
the consent of, any one such Administrative Trustee.
(b) Unless otherwise determined by the Administrative Trustees in
accordance with Section 5.9, and except as otherwise required by the Statutory
Trust Act or applicable law, any Administrative Trustee is authorized to execute
on behalf of the Trust any documents which the Administrative Trustees have the
power and authority to cause the Trust to execute pursuant to Section 3.6.
Section 5.6 Appointment; Removal and Resignation of Trustees.
(a) Subject to Section 5.6(b), Trustees may be appointed or removed
without cause at any time:
(i) until the issuance of any Securities, by written instrument
executed by the Sponsor;
(ii) after the issuance of any Securities, by the Holders of a
Majority in liquidation amount of the Common Securities voting as a class
at a meeting of the
30
Holders of the Common Securities unless an Event of Default shall have
occurred and be continuing, and
(iii) if an Event of Default shall have occurred and be continuing,
after the issuance of the Securities, with respect to:
(A) the Administrative Trustees, by vote or written
consent of the Holders of a Majority in liquidation amount of
the Common Securities acting separately as a class; and
(B) the Property Trustee and the Delaware Trustee, by
vote or written consent of the Holders of a Majority in
liquidation amount of the Trust Preferred Securities, acting
separately as a class.
(b) (i) The Property Trustee shall not be removed in accordance with
Section 5.6(a) until a Successor Property Trustee possessing the
qualifications to act as Property Trustee under Sections 5.2 and 5.3 has
been appointed and has accepted such appointment by written instrument
executed by such Successor Property Trustee and delivered to the
Administrative Trustees, the Delaware Trustee (if the removed Property
Trustee is not also the Delaware Trustee) and the Sponsor.
(ii) The Delaware Trustee shall not be removed in accordance with
Section 5.6(a) until a successor possessing the qualifications to act as
Delaware Trustee under Sections 5.2 and 5.4 (a "Successor Delaware
Trustee") has been appointed and has accepted such appointment by written
instrument executed by such Successor Delaware Trustee and delivered to
the Administrative Trustees, the Property Trustee (if the removed Delaware
Trustee is not also the Property Trustee) and the Sponsor.
(c) A Trustee appointed to office shall hold office until such Trustee's
successor shall have been appointed or until such Trustee's death, bankruptcy,
dissolution, termination, removal or resignation. Any Trustee may resign from
office (without need for prior or subsequent accounting) by an instrument in
writing signed by the Trustee and delivered to the other Trustees, the Sponsor,
the Trust and, after an Event of Default has occurred and is continuing, the
Holders of Trust Preferred Securities, 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 Property Trustee shall be
effective:
(A) until a Successor Property Trustee has been
appointed and has accepted such appointment by instrument
executed by such Successor Property Trustee and delivered to
the Trust, the Sponsor, the Delaware Trustee, the resigning
Property Trustee and, after an Event of Default has occurred
and is continuing, the Holders of Trust Preferred Securities;
or
(B) until the assets of the Trust have been completely
liquidated and the proceeds thereof distributed to the Holders
of the Securities and the Trust is terminated pursuant to the
terms of this Agreement and the Securities; and
31
(ii) no such resignation of 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, the Property Trustee, the
resigning Delaware Trustee and, after an Event of Default has occurred and
is continuing, the Holders of Trust Preferred Securities.
(d) The Holders of the Common Securities or, if an Event of Default has
occurred and is continuing after the issuance of any Securities, the Holders of
Trust Preferred Securities shall use all reasonable efforts to promptly appoint
a Successor Delaware Trustee or Successor Property Trustee, as the case may be,
if the Property Trustee or the Delaware Trustee delivers an instrument of
resignation in accordance with this Section 5.6.
(e) If no Successor Property Trustee or Successor Delaware Trustee shall
have been appointed and accepted appointment as provided in this Section 5.6
within 60 days after delivery to the other Trustees, the Sponsor, the Trust and,
after an Event of Default has occurred and is continuing, the Holders of the
Trust Preferred Securities of an instrument of resignation, the resigning
Property Trustee or Delaware Trustee, as applicable, may petition any court of
competent jurisdiction for appointment of a Successor Property Trustee or
Successor Delaware Trustee. Such court may thereupon, after prescribing such
notice, if any, as it may deem proper, appoint a Successor Property Trustee or
Successor Delaware Trustee, as the case may be.
(f) No Property Trustee or Delaware Trustee shall be liable for the acts
or omissions to act of any Successor Property Trustee or Successor Delaware
Trustee, as the case may be.
(g) At the time of the resignation or removal of the Property Trustee or
the Delaware Trustee, the Sponsor shall pay to such Trustee any amounts that may
be owed to such Trustee pursuant to Section 10.4.
Section 5.7 Vacancies Among Trustees.
If a Trustee ceases to hold office for any reason and the number of
Trustees is not reduced pursuant to Section 5.1, or if the number of Trustees is
increased pursuant to Section 5.1, a vacancy shall occur. A resolution
certifying the existence of such vacancy by the Administrative Trustees or, if
there are more than two Administrative Trustees, a majority of the
Administrative Trustees shall be conclusive evidence of the existence of such
vacancy. The vacancy shall be filled with a Trustee appointed in accordance with
Section 5.6.
Section 5.8 Effect of Vacancies.
The death, resignation, retirement, removal, bankruptcy, dissolution,
liquidation, incompetence or incapacity to perform the duties of a Trustee shall
not operate to dissolve, terminate or annul the Trust. Whenever a vacancy among
the Administrative Trustees shall occur, until such vacancy is filled by the
appointment of an Administrative Trustee in accordance with Section 5.6, the
Administrative Trustees in office, regardless of their number, shall have all
the powers granted to the Administrative Trustees and shall discharge all the
duties imposed upon the Administrative Trustees by this Agreement.
32
Section 5.9 Meetings.
If there is more than one Administrative Trustee, meetings of the
Administrative Trustees shall be held from time to time upon the call of any
Administrative Trustee. Regular meetings of the Administrative Trustees may be
held at a time and place fixed by resolution of the Administrative Trustees.
Notice of any in-person meetings of the Administrative Trustees shall be hand
delivered or otherwise delivered in writing (including by facsimile, with a hard
copy by overnight courier) not less than 48 hours before such meeting. Notice of
any telephonic meetings of the Administrative 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
a meeting. Notices shall contain a brief statement of the time, place and
anticipated purposes of the meeting. The presence (whether in person or by
telephone) of an Administrative Trustee at a meeting shall constitute a waiver
of notice of such meeting except where an Administrative 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 Agreement, any action of the Administrative Trustees
may be taken at (i) a meeting by vote of a majority of the Administrative
Trustees present (whether in person or by telephone) and eligible to vote with
respect to such matter, provided that a Quorum is present, or (ii) without a
meeting and without prior notice by the unanimous written consent of the
Administrative Trustees. In the event there is only one Administrative Trustee,
any and all action of such Administrative Trustee shall be evidenced by a
written consent of such Administrative Trustee.
Section 5.10 Delegation of Power.
(a) Any Administrative Trustee may, by power of attorney consistent with
applicable law, delegate to any other natural person over the age of 21 his or
her power for the purpose of executing any documents contemplated in Section
3.6.
(b) The Administrative 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 Administrative Trustees or otherwise as the Administrative
Trustees may deem expedient, to the extent such delegation is not prohibited by
applicable law or contrary to the provisions of the Trust, as set forth herein.
Section 5.11 Merger, Conversion, Consolidation or Succession to Business.
Any Person into which the Property Trustee or the Delaware Trustee, as the
case may be, may be merged or converted or with which either may be
consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Property Trustee or the Delaware Trustee, as the case
may be, shall be a party, or any Person succeeding to all or substantially all
the corporate trust business of the Property Trustee or the Delaware Trustee, as
the case may be, shall be the successor of the Property Trustee or the Delaware
Trustee, as the case may be, hereunder, provided such Person shall be otherwise
qualified and eligible under this Article, without the execution or filing of
any paper or any further act on the part of any of the parties hereto; provided,
however that such successor shall promptly notify the Sponsor (except that a
Successor Delaware Trustee shall file an appropriate amendment to the
Certificate of Trust of the Trust, if required by the Statutory Trust Act).
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ARTICLE VI
DISTRIBUTIONS
Section 6.1 Distributions.
If and to the extent that the Trust receives income on any Debenture
whether in cash, securities or other property as proceeds from the redemption,
repayment, exchange, maturity or other disposition of any Debenture (including
any interest on or the principal of the Debentures, any securities or other
property received in exchange for the Debentures (collectively, the "Payment
Amount"), then, unless otherwise specified in this Agreement, the Property
Trustee shall distribute the Payment Amount to the Holders of the Securities in
accordance with the terms of the Securities they hold as set forth in this
Agreement, including the Terms and Conditions. The Property Trustee shall make
the distributions on the Trust Preferred Securities and the Common Securities in
accordance with the relative rights, preferences and privileges that apply to
each of those classes of Securities as set forth in this Agreement.
ARTICLE VII
ISSUANCE OF SECURITIES
Section 7.1 General Provisions Regarding Securities
(a) The Administrative Trustees shall, on behalf of the Trust, issue one
class of preferred securities representing undivided beneficial interests in the
assets of the Trust having such terms as are set forth in the Terms and
Conditions (the "Trust Preferred Securities") and one class of common securities
representing undivided beneficial interests in the assets of the Trust having
such terms as are set forth in the Terms and Conditions (the "Common
Securities"). The Trust shall issue no securities or other interests in the
assets of the Trust other than the Trust Preferred Securities and the Common
Securities.
(b) The terms of the Securities shall be set forth in the Terms and
Conditions and shall be attached to this Agreement as Exhibit A. Such Terms and
Conditions are incorporated herein by reference and shall set forth the
following to the extent not provided by, or in lieu or modification of, the
other provisions of this Agreement:
(1) the designation of the Trust Preferred Securities and the
designation of the Common Securities;
(2) any limit upon the number and/or aggregate liquidation amount
of the Trust Preferred Securities or the Common Securities to
be executed and delivered under this Agreement (except for
Securities authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of, other
Securities of such class pursuant to Section 9.2, 9.7 or 9.8,
upon repayment or redemption in part of any Security or upon
surrender in part of any Security for conversion or exchange
into other securities pursuant to its terms);
(3) the amounts payable out of the assets of the Trust to, and any
other rights of the Holders upon, the liquidation of the Trust
and any provisions for the
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dissolution and liquidation of the Trust, including the
obligation, if any, of the Sponsor, the Trust or any other
party to liquidate the Trust and any terms and conditions of
such liquidation;
(4) the date or dates, or the method or methods, if any, by which
such date or dates shall be determined, on which the
liquidation amount and premium, if any, of the Securities are
distributable;
(5) the rate or rates at which income on the Trust Property shall
be distributed to Holders, or the method or methods, if any,
by which such rate or rates are to be determined, the date or
dates, if any, from which such income shall accrue or the
method or methods, if any, by which such date or dates are to
be determined, the date or dates, if any, on which such income
shall be payable, including any deferral provisions, and the
record date or dates, if any, for the income payable on the
Securities on any such income payment date, the notice, if
any, to Holders regarding the determination of income on a
floating rate Security and the manner of giving such notice,
and the basis upon which interest shall be calculated if other
than that of a 360-day year of twelve 30-day months;
(6) whether the Distributions on the Securities will be cumulative
and, if so, the dates from which and upon which distributions
will accumulate and be payable;
(7) whether, in addition to or other than the Borough of
Manhattan, The City of New York, the place or places where the
distributions on the Securities may be made, the Securities
may be surrendered for registration of transfer, exchange,
redemption, repayment, conversion or upon maturity, and
notices or demands to or upon the Trust in respect of the
Securities and this Agreement may be served;
(8) whether the Trust is obligated or entitled to redeem or
purchase any of such Securities at its option, pursuant to any
sinking fund or analogous provision or at the option of any
Holder thereof or otherwise, and, if so, the date or dates on
which, the period or periods within which, the price or prices
at which and the other terms and conditions upon which such
Securities shall be redeemed or purchased, in whole or in
part, pursuant to such obligation, and any provisions for the
remarketing, auction or other secondary sales of Securities so
redeemed or purchased;
(9) the denominations in which the Securities shall be issuable if
other than denominations of $1,000 and any integral multiple;
(10) whether the Securities will be convertible into and/or
exchangeable for other securities or property or both, and if
so, the terms and conditions upon which the Securities will be
so convertible or exchangeable;
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(11) any voting rights granted to the Holders of the Trust
Preferred Securities or the Common Securities in addition to
or in lieu of the voting rights set forth elsewhere in this
Agreement;
(12) if other than U.S. dollars, the currency in which cash
distributions on the Securities shall be payable;
(13) if cash distributions with respect to the Securities are to be
payable, at the election of the Trust or a Holder thereof or
otherwise, in a currency other than that in which the
Securities are stated to be payable, the date or dates on
which, the period or periods within which, and the other terms
and conditions upon which, such election may be made, and the
time and manner of determining the exchange rate between the
currency in which the Securities are stated to be payable and
the currency in which the Securities or any of them are to be
paid pursuant to such election;
(14) whether any distributions may be determined with reference to
an index, formula or other method or methods (which index,
formula or method or methods may be based, without limitation,
on one or more currencies, commodities, equity indices or
other indices), and, if so, the terms and conditions upon
which and the manner in which such amounts shall be determined
and paid or payable;
(15) the title and amount of the Debentures to be acquired with the
proceeds of the sale of the Securities;
(16) the ranking of the Trust Preferred Securities and the Common
Securities; and
(17) any other rights, preferences, restrictions, limitations or
conditions relative to the Trust Preferred Securities or the
Common Securities permitted by Delaware law and any deletions
from or modifications or additions to this Agreement,
including any Events of Default or covenants of any of the
parties hereto, in respect of the Securities, provided no
covenant in this Agreement may be modified without the consent
of the party giving such covenant.
