EXECUTION VERSION
EXHIBIT 10.88
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AMENDED AND RESTATED TRUST AGREEMENT
among
UICI,
as Depositor
JPMORGAN CHASE BANK,
as Property Trustee
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION,
as Delaware Trustee
and
THE ADMINISTRATIVE TRUSTEES NAMED HEREIN
as Administrative Trustees
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Dated as of April 29, 2004
----------------
UICI CAPITAL TRUST I
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TABLE OF CONTENTS
PAGE
ARTICLE I. DEFINED TERMS....................................................................................... 1
Section 1.1. Definitions...................................................................... 1
ARTICLE II. THE TRUST........................................................................................... 11
Section 2.1. Name............................................................................. 11
Section 2.2. Office of the Delaware Trustee; Principal Place of Business...................... 11
Section 2.3. Initial Contribution of Trust Property; Fees, Costs and Expenses................. 11
Section 2.4. Purposes of Trust................................................................ 11
Section 2.5. Authorization to Enter into Certain Transactions................................. 12
Section 2.6. Assets of Trust.................................................................. 14
Section 2.7. Title to Trust Property.......................................................... 15
ARTICLE III.PAYMENT ACCOUNT; PAYING AGENTS...................................................................... 15
Section 3.1. Payment Account.................................................................. 15
Section 3.2. Appointment of Paying Agents..................................................... 15
ARTICLE IV. DISTRIBUTIONS; REDEMPTION........................................................................... 16
Section 4.1. Distributions.................................................................... 16
Section 4.2. Redemption....................................................................... 17
Section 4.3. Subordination of Common Securities............................................... 20
Section 4.4. Payment Procedures............................................................... 21
Section 4.5. Withholding Tax.................................................................. 21
Section 4.6. Tax Returns and Other Reports.................................................... 21
Section 4.7. Payment of Taxes, Duties, Etc. of the Trust...................................... 22
Section 4.8. Payments under Indenture or Pursuant to Direct Actions........................... 22
Section 4.9. Exchanges........................................................................ 22
Section 4.10. Calculation Agent................................................................ 23
Section 4.11. Certain Accounting Matters....................................................... 23
ARTICLE V. SECURITIES.......................................................................................... 24
Section 5.1. Initial Ownership................................................................ 24
Section 5.2. Authorized Trust Securities...................................................... 25
Section 5.3. Issuance of the Common Securities; Subscription and Purchase of Notes............ 25
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TABLE OF CONTENTS
(continued)
Page
Section 5.4. The Securities Certificates...................................................... 25
Section 5.5. Rights of Holders................................................................ 26
Section 5.6. Book-Entry Preferred Securities.................................................. 26
Section 5.7. Registration of Transfer and Exchange of Preferred Securities
Certificates..................................................................... 28
Section 5.8. Mutilated, Destroyed, Lost or Stolen Securities Certificates..................... 29
Section 5.9. Persons Deemed Holders........................................................... 30
Section 5.10. Cancellation..................................................................... 30
Section 5.11. Ownership of Common Securities by Depositor...................................... 30
Section 5.12. Restricted Legends............................................................... 31
Section 5.13. Form of Certificate of Authentication............................................ 34
ARTICLE VI. MEETINGS; VOTING; ACTS OF HOLDERS................................................................... 34
Section 6.1. Notice of Meetings............................................................... 34
Section 6.2. Meetings of Holders of the Preferred Securities.................................. 34
Section 6.3. Voting Rights.................................................................... 35
Section 6.4. Proxies, Etc..................................................................... 35
Section 6.5. Holder Action by Written Consent................................................. 35
Section 6.6. Record Date for Voting and Other Purposes........................................ 35
Section 6.7. Acts of Holders.................................................................. 35
Section 6.8. Inspection of Records............................................................ 36
Section 6.9. Limitations on Voting Rights..................................................... 37
Section 6.10. Acceleration of Maturity; Rescission of Annulment; Waivers of Past
Defaults......................................................................... 37
ARTICLE VII.REPRESENTATIONS AND WARRANTIES...................................................................... 40
Section 7.1. Representations and Warranties of the Property Trustee and the
Delaware Trustee................................................................. 40
Section 7.2. Representations and Warranties of Depositor...................................... 41
ARTICLE VIII.THE TRUSTEES....................................................................................... 42
Section 8.1. Number of Trustees............................................................... 42
Section 8.2. Property Trustee Required........................................................ 42
Section 8.3. Delaware Trustee Required........................................................ 43
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TABLE OF CONTENTS
(continued)
Page
Section 8.4. Appointment of Administrative Trustees........................................... 43
Section 8.5. Duties and Responsibilities of the Trustees...................................... 43
Section 8.6. Notices of Defaults and Extensions............................................... 45
Section 8.7. Certain Rights of Property Trustee............................................... 46
Section 8.8. Delegation of Power.............................................................. 48
Section 8.9. May Hold Securities.............................................................. 48
Section 8.10. Compensation; Reimbursement; Indemnity........................................... 48
Section 8.11. Resignation and Removal; Appointment of Successor................................ 49
Section 8.12. Acceptance of Appointment by Successor........................................... 51
Section 8.13. Merger, Conversion, Consolidation or Succession to Business...................... 51
Section 8.14. Not Responsible for Recitals or Issuance of Securities........................... 51
Section 8.15. Property Trustee May File Proofs of Claim........................................ 51
Section 8.16. Reports to the Property Trustee.................................................. 52
ARTICLE IX. TERMINATION, LIQUIDATION AND MERGER................................................................. 53
Section 9.1. Dissolution Upon Expiration Date................................................. 53
Section 9.2. Early Termination................................................................ 53
Section 9.3. Termination...................................................................... 53
Section 9.4. Liquidation...................................................................... 54
Section 9.5. Mergers, Consolidations, Amalgamations or Replacements of Trust.................. 55
ARTICLE X. MISCELLANEOUS PROVISIONS............................................................................ 56
Section 10.1. Limitation of Rights of Holders.................................................. 56
Section 10.2. Agreed Tax Treatment of Trust and Trust Securities............................... 57
Section 10.3. Amendment........................................................................ 57
Section 10.4. Separability..................................................................... 58
Section 10.5. Governing Law.................................................................... 58
Section 10.6. Successors....................................................................... 59
Section 10.7. Headings......................................................................... 59
Section 10.8. Reports, Notices and Demands..................................................... 59
Section 10.9. Agreement Not to Petition........................................................ 60
Section 10.10. Counterparts..................................................................... 60
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TABLE OF CONTENTS
(continued)
Page
Exhibit A Certificate of Trust of UICI Capital Trust I
Exhibit B Form of Common Securities Certificate
Exhibit C Form of Preferred Securities Certificate
Exhibit D Junior Subordinated Indenture
Exhibit E Form of Transferor Certificate to be Executed for QIBs
Exhibit F Form of Transferee Certificate to be Executed by Transferees other
than QIBs
Exhibit G Form of Officer's Financial Certificate of the Depositor
Schedule A Calculation of LIBOR
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THIS AMENDED AND RESTATED TRUST AGREEMENT, dated as of April 29, 2004,
among (i) UICI, a Delaware corporation (including any successors or permitted
assigns, the "Depositor"), (ii) JPMorgan Chase Bank, a New York banking
corporation, as property trustee (in such capacity, the "Property Trustee"),
(iii) Chase Manhattan Bank USA, National Association, a national banking
association, as Delaware trustee (in such capacity, the "Delaware Trustee"),
(iv) William J. Gedwed, an individual, Mark D. Hauptman, an individual and Glenn
W. Reed, an individual, each of whose address is c/o UICI, 9151 Grapevine
Highway, North Richland Hills, Texas 76180, as administrative trustees (in such
capacities, each an "Administrative Trustee" and, collectively, the
"Administrative Trustees" and, together with the Property Trustee and the
Delaware Trustee, the "Trustees") and (v) the several Holders, as hereinafter
defined.
WITNESSETH
WHEREAS, the Depositor, the Property Trustee and the Delaware Trustee have
heretofore created a Delaware statutory trust pursuant to the Delaware Statutory
Trust Act by entering into a Trust Agreement, dated as of April 27, 2004 (the
"Original Trust Agreement"), and by executing and filing with the Secretary of
State of the State of Delaware the Certificate of Trust, substantially in the
form attached as Exhibit A; and
WHEREAS, the Depositor and the Trustees desire to amend and restate the
Original Trust Agreement in its entirety as set forth herein to provide for,
among other things, (i) the issuance of the Common Securities by the Trust to
the Depositor, (ii) the issuance and sale of the Preferred Securities by the
Trust pursuant to the Purchase Agreement and (iii) the acquisition by the Trust
from the Depositor of all of the right, title and interest in and to the Notes;
NOW, THEREFORE, in consideration of the agreements and obligations set
forth herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, each party, for the benefit of the
other parties and for the benefit of the Holders, hereby amends and restates the
Original Trust Agreement in its entirety and agrees as follows:
ARTICLE I
DEFINED TERMS
SECTION 1.1. Definitions.
For all purposes of this Trust Agreement, except as otherwise
expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article I have the meanings assigned
to them in this Article I;
(b) the words "include", "includes" and "including" shall be deemed
to be followed by the phrase "without limitation";
(c) all accounting terms used but not defined herein have the
meanings assigned to them in accordance with United States generally
accepted accounting principles;
(d) unless the context otherwise requires, any reference to an
"Article", a "Section", a "Schedule" or an "Exhibit" refers to an Article,
a Section, a Schedule or an Exhibit, as the case may be, of or to this
Trust Agreement;
(e) the words "hereby", "herein", "hereof" and "hereunder" and other
words of similar import refer to this Trust Agreement as a whole and not
to any particular Article, Section or other subdivision;
(f) a reference to the singular includes the plural and vice versa;
and
(g) the masculine, feminine or neuter genders used herein shall
include the masculine, feminine and neuter genders.
"Act" has the meaning specified in Section 6.7.
"Additional Interest" has the meaning specified in Section 1.1 of the
Indenture.
"Additional Interest Amount" means, with respect to Trust Securities of a
given Liquidation Amount and/or a given period, the amount of Additional
Interest paid by the Depositor on a Like Amount of Notes for such period.
"Additional Taxes" has the meaning specified in Section 1.1 of the
Indenture.
"Additional Tax Sums" has the meaning specified in Section 10.5 of the
Indenture.
"Administrative Trustee" means each of the Persons identified as an
"Administrative Trustee" in the preamble to this Trust Agreement, solely in each
such Person's capacity as Administrative Trustee of the Trust and not in such
Person's individual capacity, or any successor Administrative Trustee appointed
as herein provided.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Applicable Accounting Principles" means accounting practices prescribed
or permitted by the National Association of Insurance Commissioners and, with
respect to the Depositor's subsidiary insurance companies, the applicable
insurance department of the state of domicile of such insurance subsidiary and,
in each case, applied consistently throughout the periods involved.
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"Applicable Depositary Procedures" means, with respect to any
transfer or transaction involving a Book-Entry Preferred Security, the
rules and procedures of the Depositary for such Book-Entry Preferred
Security, in each case to the extent applicable to such transaction and as
in effect from time to time.
"Applicable Insurance Regulatory Authority" means any commissioner
of insurance, department of insurance or similar regulatory authority of
any state, the Turks & Caicos Islands or other jurisdiction with
regulatory authority over the Company or any of its subsidiaries, or, if
at any time after the execution of this Trust Agreement any such entity is
not existing and performing the duties now assigned to it, any successor
body performing similar duties or functions.
"Bankruptcy Event" means, with respect to any Person:
(a) the entry of a decree or order by a court having jurisdiction in
the premises (i) judging such Person a bankrupt or insolvent, (ii)
approving as properly filed a petition seeking reorganization,
arrangement, adjudication or composition of or in respect of such
Person under any applicable Federal or state bankruptcy, insolvency,
reorganization or other similar law, (iii) appointing a custodian,
receiver, liquidator, assignee, trustee, sequestrator or other
similar official of such Person or of any substantial part of its
property or (iv) ordering the winding up or liquidation of its
affairs, and the continuance of any such decree or order unstayed
and in effect for a period of sixty (60) consecutive days; or
(b) the institution by such Person of proceedings to be adjudicated
a bankrupt or insolvent, or the consent by it to the institution of
bankruptcy or insolvency proceedings against it, or the filing by it
of a petition or answer or consent seeking reorganization or relief
under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law, or the consent by it to the
filing of any such petition or to the appointment of a custodian,
receiver, liquidator, assignee, trustee, sequestrator or similar
official of such Person or of any substantial part of its property,
or the making by it of an assignment for the benefit of creditors,
or the admission by it in writing of its inability to pay its debts
generally as they become due and its willingness to be adjudicated a
bankrupt or insolvent, or the taking of corporate action by such
Person in furtherance of any such action.
"Bankruptcy Laws" means all Federal and state bankruptcy,
insolvency, reorganization and other similar laws, including the United
States Bankruptcy Code.
"Book-Entry Preferred Security" means a Preferred Security, the
ownership and transfers of which shall be made through book entries by a
Depositary.
"Business Day" means a day other than (a) a Saturday or Sunday, (b)
a day on which banking institutions in the City of New York are authorized
or required by law or executive order to remain closed or (c) a day on
which the Corporate Trust Office is closed for business.
"Calculation Agent" has the meaning specified in Section 4.10.
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"Closing Date" has the meaning specified in the Purchase Agreement.
"Code" means the United States Internal Revenue Code of 1986, as
amended.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Exchange Act or, if at any
time after the execution of this Trust Agreement such Commission is not
existing and performing the duties assigned to it, then the body
performing such duties at such time.
"Common Securities Certificate" means a certificate evidencing
ownership of Common Securities, substantially in the form attached as
Exhibit B.
"Common Security" means an undivided beneficial interest in the
assets of the Trust, having a Liquidation Amount of $1,000 and having the
rights provided therefor in this Trust Agreement.
"Corporate Trust Office" means the principal office of the Property
Trustee at which any particular time its corporate trust business shall be
administered, which office at the date of this Trust Agreement is located
at 600 Travis, 50th Floor, Houston, Texas 77002, Attention: Institutional
Trust Services -- UICI Capital Trust I.
"Definitive Preferred Securities Certificates" means Preferred
Securities issued in certificated, fully registered form that are not
Global Preferred Securities.
"Delaware Statutory Trust Act" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code Section 3801 et seq., or any successor statute
thereto, in each case as amended from time to time.
"Delaware Trustee" means the Person identified as the "Delaware
Trustee" in the preamble to this Trust Agreement, solely in its capacity
as Delaware Trustee of the Trust and not in its individual capacity, or
its successor in interest in such capacity, or any successor Delaware
Trustee appointed as herein provided.
"Depositary" means an organization registered as a clearing agency
under the Exchange Act that is designated as Depositary by the Depositor
or any successor thereto. DTC will be the initial Depositary.
"Depositary Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time the
Depositary effects book-entry transfers and pledges of securities
deposited with the Depositary.
"Depositor" has the meaning specified in the preamble to this Trust
Agreement and any successors and permitted assigns.
"Depositor Affiliate" has the meaning specified in Section 4.9.
"Distribution Date" has the meaning specified in Section 4.1(a)(i).
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"Distributions" means amounts payable in respect of the Trust
Securities as provided in Section 4.1.
"DTC" means The Depository Trust Company, a New York corporation, or
any successor thereto.
"Early Termination Event" has the meaning specified in Section 9.2.
"Event of Default" means any one of the following events (whatever
the reason for such event and whether it shall be voluntary or involuntary
or be effected by operation of law or pursuant to any judgment, decree or
order of any court or any order, rule or regulation of any administrative
or governmental body):
(a) the occurrence of a Note Event of Default; or
(b) default by the Trust in the payment of any Distribution when it
becomes due and payable, and continuation of such default for a
period of thirty (30) days; or
(c) default by the Trust in the payment of any Redemption Price of
any Trust Security when it becomes due and payable; or
(d) default in the performance, or breach, in any material respect
of any covenant or warranty of the Trustees in this Trust Agreement
(other than those specified in clause (b) or (c) above) and
continuation of such default or breach for a period of thirty (30)
days after there has been given, by registered or certified mail, to
the Trustees and to the Depositor by the Holders of at least twenty
five percent (25%) in aggregate Liquidation Amount of the
Outstanding Preferred Securities a written notice specifying such
default or breach and requiring it to be remedied and stating that
such notice is a "Notice of Default" hereunder; or
(e) the occurrence of a Bankruptcy Event with respect to the
Property Trustee if a successor Property Trustee has not been
appointed within ninety (90) days thereof.
"Exchange Act" means the Securities Exchange Act of 1934, and any
successor statute thereto, in each case as amended from time to time.
"Expiration Date" has the meaning specified in Section 9.1.
"Extension Period" has the meaning specified in Section 4.1(a)(ii).
"Fiscal Year" shall be the fiscal year of the Trust, which shall be
the calendar year, or such other period as is required by the Code.
"Global Preferred Security" means a Preferred Securities Certificate
evidencing ownership of Book-Entry Preferred Securities.
"Guarantee Agreement" means the Guarantee Agreement executed and
delivered by the Depositor and JPMorgan Chase Bank, as guarantee trustee,
contemporaneously with the
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execution and delivery of this Trust Agreement for the benefit of the
holders of the Preferred Securities, as amended from time to time.
"Holder" means a Person in whose name a Trust Security or Trust
Securities are registered in the Securities Register; any such Person
shall be deemed to be a beneficial owner within the meaning of the
Delaware Statutory Trust Act.
"Indemnified Person" has the meaning specified in Section 8.10(c).
"Indenture" means the Junior Subordinated Indenture executed and
delivered by the Depositor and the Note Trustee contemporaneously with the
execution and delivery of this Trust Agreement, for the benefit of the
holders of the Notes, a copy of which is attached hereto as Exhibit D, as
amended or supplemented from time to time.
"Indenture Redemption Price" means the Optional Note Redemption
Price or the Special Note Redemption Price, as applicable.
"Interest Payment Date" has the meaning specified in Section 1.1 of
the Indenture.
"Investment Company Act" means the Investment Company Act of 1940,
or any successor statute thereto, in each case as amended from time to
time.
"Investment Company Event" has the meaning specified in Section 1.1
of the Indenture.
"LIBOR" has the meaning specified in Schedule A.
"LIBOR Business Day" has the meaning specified in Schedule A.
"LIBOR Determination Date" has the meaning specified in Schedule A.
"Lien" means any lien, pledge, charge, encumbrance, mortgage, deed
of trust, adverse ownership interest, hypothecation, assignment, security
interest or preference, priority or other security agreement or
preferential arrangement of any kind or nature whatsoever.
"Like Amount" means (a) with respect to a redemption of any Trust
Securities, Trust Securities having a Liquidation Amount equal to the
principal amount of Notes to be contemporaneously redeemed or paid at
maturity in accordance with the Indenture, the proceeds of which will be
used to pay the Redemption Price of such Trust Securities, (b) with
respect to a distribution of Notes to Holders of Trust Securities in
connection with a dissolution of the Trust, Notes having a principal
amount equal to the Liquidation Amount of the Trust Securities of the
Holder to whom such Notes are distributed and (c) with respect to any
distribution of Additional Interest Amounts to Holders of Trust
Securities, Notes having a principal amount equal to the Liquidation
Amount of the Trust Securities in respect of which such distribution is
made.
"Liquidation Amount" means the stated amount of $1,000 per Trust
Security.
"Liquidation Date" means the date on which assets are to be
distributed to Holders in accordance with Section 9.4(a) hereunder
following dissolution of the Trust.
6
"Liquidation Distribution" has the meaning specified in Section
9.4(d).
"Majority in Liquidation Amount" means Common or Preferred
Securities, as the case may be, representing more than fifty percent (50%)
of the aggregate Liquidation Amount of all (or a specified group of) then
Outstanding Common or Preferred Securities, as the case may be.
"Note Event of Default" means any "Event of Default" specified in
Section 5.1 of the Indenture.
"Note Redemption Date" means, with respect to any Notes to be
redeemed under the Indenture, the date fixed for redemption of such Notes
under the Indenture.
"Note Trustee" means the Person identified as the "Trustee" in the
Indenture, solely in its capacity as Trustee pursuant to the Indenture and
not in its individual capacity, or its successor in interest in such
capacity, or any successor Trustee appointed as provided in the Indenture.
"Notes" means the Depositor's Floating Rate Junior Subordinated
Notes issued pursuant to the Indenture.
"Officers' Certificate" means a certificate signed by the Chief
Executive Officer, the President or an Executive Vice President, and by
the Chief Financial Officer, Treasurer or an Assistant Treasurer, of the
Depositor, and delivered to the Trustees. Any Officers' Certificate
delivered with respect to compliance with a condition or covenant provided
for in this Trust Agreement (other than the certificate provided pursuant
to Section 8.16, which is not an Officers' Certificate) shall include:
(a) a statement by each officer signing the Officers' Certificate
that such officer has read the covenant or condition and the
definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by such officer in rendering the Officers'
Certificate;
(c) a statement that such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable
such officer to express an informed opinion as to whether or not
such covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of such officer, such
condition or covenant has been complied with.
"Operative Documents" means the Purchase Agreement, the Indenture,
the Trust Agreement, the Guarantee Agreement, the Notes and the Trust
Securities.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for, or an employee of, the Depositor or any Affiliate of the
Depositor.
"Optional Redemption Price" means, with respect to any Trust
Security, an amount equal to one hundred percent (100%) of the Liquidation
Amount of such Trust Security on the
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Redemption Date, plus accumulated and unpaid Distributions to the
Redemption Date, plus the related amount of the premium, if any, and/or
accrued interest, including Additional Interest, if any, thereon paid by
the Depositor upon the concurrent redemption or payment at maturity of a
Like Amount of Notes.
"Optional Note Redemption Price" means, with respect to any Note to
be redeemed on any Redemption Date under the Indenture, an amount equal to
one hundred percent (100%) of the outstanding principal amount of such
Note, together with accrued interest, including any Additional Interest
(to the extent legally enforceable), thereon through but not including the
date fixed as such Redemption Date.
"Original Issue Date" means the date of original issuance of the
Trust Securities.
"Original Trust Agreement" has the meaning specified in the recitals
to this Trust Agreement.
"Outstanding", when used with respect to any Trust Securities,
means, as of the date of determination, all Trust Securities theretofore
executed and delivered under this Trust Agreement, except:
(a) Trust Securities theretofore canceled by the Property Trustee or
delivered to the Property Trustee for cancellation;
(b) Trust Securities for which payment or redemption money in the
necessary amount has been theretofore deposited with the Property
Trustee or any Paying Agent in trust for the Holders of such Trust
Securities; provided, that if such Trust Securities are to be
redeemed, notice of such redemption has been duly given pursuant to
this Trust Agreement; and
(c) Trust Securities that have been paid or in exchange for or in
lieu of which other Trust Securities have been executed and
delivered pursuant to the provisions of this Trust Agreement, unless
proof satisfactory to the Property Trustee is presented that any
such Trust Securities are held by Holders in whose hands such Trust
Securities are valid, legal and binding obligations of the Trust;
provided, that in determining whether the Holders of the requisite
Liquidation Amount of the Outstanding Preferred Securities have given any
request, demand, authorization, direction, notice, consent or waiver
hereunder, Preferred Securities owned by the Depositor, any Trustee or any
Affiliate of the Depositor or of any 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 Preferred
Securities that such Trustee knows to be so owned shall be so disregarded
and (ii) the foregoing shall not apply at any time when all of the
Outstanding Preferred Securities are owned by the Depositor, one or more
of the Trustees and/or any such Affiliate. Preferred Securities so owned
that have been pledged in good faith may be regarded as Outstanding if the
pledgee establishes to the satisfaction of the Administrative Trustees the
pledgee's right so to act with respect to such Preferred Securities and
that the pledgee is not the Depositor, any Trustee or any Affiliate of the
Depositor or of any Trustee.
8
"Owner" means each Person who is the beneficial owner of Book-Entry
Preferred Securities as reflected in the records of the Depositary or, if
a Depositary Participant is not the beneficial owner, then the beneficial
owner as reflected in the records of the Depositary Participant.
"Paying Agent" means any Person authorized by the Administrative
Trustees to pay Distributions or other amounts in respect of any Trust
Securities on behalf of the Trust.
"Payment Account" means a segregated non-interest-bearing corporate
trust account maintained by the Property Trustee for the benefit of the
Holders in which all amounts paid in respect of the Notes will be held and
from which the Property Trustee, through the Paying Agent, shall make
payments to the Holders in accordance with Sections 3.1, 4.1 and 4.2.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, company, limited liability company, trust, unincorporated
association or government, or any agency or political subdivision thereof,
or any other entity of whatever nature.
"Preferred Security" means an undivided beneficial interest in the
assets of the Trust, having a Liquidation Amount of $1,000 and having the
rights provided therefor in this Trust Agreement.
"Preferred Securities Certificate" means a certificate evidencing
ownership of Preferred Securities, substantially in the form attached as
Exhibit C.
"Property Trustee" means the Person identified as the "Property
Trustee" in the preamble to this Trust Agreement, solely in its capacity
as Property Trustee of the Trust and not in its individual capacity, or
its successor in interest in such capacity, or any successor Property
Trustee appointed as herein provided.
"Purchase Agreement" means the Purchase Agreement executed and
delivered by the Trust, the Depositor and Dekania CDO II, Ltd., as
purchaser, contemporaneously with the execution and delivery of this Trust
Agreement, as amended from time to time.
"QIB" means a "qualified institutional buyer" as defined in Rule
144A under the Securities Act of 1933, as amended.
"Redemption Date" means, with respect to any Trust Security to be
redeemed, the date fixed for such redemption by or pursuant to this Trust
Agreement; provided, that each Note Redemption Date and the stated
maturity (or any date of principal repayment upon early maturity) of the
Notes shall be a Redemption Date for a Like Amount of Trust Securities.
"Redemption Price" means the Special Redemption Price or Optional
Redemption Price, as applicable. If the Depositor has redeemed the Notes
at the Special Note Redemption Price, the Trust shall redeem the Trust
Securities at the Special Redemption Price. If the Depositor has redeemed
the Notes at the Optional Note Redemption Price, the Trust shall redeem
the Trust Securities at the Optional Redemption Price.
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"Reference Banks" has the meaning specified in Schedule A.
"Responsible Officer" means, with respect to the Property Trustee,
the officer in the Institutional Trust Services department of the Property
Trustee having direct responsibility for the administration of this Trust
Agreement.
"Securities Act" means the Securities Act of 1933, and any successor
statute thereto, in each case as amended from time to time.
"Securities Certificate" means any one of the Common Securities
Certificates or the Preferred Securities Certificates.
"Securities Register" and "Securities Registrar" have the respective
meanings specified in Section 5.7.
"Special Redemption Price" means, with respect to any Trust
Security, an amount equal to one hundred seven and one half percent
(107.5%) of the Liquidation Amount of such Trust Security on the
Redemption Date, plus accumulated and unpaid Distributions to the
Redemption Date, plus the related amount of the premium, if any, and/or
accrued interest, including Additional Interest, if any, thereon paid by
the Depositor upon the concurrent redemption or payment at maturity of a
Like Amount of Notes.
"Special Note Redemption Price" means, with respect to any Note to
be redeemed on any Redemption Date under the Indenture, an amount equal to
one hundred seven and one half percent (107.5%) of the outstanding
principal amount of such Note, together with accrued interest, including
Additional Interest, thereon through but not including the date fixed as
such Redemption Date.
"Statutory Financial Statements" means all financial statements of
the Depositor's subsidiary insurance companies for each relevant period,
prepared in accordance with Applicable Accounting Principles.
"Successor Securities" has the meaning specified in Section 9.5(a).
"Tax Event" has the meaning specified in Section 1.1 of the
Indenture.
"Trust" means the Delaware statutory trust known as "UICI Capital
Trust I," which was created on April 27, 2004 under the Delaware Statutory
Trust Act pursuant to the Original Trust Agreement and the filing of the
Certificate of Trust, and continued pursuant to this Trust Agreement.
"Trust Agreement" means this Amended and Restated Trust Agreement,
as the same may be modified, amended or supplemented from time to time in
accordance with the applicable provisions hereof, including all Schedules
and Exhibits.
"Trustees" means the Administrative Trustees, the Property Trustee
and the Delaware Trustee, each as defined in this Article I.
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"Trust Property" means (a) the Notes, (b) any cash on deposit in, or
owing to, the Payment Account and (c) all proceeds and rights in respect
of the foregoing and any other property and assets for the time being held
or deemed to be held by the Property Trustee pursuant to the trusts of
this Trust Agreement.
"Trust Security" means any one of the Common Securities or the
Preferred Securities.
ARTICLE II.
THE TRUST
SECTION 2.1. Name.
The trust continued hereby shall be known as "UICI Capital Trust I",
as such name may be modified from time to time by the Administrative
Trustees following written notice to the Holders of Trust Securities and
the other Trustees, in which name the Trustees may conduct the business of
the Trust, make and execute contracts and other instruments on behalf of
the Trust and sue and be sued.
SECTION 2.2. Office of the Delaware Trustee; Principal Place of
Business.
The address of the Delaware Trustee in the State of Delaware is
Chase Manhattan Bank USA, National Association, 500 Stanton Christiana
Road, 3/OPS 4, Newark, Delaware 19713, Attention: Institutional Trust
Services, or such other address in the State of Delaware as the Delaware
Trustee may designate by written notice to the Holders, the Depositor, the
Property Trustee and the Administrative Trustees. The principal executive
office of the Trust is 9151 Grapevine Highway, North Richland Hills, Texas
76180, Attention: Mark D. Hauptman, as such address may be changed from
time to time by the Administrative Trustees following written notice to
the Holders and the other Trustees.
SECTION 2.3. Initial Contribution of Trust Property; Fees, Costs and
Expenses.
The Property Trustee acknowledges receipt from the Depositor in
connection with the Original Trust Agreement of the sum of ten dollars
($10), which constituted the initial Trust Property. The Depositor shall
pay all fees, costs and expenses of the Trust (except with respect to the
Trust Securities) as they arise or shall, upon request of any Trustee,
promptly reimburse such Trustee for any such fees, costs and expenses paid
by such Trustee. The Depositor shall make no claim upon the Trust Property
for the payment of such fees, costs or expenses.
SECTION 2.4. Purposes of Trust.
(a) The exclusive purposes and functions of the Trust are to (i)
issue and sell Trust Securities and use the proceeds from such sale to
acquire the Notes and (ii) engage in only those activities necessary or
incidental thereto. The Delaware Trustee, the Property Trustee and the
Administrative Trustees are trustees of the Trust, and have all the
rights, powers and duties to the extent set forth herein. The Trustees
hereby acknowledge that they are trustees of the Trust.
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(b) So long as this Trust Agreement remains in effect, the Trust (or
the Trustees acting on behalf of the Trust) shall not undertake any
business, activities or transaction except as expressly provided herein or
contemplated hereby. In particular, the Trust (or the Trustees acting on
behalf of the Trust) shall not (i) acquire any investments or engage in
any activities not authorized by this Trust Agreement, (ii) sell, assign,
transfer, exchange, mortgage, pledge, set-off or otherwise dispose of any
of the Trust Property or interests therein, including to Holders, except
as expressly provided herein, (iii) incur any indebtedness for borrowed
money or issue any other debt, (iv) take or consent to any action that
would result in the placement of a Lien on any of the Trust Property, (v)
take or consent to any action that would reasonably be expected to cause
the Trust to become taxable as a corporation or classified as other than a
grantor trust for United States federal income tax purposes, (vi) take or
consent to any action that would cause the Notes to be treated as other
than indebtedness of the Depositor for United States federal income tax
purposes or (vii) take or consent to any action that would cause the Trust
to be deemed to be an "investment company" required to be registered under
the Investment Company Act.
SECTION 2.5. Authorization to Enter into Certain Transactions.
(a) The Trustees shall conduct the affairs of the Trust in
accordance with and subject to the terms of this Trust Agreement. In
accordance with the following provisions (i) and (ii), the Trustees shall
have the authority to enter into all transactions and agreements
determined by the Trustees to be appropriate in exercising the authority,
express or implied, otherwise granted to the Trustees, under this Trust
Agreement, and to perform all acts in furtherance thereof, including the
following:
(i) As among the Trustees, each Administrative Trustee shall
severally have the power and authority to act on behalf of the Trust
with respect to the following matters:
(A) the issuance and sale of the Trust Securities;
(B) to cause the Trust to enter into, and to execute,
deliver and perform on behalf of the Trust, such agreements as
may be necessary or desirable in connection with the purposes
and function of the Trust, including, without limitation, a
common securities subscription agreement and a junior
subordinated note purchase agreement;
(C) assisting in the sale of the Preferred Securities in
one or more transactions exempt from registration under the
Securities Act, and in compliance with applicable state
securities or blue sky laws;
(D) assisting in the sending of notices (other than
notices of default) and other information regarding the Trust
Securities and the Notes to the Holders in accordance with
this Trust Agreement;
(E) the appointment of a Paying Agent and Securities
Registrar in accordance with this Trust Agreement;
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(F) execution of the Trust Securities on behalf of the
Trust in accordance with this Trust Agreement;
(G) execution and delivery of closing certificates, if
any, pursuant to the Purchase Agreement and application for a
taxpayer identification number for the Trust;
(H) preparation and filing of all applicable tax returns
and tax information reports that are required to be filed on
behalf of the Trust;
(I) establishing a record date with respect to all
actions to be taken hereunder that require a record date to be
established, except as provided in Section 6.10(a);
(J) unless otherwise required by the Delaware Statutory
Trust Act to execute on behalf of the Trust (either acting
alone or together with the other Administrative Trustees) any
documents that such Administrative Trustee has the power to
execute pursuant to this Trust Agreement; and
(K) the taking of any action incidental to the foregoing
as such Administrative Trustee may from time to time determine
is necessary or advisable to give effect to the terms of this
Trust Agreement.
(ii) As among the Trustees, the Property Trustee shall have
the power, duty and authority to act on behalf of the Trust with
respect to the following matters:
(A) the receipt and holding of legal title of the Notes;
(B) the establishment of the Payment Account;
(C) the collection of interest, principal and any other
payments made in respect of the Notes and the holding of such
amounts in the Payment Account;
(D) the distribution through the Paying Agent of amounts
distributable to the Holders in respect of the Trust
Securities;
(E) the exercise of all of the rights, powers and
privileges of a holder of the Notes in accordance with the
terms of this Trust Agreement;
(F) the sending of notices of default and other
information regarding the Trust Securities and the Notes to
the Holders in accordance with this Trust Agreement;
(G) the distribution of the Trust Property in accordance
with the terms of this Trust Agreement;
(H) to the extent provided in this Trust Agreement, the
winding up of the affairs of and liquidation of the Trust,
provided that the Administrative
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Trustees shall have the power, duty and authority to act on
behalf of the Trust with respect to the preparation, execution
and filing of the certificate of cancellation of the Trust
with the Secretary of State of the State of Delaware; and
(I) the taking of any action incidental to the foregoing
as the Property Trustee may from time to time determine is
necessary or advisable to give effect to the terms of this
Trust Agreement and protect and conserve the Trust Property
for the benefit of the Holders (without consideration of the
effect of any such action on any particular Holder).
(b) In connection with the issue and sale of the Preferred
Securities, the Depositor shall have the right and responsibility to
assist the Trust with respect to, or effect on behalf of the Trust,
the following (and any actions taken by the Depositor in furtherance
of the following prior to the date of this Trust Agreement are
hereby ratified and confirmed in all respects):
(i) the negotiation of the terms of, and the execution
and delivery of, the Purchase Agreement providing for the sale
of the Preferred Securities in one or more transactions exempt
from registration under the Securities Act, and in compliance
with applicable state securities or blue sky laws; and
(ii) the taking of any other actions necessary or
desirable to carry out any of the foregoing activities.
(c) Notwithstanding anything herein to the contrary, the
Administrative Trustees are authorized and directed to conduct the
affairs of the Trust and authorized to operate the Trust so that the
Trust will not be taxable as a corporation or classified as other
than a grantor trust for United States federal income tax purposes,
so that the Notes will be treated as indebtedness of the Depositor
for United States federal income tax purposes and so that the Trust
will not be deemed to be an "investment company" required to be
registered under the Investment Company Act. In respect thereof,
each Administrative Trustee is authorized to take any action, not
inconsistent with applicable law, the Certificate of Trust or this
Trust Agreement, that such Administrative Trustee determines in his
or her discretion to be necessary or desirable for such purposes, as
long as such action does not adversely affect in any material
respect the interests of the Holders of the Outstanding Preferred
Securities. In no event shall the Administrative Trustees be liable
to the Trust or the Holders for any failure to comply with this
Section 2.5 to the extent that such failure results solely from a
change in law or regulation or in the interpretation thereof.
(d) Any action taken by a Trustee in accordance with its
powers shall constitute the act of and serve to bind the Trust. In
dealing with any Trustee acting on behalf of the Trust, no Person
shall be required to inquire into the authority of such Trustee to
bind the Trust. Persons dealing with the Trust are entitled to rely
conclusively on the power and authority of any Trustee as set forth
in this Trust Agreement.
SECTION 2.6. Assets of Trust.
The assets of the Trust shall consist of the Trust Property.
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SECTION 2.7. Title to Trust Property.
(a) Legal title to all Trust Property shall be vested at all times
in the Property Trustee and shall be held and administered by the Property
Trustee in trust for the benefit of the Trust and the Holders in
accordance with this Trust Agreement.