(c) The Certificates shall be in the forms prepared by the Sponsor and
signed on behalf of the Trust by at least one Administrative Trustee. Such
signature shall be the manual or facsimile signature of any present or any
future Administrative Trustee. In case any Administrative Trustee who shall have
signed any of the Securities shall cease to be such Administrative Trustee
before the Certificates so signed shall be delivered by the Trust, such
Certificates nevertheless may be delivered as though the person who signed such
Certificates had not ceased to be such Administrative Trustee; and any
Certificate may be signed on behalf of the Trust by any persons who, at the
actual date of execution of such Certificate, shall be an Administrative Trustee
of the Trust, although at the date of the execution and delivery of the
Agreement any such person was not such an Administrative Trustee. Certificates
shall be printed, lithographed or engraved or
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may be produced in any other manner as is reasonably acceptable to the
Administrative Trustee, as evidenced by such individual's execution thereof, and
may have such letters, numbers or other marks of identification or designation
and such legends or endorsements as the Administrative Trustee that signs such
Certificates may deem appropriate, or as may be required to comply with any law
or with any rule or regulation of any stock exchange on which Securities may be
listed, or to conform to usage.
A Trust Preferred Security Certificate shall not be valid until
authenticated by the manual signature of an authorized officer of the Property
Trustee. Such signature shall be conclusive evidence that a Trust Preferred
Security Certificate has been authenticated under this Agreement.
Each Trust Preferred Security Certificate shall be dated the date of its
authentication by the Property Trustee. Each Common Security Certificate shall
be dated the date it is executed by an Administrative Trustee.
Upon a written order of the Trust signed by one Administrative Trustee,
the Property Trustee shall authenticate Trust Preferred Security Certificates,
provided the aggregate liquidation amount or number of the Trust Preferred
Securities shall not exceed the aggregate liquidation amount or number, as the
case may be, of Trust Preferred Securities designated in the Terms and
Conditions, as such liquidation amount or number, as the case may be, may be
reduced by redemptions, repayments, exchanges, conversions or liquidating
distributions.
The Property Trustee may appoint an authenticating agent acceptable to the
Administrative Trustees to authenticate Trust Preferred Security Certificates.
An authenticating agent may authenticate Trust Preferred Security Certificates
whenever the Property Trustee may do so. Each reference in this Agreement to
authentication by the Property Trustee includes authentication by such agent. An
authenticating agent has the same rights as the Property Trustee to deal with
the Sponsor or an Affiliate of the Sponsor.
(d) The consideration received by the Trust for the issuance of the
Securities shall constitute a contribution to the capital of the Trust and shall
not constitute a loan to the Trust.
(e) Upon issuance of the Securities as provided in this Agreement, the
Securities so issued shall be deemed to be validly issued, fully paid and,
subject to Section 10.1(b), non-assessable.
(f) Every Person, by virtue of having become a Holder or a Trust Preferred
Security Beneficial Owner in accordance with the terms of this Agreement, shall
be deemed to have expressly assented and agreed to the terms of, and shall be
bound by, this Agreement.
(g) The Holders, as beneficial owners of the Trust, will be entitled to
the same limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the State
of Delaware.
Section 7.2 Paying Agent and Registrar.
In the event that the Trust Preferred Securities are not in book-entry
only form:
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(a) The Trust shall maintain in the Borough of Manhattan, The City of New
York, an office or agency where the Trust Preferred Securities may be presented
for payment ("Paying Agent"), and any such Paying Agent shall comply with
Section 317(b) of the Trust Indenture Act. The Administrative Trustees on behalf
of the Trust may appoint the Paying Agent and may appoint one or more additional
paying agents in such other locations as it shall determine. The term "Paying
Agent" includes any additional paying agent. The Administrative Trustees on
behalf of the Trust may change any Paying Agent without prior notice to any
Holder. The Administrative Trustees on behalf of the Trust shall notify the
Property Trustee of the name and address of any Paying Agent not a party to this
Agreement. If the Administrative Trustees on behalf of the Trust fail to appoint
or maintain another entity as Paying Agent, the Property Trustee shall act as
such. The Administrative Trustees on behalf of the Trust or any of its
Affiliates (including the Sponsor) may act as Paying Agent. The Property Trustee
at its Corporate Trust Office shall initially act as Paying Agent for the Trust
Preferred Securities and the Common Securities.
(b) The Trust shall maintain in the Borough of Manhattan, The City of New
York, an office or agency where Trust Preferred Securities may be presented for
registration of transfer or exchange ("Registrar"). The Registrar shall keep a
register of the Trust Preferred Securities and of their transfer or exchange.
The Administrative Trustees on behalf of the Trust may appoint the Registrar and
may appoint one or more co-registrars in such other locations as it shall
determine. The term "Registrar" includes any such additional registrar. The
Administrative Trustees on behalf of the Trust may change any Registrar or
co-registrar without prior notice to any Holder. The Administrative Trustees on
behalf of the Trust shall notify the Property Trustee of the name and address of
any Agent not a party to this Agreement. If the Administrative Trustees on
behalf of the Trust fail to appoint or maintain another entity as Registrar, the
Property Trustee shall act as such. The Trust or any of its Affiliates
(including the Sponsor) may act as Registrar. The Administrative Trustees on
behalf of the Trust shall act as Registrar for the Common Securities.
(c) Notwithstanding Sections 3.6(b)(vi) and 3.6(l), the Trust initially
appoints the Property Trustee as Registrar for the Trust Preferred Securities
and authorizes it to execute and deliver letters, documents and instruments with
DTC and other Clearing Agencies relating to the Trust Preferred Securities.
ARTICLE VIII
TERMINATION OF TRUST
Section 8.1 Termination of Trust.
(a) The Trust shall dissolve and its affairs shall be wound up upon the
first of the following to occur:
(i) the expiration of the term of the Trust provided in Section
3.13 of this Agreement;
(ii) upon the bankruptcy of the Sponsor or the Trust;
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(iii) (other than in connection with a merger, consolidation or
similar transaction not prohibited by this Agreement or any Trust
Property) upon the filing of a certificate of dissolution or its
equivalent with respect to the Sponsor;
(iv) upon the vote of the Holders of at least a Majority in
liquidation amount of the Securities, voting together as a single class to
dissolve the Trust;
(v) the revocation of the Sponsor's charter and the expiration of
90 days after the date of revocation without a reinstatement thereof;
(vi) upon the distribution to the Holders of the Debentures and all
other amounts they are required to receive in accordance with the terms of
this Agreement and the Securities, provided that the Property Trustee has
received written notice from the Sponsor directing the Property Trustee to
dissolve the Trust (which direction is optional and, except as otherwise
expressly provided herein, within the discretion of Sponsor),
(vii) upon the entry of a decree of judicial dissolution of the
Sponsor or the Trust;
(viii) when all the Securities shall have been called for redemption
and the amounts necessary for redemption shall have been distributed to
the Holders in accordance with the terms of this Agreement and the
Securities; and
(ix) any other event specified in the Terms and Conditions.
(b) As soon as is practicable after the occurrence of an event referred to
in Section 8.1(a) and upon completion of the winding-up of the Trust, a
certificate of cancellation of the Certificate of Trust of the Trust shall be
filed with the Secretary of State of the State of Delaware in accordance with
the Statutory Trust Act.
(c) The provisions of Section 4.4 and Article X shall survive the
termination of the Trust.
ARTICLE IX
TRANSFER OF INTERESTS
Section 9.1 Transfer of Securities.
(a) Securities may only be transferred, in whole or in part, in accordance
with the terms and conditions set forth in this Agreement and in the terms of
the Securities. To the fullest extent permitted by law, any transfer or
purported transfer of any Security not made in accordance with this Agreement
shall be null and void.
(b) Subject to this Article IX and the Terms and Conditions, Trust
Preferred Securities shall be freely transferable.
(c) To the fullest extent permitted by applicable law, subject to this
Article IX, the Sponsor and any Related Party may only transfer Common
Securities to the Sponsor or a Related Party of the Sponsor; provided that, any
such transfer is subject to the condition precedent that
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the transferor obtain the written opinion of nationally recognized independent
counsel experienced in such matters that such transfer would not cause more than
an insubstantial risk that:
(i) the Trust would not be classified for United States federal
income tax purposes as a grantor trust; and
(ii) the Trust would be an Investment Company or the transferee
would become an Investment Company.
Section 9.2 Transfer or Exchange of Certificates.
The Registrar shall provide for the registration of Certificates and of
transfers or exchanges of Certificates, which shall be effected without charge
but only upon payment (with such indemnity as the Administrative Trustees may
require) in respect of any tax or other government charges that may be imposed
in relation to it. The Trust will not be required to register or cause to be
registered the transfer of its trust preferred securities after they have been
converted, exchanged, repaid, redeemed or called for redemption. Upon surrender
for registration of transfer or exchange of any Certificate at the Corporate
Trust Office of the Property Trustee, the applicable Registrar shall cause one
or more new Certificates to be issued in the name of the designated transferee
or transferees or the party requesting the exchange, as the case may be. Every
Certificate surrendered for registration of transfer or exchange shall be
accompanied by a written instrument of transfer or exchange in form satisfactory
to the applicable Registrar and duly executed by the Holder or such Holder's
attorney duly authorized in writing. Each Certificate surrendered for
registration of transfer or exchange shall be cancelled by the applicable
Registrar. A transferee of a Certificate and the recipient of one or more
Certificates issued in exchange for cancelled Certificates shall be entitled to
the rights and subject to the obligations of a Holder hereunder upon the receipt
by such transferee or recipient of a Certificate or Certificates duly executed
by an Administrative Trustee and, in the case of a Trust Preferred Security
Certificate, authenticated by the Property Trustee. By acceptance of a
Certificate, each transferee shall be deemed to have agreed to be bound by this
Agreement.
Section 9.3 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 Trust shall have
actual or other notice thereof.
Section 9.4 Book Entry Interests.
Unless otherwise specified in the Terms and Conditions, the Trust
Preferred Securities Certificates, on original issuance, shall be issued in the
form of one or more, fully registered, global Trust Preferred Security
Certificates (each a "Global Certificate"), to be delivered to DTC, the initial
Clearing Agency, by, or on behalf of, the Trust. Each such Global Certificate
shall initially be registered on the books and records of the Trust in the name
of Cede & Co., the
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nominee of DTC, and no Trust Preferred Security Beneficial Owner will receive a
definitive Trust Preferred Security Certificate representing such Trust
Preferred Security Beneficial Owner's interests in any Global Certificate,
except as provided in Section 9.7. Except for the definitive Trust Preferred
Security Certificates issued to the Trust Preferred Security Beneficial Owners
pursuant to Section 9.7 or in accordance with the Terms and Conditions:
(a) the provisions of this Section 9.4 shall be in full force and effect;
(b) the Trust, the Trustees and any Agent shall be entitled to deal with
the Clearing Agency for all purposes of this Agreement (including the payment of
distributions on any Global Certificate and receiving approvals, votes or
consents hereunder) as the Holder of the Trust Preferred Securities and the sole
holder of any Global Certificate and shall have no obligation to the Trust
Preferred Security Beneficial Owners;
(c) to the extent that the provisions of this Section 9.4 conflict with
any other provisions of this Agreement other than the Terms and Conditions, the
provisions of this Section 9.4 shall control; and
(d) the rights of the Trust Preferred Security Beneficial Owners shall be
exercised only through the Clearing Agency and shall be limited to those
established by law and agreements between the Trust Preferred Security
Beneficial Owners and the Clearing Agency and/or the Clearing Agency
Participants to receive and transmit payments and other distributions on the
Global Certificates to such Clearing Agency Participants. DTC will make book
entry transfers among the Clearing Agency Participants; provided that, solely
for the purposes of determining whether the Holders of the requisite amount of
Trust Preferred Securities have voted on any matter provided for in this
Agreement, 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 Clearing Agency setting forth the Trust Preferred Security Beneficial
Owners' votes or assigning the right to vote on any matter to any other Persons
either in whole or in part.
Section 9.5 Notices to Clearing Agency.
Whenever a notice or other communication to the Trust Preferred Security
Holders is required under this Agreement, unless and until definitive fully
registered Trust Preferred Security Certificates shall have been issued to the
Trust Preferred Security Beneficial Owners pursuant to Section 9.7 or otherwise,
the Administrative Trustees shall give all such notices and communications
specified herein to be given to the Trust Preferred Security Holders to the
Clearing Agency, and shall have no notice obligations to the Trust Preferred
Security Beneficial Owners.
Section 9.6 Appointment of Successor Clearing Agency.
If any Clearing Agency elects to discontinue its services as securities
depositary with respect to the Trust Preferred Securities, the Administrative
Trustees may, in their sole discretion, appoint a successor Clearing Agency with
respect to such Trust Preferred Securities.
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Section 9.7 Definitive Trust Preferred Security Certificates.