(b) The Holders shall not have any right or title to the Trust
Property other than the undivided beneficial interest in the assets of the
Trust conferred by their Trust Securities and they shall have no right to
call for any partition or division of property, profits or rights of the
Trust except as described below. The Trust Securities shall be personal
property giving only the rights specifically set forth therein and in this
Trust Agreement.
ARTICLE III.
PAYMENT ACCOUNT; PAYING AGENTS
SECTION 3.1. Payment Account.
(a) On or prior to the Closing Date, the Property Trustee shall
establish the Payment Account. The Property Trustee and the Paying Agent
shall have exclusive control and sole right of withdrawal with respect to
the Payment Account for the purpose of making deposits in and withdrawals
from the Payment Account in accordance with this Trust Agreement. All
monies and other property deposited or held from time to time in the
Payment Account shall be held by the Property Trustee in the Payment
Account for the exclusive benefit of the Holders and for Distribution as
herein provided.
(b) The Property Trustee shall deposit in the Payment Account,
promptly upon receipt, all payments of principal of or interest on, and
any other payments with respect to, the Notes. Amounts held in the Payment
Account shall not be invested by the Property Trustee pending distribution
thereof.
SECTION 3.2. Appointment of Paying Agents.
The Paying Agent shall initially be the Property Trustee. The Paying
Agent shall make Distributions to Holders from the Payment Account and
shall report the amounts of such Distributions to the Property Trustee and
the Administrative Trustees. Any Paying Agent shall have the revocable
power to withdraw funds from the Payment Account solely for the purpose of
making the Distributions referred to above. The Administrative Trustees
may revoke such power and remove the Paying Agent in their sole
discretion. Any Person acting as Paying Agent shall be permitted to resign
as Paying Agent upon thirty (30) days' written notice to the
Administrative Trustees and the Property Trustee. If the Property Trustee
shall no longer be the Paying Agent or a successor Paying Agent shall
resign or its authority to act be revoked, the Administrative Trustees
shall appoint a successor (which shall be a bank or trust company) to act
as Paying Agent. Such successor Paying Agent appointed by the
Administrative Trustees shall execute and deliver to the Trustees an
instrument in which such successor Paying Agent shall agree with the
Trustees that as Paying Agent, such successor Paying Agent will hold all
sums, if any, held by it for payment to the Holders in trust for the
benefit of the Holders entitled thereto
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until such sums shall be paid to such Holders. The Paying Agent shall
return all unclaimed funds to the Property Trustee and upon removal of a
Paying Agent such Paying Agent shall also return all funds in its
possession to the Property Trustee. The provisions of Article VIII shall
apply to the Property Trustee also in its role as Paying Agent, for so
long as the Property Trustee shall act as Paying Agent and, to the extent
applicable, to any other Paying Agent appointed hereunder. Any reference
in this Trust Agreement to the Paying Agent shall include any co-paying
agent unless the context requires otherwise.
ARTICLE IV.
DISTRIBUTIONS; REDEMPTION
SECTION 4.1. Distributions.
(a) The Trust Securities represent undivided beneficial interests in
the Trust Property, and Distributions (including any Additional Interest
Amounts) will be made on the Trust Securities at the rate and on the dates
that payments of interest (including any Additional Interest) are made on
the Notes. Accordingly:
(i) Distributions on the Trust Securities shall be cumulative,
and shall accumulate whether or not there are funds of the Trust
available for the payment of Distributions. Distributions shall
accumulate from April 29, 2004, and, except as provided in clause
(ii) below, shall be payable quarterly in arrears on February 15,
May 15, August 15 and November 15 of each year, commencing on August
15, 2004. If any date on which a Distribution is otherwise payable
on the Trust Securities is not a Business Day, then the payment of
such Distribution shall be made on the next succeeding Business Day
(and no interest shall accrue in respect of the amounts whose
payment is so delayed for the period from and after each such date
until the next succeeding Business Day), except that, if such
Business Day falls 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
(each date on which Distributions are payable in accordance with
this Section 4.1(a)(i), a "Distribution Date");
(ii) in the event (and to the extent) that the Depositor
exercises its right under the Indenture to defer the payment of
interest on the Notes, Distributions on the Trust Securities shall
be deferred. Under the Indenture, so long as no Note Event of
Default has occurred and is continuing, the Depositor shall have the
right, at any time and from time to time during the term of the
Notes, to defer the payment of interest on the Notes for a period of
up to twenty (20) consecutive quarterly interest payment periods
(each such extended interest payment period, an "Extension Period"),
during which Extension Period no interest on the Notes shall be due
and payable (except any Additional Tax Sums that may be due and
payable). No interest on the Notes shall be due and payable during
an Extension Period, except at the end thereof, but each installment
of interest that would otherwise have been due and payable during
such Extension Period shall bear Additional Interest (to the extent
payment of such interest would be legally enforceable)
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at a variable rate equal to LIBOR plus 3.50% per annum compounded
quarterly, from the dates on which amounts would have otherwise been
due and payable until paid or until funds for the payment thereof
have been made available for payment. If Distributions are deferred,
the deferred Distributions (including Additional Interest Amounts)
shall be paid on the date that the related Extension Period
terminates, to Holders of the Trust Securities as they appear on the
books and records of the Trust on the record date immediately
preceding such termination date.
(iii) Distributions shall accumulate in respect of the Trust
Securities at a variable rate equal to LIBOR plus 3.50% per annum of
the Liquidation Amount of the Trust Securities, such rate being the
rate of interest payable on the Notes. LIBOR shall be determined by
the Calculation Agent in accordance with Schedule A. The amount of
Distributions payable for any period less than a full Distribution
period shall be computed on the basis of a 360-day year and the
actual number of days elapsed in the relevant Distribution period.
The amount of Distributions payable for any period shall include any
Additional Interest Amounts in respect of such period; and
(iv) Distributions on the Trust Securities shall be made by
the Paying Agent from the Payment Account and shall be payable on
each Distribution Date only to the extent that the Trust has funds
then on hand and available in the Payment Account for the payment of
such Distributions.
(b) Distributions on the Trust Securities with respect to a
Distribution Date shall be payable to the Holders thereof as they appear
on the Securities Register for the Trust Securities at the close of
business on the relevant record date, which shall be at the close of
business on the fifteenth day (whether or not a Business Day) preceding
the relevant Distribution Date. Distributions payable on any Trust
Securities that are not punctually paid on any Distribution Date as a
result of the Depositor having failed to make an interest payment under
the Notes will cease to be payable to the Person in whose name such Trust
Securities are registered on the relevant record date, and such defaulted
Distributions and any Additional Interest Amounts will instead be payable
to the Person in whose name such Trust Securities are registered on the
special record date, or other specified date for determining Holders
entitled to such defaulted Distribution and Additional Interest Amount,
established in the same manner, and on the same date, as such is
established with respect to the Notes under the Indenture.
SECTION 4.2. Redemption.
(a) On each Note Redemption Date and on the stated maturity (or any
date of principal repayment upon early maturity) of the Notes and on each
other date on (or in respect of) which any principal on the Notes is
repaid, the Trust will be required to redeem a Like Amount of Trust
Securities at the Redemption Price.
(b) Notice of redemption shall be given by the Property Trustee by
first-class mail, postage prepaid, mailed not less than thirty (30) nor
more than sixty (60) days prior to the Redemption Date to each Holder of
Trust Securities to be redeemed, at such Holder's address appearing in the
Securities Register. All notices of redemption shall state:
17
(i) the Redemption Date;
(ii) the Redemption Price or, if the Redemption Price cannot
be calculated prior to the time the notice is required to be sent,
the estimate of the Redemption Price provided pursuant to the
Indenture, as calculated by the Depositor, together with a statement
that it is an estimate and that the actual Redemption Price will be
calculated by the Calculation Agent on the fifth Business Day prior
to the Redemption Date (and if an estimate is provided, a further
notice shall be sent of the actual Redemption Price on the date that
such Redemption Price is calculated);
(iii) if less than all the Outstanding Trust Securities are to
be redeemed, the identification (and, in the case of partial
redemption, the respective amounts) and Liquidation Amounts of the
particular Trust Securities to be redeemed;
(iv) that on the Redemption Date, the Redemption Price will
become due and payable upon each such Trust Security, or portion
thereof, to be redeemed and that Distributions thereon will cease to
accumulate on such Trust Security or such portion, as the case may
be, on and after said date, except as provided in Section 4.2(d);
(v) the place or places where the Trust Securities are to be
surrendered for the payment of the Redemption Price; and
(vi) such other provisions as the Property Trustee deems
relevant.
(c) The Trust Securities (or portion thereof) redeemed on each
Redemption Date shall be redeemed at the Redemption Price with the
proceeds from the contemporaneous redemption or payment at maturity of
Notes. Redemptions of the Trust Securities (or portion thereof) shall be
made and the Redemption Price shall be payable on each Redemption Date
only to the extent that the Trust has funds then on hand and available in
the Payment Account for the payment of such Redemption Price. Under the
Indenture, the Notes may be redeemed by the Depositor on any Interest
Payment Date, at the Depositor's option, on or after April 29, 2009, in
whole or in part, from time to time at the Optional Note Redemption Price;
provided, that the Depositor shall have received the prior approval of any
Applicable Insurance Regulatory Authority then required. The Notes may
also be redeemed by the Depositor, at its option pursuant to the terms of
the Indenture, in whole but not in part, upon the occurrence and during
the continuation of an Investment Company Event or a Tax Event, at the
Special Note Redemption Price; provided, that the Depositor shall have
received the prior approval of any Applicable Insurance Regulatory
Authority then required.
(d) If the Property Trustee gives a notice of redemption in respect
of any Preferred Securities, then by 10:00 A.M., New York City time, on
the Redemption Date, the Depositor shall deposit sufficient funds with the
Property Trustee to pay the Redemption Price. If such deposit has been
made by such time, then by 12:00 noon, New York City time, on the
Redemption Date, the Property Trustee will, with respect to Book-Entry
Preferred Securities, irrevocably deposit with the Depositary for such
Book-Entry Preferred Securities, to the extent available therefor, funds
sufficient to pay the applicable Redemption Price and will give such
Depositary irrevocable instructions and authority to pay the Redemption
Price to the Holders of
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the Preferred Securities. With respect to Preferred Securities that are
not Book-Entry Preferred Securities, the Property Trustee will irrevocably
deposit with the Paying Agent, to the extent available therefor, funds
sufficient to pay the applicable Redemption Price and will give the Paying
Agent irrevocable instructions and authority to pay the Redemption Price
to the Holders of the Preferred Securities upon surrender of their
Preferred Securities Certificates. Notwithstanding the foregoing,
Distributions payable on or prior to the Redemption Date for any Trust
Securities (or portion thereof) called for redemption shall be payable to
the Holders of such Trust Securities as they appear on the Securities
Register on the relevant record dates for the related Distribution Dates.
If notice of redemption shall have been given and funds deposited as
required, then upon the date of such deposit, all rights of Holders
holding Trust Securities (or portion thereof) so called for redemption
will cease, except the right of such Holders to receive the Redemption
Price and any Distribution payable in respect of the Trust Securities on
or prior to the Redemption Date, but without interest, and, in the case of
a partial redemption, the right of such Holders to receive a new Trust
Security or Securities of authorized denominations, in aggregate
Liquidation Amount equal to the unredeemed portion of such Trust Security
or Securities, and such Securities (or portion thereof) called for
redemption will cease to be Outstanding. In the event that any date on
which any Redemption Price is payable is not a Business Day, then payment
of the Redemption Price payable on such date will be made on the next
succeeding Business Day (and no interest shall accrue in respect of the
amounts whose payment is so delayed for the period from and after each
such date until the next succeeding Business Day), except that, if such
Business Day falls 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. In the event that
payment of the Redemption Price in respect of any Trust Securities (or
portion thereof) called for redemption is improperly withheld or refused
and not paid either by the Trust or by the Depositor pursuant to the
Guarantee Agreement, Distributions on such Trust Securities (or portion
thereof) will continue to accumulate, as set forth in Section 4.1, from
the Redemption Date originally established by the Trust for such Trust
Securities (or portion thereof) to the date such Redemption Price is
actually paid, in which case the actual payment date will be the date
fixed for redemption for purposes of calculating the Redemption Price.
(e) Subject to Section 4.3(a), if less than all the Outstanding
Trust Securities are to be redeemed on a Redemption Date, then the
aggregate Liquidation Amount of Trust Securities to be redeemed shall be
allocated pro rata to the Common Securities and the Preferred Securities
based upon the relative aggregate Liquidation Amounts of the Common
Securities and the Preferred Securities. The Preferred Securities to be
redeemed shall be selected on a pro rata basis based upon their respective
Liquidation Amounts not more than sixty (60) days prior to the Redemption
Date by the Property Trustee from the Outstanding Preferred Securities not
previously called for redemption; provided, that with respect to Holders
that would be required to hold less than one hundred (100) but more than
zero (0) Trust Securities as a result of such redemption, the Trust shall
redeem Trust Securities of each such Holder so that after such redemption
such Holder shall hold either one hundred (100) Trust Securities or such
Holder no longer holds any Trust Securities, and shall use such method
(including, without limitation, by lot) as the Trust shall deem fair and
appropriate; and provided, further, that so long as the Preferred
Securities are Book-Entry Preferred Securities, such selection shall be
made in accordance with the Applicable Depositary Procedures for the
Preferred Securities by such Depositary. The Property Trustee shall
promptly notify the Securities Registrar in writing of the
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Preferred Securities (or portion thereof) selected for redemption and, in
the case of any Preferred Securities selected for partial redemption, the
Liquidation Amount thereof to be redeemed. For all purposes of this Trust
Agreement, unless the context otherwise requires, all provisions relating
to the redemption of Preferred Securities shall relate, in the case of any
Preferred Securities redeemed or to be redeemed only in part, to the
portion of the aggregate Liquidation Amount of Preferred Securities that
has been or is to be redeemed.
(f) The Trust in issuing the Trust Securities may use "CUSIP"
numbers (if then generally in use), and, if so, the Property Trustee shall
indicate the "CUSIP" numbers of the Trust Securities in notices of
redemption and related materials as a convenience to Holders; provided,
that any such notice may state that no representation is made as to the
correctness of such numbers either as printed on the Trust Securities or
as contained in any notice of redemption and related materials.
SECTION 4.3. Subordination of Common Securities.
(a) Payment of Distributions (including any Additional Interest
Amounts) on, the Redemption Price of and the Liquidation Distribution in
respect of, the Trust Securities, as applicable, shall be made, pro rata
among the Common Securities and the Preferred Securities based on the
Liquidation Amount of the respective Trust Securities; provided, that if
on any Distribution Date, Redemption Date or Liquidation Date an Event of
Default shall have occurred and be continuing, no payment of any
Distribution (including any Additional Interest Amounts) on, Redemption
Price of or Liquidation Distribution in respect of, any Common Security,
and no other payment on account of the redemption, liquidation or other
acquisition of Common Securities, shall be made unless payment in full in
cash of all accumulated and unpaid Distributions (including any Additional
Interest Amounts) on all Outstanding Preferred Securities for all
Distribution periods terminating on or prior thereto, or in the case of
payment of the Redemption Price the full amount of such Redemption Price
on all Outstanding Preferred Securities then called for redemption, or in
the case of payment of the Liquidation Distribution the full amount of
such Liquidation Distribution on all Outstanding Preferred Securities,
shall have been made or provided for, and all funds immediately available
to the Property Trustee shall first be applied to the payment in full in
cash of all Distributions (including any Additional Interest Amounts) on,
or the Redemption Price of or the Liquidation Distribution in respect of,
the Preferred Securities then due and payable.
(b) In the case of the occurrence of any Event of Default, the
Holders of the Common Securities shall have no right to act with respect
to any such Event of Default under this Trust Agreement until all such
Events of Default with respect to the Preferred Securities have been
cured, waived or otherwise eliminated. Until all such Events of Default
under this Trust Agreement with respect to the Preferred Securities have
been so cured, waived or otherwise eliminated, the Property Trustee shall
act solely on behalf of the Holders of the Preferred Securities and not on
behalf of the Holders of the Common Securities, and only the Holders of
all the Preferred Securities will have the right to direct the Property
Trustee to act on their behalf.
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SECTION 4.4. Payment Procedures.
Payments of Distributions (including any Additional Interest
Amounts), the Redemption Price, Liquidation Amount or any other amounts in
respect of the Preferred Securities shall be made by wire transfer at such
place and to such account at a banking institution in the United States as
may be designated in writing at least ten (10) Business Days prior to the
date for payment by the Person entitled thereto unless proper written
transfer instructions have not been received by the relevant record date,
in which case such payments shall be made by check mailed to the address
of such Person as such address shall appear in the Securities Register. If
any Preferred Securities are held by a Depositary, such Distributions
thereon shall be made to the Depositary in immediately available funds.
Payments in respect of the Common Securities shall be made in such manner
as shall be mutually agreed between the Property Trustee and the Holder of
all the Common Securities.
SECTION 4.5. Withholding Tax.
The Trust and the Administrative Trustees shall comply with all
withholding and backup withholding tax requirements under United States
federal, state and local law. The Administrative Trustees on behalf of 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 and backup withholding tax with respect to each Holder and any
representations and forms as shall reasonably be requested by the
Administrative Trustees on behalf of the Trust to assist it in determining
the extent of, and in fulfilling, its withholding and backup withholding
tax obligations. The Administrative Trustees shall file required forms
with applicable jurisdictions and, unless an exemption from withholding
and backup withholding tax 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 jurisdiction 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 overwithholding, Holders shall be limited to an action
against the applicable jurisdiction. If the amount required to be withheld
was not withheld from actual Distributions made, the Administrative
Trustees on behalf of the Trust may reduce subsequent Distributions by the
amount of such required withholding.
SECTION 4.6. Tax Returns and Other Reports.
(a) The Administrative Trustees shall prepare (or cause to be
prepared) at the principal office of the Trust in the United States, as
defined for purposes of Treasury regulations section 301.7701-7, at the
Depositor's expense, and file, all United States federal, state and local
tax and information returns and reports required to be filed by or in
respect of the Trust. The Administrative Trustees shall prepare at the
principal office of the Trust in the United States, as defined for
purposes of Treasury regulations section 301.7701-7, and furnish (or cause
to be prepared and furnished), by January 31 in each taxable year of the
Trust to each Holder all Internal Revenue Service forms and returns
required to be provided by the Trust. The Administrative Trustees shall
provide the Depositor, Dekania Capital Management, LLC and the Property
Trustee with a copy of all such returns and reports promptly after such
filing or furnishing.
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(b) So long as the Property Trustee for the benefit of the Trust is
the holder of the Notes, the Administrative Trustees will cause any
Statutory Financial Statements to be delivered to the Property Trustee and
to each Holder and Dekania Capital Management, LLC promptly following the
filing of each such document with the relevant Applicable Insurance
Regulatory Authority. The delivery requirement set forth in the preceding
sentence may be satisfied by submitting the required Statutory Financial
Statements pursuant to Section 8.16(b) hereof.
SECTION 4.7. Payment of Taxes, Duties, Etc. of the Trust.
Upon receipt under the Notes of Additional Tax Sums and upon the
written direction of the Administrative Trustees, the Property Trustee
shall promptly pay, solely out of monies on deposit pursuant to this Trust
Agreement, any Additional Taxes imposed on the Trust by the United States
or any other taxing authority.
SECTION 4.8. Payments under Indenture or Pursuant to Direct Actions.
Any amount payable hereunder to any Holder of Preferred Securities
shall be reduced by the amount of any corresponding payment such Holder
(or any Owner with respect thereto) has directly received pursuant to
Section 5.8 of the Indenture or Section 6.10(b) of this Trust Agreement.
SECTION 4.9. Exchanges.
(a) If at any time the Depositor or any of its Affiliates (in either
case, a "Depositor Affiliate") is the Owner or Holder of any Preferred
Securities, such Depositor Affiliate shall have the right to deliver to
the Property Trustee all or such portion of its Preferred Securities as it
elects and, subject to compliance with Sections 2.2 and 3.5 of the
Indenture, receive, in exchange therefor, a Like Amount of Notes. Such
election shall be exercisable effective on any Distribution Date by such
Depositor Affiliate delivering to the Property Trustee (i) at least ten
(10) Business Days prior to the Distribution Date on which such exchange
is to occur, the registration instructions and the documentation, if any,
required pursuant to Sections 2.2 and 3.5 of the Indenture to enable the
Indenture Trustee to issue the requested Like Amount of Notes, (ii) a
written notice of such election specifying the Liquidation Amount of
Preferred Securities with respect to which such election is being made and
the Distribution Date on which such exchange shall occur, which
Distribution Date shall be not less than ten (10) Business Days after the
date of receipt by the Property Trustee of such election notice and (iii)
shall be conditioned upon such Depositor Affiliate having delivered or
caused to be delivered to the Property Trustee or its designee the
Preferred Securities that are the subject of such election by 10:00 A.M.
New York time, on the Distribution Date on which such exchange is to
occur. After the exchange, such Preferred Securities will be canceled and
will no longer be deemed to be Outstanding and all rights of the Depositor
Affiliate with respect to such Preferred Securities will cease.
(b) In the case of an exchange described in Section 4.9(a), the
Property Trustee on behalf of the Trust will, on the date of such
exchange, exchange Notes having a principal amount equal to a proportional
amount of the aggregate Liquidation Amount of the Outstanding Common
Securities, based on the ratio of the aggregate Liquidation Amount of
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the Preferred Securities exchanged pursuant to Section 4.9(a) divided by
the aggregate Liquidation Amount of the Preferred Securities Outstanding
immediately prior to such exchange, for such proportional amount of Common
Securities held by the Depositor (which contemporaneously shall be
canceled and no longer be deemed to be Outstanding); provided, that the
Depositor delivers or causes to be delivered to the Property Trustee or
its designee the required amount of Common Securities to be exchanged by
10:00 A.M. New York time, on the Distribution Date on which such exchange
is to occur.
SECTION 4.10. Calculation Agent.
(a) The Property Trustee shall initially, and, subject to the
immediately following sentence, for so long as it holds any of the Notes,
be the Calculation Agent for purposes of determining LIBOR for each
Distribution Date. The Calculation Agent may be removed by the
Administrative Trustees at any time. If the Calculation Agent is unable or
unwilling to act as such or is removed by the Administrative Trustees, the
Administrative Trustees will promptly appoint as a replacement Calculation
Agent the London office of a leading bank which is engaged in transactions
in six-month Eurodollar deposits in the international Eurodollar market
and which does not control or is not controlled by or under common control
with the Administrative Trustee or its Affiliates. The Calculation Agent
may not resign its duties without a successor having been duly appointed.
(b) The Calculation Agent shall be required to agree that, as soon
as possible after 11:00 a.m. (London time) on each LIBOR Determination
Date, but in no event later than 11:00 a.m. (London time) on the Business
Day immediately following each LIBOR Determination Date, the Calculation
Agent will calculate the interest rate (rounded to the nearest cent, with
half a cent being rounded upwards) for the related Distribution Date, and
will communicate such rate and amount to the Depositor, the Administrative
Trustees, the Note Trustee, each Paying Agent and the Depositary. The
Calculation Agent will also specify to the Administrative Trustees the
quotations upon which the foregoing rates and amounts are based and, in
any event, the Calculation Agent shall notify the Administrative Trustees
before 5:00 p.m. (London time) on each LIBOR Determination Date that
either: (i) it has determined or is in the process of determining the
foregoing rates and amounts or (ii) it has not determined and is not in
the process of determining the foregoing rates and amounts, together with
its reasons therefor. The Calculation Agent's determination of the
foregoing rates and amounts for any Distribution Date will (in the absence
of manifest error) be final and binding upon all parties. For the sole
purpose of calculating the interest rate for the Trust Securities,
"Business Day" shall be defined as any day on which dealings in deposits
in Dollars are transacted in the London interbank market.
SECTION 4.11. Certain Accounting Matters.
(a) At all times during the existence of the Trust, the
Administrative Trustees shall keep, or cause to be kept at the principal
office of the Trust in the United States, as defined for purposes of
Treasury Regulations section 301.7701-7, full books of account, records
and supporting documents, which shall reflect in reasonable detail each
transaction of the Trust. The books of account shall be maintained on the
accrual method of accounting, in accordance with generally accepted
accounting principles, consistently applied.
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(b) The Administrative Trustees shall either (i) if the Depositor is
then subject to such reporting requirements, cause each Form 10-K and Form
10-Q prepared by the Depositor and filed with the Commission in accordance
with the Exchange Act to be delivered to each Holder, with a copy to the
Property Trustee, within thirty (30) days after the filing thereof or (ii)
cause to be prepared at the principal office of the Trust in the United
States, as defined for purposes of Treasury Regulations section
301.7701-7, and delivered to each of the Holders, with a copy to the
Property Trustee, within ninety (90) days after the end of each Fiscal
Year, annual financial statements of the Trust, including a balance sheet
of the Trust as of the end of such Fiscal Year, and the related statements
of income or loss.
(c) If the Depositor intends to file its annual and quarterly
information with the Commission in electronic form pursuant to Regulation
S-T of the Commission using the Commission's Electronic Data Gathering,
Analysis and Retrieval ("EDGAR") system, the Administrative Trustees shall
notify the Property Trustee in the manner prescribed herein of each such
annual and quarterly filing. The Property Trustee is hereby authorized and
directed to access the EDGAR system for purposes of retrieving the
financial information so filed. Compliance with the foregoing shall
constitute delivery by the Administrative Trustees of its financial
statements to the Property Trustee in compliance with the provisions of
Section 314(a) of the Trust Indenture Act, if applicable. The Property
Trustee shall have no duty to search for or obtain any electronic or other
filings that the Depositor makes with the Commission, regardless of
whether such filings are periodic, supplemental or otherwise. Delivery of
reports, information and documents to the Property Trustee pursuant to
this Section 4.11(c) shall be solely for purposes of compliance with this
Section 4.11 and, if applicable, with Section 314(a) of the Trust
Indenture Act. The Property Trustee's receipt of such reports, information
and documents shall not constitute notice to it of the content thereof or
any matter determinable from the content thereof, including the
Depositor's compliance with any of its covenants hereunder, as to which
the Property Trustee is entitled to rely upon Officers' Certificates.
(d) The Trust shall maintain one or more bank accounts in the United
States, as defined for purposes of Treasury Regulations section
301.7701-7, in the name and for the sole benefit of the Trust; provided,
however, that all payments of funds in respect of the Notes held by the
Property Trustee shall be made directly to the Payment Account and no
other funds of the Trust shall be deposited in the Payment Account. The
sole signatories for such accounts (including the Payment Account) shall
be designated by the Property Trustee.
ARTICLE V.
SECURITIES
SECTION 5.1. Initial Ownership.
Upon the creation of the Trust and the contribution by the Depositor
referred to in Section 2.3 and until the issuance of the Trust Securities,
and at any time during which no Trust Securities are Outstanding, the
Depositor shall be the sole beneficial owner of the Trust.
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SECTION 5.2. Authorized Trust Securities.
The Trust shall be authorized to issue one series of Preferred
Securities having an aggregate Liquidation Amount of $15,000,000 and one
series of Common Securities having an aggregate Liquidation Amount of
$470,000.
SECTION 5.3. Issuance of the Common Securities; Subscription and
Purchase of Notes.
On the Closing Date, an Administrative Trustee, on behalf of the
Trust, shall execute and deliver to the Depositor Common Securities
Certificates, registered in the name of the Depositor, evidencing an
aggregate of Four Hundred Seventy (470) Common Securities having an
aggregate Liquidation Amount of Four Hundred Seventy Thousand Dollars
($470,000), against receipt by the Trust of the aggregate purchase price
of such Common Securities of Four Hundred Seventy Thousand Dollars
($470,000). Contemporaneously therewith and with the sale by the Trust to
the Holders of an aggregate of Fifteen Thousand (15,000) Preferred
Securities having an aggregate Liquidation Amount of Fifteen Million
Dollars ($15,000,000), an Administrative Trustee, on behalf of the Trust,
shall purchase from the Depositor Notes, to be registered in the name of
the Property Trustee on behalf of the Trust and having an aggregate
principal amount equal to Fifteen Million Four Hundred Seventy Thousand
Dollars ($15,470,000), and, in satisfaction of the purchase price for such
Notes, the Property Trustee, on behalf of the Trust, shall deliver to the
Depositor the sum of Fifteen Million Four Hundred Seventy Thousand Dollars
($15,470,000) (being the aggregate amount paid by the Holders for the
Preferred Securities, and the amount paid by the Depositor for the Common
Securities).
SECTION 5.4. The Securities Certificates.
(a) The Preferred Securities Certificates shall be issued in minimum
denominations of $100,000 Liquidation Amount and integral multiples of
$1,000 in excess thereof, and the Common Securities Certificates shall be
issued in minimum denominations of $10,000 Liquidation Amount and integral
multiples of $1,000 in excess thereof. The Securities Certificates shall
be executed on behalf of the Trust by manual or facsimile signature of at
least one Administrative Trustee. Securities Certificates bearing the
signatures of individuals who were, at the time when such signatures shall
have been affixed, authorized to sign such Securities Certificates on
behalf of the Trust shall be validly issued and entitled to the benefits
of this Trust Agreement, notwithstanding that such individuals or any of
them shall have ceased to be so authorized prior to the delivery of such
Securities Certificates or did not have such authority at the date of
delivery of such Securities Certificates.
(b) On the Closing Date, upon the written order of an authorized
officer of the Depositor, the Administrative Trustees shall cause
Securities Certificates to be executed on behalf of the Trust and
delivered, without further corporate action by the Depositor, in
authorized denominations.
(c) The Preferred Securities issued to QIBs shall be, except as
provided in Section 5.6, Book-Entry Preferred Securities issued in the
form of one or more Global Preferred Securities registered in the name of
the Depositary, or its nominee and deposited with the Depositary or a
custodian for the Depositary for credit by the Depositary to the
respective
25
accounts of the Depositary Participants thereof (or such other accounts as they
may direct). The Preferred Securities issued to a Person other than a QIB shall
be issued in the form of Definitive Preferred Securities Certificates.
(d) A Preferred Security shall not be valid until authenticated by the
manual signature of an authorized signatory of the Property Trustee. Such
signature shall be conclusive evidence that the Preferred Security has been
authenticated under this Trust Agreement. Upon written order of the Trust signed
by one Administrative Trustee, the Property Trustee shall authenticate the
Preferred Securities for original issue. The Property Trustee may appoint an
authenticating agent that is a U.S. Person acceptable to the Trust to
authenticate the Preferred Securities. A Common Security need not be so
authenticated and shall be valid upon execution by one or more Administrative
Trustees. The form of this certificate of authentication can be found in Section
5.13.
SECTION 5.5. Rights of Holders.
The Trust Securities shall have no preemptive or similar rights and when
issued and delivered to Holders against payment of the purchase price therefor
will be fully paid and non-assessable by the Trust. Except as provided in
Section 5.11(b), the Holders of the Trust Securities, in their capacities as
such, 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 5.6. Book-Entry Preferred Securities.
(a) A Global Preferred Security may be exchanged, in whole or in part, for
Definitive Preferred Securities Certificates registered in the names of the
Owners only if such exchange complies with Section 5.7 and (i) the Depositary
advises the Administrative Trustees and the Property Trustee in writing that the
Depositary is no longer willing or able properly to discharge its
responsibilities with respect to the Global Preferred Security, and no qualified
successor is appointed by the Administrative Trustees within ninety (90) days of
receipt of such notice, (ii) the Depositary ceases to be a clearing agency
registered under the Exchange Act and the Administrative Trustees fail to
appoint a qualified successor within ninety (90) days of obtaining knowledge of
such event, (iii) the Administrative Trustees at their option advise the
Property Trustee in writing that the Trust elects to terminate the book-entry
system through the Depositary or (iv) a Note Event of Default has occurred and
is continuing. Upon the occurrence of any event specified in clause (i), (ii),
(iii) or (iv) above, the Administrative Trustees shall notify the Depositary and
instruct the Depositary to notify all Owners of Book-Entry Preferred Securities,
the Delaware Trustee and the Property Trustee of the occurrence of such event
and of the availability of the Definitive Preferred Securities Certificates to
Owners of the Preferred Securities requesting the same. Upon the issuance of
Definitive Preferred Securities Certificates, the Trustees shall recognize the
Holders of the Definitive Preferred Securities Certificates as Holders.
Notwithstanding the foregoing, if an Owner of a beneficial interest in a Global
Preferred Security wishes at any time to transfer an interest in such Global
Preferred Security to a Person other than a QIB, such transfer shall be
effected, subject to the Applicable Depositary Procedures, in accordance with
the provisions of this Section 5.6 and Section 5.7, and the transferee shall
receive a Definitive Preferred Securities Certificate in connection with such
26
transfer. A holder of a Definitive Preferred Securities Certificate that is a
QIB may, upon request and in accordance with the provisions of this Section 5.6
and Section 5.7, exchange such Definitive Preferred Securities Certificate for a
beneficial interest in a Global Preferred Security.
(b) If any Global Preferred Security is to be exchanged for Definitive
Preferred Securities Certificates or canceled in part, or if any Definitive
Preferred Securities Certificate is to be exchanged in whole or in part for any
Global Preferred Security, then either (i) such Global Preferred Security shall
be so surrendered for exchange or cancellation as provided in this Article V or
(ii) the aggregate Liquidation Amount represented by such Global Preferred
Security shall be reduced, subject to Section 5.4, or increased by an amount
equal to the Liquidation Amount represented by that portion of the Global
Preferred Security to be so exchanged or canceled, or equal to the Liquidation
Amount represented by such Definitive Preferred Securities Certificates to be so
exchanged for any Global Preferred Security, as the case may be, by means of an
appropriate adjustment made on the records of the Securities Registrar,
whereupon the Property Trustee, in accordance with the Applicable Depositary
Procedures, shall instruct the Depositary or its authorized representative to
make a corresponding adjustment to its records. Upon any such surrender to the
Administrative Trustees or the Securities Registrar of any Global Preferred
Security or Securities by the Depositary, accompanied by registration
instructions, the Administrative Trustees, or any one of them, shall execute the
Definitive Preferred Securities Certificates in accordance with the instructions
of the Depositary. None of the Securities Registrar or the Trustees shall be
liable for any delay in delivery of such instructions and may conclusively rely
on, and shall be fully protected in relying on, such instructions.
(c) Every Definitive Preferred Securities Certificate executed and
delivered upon registration or transfer of, or in exchange for or in lieu of, a
Global Preferred Security or any portion thereof shall be executed and delivered
in the form of, and shall be, a Global Preferred Security, unless such
Definitive Preferred Securities Certificate is registered in the name of a
Person other than the Depositary for such Global Preferred Security or a nominee
thereof.
(d) The Depositary or its nominee, as registered owner of a Global
Preferred Security, shall be the Holder of such Global Preferred Security for
all purposes under this Trust Agreement and the Global Preferred Security, and
Owners with respect to a Global Preferred Security shall hold such interests
pursuant to the Applicable Depositary Procedures. The Securities Registrar and
the Trustees shall be entitled to deal with the Depositary for all purposes of
this Trust Agreement relating to the Global Preferred Securities (including the
payment of the Liquidation Amount of and Distributions on the Book-Entry
Preferred Securities represented thereby and the giving of instructions or
directions by Owners of Book-Entry Preferred Securities represented thereby and
the giving of notices) as the sole Holder of the Book-Entry Preferred Securities
represented thereby and shall have no obligations to the Owners thereof. None of
the Trustees nor the Securities Registrar shall have any liability in respect of
any transfers effected by the Depositary.
(e) The rights of the Owners of the Book-Entry Preferred Securities shall
be exercised only through the Depositary and shall be limited to those
established by law, the Applicable Depositary Procedures and agreements between
such Owners and the Depositary and/or the Depositary Participants; provided,
solely for the purpose of determining whether the Holders of the requisite
amount of Preferred Securities have voted on any matter provided for in
27
this Trust Agreement, to the extent that Preferred Securities are represented by
a Global Preferred Security, the Trustees may conclusively rely on, and shall be
fully protected in relying on, any written instrument (including a proxy)
delivered to the Property Trustee by the Depositary setting forth the Owners'
votes or assigning the right to vote on any matter to any other Persons either
in whole or in part. To the extent that Preferred Securities are represented by
a Global Preferred Security, the initial Depositary will make book-entry
transfers among the Depositary Participants and receive and transmit payments on
the Preferred Securities that are represented by a Global Preferred Security to
such Depositary Participants, and none of the Depositor or the Trustees shall
have any responsibility or obligation with respect thereto.
(f) To the extent that a notice or other communication to the Holders is
required under this Trust Agreement, for so long as Preferred Securities are
represented by a Global Preferred Security, the Trustees shall give all such
notices and communications to the Depositary, and shall have no obligations to
the Owners.
SECTION 5.7. Registration of Transfer and Exchange of Preferred Securities
Certificates.
(a) The Property Trustee shall keep or cause to be kept, at the Corporate
Trust Office, a register or registers (the "Securities Register") in which the
registrar and transfer agent with respect to the Trust Securities (the
"Securities Registrar"), subject to such reasonable regulations as it may
prescribe, shall provide for the registration of Preferred Securities
Certificates and Common Securities Certificates and registration of transfers
and exchanges of Preferred Securities Certificates as herein provided. The
Person acting as the Property Trustee shall at all times also be the Securities
Registrar. The provisions of Article VIII shall apply to the Property Trustee in
its role as Securities Registrar.