If:
(a) a Clearing Agency elects to discontinue its services as securities
depositary with respect to the Trust Preferred Securities and a successor
Clearing Agency is not appointed within 90 days after such discontinuance
pursuant to Section 9.6; or
(b) the Administrative Trustees elect after consultation with the Sponsor
to terminate the book-entry system through the Clearing Agency with respect to
the Trust Preferred Securities, then:
(1) definitive fully registered Trust Preferred Security
Certificates shall be prepared and executed by the Administrative Trustees
and authenticated by the Property Trustee on behalf of the Trust with
respect to such Trust Preferred Securities; and
(2) upon surrender of any Global Certificate by the Clearing Agency,
accompanied by registration instructions, the Administrative Trustees
shall cause definitive fully registered Trust Preferred Securities
Certificates to be executed, and the Property Trustee shall cause such
Trust Preferred Securities Certificates to be authenticated and delivered
to Trust 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, said
instructions of the Clearing Agency. The definitive fully registered Trust
Preferred Security Certificates shall be printed, lithographed or engraved
or may be produced in any other manner as is reasonably acceptable to the
Administrative Trustees, as evidenced by their execution thereof, and may
have such letters, numbers or other marks of identification or designation
and such legends or endorsements as the Administrative Trustees and the
Property Trustee 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 regulation of any stock exchange on which Trust Preferred
Securities may be listed, or to conform to usage.
Section 9.8 Mutilated, Destroyed, Lost or Stolen Certificates.
If: (a) any mutilated Certificate shall be surrendered to the
Administrative Trustees, or if the Administrative Trustees shall receive
evidence to their satisfaction of the destruction, loss or theft of any
Certificate; and (b) there shall be delivered to the Administrative Trustees and
the Property Trustee such security or indemnity as may be required by them to
keep each of the Trustees and the Trust harmless, then, in the absence of notice
that such Certificate shall have been acquired by a protected purchaser, any
Administrative Trustee on behalf of the Trust shall execute and deliver, and, in
the case of a Trust Preferred Securities Certificate, the Property Trustee shall
authenticate, in exchange for or in lieu of any such mutilated, destroyed, lost
or stolen Certificate, a new Certificate of like denomination. In connection
with the issuance of any new Certificate under this Section 9.8, the
Administrative Trustees and the Property Trustee may require the payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection therewith.
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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 X
LIMITATION OF LIABILITY OF HOLDERS OF SECURITIES,
TRUSTEES OR OTHERS
Section 10.1 Liability.
(a) Except as expressly set forth in this Agreement, the Debentures, any
other instrument or agreement, the Securities Guarantees and the terms of the
Securities, the Sponsor shall not be:
(i) personally liable for the return of any portion of the capital
contributions (or any return thereon) of the Holders of the Securities,
which shall be made solely from assets of the Trust; or
(ii) required to pay to the Trust or to any Holder of Securities
any deficit upon dissolution of the Trust or otherwise.
(b) The Sponsor, as the Debenture Issuer, shall be liable for all of the
debts and obligations of the Trust (other than with respect to the Securities)
to the extent not satisfied out of the Trust's assets.
(c) Pursuant to Section 3803(a) of the Statutory Trust Act, the Holders of
the Trust Preferred Securities shall be entitled to the same limitation of
personal liability extended to stockholders of private corporations for profit
organized under the General Corporation Law of the State of Delaware.
Section 10.2 Exculpation.
(a) No Indemnified Person shall be liable, responsible or accountable in
damages or otherwise to the Trust or any Covered Person for any loss, damage or
claim incurred by reason of any act or omission performed or omitted by such
Indemnified Person in good faith on behalf of the Trust and in a manner such
Indemnified Person reasonably believed to be within the scope of the authority
conferred on such Indemnified Person by this Agreement or by law, except that an
Indemnified Person shall be liable for any such loss, damage or claim incurred
by reason of such Indemnified Person's gross negligence (or, in the case of the
Property Trustee, negligence), bad faith 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.
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Section 10.3 Fiduciary Duty.
(a) To the extent that, at law or in equity, an Indemnified Person has
duties (including fiduciary duties) and liabilities relating thereto to the
Trust or to any other Covered Person, an Indemnified Person acting under this
Agreement shall not be liable to the Trust or to any other Covered Person for
its good faith reliance on the provisions of this Agreement. The provisions of
this Agreement, to the extent that they restrict the duties and liabilities of
an Indemnified Person otherwise existing at law or in equity (other than the
duties imposed on the Property Trustee under the Trust Indenture Act), are
agreed by the parties hereto to replace such other duties and liabilities of
such Indemnified Person.
(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises between any
Covered Persons and any Indemnified Person; or
(ii) whenever this Agreement or any other instrument or agreement
contemplated herein or therein provides that an Indemnified Person shall
act in a manner that is, or provides terms that are, fair and reasonable
to the Trust or any Holder of Securities,
the Indemnified Person shall resolve such conflict of interest, take such action
or provide such terms, considering in each case the relative interest of each
party (including its own interest) to such conflict, agreement, transaction or
situation and the benefits and burdens relating to such interests, any customary
or accepted industry practices, and any applicable generally accepted accounting
practices or principles. In the absence of bad faith by the Indemnified Person,
the resolution, action or term so made, taken or provided by the Indemnified
Person shall not constitute a breach of this Agreement or any other agreement
contemplated herein or of any duty or obligation of the Indemnified Person at
law or in equity or otherwise.
(c) Whenever in this Agreement an Indemnified Person is permitted or
required to make a decision:
(i) in its "sole discretion" or under a grant of similar
authority, the Indemnified Person shall be entitled to consider such
interests and factors as it desires, including its own interests, and
shall have no duty or obligation to give any consideration to any interest
of or factors affecting the Trust or any other Person; or
(ii) in its "good faith" or under another express standard, the
Indemnified Person shall act under such express standard and shall not be
subject to any other or different standard imposed by this Agreement or by
applicable law.
Section 10.4 Indemnification.
(a) (i) The Sponsor shall indemnify, to the fullest extent permitted by
law, any Company Indemnified Person who was or is a party or is threatened to be
made a party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (other than an action
by or in the right of the Trust) by reason of the fact that he is
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or was a Company Indemnified Person against expenses (including reasonable
attorneys' fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such action, suit or proceeding if
he acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the Trust, and, with respect to any criminal
action or proceeding, had no reasonable cause to believe his conduct was
unlawful. The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that the Company Indemnified Person
did not act in good faith and in a manner which he reasonably believed to be in
or not opposed to the best interests of the Trust, and, with respect to any
criminal action or proceeding, had reasonable cause to believe that his conduct
was unlawful.
(ii) The Sponsor shall indemnify, to the fullest extent permitted
by law, any Company Indemnified Person who was or is a party or is
threatened to be made a party to any threatened, pending or completed
action or suit by or in the right of the Trust to procure a judgment in
its favor by reason of the fact that he is or was a Company Indemnified
Person against expenses (including reasonable attorneys' fees) actually
and reasonably incurred by him in connection with the defense or
settlement of such action or suit if he acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best
interests of the Trust and except that no such indemnification shall be
made in respect of any claim, issue or matter as to which such Company
Indemnified Person shall have been adjudged to be liable to the Trust
unless and only to the extent that the Court of Chancery of Delaware or
the court in which such action or suit was brought shall determine upon
application that, despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses which such Court of Chancery or
such other court shall deem proper.
(iii) Any indemnification under paragraphs (i) and (ii) of this
Section 10.4(a) (unless ordered by a court) shall be made by the Sponsor
only as authorized in the specific case upon a determination that
indemnification of the Company Indemnified Person is proper in the
circumstances because he has met the applicable standard of conduct set
forth in paragraphs (i) and (ii). Such determination shall be made (1) by
the Administrative Trustees by a majority vote of a Quorum consisting of
such Administrative Trustees who were not parties to such action, suit or
proceeding, (2) if such a Quorum is not obtainable, or, even if
obtainable, if a Quorum of disinterested Administrative Trustees so
directs, by independent legal counsel in a written opinion, or (3) by the
Common Security Holder of the Trust.
(iv) Expenses (including reasonable attorneys' fees) incurred by a
Company Indemnified Person in defending a civil, criminal, administrative
or investigative action, suit or proceeding referred to in paragraphs (i)
and (ii) of this Section 10.4(a) shall be paid by the Sponsor in advance
of the final disposition of such action, suit or proceeding upon receipt
of an undertaking by or on behalf of such Company Indemnified Person to
repay such amount if it shall ultimately be determined that such person is
not entitled to be indemnified by the Sponsor as authorized in this
Section 10.4(a). Notwithstanding the foregoing, no advance shall be made
by the Sponsor if a determination is reasonably and promptly made (i) by
the Administrative Trustees by a majority vote of a Quorum of
45
disinterested Administrative Trustees, (ii) if such a Quorum is not
obtainable, or, even if obtainable, if a Quorum of disinterested
Administrative Trustees so directs, by independent legal counsel in a
written opinion or (iii) the Common Security Holder of the Trust, that,
based upon the facts known to the Administrative Trustees, independent
legal counsel or Common Security Holder at the time such determination is
made, such person acted in bad faith or in a manner that such person did
not believe to be in or not opposed to the best interests of the Trust,
or, with respect to any criminal proceeding, that such Company Indemnified
Person believed or had reasonable cause to believe his conduct was
unlawful. In no event shall any advance be made in instances where the
Administrative Trustees, independent legal counsel or Common Security
Holder reasonably determine that such person deliberately breached such
person's duty to the Trust or its Common or Trust Preferred Security
Holders.
(v) The indemnification and advancement of expenses provided by,
or granted pursuant to, the other paragraphs of this Section 10.4(a) shall
not be deemed exclusive of any other rights to which those seeking
indemnification and advancement of expenses may be entitled under any
agreement, vote of shareholders or disinterested directors of the Sponsor
or Trust Preferred Security Holders of the Trust or otherwise, both as to
action in his official capacity and as to action in another capacity while
holding such office. All rights to indemnification under this Section
10.4(a) shall be deemed to be provided by a contract between the Sponsor
and each Company Indemnified Person who serves in such capacity at any
time while this Section 10.4(a) is in effect. Any repeal or modification
of this Section 10.4(a) shall not affect any rights or obligations then
existing.
(vi) The Sponsor or the Trust may purchase and maintain insurance
on behalf of any person who is or was a Company Indemnified Person against
any liability asserted against him and incurred by him in any such
capacity, or arising out of his status as such, whether or not the Sponsor
would have the power to indemnify him against such liability under the
provisions of this Section 10.4(a).
(vii) For purposes of this Section 10.4(a), references to "the
Trust" shall include, in addition to the resulting or surviving entity,
any constituent entity (including any constituent of a constituent)
absorbed in a consolidation or merger, so that any person who is or was a
director, trustee, officer or employee of such constituent entity, or is
or was serving at the request of such constituent entity as a director,
trustee, officer, employee or agent of another entity, shall stand in the
same position under the provisions of this Section 10.4(a) with respect to
the resulting or surviving entity as such person would have with respect
to such constituent entity if its separate existence had continued.
(viii) The indemnification and advancement of expenses provided by,
or granted pursuant to, this Section 10.4(a) shall, unless otherwise
provided when authorized or ratified, continue as to a person who has
ceased to be a Company Indemnified Person and shall inure to the benefit
of the successors, heirs, executors and administrators of such a person.
46
(b) To the fullest extent permitted by law, the Sponsor agrees to
indemnify each Fiduciary Indemnified Person for, and to hold each Fiduciary
Indemnified Person harmless against, any loss, liability or expense to the
extent incurred without gross negligence (or in the case of the Property
Trustee, pursuant to Section 3.9, negligence), bad faith or willful misconduct
on its part, arising out of or in connection with the acceptance or
administration of the trust or trusts hereunder, including the costs and
expenses (including reasonable legal fees and expenses) of defending itself
against or investigating any claim or liability in connection with the exercise
or performance of any of its powers or duties hereunder. The provisions of this
Section 10.4(b) shall survive the satisfaction and discharge of this Agreement
and any resignation or removal of the Property Trustee or the Delaware Trustee,
as the case may be.
Section 10.5 Outside Businesses.
Any Covered Person, the Sponsor, the Delaware Trustee and the Property
Trustee (subject to Section 5.3(c)) may engage in or possess an interest in
other business ventures of any nature or description, independently or with
others, similar or dissimilar to the business of the Trust, and the Trust and
the Holders of Securities shall have no rights by virtue of this Agreement in
and to such independent ventures or the income or profits derived therefrom, and
the pursuit of any such venture, even if competitive with the business of the
Trust, shall not be deemed wrongful or improper. No Covered Person, the Sponsor,
the Delaware Trustee or the Property Trustee shall be obligated to present any
particular investment or other opportunity to the Trust even if such opportunity
is of a character that, if presented to the Trust, could be taken by the Trust,
and any Covered Person, the Sponsor, the Delaware Trustee and the Property
Trustee shall have the right to take for its own account (individually or as a
partner or fiduciary) or to recommend to others any such particular investment
or other opportunity. Any Covered Person, the Delaware Trustee and the Property
Trustee may engage or be interested in any financial or other transaction with
the Sponsor or any Affiliate of the Sponsor, or may act as depositary for,
trustee or agent for, or act on any committee or body of holders of, securities
or other obligations of the Sponsor or its Affiliates.
Section 10.6 Trustees' Fees and Expenses.
Each Trustee shall receive as compensation for its services hereunder such
fees and expenses as have been separately agreed upon before the date hereof
between the Sponsor and such Trustee, and each Trustee shall be entitled to be
reimbursed by the Sponsor for other reasonable expenses hereunder, including the
reasonable compensation, expenses and disbursements of such agents,
representatives, experts and counsel as such Trustee may employ in connection
with the exercise and performance of its rights and duties hereunder.
ARTICLE XI
ACCOUNTING
Section 11.1 Fiscal Year.
The fiscal year ("Fiscal Year") of the Trust shall be the calendar year,
or such other year as is required by the Code.
47
Section 11.2 Certain Accounting Matters.
(a) At all times during the existence of the Trust, the Administrative
Trustees on behalf of the Trust shall keep, or cause to be kept, full books of
account, records and supporting documents, all of 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.