(b) Subject to Section 5.7(d), upon surrender for registration of transfer
of any Preferred Securities Certificate at the office or agency maintained
pursuant to Section 5.7(f), the Administrative Trustees or any one of them shall
execute by manual or facsimile signature and deliver to the Property Trustee,
and the Property Trustee shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Preferred Securities
Certificates in authorized denominations of a like aggregate Liquidation Amount
as may be required by this Trust Agreement dated the date of execution by such
Administrative Trustee or Trustees. At the option of a Holder, Preferred
Securities Certificates may be exchanged for other Preferred Securities
Certificates in authorized denominations and of a like aggregate Liquidation
Amount upon surrender of the Preferred Securities Certificate to be exchanged at
the office or agency maintained pursuant to Section 5.7(f). Whenever any
Preferred Securities Certificates are so surrendered for exchange, the
Administrative Trustees or any one of them shall execute by manual or facsimile
signature and deliver to the Property Trustee, and the Property Trustee shall
authenticate and deliver, the Preferred Securities Certificates that the Holder
making the exchange is entitled to receive.
(c) The Securities Registrar shall not be required, (i) to issue, register
the transfer of or exchange any Preferred Security during a period beginning at
the opening of business fifteen (15) days before the day of selection for
redemption of such Preferred Securities pursuant to Article IV and ending at the
close of business on the day of mailing of the notice of redemption
28
or (ii) to register the transfer of or exchange any Preferred Security so
selected for redemption in whole or in part, except, in the case of any such
Preferred Security to be redeemed in part, any portion thereof not to be
redeemed.
(d) Every Preferred Securities Certificate presented or surrendered for
registration of transfer or exchange shall be duly endorsed, or be accompanied
by a written instrument of transfer in form satisfactory to the Securities
Registrar duly executed by the Holder or such Holder's attorney duly authorized
in writing and (i) if such Preferred Securities Certificate is being transferred
to a QIB, accompanied by a certificate of the transferor substantially in the
form set forth as Exhibit E hereto or (ii) if such Preferred Securities
Certificate is being transferred otherwise than to a QIB, accompanied by a
certificate of the transferee substantially in the form set forth as Exhibit F
hereto.
(e) No service charge shall be made for any registration of transfer or
exchange of Preferred Securities Certificates, but the Property Trustee on
behalf of the Trust may require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any transfer or
exchange of Preferred Securities Certificates.
(f) The Administrative Trustees shall designate an office or offices or
agency or agencies where Preferred Securities Certificates may be surrendered
for registration of transfer or exchange and initially designate the Corporate
Trust Office as its office and agency for such purposes. The Administrative
Trustees shall give prompt written notice to the Depositor, the Property Trustee
and to the Holders of any change in the location of any such office or agency.
SECTION 5.8. Mutilated, Destroyed, Lost or Stolen Securities Certificates.
(a) If any mutilated Securities Certificate shall be surrendered to the
Securities Registrar together with such security or indemnity as may be required
by the Securities Registrar to save each of the Trustees harmless, the
Administrative Trustees, or any one of them, on behalf of the Trust, shall
execute and make available for delivery in exchange therefor a new Securities
Certificate of like class, tenor and denomination.
(b) If the Securities Registrar shall receive evidence to its satisfaction
of the destruction, loss or theft of any Securities Certificate and there shall
be delivered to the Securities Registrar such security or indemnity as may be
required by it to save each of the Trustees harmless, then in the absence of
notice that such Securities Certificate shall have been acquired by a protected
purchaser, the Administrative Trustees, or any one of them, on behalf of the
Trust, shall execute and make available for delivery, and, with respect to
Preferred Securities, the Property Trustee shall authenticate, in exchange for
or in lieu of any such destroyed, lost or stolen Securities Certificate, a new
Securities Certificate of like class, tenor and denomination.
(c) In connection with the issuance of any new Securities Certificate
under this Section 5.8, the Administrative Trustees or the Securities Registrar
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection therewith.
(d) Any duplicate Securities Certificate issued pursuant to this Section
5.8 shall constitute conclusive evidence of an undivided beneficial interest in
the assets of the Trust
29
corresponding to that evidenced by the mutilated, lost, stolen or destroyed
Securities Certificate, as if originally issued, whether or not the lost, stolen
or destroyed Securities Certificate shall be found at any time.
(e) If any such mutilated, destroyed, lost or stolen Securities
Certificate has become or is about to become due and payable, the Depositor in
its discretion may provide the Administrative Trustee with the funds to pay such
Trust Security and upon receipt of such funds, the Administrative Trustee shall
pay such Trust Security instead of issuing a new Securities Certificate.
(f) The provisions of this Section 5.8 are exclusive and shall preclude
(to the extent lawful) all other rights and remedies with respect to the
replacement of mutilated, destroyed, lost or stolen Securities Certificates.
SECTION 5.9. Persons Deemed Holders.
The Trustees and the Securities Registrar shall each treat the Person in
whose name any Securities Certificate shall be registered in the Securities
Register as the owner of such Securities Certificate for the purpose of
receiving Distributions and for all other purposes whatsoever, and none of the
Trustees and the Securities Registrar shall be bound by any notice to the
contrary.
SECTION 5.10. Cancellation.
All Preferred Securities Certificates surrendered for registration of
transfer or exchange or for payment shall, if surrendered to any Person other
than the Property Trustee, be delivered to the Property Trustee, and any such
Preferred Securities Certificates and Preferred Securities Certificates
surrendered directly to the Property Trustee for any such purpose shall be
promptly canceled by it. The Administrative Trustees may at any time deliver to
the Property Trustee for cancellation any Preferred Securities Certificates
previously delivered hereunder that the Administrative Trustees may have
acquired in any manner whatsoever, and all Preferred Securities Certificates so
delivered shall be promptly canceled by the Property Trustee. No Preferred
Securities Certificates shall be executed and delivered in lieu of or in
exchange for any Preferred Securities Certificates canceled as provided in this
Section 5.10, except as expressly permitted by this Trust Agreement. All
canceled Preferred Securities Certificates shall be retained by the Property
Trustee in accordance with its customary practices.
SECTION 5.11. Ownership of Common Securities by Depositor.
(a) On the Closing Date, the Depositor shall acquire, and thereafter shall
retain, beneficial and record ownership of the Common Securities. Neither the
Depositor nor any successor Holder of the Common Securities may transfer less
than all the Common Securities, and the Depositor or any such successor Holder
may transfer the Common Securities only (i) in connection with a consolidation
or merger of the Depositor into another Person, or any conveyance, transfer or
lease by the Depositor of its properties and assets substantially as an entirety
to any Person (in which event such Common Securities will be transferred to such
surviving entity, transferee or lessee, as the case may be), pursuant to Section
8.1 of the Indenture or (ii) to the Depositor or an Affiliate of the Depositor,
in each such case in compliance with applicable law (including the Securities
Act, and applicable state securities and
30
blue sky laws). To the fullest extent permitted by law, any attempted transfer
of the Common Securities other than as set forth in the immediately preceding
sentence shall be void. The Administrative Trustees shall cause each Common
Securities Certificate issued to the Depositor to contain a legend stating
substantially "THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT IN COMPLIANCE WITH
APPLICABLE LAW AND SECTION 5.11 OF THE TRUST AGREEMENT."
(b) Any Holder of the Common Securities shall be liable for the debts and
obligations of the Trust in the manner and to the extent set forth with respect
to the Depositor and agrees that it shall be subject to all liabilities to which
the Depositor may be subject and, prior to becoming such a Holder, shall deliver
to the Administrative Trustees an instrument of assumption satisfactory to such
Trustees.
SECTION 5.12. Restricted Legends.
(a) Each Preferred Security Certificate shall bear a legend in
substantially the following form:
"THIS PREFERRED SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
TRUST AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF
THE DEPOSITORY TRUST COMPANY ("DTC") OR A NOMINEE OF DTC. THIS PREFERRED
SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON
OTHER THAN DTC OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED
IN THE TRUST AGREEMENT, AND NO TRANSFER OF THIS PREFERRED SECURITY (OTHER
THAN A TRANSFER OF THIS PREFERRED SECURITY AS A WHOLE BY DTC TO A NOMINEE
OF DTC OR BY A NOMINEE OF DTC TO DTC OR ANOTHER NOMINEE OF DTC) MAY BE
REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS PREFERRED SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC TO UICI CAPITAL TRUST I OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY PREFERRED SECURITY
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON
IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE PREFERRED SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY
ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND SUCH PREFERRED SECURITIES
OR ANY INTEREST THEREIN, MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED
IN THE
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ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF ANY PREFERRED SECURITIES IS HEREBY NOTIFIED THAT THE SELLER
OF THE PREFERRED SECURITIES MAY BE RELYING ON THE EXEMPTION FROM THE
PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A UNDER
THE SECURITIES ACT.
THE HOLDER OF THE PREFERRED SECURITIES REPRESENTED BY THIS CERTIFICATE
AGREES FOR THE BENEFIT OF THE TRUST AND THE DEPOSITOR THAT (A) SUCH
PREFERRED SECURITIES MAY BE OFFERED, RESOLD OR OTHERWISE TRANSFERRED ONLY
(I) TO THE TRUST, (II) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS
A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A,
(III) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF
SUBPARAGRAPH (a) (1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT
THAT IS ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF
AN "ACCREDITED INVESTOR," FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO,
OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF
THE SECURITIES ACT, (IV) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OR (V) PURSUANT TO AN EXEMPTION FROM THE
SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES
LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE
JURISDICTION AND, IN THE CASE OF (III) OR (V), SUBJECT TO THE RIGHT OF THE
TRUST AND THE DEPOSITOR TO REQUIRE AN OPINION OF COUNSEL AND OTHER
INFORMATION SATISFACTORY TO EACH OF THEM AND (B) THE HOLDER WILL NOTIFY
ANY PURCHASER OF ANY PREFERRED SECURITIES FROM IT OF THE RESALE
RESTRICTIONS REFERRED TO IN (A) ABOVE.
THE PREFERRED SECURITIES WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN
BLOCKS HAVING AN AGGREGATE LIQUIDATION AMOUNT OF NOT LESS THAN $100,000.
TO THE FULLEST EXTENT PERMITTED BY LAW, ANY ATTEMPTED TRANSFER OF
PREFERRED SECURITIES, OR ANY INTEREST THEREIN, IN A BLOCK HAVING AN
AGGREGATE LIQUIDATION AMOUNT OF LESS THAN $100,000 AND MULTIPLES OF $1,000
IN EXCESS THEREOF SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT
WHATSOEVER. TO THE FULLEST EXTENT PERMITTED BY LAW, ANY SUCH PURPORTED
TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER OF SUCH PREFERRED
SECURITIES FOR ANY PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF
PRINCIPAL OF OR INTEREST ON SUCH PREFERRED SECURITIES, OR ANY INTEREST
THEREIN, AND SUCH PURPORTED TRANSFEREE SHALL BE DEEMED TO HAVE NO INTEREST
WHATSOEVER IN SUCH PREFERRED SECURITIES.
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THE HOLDER OF THIS SECURITY, OR ANY INTEREST THEREIN, BY ITS ACCEPTANCE
HEREOF OR THEREOF ALSO AGREES, REPRESENTS AND WARRANTS THAT IT IS NOT AN
EMPLOYEE BENEFIT, INDIVIDUAL RETIREMENT ACCOUNT OR OTHER PLAN OR
ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED (THE "CODE") (EACH A "PLAN"), OR AN ENTITY WHOSE
UNDERLYING ASSETS INCLUDE "PLAN ASSETS" BY REASON OF ANY PLAN'S INVESTMENT
IN THE ENTITY, AND NO PERSON INVESTING "PLAN ASSETS" OF ANY PLAN MAY
ACQUIRE OR HOLD THIS PREFERRED SECURITY OR ANY INTEREST THEREIN. ANY
PURCHASER OR HOLDER OF THE PREFERRED SECURITIES OR ANY INTEREST THEREIN
WILL BE DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND HOLDING THEREOF
THAT IT IS NOT AN EMPLOYEE BENEFIT PLAN WITHIN THE MEANING OF SECTION 3(3)
OF ERISA, OR A PLAN TO WHICH SECTION 4975 OF THE CODE IS APPLICABLE, A
TRUSTEE OR OTHER PERSON ACTING ON BEHALF OF AN EMPLOYEE BENEFIT PLAN OR
PLAN, OR ANY OTHER PERSON OR ENTITY USING THE ASSETS OF ANY EMPLOYEE
BENEFIT PLAN OR PLAN TO FINANCE SUCH PURCHASE."
(b) The above legend shall not be removed from any of the Preferred
Securities Certificates unless there is delivered to the Property Trustee and
the Depositor satisfactory evidence, which may include an opinion of counsel, as
may be reasonably required to ensure that any future transfers thereof may be
made without restriction under the provisions of the Securities Act and other
applicable law. Upon provision of such satisfactory evidence, one or more of the
Administrative Trustees on behalf of the Trust shall execute and deliver to the
Property Trustee, and the Property Trustee shall deliver, at the written
direction of the Administrative Trustees and the Depositor, Preferred Securities
Certificates that do not bear the legend.
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SECTION 5.13. Form of Certificate of Authentication.
The Property Trustee's certificate of authentication shall be in
substantially the following form:
This is one of the Preferred Securities referred to in the
within-mentioned Trust Agreement.
Dated: JPMorgan Chase Bank, not in its individual
capacity, but solely as Property Trustee
By: ________________________________
Authenticating Agent
By: ________________________________
Authorized signatory
ARTICLE VI.
MEETINGS; VOTING; ACTS OF HOLDERS
SECTION 6.1. Notice of Meetings.
Notice of all meetings of the Holders of the Preferred Securities, stating
the time, place and purpose of the meeting, shall be given by the Property
Trustee pursuant to Section 10.8 to each Holder of Preferred Securities, at such
Holder's registered address, at least fifteen (15) days and not more than ninety
(90) days before the meeting. At any such meeting, any business properly before
the meeting may be so considered whether or not stated in the notice of the
meeting. Any adjourned meeting may be held as adjourned without further notice.
SECTION 6.2. Meetings of Holders of the Preferred Securities.
(a) No annual meeting of Holders is required to be held. The Property
Trustee, however, shall call a meeting of the Holders of the Preferred
Securities to vote on any matter upon the written request of the Holders of at
least twenty five percent (25%) in aggregate Liquidation Amount of the
Outstanding Preferred Securities and the Administrative Trustees or the Property
Trustee may, at any time in their discretion, call a meeting of the Holders of
the Preferred Securities to vote on any matters as to which such Holders are
entitled to vote.
(b) The Holders of at least a Majority in Liquidation Amount of the
Preferred Securities, present in person or by proxy, shall constitute a quorum
at any meeting of the Holders of the Preferred Securities.
(c) If a quorum is present at a meeting, an affirmative vote by the
Holders present, in person or by proxy, holding Preferred Securities
representing at least a Majority in Liquidation
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Amount of the Preferred Securities held by the Holders present, either in person
or by proxy, at such meeting shall constitute the action of the Holders of the
Preferred Securities, unless this Trust Agreement requires a lesser or greater
number of affirmative votes.
SECTION 6.3. Voting Rights.
Holders shall be entitled to one vote for each $10,000 of Liquidation
Amount represented by their Outstanding Trust Securities in respect of any
matter as to which such Holders are entitled to vote.
SECTION 6.4. Proxies, Etc.
At any meeting of Holders, any Holder entitled to vote thereat may vote by
proxy, provided, that no proxy shall be voted at any meeting unless it shall
have been placed on file with the Administrative Trustees, or with such other
officer or agent of the Trust as the Administrative Trustees may direct, for
verification prior to the time at which such vote shall be taken. Pursuant to a
resolution of the Property Trustee, proxies may be solicited in the name of the
Property Trustee or one or more officers of the Property Trustee. Only Holders
of record shall be entitled to vote. When Trust Securities are held jointly by
several Persons, any one of them may vote at any meeting in person or by proxy
in respect of such Trust Securities, but if more than one of them shall be
present at such meeting in person or by proxy, and such joint owners or their
proxies so present disagree as to any vote to be cast, such vote shall not be
received in respect of such Trust Securities. A proxy purporting to be executed
by or on behalf of a Holder shall be deemed valid unless challenged at or prior
to its exercise, and the burden of proving invalidity shall rest on the
challenger. No proxy shall be valid more than three years after its date of
execution.
SECTION 6.5. Holder Action by Written Consent.
Any action that may be taken by Holders at a meeting may be taken without
a meeting and without prior notice if Holders holding at least a Majority in
Liquidation Amount of all Preferred Securities entitled to vote in respect of
such action (or such lesser or greater proportion thereof as shall be required
by any other provision of this Trust Agreement) shall consent to the action in
writing; provided, that notice of such action is promptly provided to the
Holders of Preferred Securities that did not consent to such action. Any action
that may be taken by the Holders of all the Common Securities may be taken
without a meeting and without prior notice if such Holders shall consent to the
action in writing.
SECTION 6.6. Record Date for Voting and Other Purposes.
Except as provided in Section 6.10(a), for the purposes of determining the
Holders who are entitled to notice of and to vote at any meeting or to act by
written consent, or to participate in any distribution on the Trust Securities
in respect of which a record date is not otherwise provided for in this Trust
Agreement, or for the purpose of any other action, the Administrative Trustees
may from time to time fix a date, not more than ninety (90) days prior to the
date of any meeting of Holders or the payment of a Distribution or other action,
as the case may be, as a record date for the determination of the identity of
the Holders of record for such purposes.
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SECTION 6.7. Acts of Holders.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided or permitted by this Trust Agreement to be given, made
or taken by Holders may be embodied in and evidenced by one or more instruments
of substantially similar tenor signed by such Holders in person or by an agent
thereof duly appointed in writing; and, except as otherwise expressly provided
herein, such action shall become effective when such instrument or instruments
are delivered to an Administrative Trustee. Such instrument or instruments (and
the action embodied therein and evidenced thereby) are herein sometimes referred
to as the "Act" of the Holders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent shall
be sufficient for any purpose of this Trust Agreement and conclusive in favor of
the Trustees, if made in the manner provided in this Section 6.7.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than such signer's
individual capacity, such certificate or affidavit shall also constitute
sufficient proof of such signer's authority. The fact and date of the execution
of any such instrument or writing, or the authority of the Person executing the
same, may also be proved in any other manner that any Trustee receiving the same
deems sufficient.
(c) The ownership of Trust Securities shall be proved by the Securities
Register.
(d) Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the Holder of any Trust Security shall bind every future Holder
of the same Trust Security and the Holder of every Trust Security issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done, omitted or suffered to be done by the Trustees, the
Administrative Trustees or the Trust in reliance thereon, whether or not
notation of such action is made upon such Trust Security.
(e) Without limiting the foregoing, a Holder entitled hereunder to take
any action hereunder with regard to any particular Trust Security may do so with
regard to all or any part of the Liquidation Amount of such Trust Security or by
one or more duly appointed agents each of which may do so pursuant to such
appointment with regard to all or any part of such Liquidation Amount.