(b) The Administrative Trustees, on behalf of the Trust, shall cause to be
duly prepared and delivered to each of the Holders of Securities, any annual
United States federal income tax information statement required by the Code and
the Treasury Regulations, 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 Administrative Trustees on behalf of the Trust
shall endeavor to deliver all such statements within 30 days after the end of
each Fiscal Year of the Trust.
(c) The Administrative Trustees on behalf of the Trust shall cause to be
duly prepared and filed with the appropriate taxing authority an annual United
States federal income tax return, on a Form 1041 or such other form required by
United States federal income tax law, and any other annual income tax returns
required to be filed by the Trust with any state or local taxing authority.
Section 11.3 Banking.
The Administrative Trustees, on behalf of 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 for the benefit of holders of Securities of funds in
respect of Trust Property shall be made directly to the Property Trustee Account
and no other funds of the Trust shall be deposited in the Property Trustee
Account. The sole signatories for such accounts shall be designated by the
Administrative Trustees; provided, however, that the Property Trustee shall
designate the signatories for the Property Trustee Account.
Section 11.4 Withholding.
The Administrative Trustees on behalf of the Trust 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 Administrative Trustees on behalf
of 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
48
applicable jurisdiction. If the amount required to be withheld was not withheld
from actual distributions made, the Trust may reduce subsequent distributions by
the amount of such withholding.
ARTICLE XII
AMENDMENTS AND MEETINGS
Section 12.1 Amendments.
Except as otherwise provided in this Agreement or by any applicable terms
of the Securities:
(a) this Agreement may only be amended by a written instrument approved
and executed by the Sponsor and the Administrative Trustees (or, if there are
more than two Administrative Trustees, a majority of the Administrative
Trustees) and:
(i) if the amendment affects the rights, powers, duties,
obligations or immunities of the Property Trustee, also by the Property
Trustee; and
(ii) if the amendment affects the rights, powers, duties,
obligations or immunities of the Delaware Trustee, also by the Delaware
Trustee;
(b) no amendment shall be made:
(i) unless, in the case of any proposed amendment, the Property
Trustee shall have first received an Officers' Certificate from each of
the Trust and the Sponsor that such amendment is permitted by, and
conforms to, the terms of this Agreement (including the terms of the
Securities);
(ii) unless, in the case of any proposed amendment which affects
the rights, powers, duties, obligations or immunities of the Property
Trustee, the Property Trustee shall have first received:
(A) an Officers' Certificate from each of the Trust and
the Sponsor that such amendment is permitted by, and conforms
to, the terms of this Agreement (including the terms of the
Securities); and
(B) an opinion of qualified independent counsel that
such amendment is permitted by, and conforms to, the terms of
this Agreement (including the terms of the Securities); and
(iii) to the extent the result of such amendment would be to:
(A) cause the Trust to fail to continue to be classified
for purposes of United States federal income taxation as a
grantor trust;
(B) reduce or otherwise adversely affect the powers of
the Property Trustee in contravention of the Trust Indenture
Act; or
49
(C) cause the Trust to be deemed to be an Investment
Company required to be registered under the Investment Company
Act;
(c) after the Trust has issued any Securities that remain outstanding,
without the consent of the Holders of a Majority in liquidation amount of each
class of Securities affected, this Agreement may not be amended for any reason
in a manner that would adversely affect the rights, privileges or preferences of
such class of Securities, provided that, except as may be provided in the Terms
and Conditions, without the consent of each Holder of Securities affected
thereby, this Agreement may not be amended to:
(i) change the Distribution rate, or manner of calculation of the
Distribution rate, amount, timing or currency or otherwise adversely
affect the method of any required payment;
(ii) change the purpose of the Trust;
(iii) authorize the issuance of any additional beneficial interests
in the Trust;
(iv) change the conversion, exchange, redemption or repayment
provisions, if any;
(v) change the conditions precedent for the Sponsor to elect to
dissolve the Trust and distribute the Debentures held by the Trust to the
Holders of the Securities, if applicable;
(vi) change the liquidation, distribution or other provisions
relating to the distribution of amounts payable upon the dissolution and
liquidation of the Trust;
(vii) affect the limited liability of any Holder of the Securities;
or
(viii) restrict the right of a Holder of the Securities to institute
suit for the enforcement of any required payment on or, if applicable,
after the due date therefor or for the conversion or exchange of the
Securities in accordance with their terms.
(d) Section 9.1(c) and this Section 12.1 shall not be amended without the
consent of all of the Holders of the Securities;
(e) Article IV shall not be amended without the consent of the Sponsor;
(f) the rights of the holders of the Common Securities under Article V to
increase or decrease the number of, and appoint and remove, Trustees shall not
be amended without the consent of the Holders of a Majority in liquidation
amount of the Common Securities; and
(g) subject to Section 12.1(c) and the Terms and Conditions, this
Agreement may be amended by the Trustees and the Sponsor without the consent of
the Holders of the any Securities that are outstanding to:
(i) cure any ambiguity;
50
(ii) correct or supplement any provision in this Agreement that may
be defective or inconsistent with any other provision of this Agreement;
(iii) add to the covenants, restrictions or obligations of the
Sponsor;
(iv) modify, add or eliminate provisions necessary to ensure
classification as a grantor trust for United States federal income tax
purposes or to ensure that the Trust will not be subject to the Investment
Company Act, conform to any change in the Investment Company Act or the
Trust Indenture Act or the rules and regulations promulgated thereunder or
any written change in interpretation or application of such act or such
rules or regulations by any legislative body, court, government agency or
regulatory authority; or
(v) comply with the requirements of the Trust Indenture Act to
ensure that this Agreement is qualified under the Trust Indenture Act, or
cause the Trust to continue to be classified for United States federal
income tax purposes as a grantor trust;
provided that any amendment does not adversely affect in any material respect
the interests of the Holders of the Securities.
Any amendments to this Agreement adopted pursuant to Section 12.1(g) shall
become effective when notice thereof is given to the Holders.
Section 12.2 Meetings of the Holders of Securities; Action by Written Consent.
(a) Except as otherwise provided in the Terms and Conditions, meetings of
the Holders of any class of Securities may be called at any time by the
Administrative Trustees (or as provided in the terms of the Securities) to
consider and act on any matter on which Holders of Securities are entitled to
act under the terms of this Agreement, the terms of the Securities or the rules
of any stock exchange on which the Trust Preferred Securities are listed or
admitted for trading. The Administrative Trustees shall call a meeting of the
Holders if directed to do so by the Holders of at least 10% in liquidation
amount of Securities. Such direction shall be given by delivering to the
Administrative 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
Securities specified shall be counted for purposes of determining whether the
required percentage set forth in the second sentence of this paragraph has been
met.
(b) Except to the extent otherwise provided in the terms of the
Securities, the following provisions shall apply to meetings of Holders of
Securities:
(i) notice of any such meeting shall be given to all the Holders
of Securities having a right to vote thereat at least seven days and not
more than 60 days before the date of such meeting. Whenever a vote,
consent or approval of the Holders of Securities is permitted or required
under this Agreement, the terms of the Securities or the rules of any
stock exchange on which the Trust Preferred Securities are listed or
admitted for trading, such vote, consent or approval may be given at a
meeting of the Holders of
51
Securities. Any action that may be taken at a meeting of the Holders of
Securities may be taken without a meeting and without prior notice if a
consent in writing setting forth the action so taken is signed by the
Holders of Securities owning not less than the minimum amount of
Securities in liquidation amount that would be necessary to authorize or
take such action at a meeting at which all Holders of Securities having a
right to vote thereon were present and voting. Prompt notice of the taking
of action without a meeting shall be given to the Holders of Securities
entitled to vote who have not consented in writing. The Administrative
Trustees may specify that any written ballot submitted to the Holder of
Securities for the purpose of taking any action without a meeting shall be
returned to the Trust within the time specified by the Administrative
Trustees;
(ii) each Holder of a Security may authorize any Person to act for
it by proxy on all matters in which a Holder of Securities is entitled to
participate, including waiving notice of any meeting, or voting or
participating at a meeting. No proxy shall be valid after the expiration
of 11 months from the date thereof unless otherwise provided in the proxy.
Every proxy shall be revocable at the pleasure of the Holder of Securities
executing it. Except as otherwise provided herein, all matters relating to
the giving, voting or validity of proxies shall be governed by the General
Corporation Law of the State of Delaware relating to proxies, and judicial
interpretations thereunder, as if the Trust were a Delaware corporation
and the Holders of the Securities were stockholders of a Delaware
corporation;
(iii) each meeting of the Holders of the Securities shall be
conducted by the Administrative Trustees or by such other Person that the
Administrative Trustees may designate; and
(iv) unless the Statutory Trust Act, this Agreement, the terms of
the Securities, the Trust Indenture Act or the listing rules of any stock
exchange on which the Trust Preferred Securities are then listed or
trading otherwise provides, the Administrative Trustees, in their sole
discretion, shall establish all other provisions relating to meetings of
Holders of Securities, including notice of the time, place or purpose of
any meeting at which any matter is to be voted on by any Holders of
Securities, waiver of any such notice, action by consent without a
meeting, the establishment of a record date, quorum requirements, voting
in person or by proxy or any other matter with respect to the exercise of
any such right to vote.
ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE AND
DELAWARE TRUSTEE
Section 13.1 Representations and Warranties of Property Trustee.
The Trustee that acts as initial Property Trustee represents and warrants
to the Trust and to the Sponsor at the date of this Agreement, 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:
52
(a) the Property Trustee is a banking corporation, a national banking
association or a bank with trust powers, duly organized, validly existing and in
good standing under the laws of the United States of America or any State 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 Agreement;
(b) the Property Trustee satisfies the requirements set forth in Section
5.3(a);
(c) the execution, delivery and performance by the Property Trustee of
this Agreement has been duly authorized by all necessary corporate action on the
part of the Property Trustee. The Agreement has been duly executed and delivered
by the Property Trustee, and it constitutes a legal, valid and binding
obligation of the Property Trustee, enforceable against it in accordance with
its terms, subject to applicable bankruptcy, reorganization, moratorium,
insolvency, and other similar laws affecting creditors' rights generally and to
general principles of equity and the discretion of the court (regardless of
whether the enforcement of such remedies is considered in a proceeding in equity
or at law);
(d) the execution, delivery and performance of this Agreement by the
Property Trustee does not conflict with or constitute a breach of the Articles
of Organization or By-laws of the Property Trustee; and
(e) no consent, approval or authorization of, or registration with or
notice to, any State or Federal banking authority is required for the execution,
delivery or performance by the Property Trustee, of this Agreement.
Section 13.2 Representations and Warranties of Delaware Trustee.
The Trustee that acts as initial Delaware Trustee represents and warrants
to the Trust and to the Sponsor at the date of this Agreement, and each
Successor Delaware Trustee represents and warrants to the Trust and the Sponsor
at the time of the Successor Delaware Trustee's acceptance of its appointment as
Delaware Trustee, that:
(a) the Delaware Trustee is a banking corporation or national banking
association, duly organized, validly existing and in good standing under the
laws of the State of Delaware or the United States, as the case may be, with
power and authority to execute and deliver, and to carry out and perform its
obligations under the terms of, this Agreement;
(b) the execution, delivery and performance by the Delaware Trustee of
this Agreement has been duly authorized by all necessary corporate action on the
part of the Delaware Trustee. This Agreement has been duly executed and
delivered by the Delaware Trustee, and it constitutes a legal, valid and binding
obligation of the Delaware Trustee, enforceable against it in accordance with
its terms, subject to applicable bankruptcy, reorganization, moratorium,
insolvency, and other similar laws affecting creditors' rights generally and to
general principles of equity and the discretion of the court (regardless of
whether the enforcement of such remedies is considered in a proceeding in equity
or at law);
53
(c) no consent, approval or authorization of, or registration with or
notice to, any State or Federal banking authority is required for the execution,
delivery or performance by the Delaware Trustee of this Agreement; and
(d) the execution, delivery and performance of the Agreement by the
Delaware Trustee does not conflict with or constitute a breach of the Articles
of Organization or By-laws of the Delaware Trustee; and
(e) the Delaware Trustee is a natural person who is a resident of the
State of Delaware or, if not a natural person, an entity which has its principal
place of business in the State of Delaware.
ARTICLE XIV
MISCELLANEOUS
Section 14.1 Notices.
All notices provided for in this Agreement shall be in writing, duly
signed by the party giving such notice, and shall be delivered, telecopied or
mailed by registered or certified mail, as follows:
(a) if given to the Administrative Trustees or the Trust, in care of the
Administrative Trustees at the Trust's mailing address set forth below (or such
other address as the Trust may give notice of to the Holders of the Securities
and the other Trustees):
DTE Energy Company
2000 2nd Avenue
Detroit, Michigan 48226-1279
Attention: Treasurer
(b) if given to the Delaware Trustee, at the mailing address set forth
below (or such other address as Delaware Trustee may give notice of to the
Holders of the Securities):
The Bank of New York (Delaware)
White Clay Center (or P.O. Box 6973)
Route 273
Newark, Delaware 19711
Attention: Corporate Trust
(c) if given to the Property Trustee, at its Corporate Trust Office to the
attention of Capital Markets Fiduciary Services (or such other address as the
Property Trustee may give notice of to the Holders of the Securities):
BNY Midwest Trust Company
2 N. LaSalle Street, Suite 1020
Chicago, IL 60602
Attention: Corporate Trust
54
(d) if given to the Holder of the Common Securities, at the mailing
address of the Sponsor set forth below (or such other address as the Holder of
the Common Securities may give notice to the Trust and the other Trustees):
c/o DTE Energy Company
2000 2nd Avenue
Detroit, Michigan 48226-1279
Attention: Treasurer
(e) if given to any other Holder, at the address set forth on the books
and records of the Trust.