(f) If any dispute shall arise among the Holders or the Trustees with
respect to the authenticity, validity or binding nature of any request, demand,
authorization, direction, notice, consent, waiver or other Act of such Holder or
Trustee under this Article VI, then the determination of such matter by the
Property Trustee shall be conclusive with respect to such matter.
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SECTION 6.8. Inspection of Records.
Upon reasonable written notice to the Administrative Trustees and the
Property Trustee, the records of the Trust shall be open to inspection by any
Holder during normal business hours for any purpose reasonably related to such
Holder's interest as a Holder.
SECTION 6.9. Limitations on Voting Rights.
(a) Except as expressly provided in this Trust Agreement and in the
Indenture and as otherwise required by law, no Holder of Preferred Securities
shall have any right to vote or in any manner otherwise control the
administration, operation and management of the Trust or the obligations of the
parties hereto, nor shall anything herein set forth, or contained in the terms
of the Securities Certificates, be construed so as to constitute the Holders
from time to time as partners or members of an association.
(b) So long as any Notes are held by the Property Trustee on behalf of the
Trust, the Property Trustee shall not (i) direct the time, method and place of
conducting any proceeding for any remedy available to the Note Trustee, or
exercise any trust or power conferred on the Property Trustee with respect to
the Notes, (ii) waive any past default that may be waived under Section 5.13 of
the Indenture or waive compliance with any covenant or condition under Section
10.7 of the Indenture, (iii) exercise any right to rescind or annul a
declaration that the principal of all the Notes shall be due and payable or (iv)
consent to any amendment, modification or termination of the Indenture or the
Notes, where such consent shall be required, without, in each case, obtaining
the prior approval of the Holders of at least a Majority in Liquidation Amount
of the Preferred Securities; provided, that where a consent under the Indenture
would require the consent of each holder of Notes (or each Holder of Preferred
Securities) affected thereby, no such consent shall be given by the Property
Trustee without the prior written consent of each Holder of Preferred
Securities. The Property Trustee shall not revoke any action previously
authorized or approved by a vote of the Holders of the Preferred Securities,
except by a subsequent vote of the Holders of the Preferred Securities. In
addition to obtaining the foregoing approvals of the Holders of the Preferred
Securities, prior to taking any of the foregoing actions, the Property Trustee
shall, at the expense of the Depositor, obtain an Opinion of Counsel experienced
in such matters to the effect that such action shall not cause the Trust to be
taxable as a corporation or classified as other than a grantor trust for United
States federal income tax purposes.
(c) If any proposed amendment to the Trust Agreement provides for, or the
Trustees otherwise propose to effect, (i) any action that would adversely affect
in any material respect the powers, preferences or special rights of the
Preferred Securities, whether by way of amendment to the Trust Agreement or
otherwise or (ii) the dissolution, winding-up or termination of the Trust, other
than pursuant to the terms of this Trust Agreement, then the Holders of
Outstanding Preferred Securities as a class will be entitled to vote on such
amendment or proposal and such amendment or proposal shall not be effective
except with the approval of the Holders of at least a Majority in Liquidation
Amount of the Preferred Securities. Notwithstanding any other provision of this
Trust Agreement, no amendment to this Trust Agreement may be made if, as a
result of such amendment, it would cause the Trust to be taxable as a
corporation or classified as other than a grantor trust for United States
federal income tax purposes.
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SECTION 6.10. Acceleration of Maturity; Rescission of Annulment; Waivers
of Past Defaults.
(a) For so long as any Preferred Securities remain Outstanding, if, upon a
Note Event of Default, the Note Trustee fails or the holders of not less than
twenty five percent (25%) in principal amount of the outstanding Notes fail to
declare the principal of all of the Notes to be immediately due and payable, the
Holders of at least twenty five percent (25%) in Liquidation Amount of the
Preferred Securities then Outstanding shall have the right to make such
declaration by a notice in writing to the Property Trustee, the Depositor and
the Note Trustee. At any time after a declaration of acceleration with respect
to the Notes has been made and before a judgment or decree for payment of the
money due has been obtained by the Note Trustee as provided in the Indenture,
the Holders of at least a Majority in Liquidation Amount of the Preferred
Securities, by written notice to the Property Trustee, the Depositor and the
Note Trustee, may rescind and annul such declaration and its consequences if:
(i) the Depositor has paid or deposited with the Note Trustee a sum
sufficient to pay:
(A) all overdue installments of interest on all of the Notes;
(B) any accrued Additional Interest on all of the Notes;
(C) the principal of and any premium, if any, on any Notes
that have become due otherwise than by such declaration of
acceleration and interest and Additional Interest thereon at the
rate borne by the Notes; and
(D) all sums paid or advanced by the Note Trustee under the
Indenture and the reasonable compensation, expenses, disbursements
and advances of the Note Trustee, the Property Trustee and their
agents and counsel; and
(ii) all Note Events of Default, other than the non-payment of the
principal of the Notes that has become due solely by such acceleration,
have been cured or waived as provided in Section 5.13 of the Indenture.
Upon receipt by the Property Trustee of written notice requesting such an
acceleration, or rescission and annulment thereof, by Holders of any part of the
Preferred Securities, a record date shall be established for determining Holders
of Outstanding Preferred Securities entitled to join in such notice, which
record date shall be at the close of business on the day the Property Trustee
receives such notice. The Holders on such record date, or their duly designated
proxies, and only such Persons, shall be entitled to join in such notice,
whether or not such Holders remain Holders after such record date; provided,
that, unless such declaration of acceleration, or rescission and annulment, as
the case may be, shall have become effective by virtue of the requisite
percentage having joined in such notice prior to the day that is ninety (90)
days after such record date, such notice of declaration of acceleration, or
rescission and annulment, as the case may be, shall automatically and without
further action by any Holder be canceled and of no further effect. Nothing in
this paragraph shall prevent a Holder, or a proxy of a Holder, from giving,
after expiration of such ninety (90)-day period, a new written notice of
declaration of acceleration, or rescission and annulment thereof, as the case
may be, that is identical to a written
38
notice that has been canceled pursuant to the proviso to the preceding sentence,
in which event a new record date shall be established pursuant to the provisions
of this Section 6.10(a).
(b) For so long as any Preferred Securities remain Outstanding, to the
fullest extent permitted by law and subject to the terms of this Trust Agreement
and the Indenture, upon a Note Event of Default specified in paragraph (a) or
(b) of Section 5.1 of the Indenture, any Holder of Preferred Securities shall
have the right to institute a proceeding directly against the Depositor,
pursuant to Section 5.8 of the Indenture, for enforcement of payment to such
Holder of any amounts payable in respect of Notes having an aggregate principal
amount equal to the aggregate Liquidation Amount of the Preferred Securities of
such Holder. Except as set forth in Section 6.10(a) and this Section 6.10(b),
the Holders of Preferred Securities shall have no right to exercise directly any
right or remedy available to the holders of, or in respect of, the Notes.
(c) Notwithstanding paragraphs (a) and (b) of this Section 6.10, the
Holders of at least a Majority in Liquidation Amount of the Preferred Securities
may, on behalf of the Holders of all the Preferred Securities, waive any Note
Event of Default, except any Note Event of Default arising from the failure to
pay any principal of or any premium, if any, or interest on (including any
Additional Interest) the Notes (unless such Note Event of Default has been cured
and a sum sufficient to pay all matured installments of interest and all
principal and premium, if any, on all Notes due otherwise than by acceleration
has been deposited with the Note Trustee) or a Note Event of Default in respect
of a covenant or provision that under the Indenture cannot be modified or
amended without the consent of the holder of each outstanding Note. Upon any
such waiver, such Note Event of Default shall cease to exist and any Note Event
of Default arising therefrom shall be deemed to have been cured for every
purpose of the Indenture; but no such waiver shall affect any subsequent Note
Event of Default or impair any right consequent thereon.
(d) Notwithstanding paragraphs (a) and (b) of this Section 6.10, the
Holders of at least a Majority in Liquidation Amount of the Preferred Securities
may, on behalf of the Holders of all the Preferred Securities, waive any past
Event of Default and its consequences. Upon such waiver, any such Event of
Default shall cease to exist, and any Event of Default arising therefrom shall
be deemed to have been cured, for every purpose of this Trust Agreement, but no
such waiver shall extend to any subsequent or other Event of Default or impair
any right consequent thereon.
(e) The Holders of a Majority in Liquidation Amount of the Preferred
Securities shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Property Trustee in
respect of this Trust Agreement or the Notes or exercising any trust or power
conferred upon the Property Trustee under this Trust Agreement; provided, that,
subject to Sections 8.5 and 8.7, the Property Trustee shall have the right to
decline to follow any such direction if the Property Trustee being advised by
counsel determines that the action so directed may not lawfully be taken, or if
the Property Trustee in good faith shall, by an officer or officers of the
Property Trustee, determine that the proceedings so directed would be illegal or
involve it in personal liability or be unduly prejudicial to the rights of
Holders not party to such direction, and provided, further, that nothing in this
Trust Agreement shall impair the right of the Property Trustee to take any
action deemed proper by the Property Trustee and which is not inconsistent with
such direction.
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ARTICLE VII.
REPRESENTATIONS AND WARRANTIES
SECTION 7.1. Representations and Warranties of the Property Trustee and
the Delaware Trustee.
The Property Trustee and the Delaware Trustee, each severally on behalf of
and as to itself, hereby represents and warrants for the benefit of the
Depositor and the Holders that:
(a) the Property Trustee is a New York banking corporation, duly
organized and validly existing under the laws of the State of New York;
(b) the Property Trustee has full corporate power, authority and
legal right to execute, deliver and perform its obligations under this
Trust Agreement and has taken all necessary action to authorize the
execution, delivery and performance by it of this Trust Agreement;
(c) the Delaware Trustee is a national banking association, duly
formed and validly existing under the laws of the United States;
(d) the Delaware Trustee has full corporate power, authority and
legal right to execute, deliver and perform its obligations under this
Trust Agreement and has taken all necessary action to authorize the
execution, delivery and performance by it of this Trust Agreement;
(e) this Trust Agreement has been duly authorized, executed and
delivered by the Property Trustee and the Delaware Trustee and constitutes
the legal, valid and binding agreement of each of the Property Trustee and
the Delaware Trustee enforceable against each of them in accordance with
its terms, subject to applicable bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws affecting creditors'
rights generally and to general principles of equity;
(f) the execution, delivery and performance of this Trust Agreement
have been duly authorized by all necessary corporate or other action on
the part of the Property Trustee and the Delaware Trustee and do not
require any approval of stockholders of the Property Trustee and the
Delaware Trustee and such execution, delivery and performance will not (i)
violate the Restated Organization Certificate or Articles of Association,
as applicable, or By-laws of the Property Trustee or the Delaware Trustee,
(ii) violate any provision of, or constitute, with or without notice or
lapse of time, a default under, or result in the imposition of any lien on
any properties included in the Trust Property pursuant to the provisions
of any indenture, mortgage, credit agreement, license or other agreement
or instrument to which the Property Trustee or the Delaware Trustee is a
party or by which it is bound, or (iii) violate any applicable law,
governmental rule or regulation of the United States or the State of
Delaware, as the case may be, governing the banking, trust or general
powers of the Property Trustee or the Delaware Trustee or any order,
judgment or decree applicable to the Property Trustee or the Delaware
Trustee;
40
(g) neither the authorization, execution or delivery by the Property
Trustee or the Delaware Trustee of this Trust Agreement nor the
consummation of any of the transactions by the Property Trustee or the
Delaware Trustee contemplated herein requires the consent or approval of,
the giving of notice to, the registration with or the taking of any other
action with respect to any governmental authority or agency under any
existing law of the United States or the State of Delaware governing the
banking, trust or general powers of the Property Trustee or the Delaware
Trustee, as the case may be; and
(h) to the best of each of the Property Trustee's and the Delaware
Trustee's knowledge, there are no proceedings pending or threatened
against or affecting the Property Trustee or the Delaware Trustee in any
court or before any governmental authority, agency or arbitration board or
tribunal that, individually or in the aggregate, would materially and
adversely affect the Trust or would question the right, power and
authority of the Property Trustee or the Delaware Trustee, as the case may
be, to enter into or perform its obligations as one of the Trustees under
this Trust Agreement.
SECTION 7.2. Representations and Warranties of Depositor.
The Depositor hereby represents and warrants for the benefit of the
Holders that:
(a) the Depositor is a corporation duly organized, validly existing
and in good standing under the laws of its state of incorporation;
(b) the Depositor has full corporate power, authority and legal
right to execute, deliver and perform its obligations under this Trust
Agreement and has taken all necessary action to authorize the execution,
delivery and performance by it of this Trust Agreement;
(c) this Trust Agreement has been duly authorized, executed and
delivered by the Depositor and constitutes the legal, valid and binding
agreement of the Depositor enforceable against the Depositor in accordance
with its terms, subject to applicable bankruptcy, insolvency and similar
laws affecting creditors' rights generally and to general principles of
equity;
(d) the Securities Certificates issued at the Closing Date on behalf
of the Trust have been duly authorized and will have been duly and validly
executed, issued and delivered by the applicable Trustees pursuant to the
terms and provisions of, and in accordance with the requirements of, this
Trust Agreement and the Holders will be, as of such date, entitled to the
benefits of this Trust Agreement;
(e) the execution, delivery and performance of this Trust Agreement
have been duly authorized by all necessary corporate or other action on
the part of the Depositor and do not require any approval of stockholders
of the Depositor and such execution, delivery and performance will not (i)
violate the articles or certificate of incorporation or by-laws (or other
organizational documents) of the Depositor or (ii) violate any applicable
law, governmental rule or regulation governing the Depositor
41
or any material portion of its property or any order, judgment or decree
applicable to the Depositor or any material portion of its property;
(f) neither the authorization, execution or delivery by the
Depositor of this Trust Agreement nor the consummation of any of the
transactions by the Depositor contemplated herein requires the consent or
approval of, the giving of notice to, the registration with or the taking
of any other action with respect to any governmental authority or agency
under any existing law governing the Depositor or any material portion of
its property; and
(g) there are no proceedings pending or, to the best of the
Depositor's knowledge, threatened against or affecting the Depositor or
any material portion of its property in any court or before any
governmental authority, agency or arbitration board or tribunal that,
individually or in the aggregate, would materially and adversely affect
the Trust or would question the right, power and authority of the
Depositor, as the case may be, to enter into or perform its obligations
under this Trust Agreement.
ARTICLE VIII.
THE TRUSTEES
SECTION 8.1. Number of Trustees.
The number of Trustees shall be five (5); provided, that the Property
Trustee and the Delaware Trustee may be the same Person, in which case the
number of Trustees shall be four (4). The number of Trustees may be increased or
decreased by Act of the Holder of the Common Securities subject to Sections 8.2,
8.3, and 8.4. The death, resignation, retirement, removal, bankruptcy,
incompetence or incapacity to perform the duties of a Trustee shall not operate
to annul, dissolve or terminate the Trust.
SECTION 8.2. Property Trustee Required.
There shall at all times be a Property Trustee hereunder with respect to
the Trust Securities. The Property Trustee shall be a corporation organized and
doing business under the laws of the United States or of any state thereof,
authorized to exercise corporate trust powers, having a combined capital and
surplus of at least fifty million dollars ($50,000,000), subject to supervision
or examination by federal or state authority and having an office within the
United States. If any such Person publishes reports of condition at least
annually pursuant to law or to the requirements of its supervising or examining
authority, then for the purposes of this Section 8.2, the combined capital and
surplus of such Person shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time
the Property Trustee shall cease to be eligible in accordance with the
provisions of this Section 8.2, it shall resign immediately in the manner and
with the effect hereinafter specified in this Article VIII.
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SECTION 8.3. Delaware Trustee Required.
(a) If required by the Delaware Statutory Trust Act, there shall at all
times be a Delaware Trustee with respect to the Trust Securities. The Delaware
Trustee shall either be (i) a natural person who is at least 21 years of age and
a resident of the State of Delaware or (ii) a legal entity that has its
principal place of business in the State of Delaware, otherwise meets the
requirements of applicable Delaware law and shall act through one or more
persons authorized to bind such entity. If at any time the Delaware Trustee
shall cease to be eligible in accordance with the provisions of this Section
8.3, it shall resign immediately in the manner and with the effect hereinafter
specified in this Article VIII. The Delaware Trustee shall have the same rights,
privileges and immunities as the Property Trustee.
(b) The Delaware Trustee shall not be entitled to exercise any powers, nor
shall the Delaware Trustee have any of the duties and responsibilities, of the
Property Trustee or the Administrative Trustees set forth herein. The Delaware
Trustee shall be one of the trustees of the Trust for the sole and limited
purpose of fulfilling the requirements of Section 3807 of the Delaware Statutory
Trust Act and for taking such actions as are required to be taken by a Delaware
trustee under the Delaware Statutory Trust Act. The duties (including fiduciary
duties), liabilities and obligations of the Delaware Trustee shall be limited to
(a) accepting legal process served on the Trust in the State of Delaware and (b)
the execution of any certificates required to be filed with the Secretary of
State of the State of Delaware that the Delaware Trustee is required to execute
under Section 3811 of the Delaware Statutory Trust Act and there shall be no
other duties (including fiduciary duties) or obligations, express or implied, at
law or in equity, of the Delaware Trustee.
SECTION 8.4. Appointment of Administrative Trustees.
(a) There shall at all times be one or more Administrative Trustees
hereunder with respect to the Trust Securities. Each Administrative Trustee
shall be either a natural person who is at least 21 years of age or a legal
entity that shall act through one or more persons authorized to bind that
entity. Each of the individuals identified as an "Administrative Trustee" in the
preamble of this Trust Agreement hereby accepts his or her appointment as such.
(b) Except where a requirement for action by a specific number of
Administrative Trustees is expressly set forth in this Trust Agreement, any act
required or permitted to be taken by, and any power of the Administrative
Trustees may be exercised by, or with the consent of, any one such
Administrative Trustee. Whenever a vacancy in the number of Administrative
Trustees shall occur, until such vacancy is filled by the appointment of an
Administrative Trustee in accordance with Section 8.11, the Administrative
Trustees in office, regardless of their number (and notwithstanding any other
provision of this Trust Agreement), shall have all the powers granted to the
Administrative Trustees and shall discharge all the duties imposed upon the
Administrative Trustees by this Trust Agreement.
SECTION 8.5. Duties and Responsibilities of the Trustees.
(a) The rights, immunities, duties and responsibilities of the Trustees
shall be as provided by this Trust Agreement and there shall be no other duties
(including fiduciary duties)
43
or obligations, express or implied, at law or in equity, of the Trustees;
provided, however, that if an Event of Default known to the Property Trustee has
occurred and is continuing, the Property Trustee shall, prior to the receipt of
directions, if any, from the Holders of at least a Majority in Liquidation
Amount of the Preferred Securities, exercise such of the rights and powers
vested in it by this Trust Agreement, and use the same degree of care and skill
in its exercise, as a prudent person would exercise or use under the
circumstances in the conduct of such person's own affairs. Notwithstanding the
foregoing, no provision of this Trust Agreement shall require any of the
Trustees to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder, or in the exercise
of any of its or their rights or powers, if it or they shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it. Whether or not herein
expressly so provided, every provision of this Trust Agreement relating to the
conduct or affecting the liability of or affording protection to the Trustees
shall be subject to the provisions of this Section 8.5. Nothing in this Trust
Agreement shall be construed to release any Administrative Trustee from
liability for his or her own negligent action, negligent failure to act; or his
or her own willful misconduct. To the extent that, at law or in equity, a
Trustee has duties and liabilities relating to the Trust or to the Holders, such
Trustee shall not be liable to the Trust or to any Holder for such Trustee's
good faith reliance on the provisions of this Trust Agreement. The provisions of
this Trust Agreement, to the extent that they restrict the duties and
liabilities of the Trustees otherwise existing at law or in equity, are agreed
by the Depositor and the Holders to replace such other duties and liabilities of
the Trustees.
(b) All payments made by the Property Trustee or a Paying Agent in respect
of the Trust Securities shall be made only from the revenue and proceeds from
the Trust Property and only to the extent that there shall be sufficient revenue
or proceeds from the Trust Property to enable the Property Trustee or a Paying
Agent to make payments in accordance with the terms hereof. Each Holder, by its
acceptance of a Trust Security, agrees that it will look solely to the revenue
and proceeds from the Trust Property to the extent legally available for
distribution to it as herein provided and that the Trustees are not personally
liable to it for any amount distributable in respect of any Trust Security or
for any other liability in respect of any Trust Security. This Section 8.5(b)
does not limit the liability of the Trustees expressly set forth elsewhere in
this Trust Agreement.
(c) No provisions of this Trust Agreement shall be construed to relieve
the Property Trustee from liability with respect to matters that are within the
authority of the Property Trustee under this Trust Agreement for its own
negligent action, negligent failure to act or willful misconduct, except that:
(i) the Property Trustee shall not be liable for any error or
judgment made in good faith by an authorized officer of the Property
Trustee, unless it shall be proved that the Property Trustee was negligent
in ascertaining the pertinent facts;
(ii) 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 at least a Majority in Liquidation Amount
of the Preferred Securities relating to the time, method and place of
conducting any proceeding for any remedy available to the Property
44
Trustee hereunder or under the Indenture, or exercising any trust or power
conferred upon the Property Trustee under this Trust Agreement;
(iii) the Property Trustee's sole duty with respect to the custody,
safe keeping and physical preservation of the Notes and the Payment
Account shall be to deal with such Property in a similar manner as the
Property Trustee deals with similar property for its own account, subject
to the protections and limitations on liability afforded to the Property
Trustee under this Trust Agreement;
(iv) 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 Depositor; and money held by the Property Trustee need not be
segregated from other funds held by it except in relation to the Payment
Account maintained by the Property Trustee pursuant to Section 3.1 and
except to the extent otherwise required by law; and
(v) the Property Trustee shall not be responsible for monitoring the
compliance by the Administrative Trustees or the Depositor with their
respective duties under this Trust Agreement, nor shall the Property
Trustee be liable for the default or misconduct of any other Trustee or
the Depositor.
SECTION 8.6. Notices of Defaults and Extensions.
(a) Within ninety (90) days after the occurrence of a default actually
known to the Property Trustee, the Property Trustee shall transmit notice of
such default to the Holders, the Administrative Trustees and the Depositor,
unless such default shall have been cured or waived. For the purpose of this
Section 8.6, the term "default" means any event that is, or after notice or
lapse of time or both would become, an Event of Default.
(b) Within five (5) Business Days after the receipt of notice of the
Depositor's exercise of its right to defer the payment of interest on the Notes
pursuant to the Indenture, the Property Trustee shall transmit, in the manner
and to the extent provided in Section 10.8, notice of such exercise to the
Holders and the Administrative Trustees, unless such exercise shall have been
revoked.
(c) The Property Trustee shall not be charged with knowledge of any Event
of Default unless either (i) a Responsible Officer of the Property Trustee shall
have actual knowledge or (ii) the Property Trustee shall have received written
notice thereof from the Depositor, an Administrative Trustee or a Holder.
(d) The Property Trustee shall notify all Holders of the Preferred
Securities of any notice of default received with respect to the Notes.
SECTION 8.7. Certain Rights of Property Trustee.
Subject to the provisions of Section 8.5:
(a) the Property Trustee may conclusively rely and shall be
protected in acting or refraining from acting in good faith and in
accordance with the terms hereof upon any
45
resolution, Opinion of Counsel, certificate, written representation of a
Holder or transferee, certificate of auditors or any other resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, appraisal, bond, debenture, note, other
evidence of indebtedness or other paper or document believed by it to be
genuine and to have been signed or presented by the proper party or
parties;
(b) if (i) in performing its duties under this Trust Agreement the
Property Trustee is required to decide between alternative courses of
action, (ii) in construing any of the provisions of this Trust Agreement
the Property Trustee finds a provision ambiguous or inconsistent with any
other provisions contained herein or (iii) the Property Trustee is unsure
of the application of any provision of this Trust Agreement, then, except
as to any matter as to which the Holders of the Preferred Securities are
entitled to vote under the terms of this Trust Agreement, the Property
Trustee shall deliver a notice to the Depositor requesting the Depositor's
written instruction as to the course of action to be taken and the
Property Trustee shall take such action, or refrain from taking such
action, as the Property Trustee shall be instructed in writing to take, or
to refrain from taking, by the Depositor; provided, that if the Property
Trustee does not receive such instructions of the Depositor within ten
(10) Business Days after it has delivered such notice or such reasonably
shorter period of time set forth in such notice, the Property Trustee may,
but shall be under no duty to, take such action, or refrain from taking
such action, as the Property Trustee shall deem advisable and in the best
interests of the Holders, in which event the Property Trustee shall have
no liability except for its own negligence, bad faith or willful
misconduct;
(c) any direction or act of the Depositor contemplated by this Trust
Agreement shall be sufficiently evidenced by an Officers' Certificate
unless otherwise expressly provided herein;
(d) any direction or act of an Administrative Trustee contemplated
by this Trust Agreement shall be sufficiently evidenced by a certificate
executed by such Administrative Trustee and setting forth such direction
or act;
(e) 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
re-recording, re-filing or re-registration thereof;
(f) the Property Trustee may consult with counsel (which counsel may
be counsel to the Property Trustee, the Depositor or any of its
Affiliates, and may include any of its employees) and the advice of such
counsel shall be full and complete authorization and protection in respect
of any action taken, suffered or omitted by it hereunder in good faith and
in reliance thereon and in accordance with such advice; the Property
Trustee shall have the right at any time to seek instructions concerning
the administration of this Trust Agreement from any court of competent
jurisdiction;
(g) the Property Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Trust Agreement at the
request or direction of any of the Holders pursuant to this Trust
Agreement, unless such Holders shall have offered to
46
the Property Trustee reasonable security or indemnity against the costs,
expenses (including reasonable attorneys' fees and expenses) and
liabilities that might be incurred by it in compliance with such request
or direction, including reasonable advances as may be requested by the
Property Trustee; provided, however, that nothing contained in this
Section 8.7(g) shall be construed to relieve the Property Trustee, upon
the occurrence of an Event of Default, of its obligation to exercise the
rights and powers in it vested by this Trust Agreement; provided, further,
that nothing contained in this Section 8.7(g) shall prevent the Property
Trustee from exercising its rights under Section 8.11 hereof;
(h) the Property Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, approval, bond, debenture, note or other
evidence of indebtedness or other paper or document, unless requested in
writing to do so by one or more Holders, but the Property Trustee may make
such further inquiry or investigation into such facts or matters as it may
see fit, and, if the Property Trustee shall determine to make such inquiry
or investigation, it shall be entitled to examine the books, records and
premises of the Depositor, personally or by agent or attorney;
(i) the Property Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
its agents, attorneys, custodians or nominees and the Property Trustee
shall not be responsible for any negligence or misconduct on the part of
any such agent, attorney, custodian or nominee appointed with due care by
it hereunder;
(j) whenever in the administration of this Trust Agreement the
Property Trustee shall deem it desirable to receive instructions with
respect to enforcing any remedy or right hereunder, the Property Trustee
(i) may request instructions from the Holders (which instructions may only
be given by the Holders of the same proportion in Liquidation Amount of
the Trust Securities as would be entitled to direct the Property Trustee
under this Trust Agreement in respect of such remedy, right or action),
(ii) may refrain from enforcing such remedy or right or taking such other
action until such instructions are received and (iii) shall be protected
in acting in accordance with such instructions;
(k) except as otherwise expressly provided by this Trust Agreement,
the Property Trustee shall not be under any obligation to take any action
that is discretionary under the provisions of this Trust Agreement;
(l) without prejudice to any other rights available to the Property
Trustee under applicable law, when the Property Trustee incurs expenses or
renders services in connection with a Bankruptcy Event, such expenses
(including legal fees and expenses of its agents and counsel) and the
compensation for such services are intended to constitute expenses of
administration under any bankruptcy law or law relating to creditors
rights generally; and
(m) whenever in the administration of this Trust Agreement the
Property Trustee shall deem it desirable that a matter be proved or
established prior to taking,
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suffering or omitting any action hereunder, the Property Trustee (unless
other evidence be herein specifically prescribed) may, in the absence of
bad faith on its part, request and rely on an Officers' Certificate which,
upon receipt of such request, shall be promptly delivered by the
Depositor.
No provision of this Trust Agreement shall be deemed to impose any duty or
obligation on any 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 such Person 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.
SECTION 8.8. Delegation of Power.
Any Trustee may, by power of attorney consistent with applicable law,
delegate to any other natural person over the age of 21 its, his or her power
for the purpose of executing any documents contemplated in Section 2.5. The
Trustees shall have power to delegate from time to time to such of their number
or to the Depositor the doing of such things and the execution of such
instruments either in the name of the Trust or the names of the Trustees or
otherwise as the Trustees may deem expedient, to the extent such delegation is
not prohibited by applicable law or contrary to the provisions of this Trust
Agreement.
SECTION 8.9. May Hold Securities.
Any Trustee or any other agent of any Trustee or the Trust, in its
individual or any other capacity, may become the owner or pledgee of Trust
Securities and except as provided in the definition of the term "Outstanding" in
Article I, may otherwise deal with the Trust with the same rights it would have
if it were not an Trustee or such other agent.
SECTION 8.10. Compensation; Reimbursement; Indemnity.
The Depositor agrees:
(a) to pay to the Trustees from time to time such reasonable
compensation for all services rendered by them hereunder as may be agreed
by the Depositor and the Trustees from time to time (which compensation
shall not be limited by any provision of law in regard to the compensation
of a trustee of an express trust);
(b) to reimburse the Trustees upon request for all reasonable
expenses, disbursements and advances incurred or made by the Trustees in
accordance with any provision of this Trust Agreement (including the
reasonable compensation and the expenses and disbursements of their agents
and counsel), except any such expense, disbursement or advance as may be
attributable to their gross negligence, bad faith or willful misconduct;
and
(c) to the fullest extent permitted by applicable law, to indemnify
and hold harmless (i) each Trustee, (ii) any Affiliate of any Trustee,
(iii) any officer, director, shareholder, employee, representative or
agent of any Trustee or any Affiliate of any Trustee and (iv) any employee
or agent of the Trust (referred to herein as an
48
"Indemnified Person") from and against any loss, damage, liability, tax
(other than income, franchise or other taxes imposed on amounts paid
pursuant to Section 8.10(a) or (b) hereof), penalty, expense or claim of
any kind or nature whatsoever incurred without negligence, bad faith or
willful misconduct on its part, arising out of or in connection with the
acceptance or administration of the Trust hereunder, including the
advancement of funds to cover the costs and expenses of defending itself
against any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder.
The Trust shall have no payment, reimbursement or indemnity obligations to
the Trustees under this Section 8.10. The provisions of this Section 8.10 shall
survive the termination of this Trust Agreement and the earlier removal or
resignation of any Trustee.
No Trustee may claim any Lien on any Trust Property whether before or
after termination of the Trust as a result of any amount due pursuant to this
Section 8.10.
To the fullest extent permitted by law, in no event shall the Property
Trustee and the Delaware Trustee be liable for any indirect, special, punitive
or consequential loss or damage of any kind whatsoever, including, but not
limited to, lost profits, even if the Trustee has been advised of the likelihood
of such loss or damage and regardless of the form of action.
In no event shall the Property Trustee and the Delaware Trustee be liable
for any failure or delay in the performance of its obligations hereunder because
of circumstances beyond its control, including, but not limited to, acts of God,
flood, war (whether declared or undeclared), terrorism, fire, riot, embargo,
government action, including any laws, ordinances, regulations, governmental
action or the like which delay, restrict or prohibit the providing of the
services contemplated by this Trust Agreement.
SECTION 8.11. Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of any Trustee and no appointment of a
successor Trustee pursuant to this Article VIII shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 8.12.
(b) A Trustee may resign at any time by giving written notice thereof to
the Depositor and, in the case of the Property Trustee and the Delaware Trustee,
to the Holders.
(c) Unless an Event of Default shall have occurred and be continuing, the
Property Trustee or the Delaware Trustee, or both of them, may be removed (with
or without cause) at any time by Act of the Holder of Common Securities. If an
Event of Default shall have occurred and be continuing, the Property Trustee or
the Delaware Trustee, or both of them, may be removed (with or without cause) at
such time by Act of the Holders of at least a Majority in Liquidation Amount of
the Preferred Securities, delivered to the removed Trustee (in its individual
capacity and on behalf of the Trust). An Administrative Trustee may be removed
(with or without cause) only by Act of the Holder of the Common Securities at
any time.
(d) If any Trustee shall resign, be removed or become incapable of acting
as Trustee, or if a vacancy shall occur in the office of any Trustee for any
reason, at a time when no Event of Default shall have occurred and be
continuing, the Holder of the Common Securities, by Act of
49
the Holder of the Common Securities, shall promptly appoint a successor Trustee
or Trustees, and such successor Trustee and the retiring Trustee shall comply
with the applicable requirements of Section 8.12. If the Property Trustee or the
Delaware Trustee shall resign, be removed or become incapable of continuing to
act as the Property Trustee or the Delaware Trustee, as the case may be, at a
time when an Event of Default shall have occurred and be continuing, the Holders
of the Preferred Securities, by Act of the Holders of a Majority in Liquidation
Amount of the Preferred Securities, shall promptly appoint a successor Property
Trustee or Delaware Trustee, and such successor Property Trustee or Delaware
Trustee and the retiring Property Trustee or Delaware Trustee shall comply with
the applicable requirements of Section 8.12. If an Administrative Trustee shall
resign, be removed or become incapable of acting as Administrative Trustee, at a
time when an Event of Default shall have occurred and be continuing, the Holder
of the Common Securities by Act of the Holder of Common Securities shall
promptly appoint a successor Administrative Trustee and such successor
Administrative Trustee and the retiring Administrative Trustee shall comply with
the applicable requirements of Section 8.12. If no successor Trustee shall have
been so appointed by the Holder of the Common Securities or Holders of the
Preferred Securities, as the case may be, and accepted appointment in the manner
required by Section 8.12 within thirty (30) days after the giving of a notice of
resignation by a Trustee, the removal of a Trustee, or a Trustee becoming
incapable of acting as such Trustee, any Holder who has been a Holder of
Preferred Securities for at least six (6) months may, on behalf of himself and
all others similarly situated, and any resigning Trustee may, in each case, at
the expense of the Depositor, petition any court of competent jurisdiction for
the appointment of a successor Trustee.
(e) The Depositor shall give notice of each resignation and each removal
of the Property Trustee or the Delaware Trustee and each appointment of a
successor Property Trustee or Delaware Trustee to all Holders in the manner
provided in Section 10.8. Each notice shall include the name of the successor
Property Trustee or Delaware Trustee and the address of its Corporate Trust
Office if it is the Property Trustee.
(f) Notwithstanding the foregoing or any other provision of this Trust
Agreement, in the event any Administrative Trustee or a Delaware Trustee who is
a natural person dies or becomes, in the opinion of the Holder of Common
Securities, incompetent or incapacitated, the vacancy created by such death,
incompetence or incapacity may be filled by (i) the unanimous act of the
remaining Administrative Trustees if there are at least two of them or (ii)
otherwise by the Holder of the Common Securities (with the successor in each
case being a Person who satisfies the eligibility requirement for Administrative
Trustees or Delaware Trustee, as the case may be, set forth in Sections 8.3 and
8.4).
(g) Upon the appointment of a successor Delaware Trustee, such successor
Delaware Trustee shall file a Certificate of Amendment to the Certificate of
Trust in accordance with Section 3810 of the Delaware Statutory Trust Act.
SECTION 8.12. Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor Trustee, each
successor Trustee shall execute and deliver to the Depositor and to the retiring
Trustee an instrument accepting such appointment, and thereupon the resignation
or removal of the retiring Trustee
50
shall become effective and each such successor Trustee, without any further act,
deed or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Trustee; but, on request of the Trust or any successor
Trustee such retiring Trustee shall, upon payment of its charges, duly assign,
transfer and deliver to such successor Trustee all Trust Property, all proceeds
thereof and money held by such retiring Trustee hereunder with respect to the
Trust Securities and the Trust.
(b) Upon request of any such successor Trustee, the Trust (or the retiring
Trustee if requested by the Depositor) shall execute any and all instruments for
more fully and certainly vesting in and confirming to such successor Trustee all
such rights, powers and trusts referred to in the preceding paragraph.
(c) No successor Trustee shall accept its appointment unless at the time
of such acceptance such successor Trustee shall be qualified and eligible under
this Article VIII.
SECTION 8.13. Merger, Conversion, Consolidation or Succession to Business.
Any Person into which the Property Trustee or the Delaware Trustee may be
merged or converted or with which it may be consolidated, or any Person
resulting from any merger, conversion or consolidation to which such Trustee
shall be a party, or any Person succeeding to all or substantially all the
corporate trust business of such Trustee, shall be the successor of such Trustee
hereunder, without the execution or filing of any paper or any further act on
the part of any of the parties hereto, provided, that such Person shall be
otherwise qualified and eligible under this Article VIII.
SECTION 8.14. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities Certificates shall be
taken as the statements of the Trust and the Depositor, and the Trustees do not
assume any responsibility for their correctness. The Trustees make no
representations as to the title to, or value or condition of, the property of
the Trust or any part thereof, nor as to the validity or sufficiency of this
Trust Agreement, the Notes or the Trust Securities. The Trustees shall not be
accountable for the use or application by the Depositor of the proceeds of the
Notes.
SECTION 8.15. Property Trustee May File Proofs of Claim.