All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid except that if a notice or other document is refused delivery or
cannot be delivered because of a changed address of which no notice was given,
such notice or other document shall be deemed to have been delivered on the date
of such refusal or inability to deliver.
Section 14.2 Governing Law.
This Agreement 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.
Section 14.3 Intention of the Parties.
It is the intention of the parties hereto that the Trust be classified for
United States federal income tax purposes as a grantor trust. The provisions of
this Agreement shall be interpreted to further this intention of the parties.
Section 14.4 Headings.
Headings contained in this Agreement are inserted for convenience of
reference only and do not affect the interpretation of this Agreement or any
provision hereof.
Section 14.5 Successors and Assigns.
Whenever in this Agreement 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 Agreement by the Sponsor and the Trustees
shall bind and inure to the benefit of their respective successors and assigns,
whether so expressed.
Section 14.6 Partial Enforceability.
If any provision of this Agreement, or the application of such provision
to any Person or circumstance, shall be held invalid, the remainder of this
Agreement, or the application of such provision to persons or circumstances
other than those to which it is held invalid, shall not be affected thereby.
55
Section 14.7 Entire Agreement.
This Agreement constitutes the entire agreement among the parties. It
supersedes any prior agreement or understandings among them, and it may not be
modified or amended in any manner other than as set forth herein.
Section 14.8 Remedies.
The failure of any party to seek redress for violation of, or to insist
upon the strict performance of, any provision of this Agreement shall not
prevent a subsequent act, which would have originally constituted a violation,
from having the effect of an original violation. The rights and remedies
provided by this Agreement are cumulative and the use of any one right or remedy
by any party shall not preclude or waive its right to use any or all other
remedies. Said rights and remedies are given in addition to any other rights the
parties may have by law, statute, ordinance or otherwise.
Section 14.9 Counterparts.
This Agreement may contain more than one counterpart of the signature page
and this Agreement may be executed by affixing the signature of each of the
Trustees to one of such counterpart signature pages. All of such counterpart
signature pages shall be read as though one, and they shall have the same force
and effect as though all of the signers had signed a single signature page.
56
IN WITNESS WHEREOF, the undersigned have caused these presents to be
executed as of the day and year first above written.
___________________________________________
K. Hier, as Administrative Trustee
of the Trust
___________________________________________
N.A. Khouri, as Administrative Trustee
of the Trust
___________________________________________
D.R. Murphy, as Administrative Trustee
of the Trust
The Bank of New York (Delaware),
as Delaware Trustee
By:________________________________________
Name:
Title:
BNY Midwest Trust Company,
as Property Trustee
By:________________________________________
Name:
Title:
DTE Energy Company,
as Sponsor
By:________________________________________
Name:
Title:
57
EXHIBIT A
TERMS AND CONDITIONS OF
7.50% TRUST ORIGINATED PREFERRED SECURITIES
7.50% COMMON SECURITIES
Pursuant to Section 7.1(a) of the Amended and Restated Trust Agreement,
dated as of June 1, 2004, of DTE Energy Trust II (as amended from time to time,
the "Agreement"), hereby established are the designation, rights, privileges,
restrictions, preferences and other terms and provisions of the Trust Preferred
Securities and the Common Securities:
(1) These Terms and Conditions form a part of the Agreement, except as
otherwise provided herein or unless the context otherwise requires,
and all of the provisions of the other parts of the Agreement,
including the definitions of capitalized terms, apply to these Terms
and Conditions. Furthermore, unless the context otherwise requires,
in these Terms and Conditions, references to paragraphs mean
paragraphs of these Terms and Conditions and:
"Additional Interest" has the meaning set forth in paragraph 3(d).
"Capital Stock" means (i) with respect to any Person organized as a
corporation, any and all shares, interests, rights to purchase, warrants,
options, participations or other equivalents of or interest in (however
designated) corporate stock, and (ii) with respect to any Person that is not
organized as a corporation, the partnership, membership or other equity
interests or participations in such Person.
"Change in 1940 Act Law" has the meaning set forth in paragraph 5(b).
"Common Securities" has the meaning set forth in paragraph 2(b).
"Compound Interest" has the meaning set forth in paragraph 3(a).
"Coupon Rate" has the meaning set forth in paragraph 3(a).
"Debentures" means the 7.50% Junior Subordinated Debentures due 2044 of
the Debenture Issuer.
"Distribution Payment Date" has the meaning set forth in paragraph 3(b).
"Extension Period" has the meaning set forth in paragraph 3(b).
"Indenture" means the Amended and Restated Indenture, dated as of April 9,
2001, as supplemented by the supplemental indenture, dated as of June 1, 2004,
with respect to the Debentures, between the Debenture Issuer and the Debenture
Trustee.
"Investment Company Event" has the meaning set forth in paragraph 5(b).
"Liquidation" has the meaning set forth in paragraph 4.
A-1
"Liquidation Distribution" has the meaning set forth in paragraph 4.
"90 Day Period" has the meaning set forth in paragraph 5(b).
"Ministerial Action" has the meaning set forth in paragraph 5(b).
"Pro Rata" has the meaning set forth in paragraph 11.
"Redemption/Distribution Notice" has the meaning set forth in paragraph
6(a).
"Redemption Price" has the meaning set forth in paragraph 5(a).
"Rights Plan" means a plan of the Debenture Issuer providing for the
issuance by the Debenture Issuer to all holders of its Common Stock of rights
entitling the holders thereof to subscribe for or purchase shares of Common
Stock or any class or series of preferred stock, which rights (i) are deemed to
be transferred with such shares of Common Stock, (ii) are not exercisable and
(iii) are also issued in respect of future issuances of Common Stock, in each
case until the occurrence of a specified event or events.
"Special Event" means an Investment Company Event or a Tax Event, as the
case may be.
"Special Event Redemption" has the meaning set forth in paragraph 5(b).
"Special Event Redemption Date" has the meaning set forth in paragraph
5(b).
"Stated Maturity" means, with respect to the Debentures, June 1, 2044.
"Super Majority" has the meaning set forth in paragraph 8(b).
"Tax Event" has the meaning set forth in paragraph 5(b).
"Treasury Regulations" means the income tax regulations, including
temporary and proposed regulations, promulgated under the Code by the United
States Treasury, as such regulations may be amended from time to time (including
corresponding provisions of succeeding regulations).
"Trust Preferred Securities" has the meaning set forth in paragraph 2(a).
(2) Designation and Number.
(a) Trust Preferred Securities. Up to 4,140,000 Trust Preferred Securities
of the Trust, with an aggregate liquidation amount with respect to the assets of
the Trust of One Hundred Three Million Five Hundred Thousand Dollars
($103,500,000) and a liquidation amount with respect to the assets of the Trust
of $25 per security, are hereby designated for the purposes of identification
only as "7.50% Trust Originated Preferred Securities" (the "Trust Preferred
Securities"). Of such amount, 3,600,000 Trust Preferred Securities shall be
issued on the First Time of Delivery (as defined in the Underwriting Agreement)
and up to 540,000 additional Trust Preferred Securities may be issued pursuant
to the Underwriters' over allotment described in the
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Underwriting Agreement. The Trust shall issue the additional Trust Preferred
Securities no later than one business day (or such later date as shall be
requested by the Sponsor) following the receipt from the Sponsor of its request
for issuance, specifying the number of Trust Preferred Securities to be issued,
and enclosing an executed Common Securities Subscription Agreement pursuant to
which the Sponsor will purchase, simultaneously with the issuance of the
additional Trust Preferred Securities, a number of Common Securities calculated
as provided in (b) below. The Trust Preferred Security Certificates evidencing
the Trust Preferred Securities shall be substantially in the form of Exhibit A-1
to the Agreement, with such changes and additions thereto or deletions therefrom
as may be required by applicable law or the rules of any stock exchange on which
the Trust Preferred Securities are listed or to conform to ordinary usage,
custom or practice.
(b) Common Securities. Up to 128,042 Common Securities of the Trust, with
an aggregate liquidation amount with respect to the assets of the Trust of Three
Million Two Hundred One Thousand and Fifty Dollars ($3,201,050) and a
liquidation amount with respect to the assets of the Trust of $25 per security,
are hereby designated for the purposes of identification only as "7.50% Common
Securities" (the "Common Securities"). Of such amount, 111,341 Common Securities
shall be issued on the First Time of Delivery (as defined in the Underwriting
Agreement), and up to 16,701 additional Common Securities may be issued in
connection with the issuance of Trust Preferred Securities pursuant to the over
allotment option described in (a). The Trust shall issued the additional Common
Securities simultaneously with the issuance of the additional Trust Preferred
Securities referenced in (a) above, and the number of Common Securities shall be
such that the proportion of Common Securities to total Securities shall be the
same before and after such additional issuances. The Common Security
Certificates evidencing the Common Securities shall be substantially in the form
of Exhibit A-2 to the Agreement, with such changes and additions thereto or
deletions therefrom as may be required by applicable law or to conform to
ordinary usage, custom or practice.
(c) The maximum liquidation amount of Trust Preferred Securities and
Common Securities referred to above excludes Securities authenticated and
delivered upon registration of transfer of, or in exchange for, or in lieu of
other Securities pursuant to Section 9.2, 9.7 or 9.8 of the Agreement, upon
repayment, redemption or exchange into other securities in accordance with its
terms.
(d) The Trust Preferred Securities and the Common Securities represent
undivided beneficial interests in the assets of the Trust.
(e) In connection with the purchase of the Securities, the Sponsor will
deposit in the Trust, and the Trust will purchase, respectively, as trust
assets, Debentures of the Sponsor having an aggregate principal amount equal to
the aggregate liquidation amount of the Trust Preferred Securities and Common
Securities then being issued by the Trust, and bearing interest at an annual
rate equal to the annual Distribution rate on the Trust Preferred Securities and
Common Securities and having payment and redemption provisions which correspond
to the payment and redemption provisions of the Trust Preferred Securities and
Common Securities.
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(3) Distributions.
(a) Cash distributions will be payable on each Security at the rate per
annum of 7.50% (the "Coupon Rate") of the stated liquidation amount of $25 per
Security, such rate being the rate of interest payable on the Debentures.
Distributions not paid when due will accumulate additional distributions at the
Coupon Rate on the amount of unpaid distributions, compounded quarterly (to the
extent permitted by applicable law) ("Compound Interest"). The term
"Distributions" as used herein includes such cash distributions and any such
interest payable, and Additional Interest, if any, payable unless otherwise
stated. A Distribution is payable only to the extent that payments are made in
respect of the Debentures held by the Property Trustee and to the extent the
Property Trustee has funds legally available therefor. The amount of
Distributions payable for any period will be computed for any full quarterly
Distribution period on the basis of a 360-day year consisting of twelve 30-day
months, and, for any period shorter than a full quarterly Distribution period
for which Distributions are computed, Distributions will be computed on the
basis of the actual number of days elapsed per 30-day month.
(b) Distributions on the Securities will be cumulative, will accrue from,
and include, the date of original issuance of such Securities, and will be
payable quarterly in arrears, on March 1, June 1, September 1 and December 1 of
each year, commencing on September 1, 2004, when, as and if available for
payment, except as otherwise described below (a "Distribution Payment Date"). So
long as there is no Event of Default under the Indenture with respect to the
Debentures, the Debenture Issuer has the right under the Indenture to defer
payments of interest on the Debentures by extending the interest payment period
from time to time on the Debentures for a period not exceeding 20 consecutive
quarters (each an "Extension Period"), during which Extension Period no interest
shall be due and payable on the Debentures, provided that no Extension Period
shall last beyond the Stated Maturity of the Debentures. As a consequence of
such deferral, Distributions will also be deferred. Despite such deferral,
quarterly Distributions will continue to accumulate with interest thereon (to
the extent permitted by applicable law) at the Coupon Rate compounded quarterly
to the extent permitted by law during any such Extension Period. Prior to the
termination of any such Extension Period, the Debenture Issuer may shorten or
further extend such Extension Period; provided that such Extension Period,
together with all such previous and further extensions thereof, may not exceed
20 consecutive quarters or extend beyond the Stated Maturity of the Debentures.
Any interest accrued on the Debentures during an Extension Period shall be paid
Pro Rata to holders of Debentures on the first payment date following the
Extension Period, and the Payment Amount shall be paid Pro Rata to the Holders
on the first Distribution Payment Date following the Extension Period. Upon the
termination of any Extension Period and the payment of all amounts then due, the
Debenture Issuer may commence a new Extension Period, subject to the above
requirements.
If (A) there shall have occurred and be continuing an Event of Default or
any event of which the Debenture Issuer has actual knowledge that is, or with
the giving of notice or the lapse of time, or both, would be an Event of Default
and the Debenture Issuer has not taken reasonable steps to cure such Event of
Default, (B) the Debenture Issuer shall be in default with respect to its
payment or other obligations under the Trust Preferred Securities Guarantee or
(C) the Debenture Issuer shall have given notice of its election to begin an
Extension Period as provided in the Indenture and shall not have rescinded such
notice or such Extension Period, or any extension thereof, shall have commenced
and be continuing, then the Debenture Issuer shall not:
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(i) declare or pay any dividends or distributions on the Debenture
Issuer's Capital Stock;
(ii) redeem, purchase, acquire, or make a liquidation payment with
respect to any of the Debenture Issuer's Capital Stock;
(iii) make any payment of principal of or interest or premium, if
any, on or repay repurchase or redeem any indebtedness of the
Debenture Issuer that ranks equally with or junior in right of
payment to the Debentures;
(iv) make any guarantee payments with respect to any guarantee by
the Debenture Issuer of the indebtedness of any Subsidiary
thereof or any other party if such guarantee ranks equally
with or junior in right of payment to the Debentures;
(other than (a) dividends or distributions payable solely in shares
of, or options, warrants or rights to subscribe for or purchase
shares of, Common Stock of the Debenture Issuer, (b) any declaration
of a dividend in connection with the implementation of a Rights
Plan, (c) the issuance of any Capital Stock of the Debenture Issuer
under any Rights Plan, or the redemption or repurchase of any rights
distributed pursuant to a Rights Plan, (d) payments under the Trust
Preferred Securities Guarantee, (e) reclassification of the
Debenture Issuer's Capital Stock or the exchange or the conversion
of one class or series of the Debenture Issuer's Capital Stock for
another class or series of the Debenture Issuer's Capital Stock, (f)
the purchase of fractional interests in shares of the Debenture
Issuer's Capital Stock pursuant to the conversion or exchange
provisions of such Capital Stock or the security being converted or
exchanged, and (g) purchases of Common Stock related to the issuance
of Common Stock or rights under any of the Debenture Issuer's
benefit plans for its directors, officers, employees, consultants or
advisors or any of the Debenture Issuer's dividend reinvestment
plans).
(c) Distributions on the Securities will be payable to the Holders thereof
as they appear on the books and records of the Trust at the close of business on
the Business Day immediately preceding each of the relevant payment dates on the
Securities. Subject to any applicable laws and regulations and the provisions of
the Agreement, each such payment in respect of the Trust Preferred Securities
will be made as described under the heading "Description of the TOPrS --
Distributions" in the Prospectus Supplement dated May 25, 2004 to the Prospectus
dated October 2, 2002 (collectively, the "Prospectus") of the Trust relating to
the Registration Statement on Form S-3 (file nos. 333-99955 and 333-99955-02) of
the Sponsor and the Trust. The relevant record dates for the Common Securities
shall be the same record date as for the Trust Preferred Securities. If the
Trust Preferred Securities shall not continue to remain in book-entry only form
or are not in book-entry only form at issuance, the relevant record dates for
the Trust Preferred Securities shall conform to the rules of any securities
exchange on which the securities are listed and, if none, as shall be selected
by the Administrative Trustees, which dates shall be at least more than one, but
less than 60 Business Days before the relevant payment dates, which payment
dates correspond to the interest payment dates on the Debentures. Distributions
payable on any
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Securities that are not punctually paid on any Distribution Payment Date, as a
result of the Debenture Issuer having failed to make a payment under the
Debentures, will cease to be payable to the Person in whose name such Securities
are registered on the relevant record date, and such defaulted Distribution will
instead be payable to the Person in whose name such Securities are registered on
the special record date or other specified date determined in accordance with
the Indenture; provided, however, that Distributions shall not be considered
payable on any Distribution Payment Date falling within an Extension Period
unless the Debenture Issuer has elected to make a full or partial payment of
interest accrued on the Debentures on such Distribution Payment Date. If any
date on which Distributions are payable on the Securities is not a Business Day,
then payment of the Distribution payable on such date will be made on the next
succeeding day that is a Business Day (and without any interest or other payment
in respect of any such delay) except that, if such Business Day is in the next
succeeding calendar year, such payment shall be made on the immediately
preceding Business Day, in each case with the same force and effect as if made
on such date. Distributions on the Securities will be paid by the Trust.
(d) If at any time while the Property Trustee is the holder of any
Debentures, the Trust or the Property Trustee is required to pay any taxes,
duties, assessments or governmental charges of whatever nature (other than
withholding taxes imposed on Holders of Trust Preferred Securities or Common
Securities) imposed by the United States, or any other taxing authority, then,
in any such case, the Debenture Issuer will pay as additional interest
("Additional Interest") on the Debentures held by the Property Trustee, such
amounts as shall be required so that the net amounts received and retained by
the Trust and the Property Trustee after paying any such taxes, duties,
assessments or other governmental charges will be equal to the amounts the Trust
and the Property Trustee would have received had no such taxes, duties,
assessments or other governmental charges been imposed.
(e) In the event that there is any money or other property held by or for
the Trust that is not accounted for hereunder, such property shall be
distributed Pro Rata (as defined herein) among the Holders of the Securities.
(4) Liquidation Distribution Upon Dissolution.
In the event of any voluntary or involuntary liquidation, dissolution,
winding-up or termination of the Trust (each, a "Liquidation"), the Holders of
the Securities on the date of the dissolution will be entitled to receive out of
the assets of the Trust, after satisfaction of liabilities to creditors,
distributions in an amount equal to the aggregate stated liquidation amount of
such Securities, plus accumulated and unpaid Distributions on such Securities to
the date of payment (such amount being "Liquidation Distribution"), unless, in
connection with such Liquidation, Debentures in an aggregate stated principal
amount equal to the aggregate stated liquidation amount of such Securities, with
an interest rate equal to the Coupon Rate of, and bearing accrued and unpaid
interest in an amount equal to the accumulated and unpaid Distributions on, such
Securities, shall be distributed on a Pro Rata basis to the Holders in exchange
for such Securities.
If, upon any such Liquidation, the Liquidation Distribution can be paid
only in part because the Trust has insufficient assets available to pay in full
the aggregate Liquidation
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Distribution, then the amounts payable directly by the Trust on the Securities
shall be paid on a Pro Rata basis.
Holders of Common Securities will be entitled to receive distributions
upon any liquidation Pro Rata with the holders of the Trust Preferred
Securities. However, if an Event of Default has occurred and is continuing, the
Trust Preferred Securities will have a preference over the Common Securities
with regard to those distributions.
(5) Redemption and Distribution.
(a) Upon the repayment of the Debentures at maturity, the proceeds from
such repayment shall, after satisfaction of liabilities to creditors of the
Trust, be simultaneously applied to redeem Securities having an aggregate
liquidation amount equal to the aggregate principal amount of the Debentures so
repaid at a redemption price of $25 per Security plus an amount equal to
accumulated and unpaid Distributions thereon at the date of the redemption,
payable in cash.
The Debentures are redeemable prior to the Stated Maturity at the option
of the Debenture Issuer (i) in whole or in part, from time to time, on or after
June 1, 2009 or (ii) at any time prior to June 1, 2009, in whole but not in
part, within 90 days following the occurrence and continuation of a Special
Event, in either case at a redemption price (the "Redemption Price") equal to
100% of the principal amount thereof, plus accrued and unpaid interest thereon
(including Additional Interest and Compound Interest, if any) to the date of
redemption.
Upon the repayment of the Debentures in whole or in part, whether at
maturity or upon redemption, the proceeds from such repayment or payment shall
be simultaneously applied to redeem Securities having an aggregate liquidation
amount equal to the aggregate principal amount of the Debentures so repaid or
redeemed at the Redemption Price. If fewer than all the outstanding Securities
are to be so redeemed, the Securities will be redeemed Pro Rata and the Trust
Preferred Securities to be redeemed will be as described in Section 6.
(b) If an Investment Company Event (as defined herein) or a Tax Event
occurs, the Debentures are redeemable at the option of the Debenture Issuer, in
whole but not in part within 90 days following the occurrence of such Investment
Company Event or Tax Event (the "90 Day Period") on not less than 30 nor more
than 60 days notice prior to the date fixed for redemption; provided, however,
that, if at the time there is available to the Trust the opportunity to
eliminate, within the 90 Day Period, the Investment Company Event or Tax Event
by taking some ministerial action, such as filing a form or making an election,
or pursuing some other similar reasonable measure that will have no adverse
effect on the Trust, the Debenture Issuer, the Sponsor or the Holders of the
Securities and will involve no material cost ("Ministerial Action"), the
Administrative Trustees will pursue such Ministerial Action in lieu of
dissolution (either, a "Special Event Redemption"). If the Debenture Issuer
redeems the Debentures upon the occurrence and continuance of a Investment
Company Event or Tax Event, the proceeds from such redemption shall
simultaneously be applied by the Trust to redeem the Securities having an
aggregate stated liquidation amount equal to the aggregate principal amount of
the Debentures so redeemed at the Redemption Price per Security. To the extent
the Redemption Price is received
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by the Property Trustee, the Property Trustee will distribute to each record
Holder of the Securities the Redemption Price payable in liquidation of such
Holder's interests in the Trust.
"Investment Company Event" means that the Administrative Trustees shall
have received an opinion of independent counsel experienced in such matters to
the effect that, as a result of an amendment to or a change in the Investment
Company Act of 1940, as amended, or regulations thereunder or a written 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"),
which Change in 1940 Act Law becomes effective on or after the date of the
Prospectus Supplement, there is a more than an insubstantial risk that the Trust
is or will be considered an investment company and be required to be registered
under the Investment Company Act.
"Tax Event" means the receipt by the Administrative Trustees of an opinion
of nationally recognized independent tax counsel experienced in such matters to
the effect that, as a result of (a) any amendment to, or change (including any
announced proposed change) in, the laws (or any regulations thereunder) of the
United States or any political subdivisions or taxing authorities thereof or
therein affecting taxation, (b) any amendment to or change in an interpretation
or application of such laws or regulations by any legislative body, court,
governmental agency or regulatory authority or (c) any interpretation or
pronouncement that provides for a position with respect to such laws or
regulations that differs from the generally accepted position on the date the
Securities are issued, which amendment or change becomes effective or which
proposed change, pronouncement, interpretation, action or decision is announced
on or after the date of the Prospectus Supplement, there is more than an
insubstantial risk that (i) the Trust is, or will be within 90 days of the date
of such opinion would become, subject to United States federal income tax with
respect to the income received or accrued on the Debentures, (ii) interest
payable by the Debenture Issuer on the Debentures is not, or within 90 days of
the date thereof would not be, deductible, in whole or in part, by the Debenture
Issuer for United States federal income tax purposes or (iii) the Trust is, or
within 90 days of the date thereof would be, subject to more than a de minimis
amount of other taxes, duties or other governmental charges.
On and from the date fixed by the Administrative Trustees for any
distribution of Debentures upon dissolution of the Trust: (i) the Securities
shall no longer be deemed to be outstanding, (ii) DTC or its nominee (or any
successor Clearing Agency or its nominee) or the record Holder of the Trust
Preferred Securities, will receive a registered global certificate or
certificates representing the Debentures to be delivered upon such distribution
and (iii) any certificates representing Securities, except for certificates
representing Trust Preferred Securities held by DTC or its nominee (or any
successor Clearing Agency or its nominee), will be deemed to represent
beneficial interests in the Debentures having an aggregate principal amount
equal to the aggregate stated liquidation amount of such Securities, with an
interest rate of 7.50% and accumulated and unpaid interest equal to accrued and
unpaid Distributions on such Securities until such certificates are presented to
the Debenture Issuer or its agent for transfer or reissue.
(c) The Trust may not redeem fewer than all the outstanding Securities
unless all accumulated and unpaid Distributions have been paid on all Securities
for all quarterly Distribution periods terminating on or before the date of
redemption.
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(d) The Debenture Issuer will have the right at any time to liquidate the
Trust and cause the Debentures to be distributed to the Holders. If the
Debentures are distributed to the Holders and the Trust Preferred Securities are
then listed on an exchange, the Debenture Issuer will use its best efforts to
cause the Debentures to be listed on the NYSE or on such other exchange as the
Trust Preferred Securities are then listed.
(6) Redemption or Distribution Procedures.
(a) Notice of any redemption (other than in connection with the maturity
of the Debentures) of, or notice of distribution of Debentures in exchange for,
the Securities (a "Redemption/Distribution Notice") will be given by the
Property Trustee by mail to each Holder of Securities to be redeemed or
exchanged not fewer than 30 nor more than 60 days before the date fixed for
redemption or exchange thereof. For purposes of the calculation of the date of
redemption or exchange and the dates on which notices are given pursuant to this
Section 6(a), a Redemption/Distribution Notice shall be deemed to be given on
the day such notice is first mailed by first-class mail, postage prepaid, to
Holders of Securities. Each Redemption/Distribution Notice shall be addressed to
the Holders of Securities at the address of each such Holder appearing in the
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.
(b) In the event that fewer than all the outstanding Securities are to
be redeemed, the Securities to be redeemed shall be redeemed Pro Rata from each
Holder, it being understood that, in respect of Trust Preferred Securities
registered in the name of and held of record by the Clearing Agency (as defined
in the Agreement) or its nominee, the distribution of the proceeds of such
redemption will be made to each Clearing Agency Participant (as defined in the
Agreement) (or Person) on whose behalf such nominee holds such securities) in
accordance with the procedures applied by such agency or nominee.
(c) If Securities are to be redeemed and the Property Trustee gives a
Redemption/Distribution Notice, which notice may only be issued if the
Debentures are redeemed as set out in this Section 6 (such notice will be
irrevocable), then (A) while the Trust Preferred Securities are in book-entry
only form, with respect to the Trust Preferred Securities, by 12:00 noon, New
York City time, on the redemption date, provided that the Debenture Issuer has
paid the Property Trustee a sufficient amount of cash in connection with the
related redemption or maturity of the Debentures by 10:00 a.m. New York City
time on such Redemption Date, the Property Trustee will deposit irrevocably with
DTC or its nominee (or any successor Clearing Agency or its nominee), funds
sufficient to pay the applicable Redemption Price with respect to the Trust
Preferred Securities and will give DTC irrevocable instructions and authority to
pay the Redemption Price to the Holders of the Trust Preferred Securities so
called for redemption, and (B) with respect to Trust Preferred Securities issued
in definitive form and Common Securities, provided that the Debenture Issuer has
paid the Property Trustee a sufficient amount of cash in connection with the
related redemption or maturity of the Debentures, the Property Trustee will
irrevocably deposit with the Paying Agent funds sufficient to pay the relevant
Redemption Price and will give the Paying Agent irrevocable instructions and
authority to pay such Redemption Price to the Holders of such Securities upon
surrender of their
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Certificates evidencing their Securities. If a Redemption/Distribution Notice
shall have been given and funds deposited as required, if applicable, then
immediately prior to the close of business on the date of such deposit, or on
the distributions will cease to accumulate on the Securities so redeemed and all
rights of Holders of such Securities so called for redemption will cease, except
the right of the Holders of such Securities to receive the Redemption Price, but
without interest on such Redemption Price. Neither the Administrative Trustees
nor the Trust shall be required to register or cause to be registered the
transfer of any Securities that have been so called for redemption. If any date
fixed for redemption of Securities is not a Business Day, then payment of the
Redemption Price payable on such date will be made on the next succeeding day
that is a Business Day (without any interest or other payment in respect of any
such delay) except that, if such Business Day falls in the next calendar year,
such payment will be made on the immediately preceding Business Day, in each
case with the same force and effect as if made on such date fixed for
redemption. If payment of the Redemption Price in respect of any Securities is
improperly withheld or refused and not paid either by the Property Trustee or by
the Sponsor as guarantor pursuant to the relevant Securities Guarantee,
Distributions on such Securities will continue to accumulate from the original
redemption date to the actual date of payment, compounded quarterly, to the
extent permitted by law, in which case the actual payment date will be
considered the date fixed for redemption for purposes of calculating the
Redemption Price and such Securities shall cease to be outstanding.
(d) Redemption/Distribution Notices shall be sent by the Property
Trustee to (A) in respect of the Trust Preferred Securities, DTC or its nominee
(or any successor Clearing Agency or its nominee) if the Global Certificates
have been issued or, if Definitive Trust Preferred Security Certificates have
been issued, to the Holder thereof, and (B) in respect of the Common Securities,
to the Holder thereof.
(e) The Trust shall not be required to (i) issue, or register the
transfer or exchange of, any Securities during a period beginning at the opening
of business 15 days before the mailing of a notice of redemption of Securities
and ending at the close of business on the day of the mailing of the relevant
notice of redemption or (ii) register the transfer or exchange of any Securities
so selected for redemption, in whole or in part, except the unredeemed portion
of any Securities being redeemed in part.
(f) Subject to the foregoing and applicable law (including, without
limitation, United States federal securities laws) the Sponsor or any of its
subsidiaries may at any time and from time to time purchase outstanding Trust
Preferred Securities by tender, in the open market or by private agreement.
(7) Reserved.
(8) Voting Rights - Trust Preferred Securities.
(a) Except as provided under Sections 8(b) and 10 and as otherwise
required by law and the Agreement, including these Terms and Conditions, the
Holders of the Trust Preferred Securities will have no voting rights.
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(b) Subject to the requirements set forth in this paragraph, the Holders
of a Majority in liquidation amount of the Trust Preferred Securities may direct
(i) the time, method, and place of conducting any proceeding for any remedy
available to the Property Trustee, or (ii) the exercise of any trust or power
conferred upon the Property Trustee under the Agreement, including directing the
Property Trustee, as the holder of the Debentures, to exercise the remedies
available under the Indenture with respect to the Debentures, subject to Section
2.6 of the Agreement. So long as the Property Trustee holds any Debentures, the
Holders of a Majority in liquidation amount of the Trust Preferred Securities
(except in the case of an amendment, modification or termination of the
Indenture or the Debentures, in which case the Holder of a Majority in
liquidation amount of the Trust Preferred Securities and the Common Securities,
voting together as a single class, if no Event of Default has occurred and is
continuing), may (i) direct the time, method and place of conducting any
proceeding for any remedy available to the Debenture Trustee, or exercise any
trust or power conferred on the Debenture Trustee with respect to the
Debentures, (ii) waive any past default and its consequences that are waivable
under the Indenture, (iii) exercise any right to rescind or annul an
acceleration of the maturity of the Debentures, or (iv) consent to any
amendment, modification or termination of the Indenture or the Debentures. If a
consent under the Indenture would require the consent of each affected Holder of
the Debentures, the Property Trustee may not give the consent without the prior
written consent of each holder of the Trust Preferred Securities. The Property
Trustee shall not revoke any action previously authorized or approved by a vote
of the Holders of the Trust Preferred Securities except by a subsequent vote of
Holders of the Trust Preferred Securities. If an Event of Default has occurred
and is continuing, the Holders of 25% of the aggregate liquidation amount of the
Trust Preferred Securities then outstanding may direct the Property Trustee to
declare the principal of and interest on the Debentures immediately due and
payable. If a consent or action under the Indenture requires the consent or
action of the Holders of more than a majority of the Holders in principal amount
of the Debentures then outstanding (a "Super Majority"), only the Holders of at
least such Super Majority in aggregate liquidation amount of the Trust Preferred
Securities then outstanding may direct the Property Trustee to give its consent
or take such action. Other than with respect to directing the time, method and
place of conducting any remedy available to the Property Trustee or the
Debenture Trustee as set forth above, the Property Trustee shall not take any
action in accordance with the directions of the Holders of the Trust Preferred
Securities under this paragraph unless the Property Trustee has obtained an
opinion of counsel stating that for the purposes of United States federal income
tax the Trust will continue to be classified as a grantor trust. If the Property
Trustee fails to enforce its rights under the Debentures after a Holder of Trust
Preferred Securities has made a written request, such Holder of Trust Preferred
Securities may, to the fullest extent permitted by applicable law, institute a
legal proceeding directly against the Debenture Issuer to enforce the Property
Trustee's rights under the Debentures without first instituting a legal
proceeding against the Property Trustee or any other Person. Notwithstanding the
foregoing, if an Event of Default has occurred and is continuing and such event
is attributable to the failure of the Debenture Issuer to pay interest or
principal on the Debentures on the date such interest or principal is otherwise
payable (or in the case of redemption, on the redemption date), then a Holder of
Trust Preferred Securities may directly institute a proceeding for enforcement
of payment to such Holder of the principal of or interest on the Debentures
having a principal amount equal to the aggregate liquidation amount of the Trust
Preferred Securities of such Holder on or after the respective due date
specified in the Debentures. Except as provided in the preceding sentence,
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the Holders of Trust Preferred Securities shall not exercise directly any other
remedy available to the holders of the Debentures.
Any approval or direction of Holders of Trust Preferred Securities may be
given at a separate meeting of Holders of Trust Preferred Securities convened
for such purpose, at a meeting of all of the Holders of Securities in the Trust
or pursuant to written consent. The Administrative Trustees will cause a notice
of any meeting at which Holders of Trust 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 Trust 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.
No vote or consent of the Holders of the Trust Preferred Securities will
be required for the Trust to repay and cancel Trust Preferred Securities or to
distribute the Debentures in accordance with the Agreement and the terms of the
Securities. Notwithstanding that Holders of Trust Preferred Securities are
entitled to vote or consent under any of the circumstances described above, any
of the Trust Preferred Securities that are owned by the Sponsor or any Affiliate
of the Sponsor shall not be entitled to vote or consent and shall, for purposes
of such vote or consent, be treated as if they were not outstanding.
(9) Voting Rights - Common Securities.
(a) Except as provided under Sections 9(b) and (c) and 10 and as
otherwise required by law and the Agreement, including these Terms and
Conditions, the Holders of the Common Securities will have no voting rights.
(b) The Holders of the Common Securities are entitled, in accordance
with Article V of the Agreement, to vote to appoint, remove or replace any
Trustee or to increase or decrease the number of Trustees.
(c) Subject to Section 2.6 of the Agreement and only after any Event of
Default with respect to the Trust Preferred Securities has been cured, waived or
otherwise eliminated and subject to the requirements of the second to last
sentence of this paragraph, the Holders of a Majority in liquidation amount of
the Common Securities, voting separately as a class, may direct the time, method
and place of conducting any proceeding for any remedy available to the Property
Trustee, or exercising any trust or power conferred upon the Property Trustee
under the Agreement, including (i) directing 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 are
waivable under the Indenture, (iii) exercise any right to rescind or annul an
acceleration of the maturity of the Debentures, or (iv) consent to any
amendment, modification or termination of the Indenture or the Debentures,
provided that, where a consent or action under the Indenture specifically would
require the consent or act of the Holders of a Super Majority of the Debentures
then outstanding, the Property Trustee may only give such consent or take such
action at the written direction of the Holders of at least the proportion in
liquidation amount of
A-12
the Common Securities which the relevant Super Majority represents of the
aggregate principal amount of the Debentures outstanding. Pursuant to this
Section 9(c), the Property Trustee shall not revoke any action previously
authorized or approved by a vote of the Holders of the Trust Preferred
Securities. Other than with respect to directing the time, method and place of
conducting any remedy available to the Property Trustee or the Debenture Trustee
as set forth above, the Property Trustee shall not take any action in accordance
with the directions of the Holders of the Common Securities under this paragraph
unless the Property Trustee has obtained an opinion of counsel stating that for
the purposes of United States federal income tax the Trust will continue to be
classified as a grantor trust. If the Property Trustee fails to enforce its
rights under the Agreement, any Holder of Common Securities may institute a
legal proceeding directly against any Person to enforce the Property Trustee's
rights under the Agreement, without first instituting a legal proceeding against
the Property Trustee or any other Person.
Any approval or direction of Holders of Common Securities may be given at
a separate meeting of Holders of Common Securities convened for such purpose, at
a meeting of all of the Holders of Securities in the Trust or pursuant to
written consent. The Administrative 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 the Common Securities will be
required for the Trust to redeem and cancel Common Securities or to distribute
the Debentures in accordance with the Agreement and the terms of the Securities.
(10) Amendments to Agreement and Indenture.
(a) In addition to any requirements under Section 12.1 of the Agreement,
if any proposed amendment to the Agreement provides for, or the Administrative
Trustees otherwise propose to effect, (i) any action that would materially
adversely affect the powers, preferences or special rights of the Securities,
whether by way of amendment to the Agreement or otherwise, or (ii) the
dissolution of the Trust, other than as described in Section 8.1 of the
Agreement, then the Holders of outstanding Securities as a class will be
entitled to vote on such amendment or proposal (but not on any other amendment
or proposal) and such amendment or proposal shall not be effective except with
the approval of the Holders of at least a Majority in liquidation amount of the
Securities, voting together as a single class; provided, however, if any
amendment or proposal referred to in clause (i) above would adversely affect
only the Trust Preferred Securities or only the Common Securities, then only the
affected class will be entitled to vote on such amendment or proposal and such
amendment or proposal shall not be effective except with the approval of a
Majority in liquidation amount of such class of Securities.
(b) In the event the consent of the Property Trustee as the holder of
the Debentures is required under the Indenture with respect to any amendment,
modification or termination on the Indenture or the Debentures, the Property
Trustee shall request the written direction of the
A-13
Holders with respect to such amendment, modification or termination and shall
vote with respect to such amendment, modification or termination as directed by
a Majority in liquidation amount of the Securities voting together as a single
class; provided, however, that where a consent under the Indenture would require
the consent of the Holders of more than a Super Majority, only the Holders of at
least such Super Majority in aggregate liquidation amount of the Securities then
outstanding may direct the Property Trustee to give its consent; provided
further, that the Property Trustee shall not take any action in accordance with
the directions of the Holders under this Section 10(b) unless (i) the Property
Trustee has obtained an opinion of counsel experienced in such matters stating
that for the purposes of United States federal income tax the Trust will not be
classified as other than a grantor trust on account of such action or (ii) such
action would not reduce or otherwise adversely affect powers of the Property
Trustee or (iii) cause the Trust to be deemed an "investment company" which is
required to be registered under the Investment Company Act.
(11) Pro Rata.
A reference in these terms of the Securities to any payment, distribution
or treatment as being "Pro Rata" shall mean pro rata to each Holder of
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
under the Agreement has occurred and is continuing, in which case any funds
available to make such payment shall be paid first to each Holder of the Trust
Preferred Securities pro rata according to the aggregate liquidation amount of
Trust Preferred Securities held by the relevant Holder relative to the aggregate
liquidation amount of all Trust Preferred Securities outstanding, and only after
satisfaction of all amounts owed to the Holders of the Trust 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.
(12) Listing.
The Administrative Trustees shall use their best efforts to cause the
Trust Preferred Securities to be listed for quotation on the New York Stock
Exchange.
(13) Ranking.
The Trust Preferred Securities rank pari passu and payment thereon shall
be made Pro Rata with the Common Securities except that, where an Event of
Default occurs and is continuing under the Indenture in respect of the
Debentures held by the Property Trustee, the rights of Holders of the Common
Securities to payment in respect of Distributions and payments upon liquidation,
redemption and otherwise are subordinated to the rights to payment of the
Holders of the Trust Preferred Securities. If a Debenture Event of Default has
occurred and is continuing, then no payments may be made on the Common
Securities unless all unpaid amounts due on the Trust Preferred Securities have
been paid in full or provided for.
A-14
(14) Acceptance of Securities Guarantee and Indenture.
Each Holder of Trust Preferred Securities and Common Securities by the
acceptance thereof, agrees to the provisions of the Trust Preferred Securities
Guarantee and the Common Securities Guarantee, respectively, including the
subordination provisions therein, and to the provisions of the Indenture.
(15) No Preemptive Rights.
The Holders shall have no preemptive rights to subscribe for any
additional securities.
(16) Additional Provisions.
Reserved.
(17) Miscellaneous.
These terms constitute a part of the Agreement.
The Sponsor will provide a copy of the Agreement, the Trust Preferred
Securities Guarantee or the Common Securities Guarantee (as may be appropriate),
and the Indenture to a Holder without charge on written request to the Sponsor
at its principal place of business.
A-15
EXHIBIT A-1
FORM OF TRUST PREFERRED SECURITY CERTIFICATE
[IF THE TRUST PREFERRED SECURITY IS TO BE A GLOBAL CERTIFICATE INSERT -
This Trust Preferred Security is a Global Certificate within the meaning of the
Agreement hereinafter referred to and is registered in the name of The
Depository Trust Company (the "Depositary") or a nominee of the Depositary. This
Trust Preferred Security is exchangeable for Trust Preferred Securities
registered in the name of a person other than the Depositary or its nominee only
in the limited circumstances described in the Agreement and no transfer of this
Trust Preferred Security (other than a transfer of this Trust Preferred Security
as a whole by the Depositary to a nominee of the Depositary or by a nominee of
the Depositary to the Depositary or another nominee of the Depositary) may be
registered except in limited circumstances.
Unless this Trust Preferred Security is presented by an authorized
representative of The Depository Trust Company (55 Water Street, New York, New
York) to the Trust or its agent for registration of transfer, exchange or
payment, and any Trust 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.]
Certificate Number ____ Number of Trust Preferred Securities ______
CUSIP NO. 23334U 20 1
Certificate Evidencing Trust Originated Preferred Securities
of
DTE Energy Trust II
7.50% Trust Originated Preferred Securities
(liquidation amount $25 per Trust Originated Preferred Security)
DTE Energy Trust II, a statutory trust created under the laws of the State
of Delaware (the "Trust"), hereby certifies that ________________ (the "Holder")
is the registered owner of ________ Trust Originated Preferred Securities of the
Trust representing preferred undivided beneficial interests in the assets of the
Trust designated as the 7.50% Trust Originated Preferred Securities (liquidation
amount $25 per Trust Preferred Security) (the "Trust Preferred Securities"). The
Trust 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 designation,
rights, privileges, restrictions, preferences and other terms and provisions of
the Trust Preferred Securities represented hereby are issued and shall in all
respects be subject to the provisions of the Amended and Restated Trust
Agreement of the Trust dated as of June 1, 2004 as the same may be amended from
time to time (the
A1-1
"Agreement"), including the designation of the terms of the Trust Preferred
Securities as set forth in Exhibit A to the Agreement. Capitalized terms used
herein but not defined shall have the meaning given them in the Agreement. The
Holder is entitled to the benefits of the Trust Preferred Securities Guarantee
to the extent provided therein. The Sponsor will provide a copy of the
Agreement, the Trust Preferred Securities Guarantee and the Indenture to a
Holder without charge upon written request to the Trust at its principal place
of business.
Upon receipt of this certificate, the Holder is bound by the Agreement and
is entitled to the benefits thereunder.
In addition, the Holder is deemed to have (i) agreed to the terms of the
Indenture and the Debentures, including that the Debenture are subordinate and
junior in right of payment to all present and future Senior Indebtedness (as
defined in the Indenture) as and to the extent provided in the Indenture and
(ii) agreed to the terms of the Trust Preferred Securities Guarantee, including
that the Trust Preferred Securities Guarantee is subordinate and junior in right
of payment to all other liabilities of the Sponsor, including the Debentures,
except those made pari passu or subordinate by their terms, and pari passu with
any guarantee now or hereafter entered into by the Sponsor in respect of any
preferred or preference stock of any Affiliate of the Sponsor.
By acceptance, the Holder agrees to treat, for United States federal
income tax purposes, the Debentures as indebtedness and the Trust Preferred
Securities as evidence of indirect beneficial ownership in the Debentures.
Unless the Property Trustee's Certificate of Authentication hereon has
been properly executed, the Trust Preferred Securities evidenced by this
Certificate shall not be entitled to any benefit under the Agreement or be valid
or obligatory for any purpose.
A1-2
IN WITNESS WHEREOF, the Trust has executed this certificate this 1st day
of June, 2004.
DTE ENERGY TRUST II
By:_____________________________
Name:
Title: Administrative Trustee
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Trust Preferred Securities referred to in the
within-mentioned Agreement
Dated June 1, 2004
BNY Midwest Trust Company,
as Property Trustee
By: _________________________________
Authorized Signatory
A1-3
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Trust Preferred Security will be fixed at a
rate per annum of 7.50% (the "Coupon Rate") of the stated liquidation amount of
$25 per Trust Preferred Security, such rate being the rate of interest payable
on the Debentures to be held by the Property Trustee. Distributions not paid
when due will accumulate additional distributions at the Coupon Rate on the
amount of unpaid distributions, compounded quarterly (to the extent permitted by
applicable law) ("Compound Interest"). The term "Distributions" as used herein
includes such cash distributions and any such interest (including Additional
Interest and Compound Interest) payable unless otherwise stated. A Distribution
is payable only to the extent that payments are made in respect of the
Debentures held by the Property Trustee and to the extent the Property Trustee
has actually received and holds funds available therefor. The amount of
Distributions payable for any period will be computed for any full quarterly
Distribution period on the basis of a 360-day year consisting of twelve 30-day
months, and for any period shorter than a full quarterly Distribution period for
which Distributions are computed, Distributions will be computed on the basis of
the actual number of days elapsed per 30-day month.
Except as otherwise described below, Distributions on the Trust Preferred
Securities will be cumulative, will accrue from, and include, the date of
original issuance, and will be payable quarterly in arrears, on March 1, June 1,
September 1 and December 1 of each year, commencing on September 1, 2004, to
holders of record on the relevant record dates, which will be, as long as the
Trust Preferred Securities remain in book-entry form, one Business Day prior to
such payment date, which payment dates shall correspond to the interest payment
dates on the Debentures. In the event that the Trust Preferred Securities are
not in book-entry form, the record date will conform to the rules of any
securities exchange on which the securities are listed and, if none, as shall be
selected by the Administrative Trustees, which dates will be at least more than
one, but less than 60 Business Days before the relevant payment date, which
payment dates shall correspond to the interest payment dates on the Debentures.
The Debenture Issuer has the right under the Indenture to defer payments of
interest by extending the interest payment period from time to time on the
Debentures for a period not exceeding 20 consecutive quarters (each an
"Extension Period"), provided that no Extension Period shall last beyond the
date of the maturity of the Debentures and, as a consequence of such deferral,
quarterly Distributions will also be deferred. Despite such deferral, quarterly
Distributions will continue to accrue with interest thereon (to the extent
permitted by applicable law) at the Coupon Rate compounded quarterly during any
such Extension Period. Prior to the termination of any such Extension Period,
the Debenture Issuer may shorten or further extend such Extension Period;
provided that such Extension Period together with all such previous and further
extensions thereof may not exceed 20 consecutive quarters or extend beyond the
maturity of the Debentures. Payments of accrued Distributions will be payable to
Holders as they appear on the books and records of the Trust on the first record
date after the end of the Extension Period. Upon the termination of any
Extension Period and the payment of all amounts then due, the Debenture Issuer
may commence a new Extension Period, subject to the above requirements and the
Indenture.
The Trust Preferred Securities shall be redeemable as provided in the
Agreement.
A1-4
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Trust
Preferred Security Certificate to:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Insert assignee's social security or tax identification number)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Insert address and zip code of assignee)
and irrevocably appoints
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
agent to transfer this Trust Preferred Security Certificate on the books of the
Trust. The agent may substitute another to act for him or her.
Dated:
Signature:
Signature Guarantee:
(Sign exactly as your name appears on the other side of this Trust Preferred
Security Certificate)
(Signature(s) must be guaranteed by an "eligible guarantor institution" meeting
the requirements of the Trustee, which requirements include membership or
participation in STAMP or such other "signature guaranty program" as may be
determined by the Trustee in addition to or in substitution for STAMP, all in
accordance with the Securities Exchange Act of 1934, as amended.)
A1-5
EXHIBIT A-2
FORM OF COMMON SECURITY CERTIFICATE
The Common Securities may only be transferred by the Debenture Issuer and
any Related Party to the Debenture Issuer or a Related Party of the Debenture
Issuer; provided that, any such transfer is subject to the condition precedent
that the transferor obtain the written opinion of nationally recognized
independent counsel experienced in such matters that such transfer would not
cause more than an insubstantial risk that:
(i) the Trust would not be classified for United States federal
income tax purposes as a grantor Trust; and
(ii) the Trust would be an Investment Company or the transferee
would become an Investment Company.
Certificate Number __ Number of Common Securities ________
Certificate Evidencing Common Securities
of
DTE Energy Trust II
7.50% Common Securities
(liquidation amount $25 per Common Security)
DTE Energy Trust II, a statutory trust created under the laws of the State
of Delaware (the "Trust"), hereby certifies that DTE Energy Company (the
"Holder") is the registered owner of _______ common securities of the Trust
representing common undivided beneficial interests in the assets of the Trust
designated as the 7.50% Common 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. The designation, rights, privileges, restrictions, preferences and
other terms and provisions of the Common Securities represented hereby are
issued and shall in all respects be subject to the provisions of the Amended and
Restated Trust Agreement of the Trust dated as of June 1, 2004, as the same may
be amended from time to time (the "Agreement"), including the designation of the
terms of the Common Securities as set forth in Exhibit A to the Agreement.
Capitalized terms used herein but not defined shall have the meaning given them
in the Agreement. The Holder is entitled to the benefits of the Common
Securities Guarantee to the extent provided therein. The Sponsor will provide a
copy of the Agreement, the Common Securities Guarantee and the Indenture to a
Holder without charge upon written request to the Sponsor at its principal place
of business.
Upon receipt of this certificate, the Sponsor is bound by the Agreement
and is entitled to the benefits thereunder.
A2-1
In addition, the Holder 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 present and future Senior Indebtedness (as
defined in the Indenture) as and to the extent provided in the Indenture and
(ii) agreed to the terms of the Common Securities Guarantee, including that the
Common Securities Guarantee is subordinate and junior in right of payment to all
other liabilities of the Sponsor, including the Debentures, except those made
pari passu or subordinate by their terms, and pari passu with any guarantee now
or hereafter entered into by the Sponsor in respect of any preferred or
preference stock of any Affiliate of the Sponsor.
By acceptance, the Holder agrees to treat, for United States federal
income tax purposes, the Debentures as indebtedness and the Common Securities as
evidence of indirect beneficial ownership in the Debentures.
A2-2
IN WITNESS WHEREOF, the Trust has executed this certificate this 1st day
of June, 2004.
DTE ENERGY TRUST II
By:_____________________________
Name:
Title: Administrative Trustee
A2-3
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Common Security will be fixed at a rate per
annum of 7.50% (the "Coupon Rate") of the stated liquidation amount of $25 per
Common Security, such rate being the rate of interest payable on the Debentures
to be held by the Property Trustee. Distributions not paid when due will
accumulate additional distributions at the Coupon Rate on the amount of unpaid
distributions, compounded quarterly (to the extent permitted by applicable law)
("Compound Interest"). The term "Distributions" as used herein includes such
cash distributions and any such interest (including Additional Interest and
Compound Interest) payable unless otherwise stated. A Distribution is payable
only to the extent that payments are made in respect of the Debentures held by
the Property Trustee and to the extent the Property Trustee has actually
received and holds funds available therefor. The amount of Distributions payable
for any period will be computed for any full quarterly Distribution period on
the basis of a 360-day year of twelve 30-day months, and for any period shorter
than a full quarterly Distribution period for which Distributions are computed,
Distributions will be computed on the basis of the actual number of days elapsed
per 30-day month.
Except as otherwise described below, distributions on the Common
Securities will be cumulative, will accrue from, and include, the date of
original issuance, and will be payable quarterly in arrears, on March 1, June 1,
September 1 and December 1 of each year, commencing on September 1, 2004, to
Holders of record on the relevant record dates, which will be, as long as the
Common Securities remain in book-entry form, one Business Day prior to such
payment dates, which payment dates shall correspond to the interest payment
dates on the Debentures. The Debenture Issuer has the right under the Indenture
to defer payments of interest by extending the interest payment period from time
to time on the Debentures for a period not exceeding 20 consecutive quarters
(each an "Extension Period"), provided that no Extension Period shall last
beyond the date of the maturity of the Debentures and, as a consequence of such
deferral, quarterly Distributions will also be deferred. Despite such deferral,
quarterly Distributions will continue to accrue with interest thereon (to the
extent permitted by applicable law) at the Coupon Rate compounded quarterly
during any such Extension Period. Prior to the termination of any such Extension
Period, the Debenture Issuer may shorten or further extend such Extension
Period; provided that such Extension Period together with all such previous and
further extensions thereof may not exceed 20 consecutive quarters or extend
beyond the maturity date of the Debentures. Payments of accrued Distributions
will be payable to Holders as they appear on the books and records of the Trust
on the first record date after the end of the Extension Period. Upon the
termination of any Extension Period and the payment of all amounts then due, the
Debenture Issuer may commence a new Extension Period, subject to the above
requirements and the Indenture.
The Common Securities shall be redeemable as provided in the Agreement.
A2-4
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Common
Security Certificate to:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Insert assignee's social security or tax identification number)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Insert address and zip code of assignee)
and irrevocably appoints
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
agent to transfer this Common Security Certificate on the books of the Trust.
The agent may substitute another to act for him or her.
Dated:__________________
Signature:___________________________
Signature Guarantee:_________________
(Sign exactly as your name appears on the other side of this Common Security
Certificate)
(Signature(s) must be guaranteed by an "eligible guarantor institution" meeting
the requirements of the Trustee, which requirements include membership or
participation in STAMP or such other "signature guaranty program" as may be
determined by the Trustee in addition to or in substitution for STAMP, all in
accordance with the Securities Exchange Act of 1934, as amended.)
A2-5