(a) In case of any Bankruptcy Event (or event that with the passage of
time would become a Bankruptcy Event) relative to the Trust or any other obligor
upon the Trust Securities or the property of the Trust or of such other obligor
or their creditors, the Property Trustee (irrespective of whether any
Distributions on the Trust Securities shall then be due and payable and
irrespective of whether the Property Trustee shall have made any demand on the
Trust for the payment of any past due Distributions) shall be entitled and
empowered, to the fullest extent permitted by law, by intervention in such
proceeding or otherwise:
(i) to file and prove a claim for the whole amount of any
Distributions owing and unpaid in respect of the Trust Securities and to
file such other papers or documents as may be necessary or advisable in
order to have the claims of the Property Trustee (including any claim for
the reasonable compensation, expenses, disbursements and
51
advances of the Property Trustee, its agents and counsel) and of the
Holders allowed in such judicial proceeding; and
(ii) to collect and receive any monies or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such proceeding is hereby authorized by each
Holder to make such payments to the Property Trustee and, in the event the
Property Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Property Trustee first any amount due it for the
reasonable compensation, expenses, disbursements and advances of the Property
Trustee, its agents and counsel, and any other amounts due the Property Trustee.
(b) Nothing herein contained shall be deemed to authorize the Property
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement, adjustment or compensation affecting
the Trust Securities or the rights of any Holder thereof or to authorize the
Property Trustee to vote in respect of the claim of any Holder in any such
proceeding.
SECTION 8.16. Reports to the Property Trustee.
(a) The Depositor and the Administrative Trustees shall deliver to the
Property Trustee, not later than forty five (45) days after the end of each of
the first three fiscal quarters of the Depositor and not later than ninety (90)
days after the end of each fiscal year of the Trust ending after the date of
this Trust Agreement, an Officers' Certificate covering the preceding fiscal
year, stating whether or not to the knowledge of the signers thereof the
Depositor and the Trust are in default in the performance or observance of any
of the terms, provisions and conditions of this Trust Agreement (without regard
to any period of grace or requirement of notice provided hereunder) and, if the
Depositor or the Trust shall be in default, specifying all such defaults and the
nature and status thereof of which they have knowledge.
(b) The Depositor shall furnish (i) to the Property Trustee; (ii) Dekania
Capital Management, LLC, c/o Cohen Bros. & Co.1818 Market Street, 28th Floor,
Philadelphia, Pennsylvania 19103 or such other address as designated by Dekania
Capital Management, LLC); and (iii) any Owner of the Preferred Securities
reasonably identified to the Depositor and the Trust (which identification may
be made either by such Owner or by Dekania Capital Management, LLC) a duly
completed and executed certificate substantively and substantially in the form
attached hereto as Exhibit G, including the financial statements referenced in
such Exhibit, which certificate and financial statements shall be so furnished
by the Depositor not later than forty five (45) days after the end of each of
the first three fiscal quarters of each fiscal year of the Depositor and not
later than ninety (90) days after the end of each fiscal year of the Depositor.
The Property Trustee shall obtain all reports, certificate and
information, which it is entitled to obtain under each of the Operative
Documents.
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ARTICLE IX.
TERMINATION, LIQUIDATION AND MERGER
SECTION 9.1. Dissolution Upon Expiration Date.
Unless earlier dissolved, the Trust shall automatically dissolve on April
29, 2039 (the "Expiration Date"), and the Trust Property shall be liquidated in
accordance with Section 9.4.
SECTION 9.2. Early Termination.
The first to occur of any of the following events is an "Early Termination
Event", upon the occurrence of which the Trust shall be dissolved:
(a) the occurrence of a Bankruptcy Event in respect of, or the
dissolution or liquidation of, the Depositor, in its capacity as the
Holder of the Common Securities, unless the Depositor shall have
transferred the Common Securities as provided by Section 5.11, in which
case this provision shall refer instead to any such successor Holder of
the Common Securities;
(b) the written direction to the Property Trustee from the Holder of
the Common Securities at any time to dissolve the Trust and, after
satisfaction of any liabilities of the Trust as required by applicable
law, to distribute the Notes to Holders in exchange for the Preferred
Securities (which direction is optional and wholly within the discretion
of the Holder of the Common Securities), provided, that the Holder of the
Common Securities shall have received the prior approval of all necessary
Applicable Insurance Regulatory Authorities then required;
(c) the redemption of all of the Preferred Securities in connection
with the payment at maturity or redemption of all the Notes; and
(d) the entry of an order for dissolution of the Trust by a court of
competent jurisdiction.
SECTION 9.3. Termination.
The respective obligations and responsibilities of the Trustees and the
Trust shall terminate upon the latest to occur of the following: (a) the
distribution by the Property Trustee to Holders of all amounts required to be
distributed hereunder upon the liquidation of the Trust pursuant to Section 9.4,
or upon the redemption of all of the Trust Securities pursuant to Section 4.2;
(b) the satisfaction of any expenses owed by the Trust; and (c) the discharge of
all administrative duties of the Administrative Trustees, including the
performance of any tax reporting obligations with respect to the Trust or the
Holders.
SECTION 9.4. Liquidation.
(a) If an Early Termination Event specified in Section 9.2(a), (b) or (d)
occurs or upon the Expiration Date, the Trust shall be liquidated by the
Property Trustee as expeditiously
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as the Property Trustee shall determine to be possible by distributing, after
satisfaction of liabilities to creditors of the Trust as provided by applicable
law, to each Holder a Like Amount of Notes, subject to Section 9.4(d). Notice of
liquidation shall be given by the Property Trustee not less than thirty (30) nor
more than sixty (60) days prior to the Liquidation Date to each Holder of Trust
Securities at such Holder's address appearing in the Securities Register. All
such notices of liquidation shall:
(i) state the Liquidation Date;
(ii) state that from and after the Liquidation Date, the Trust
Securities will no longer be deemed to be Outstanding and (subject to
Section 9.4(d)) any Securities Certificates not surrendered for exchange
will be deemed to represent a Like Amount of Notes; and
(iii) provide such information with respect to the mechanics by
which Holders may exchange Securities Certificates for Notes, or if
Section 9.4(d) applies, receive a Liquidation Distribution, as the
Property Trustee shall deem appropriate.
(b) Except where Section 9.2(c) or 9.4(d) applies, in order to effect the
liquidation of the Trust and distribution of the Notes to Holders, the Property
Trustee, either itself acting as exchange agent or through the appointment of a
separate exchange agent, shall establish a record date for such distribution
(which shall not be more than forty five (45) days prior to the Liquidation Date
nor prior to the date on which notice of such liquidation is given to the
Holders) and establish such procedures as it shall deem appropriate to effect
the distribution of Notes in exchange for the Outstanding Securities
Certificates.
(c) Except where Section 9.2(c) or 9.4(d) applies, after the Liquidation
Date, (i) the Trust Securities will no longer be deemed to be Outstanding, (ii)
certificates representing a Like Amount of Notes will be issued to Holders of
Securities Certificates, upon surrender of such Certificates to the exchange
agent for exchange, (iii) the Depositor shall use its best efforts to have the
Notes listed on the New York Stock Exchange or on such other exchange,
interdealer quotation system or self-regulatory organization on which the
Preferred Securities are then listed, if any, (iv) Securities Certificates not
so surrendered for exchange will be deemed to represent a Like Amount of Notes
bearing accrued and unpaid interest in an amount equal to the accumulated and
unpaid Distributions on such Securities Certificates until such certificates are
so surrendered (and until such certificates are so surrendered, no payments of
interest or principal will be made to Holders of Securities Certificates with
respect to such Notes) and (v) all rights of Holders holding Trust Securities
will cease, except the right of such Holders to receive Notes upon surrender of
Securities Certificates.
(d) Notwithstanding the other provisions of this Section 9.4, if
distribution of the Notes in the manner provided herein is determined by the
Property Trustee not to be permitted or practical, the Trust Property shall be
liquidated, and the Trust shall be wound up by the Property Trustee in such
manner as the Property Trustee determines. In such event, Holders will be
entitled to receive out of the assets of the Trust available for distribution to
Holders, after satisfaction of liabilities to creditors of the Trust as provided
by applicable law, an amount equal to the Liquidation Amount per Trust Security
plus accumulated and unpaid Distributions thereon
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to the date of payment (such amount being the "Liquidation Distribution"). If,
upon any such winding up the Liquidation Distribution can be paid only in part
because the Trust has insufficient assets available to pay in full the aggregate
Liquidation Distribution, then, subject to the next succeeding sentence, the
amounts payable by the Trust on the Trust Securities shall be paid on a pro rata
basis (based upon Liquidation Amounts). The Holder of the Common Securities will
be entitled to receive Liquidation Distributions upon any such winding up pro
rata (based upon Liquidation Amounts) with Holders of all Trust Securities,
except that, if an Event of Default has occurred and is continuing, the
Preferred Securities shall have a priority over the Common Securities as
provided in Section 4.3.
SECTION 9.5. Mergers, Consolidations, Amalgamations or Replacements of
Trust.
The Trust may not merge with or into, consolidate, amalgamate, or be
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to, any Person except pursuant to this Article IX.
At the request of the Holders of the Common Securities, without the consent of
the Holders of the Preferred Securities, the Trust may merge with or into,
consolidate, amalgamate, or be replaced by or convey, transfer or lease its
properties and assets substantially as an entirety to a trust organized as such
under the laws of any State; provided, that:
(a) such successor entity either (i) expressly assumes all of the
obligations of the Trust under this Trust Agreement with respect to the
Preferred Securities or (ii) substitutes for the Preferred Securities
other securities having substantially the same terms as the Preferred
Securities (such other Securities, the "Successor Securities") so long as
the Successor Securities have the same priority as the Preferred
Securities with respect to distributions and payments upon liquidation,
redemption and otherwise;
(b) a trustee of such successor entity possessing substantially the
same powers and duties as the Property Trustee is appointed to hold the
Notes;
(c) if the Preferred Securities or the Notes are rated, such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease
does not cause the Preferred Securities or the Notes (including any
Successor Securities) to be downgraded by any nationally recognized
statistical rating organization that then assigns a rating to the
Preferred Securities or the Notes;
(d) the Preferred Securities are listed, or any Successor Securities
will be listed upon notice of issuance, on any national securities
exchange or interdealer quotation system on which the Preferred Securities
are then listed, if any;
(e) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights,
preferences and privileges of the Holders of the Preferred Securities
(including any Successor Securities) in any material respect;
(f) such successor entity has a purpose substantially identical to
that of the Trust;
55
(g) prior to such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease, the Depositor has received an Opinion of
Counsel to the effect that (i) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not adversely affect the
rights, preferences and privileges of the Holders of the Preferred
Securities (including any Successor Securities) in any material respect;
(ii) following such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease, neither the Trust nor such successor entity
will be required to register as an "investment company" under the
Investment Company Act and (iii) following such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease, the Trust (or
the successor entity) will continue to be classified as a grantor trust
for U.S. federal income tax purposes; and
(h) the Depositor or its permitted transferee owns all of the common
securities of such successor entity and guarantees the obligations of such
successor entity under the Successor Securities at least to the extent
provided by the Guarantee Agreement.
Notwithstanding the foregoing, the Trust shall not, except with the consent of
Holders of all of the Preferred Securities, consolidate, amalgamate, merge with
or into, or be replaced by or convey, transfer or lease its properties and
assets substantially as an entirety to any other Person or permit any other
entity to consolidate, amalgamate, merge with or into, or replace, the Trust if
such consolidation, amalgamation, merger, replacement, conveyance, transfer or
lease would cause the Trust or the successor entity to be taxable as a
corporation or classified as other than a grantor trust for United States
federal income tax purposes or cause the Notes to be treated as other than
indebtedness of the Depositor for United States federal income tax purposes.
ARTICLE X.
MISCELLANEOUS PROVISIONS
SECTION 10.1. Limitation of Rights of Holders.
Except as set forth in Section 9.2, the death, bankruptcy, termination,
dissolution or incapacity of any Person having an interest, beneficial or
otherwise, in Trust Securities shall not operate to terminate this Trust
Agreement, nor annul, dissolve or terminate the Trust nor entitle the legal
representatives or heirs of such Person or any Holder for such Person, to claim
an accounting, take any action or bring any proceeding in any court for a
partition or winding up of the arrangements contemplated hereby, nor otherwise
affect the rights, obligations and liabilities of the parties hereto or any of
them.
SECTION 10.2. Agreed Tax Treatment of Trust and Trust Securities.
The parties hereto and, by its acceptance or acquisition of a Trust
Security or a beneficial interest therein, the Holder of, and any Person that
acquires a beneficial interest in, such Trust Security intend and agree to treat
the Trust as a grantor trust for United States federal, state and local tax
purposes, and to treat the Trust Securities (including all payments and proceeds
with respect to such Trust Securities) as undivided beneficial ownership
interests in the Trust Property (and payments and proceeds therefrom,
respectively) for United States federal, state and local tax
56
purposes and to treat the Notes as indebtedness of the Depositor for United
States federal, state and local tax purposes. The provisions of this Trust
Agreement shall be interpreted to further this intention and agreement of the
parties.
SECTION 10.3. Amendment.
(a) This Trust Agreement may be amended from time to time by the Property
Trustee, the Administrative Trustees and the Holder of all the Common
Securities, without the consent of any Holder of the Preferred Securities, (i)
to cure any ambiguity, correct or supplement any provision herein that may be
defective or inconsistent with any other provision herein, or to make or amend
any other provisions with respect to matters or questions arising under this
Trust Agreement, which shall not be inconsistent with the other provisions of
this Trust Agreement, (ii) to modify, eliminate or add to any provisions of this
Trust Agreement to such extent as shall be necessary to ensure that the Trust
will neither be taxable as a corporation nor be classified as other than a
grantor trust for United States federal income tax purposes at all times that
any Trust Securities are Outstanding or to ensure that the Notes are treated as
indebtedness of the Depositor for United States federal income tax purposes, or
to ensure that the Trust will not be required to register as an "investment
company" under the Investment Company Act or (iii) to add to the covenants,
restrictions or obligations of the Depositor; provided, that in the case of
clauses (i), (ii) or (iii), such action shall not adversely affect in any
material respect the interests of any Holder.
(b) Except as provided in Section 10.3(c), any provision of this Trust
Agreement may be amended by the Property Trustee, the Administrative Trustees
and the Holder of all of the Common Securities and with (i) the consent of
Holders of at least a Majority in Liquidation Amount of the Preferred Securities
and (ii) receipt by the Trustees of an Opinion of Counsel to the effect that
such amendment or the exercise of any power granted to the Trustees in
accordance with such amendment will not cause the Trust to be taxable as a
corporation or classified as other than a grantor trust for United States
federal income tax purposes or affect the treatment of the Notes as indebtedness
of the Depositor for United States federal income tax purposes or affect the
Trust's exemption from status (or from any requirement to register) as an
"investment company" under the Investment Company Act.
(c) Notwithstanding any other provision of this Trust Agreement, without
the consent of each Holder, this Trust Agreement may not be amended to (i)
change the accrual rate, amount, currency or timing of any Distribution on or
the redemption price of the Trust Securities or otherwise adversely affect the
amount of any Distribution or other payment required to be made in respect of
the Trust Securities as of a specified date, (ii) restrict or impair the right
of a Holder to institute suit for the enforcement of any such payment on or
after such date, (iii) reduce the percentage of aggregate Liquidation Amount of
Outstanding Preferred Securities, the consent of whose Holders is required for
any such amendment, or the consent of whose Holders is required for any waiver
of compliance with any provision of this Trust Agreement or of defaults
hereunder and their consequences provided for in this Trust Agreement; (iv)
impair or adversely affect the rights and interests of the Holders in the Trust
Property, or permit the creation of any Lien on any portion of the Trust
Property; or (v) modify the definition of "Outstanding," this Section 10.3(c),
Sections 4.1, 4.2, 4.3, 6.10(e) or Article IX.
57
(d) Notwithstanding any other provision of this Trust Agreement, no
Trustee shall enter into or consent to any amendment to this Trust Agreement
that would cause the Trust to be taxable as a corporation or to be classified as
other than a grantor trust for United States federal income tax purposes or that
would cause the Notes to fail or cease to be treated as indebtedness of the
Depositor for United States federal income tax purposes or that would cause the
Trust to fail or cease to qualify for the exemption from status (or from any
requirement to register) as an "investment company" under the Investment Company
Act.
(e) If any amendment to this Trust Agreement is made, the Administrative
Trustees or the Property Trustee shall promptly provide to the Depositor and the
Note Trustee a copy of such amendment.
(f) No Trustee shall be required to enter into any amendment to this Trust
Agreement that affects its own rights, duties or immunities under this Trust
Agreement. The Trustees shall be entitled to receive an Opinion of Counsel and
an Officers' Certificate stating that any amendment to this Trust Agreement is
in compliance with this Trust Agreement and all conditions precedent herein
provided for relating to such action have been met.
(g) No amendment or modification to this Trust Agreement that adversely
affects in any material respect the rights, duties, liabilities, indemnities or
immunities of the Delaware Trustee hereunder shall be permitted without the
prior written consent of the Delaware Trustee.
SECTION 10.4. Separability.
If any provision in this Trust Agreement or in the Securities Certificates
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby, and there shall be deemed substituted for the provision at
issue a valid, legal and enforceable provision as similar as possible to the
provision at issue.
SECTION 10.5. Governing Law.
THIS TRUST AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF EACH OF THE
HOLDERS, THE TRUST, THE DEPOSITOR AND THE TRUSTEES WITH RESPECT TO THIS TRUST
AGREEMENT AND THE TRUST SECURITIES SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE
WITH AND GOVERNED BY THE LAWS OF THE STATE OF DELAWARE WITHOUT REFERENCE TO ITS
CONFLICTS OF LAWS PROVISIONS.
SECTION 10.6. Successors.
This Trust Agreement shall be binding upon and shall inure to the benefit
of any successor to the Depositor, the Trust and any Trustee, including any
successor by operation of law. Except in connection with a transaction involving
the Depositor that is permitted under Article VIII of the Indenture and pursuant
to which the assignee agrees in writing to perform the Depositor's obligations
hereunder, the Depositor shall not assign its obligations hereunder.
58
SECTION 10.7. Headings.
The Article and Section headings are for convenience only and shall not
affect the construction of this Trust Agreement.
SECTION 10.8. Reports, Notices and Demands.
(a) Any report, notice, demand or other communication that by any
provision of this Trust Agreement is required or permitted to be given or served
to or upon any Holder or the Depositor may be given or served in writing
delivered in person, or by reputable, overnight courier, by telecopy or by
deposit thereof, first-class postage prepaid, in the United States mail,
addressed, (a) in the case of a Holder of Preferred Securities, to such Holder
as such Holder's name and address may appear on the Securities Register; and (b)
in the case of the Holder of all the Common Securities or the Depositor, to
UICI, 9151 Grapevine Highway, North Richland Hills, Texas 76180, Attention: Mark
D. Hauptman, or to such other address as may be specified in a written notice by
the Holder of all the Common Securities or the Depositor, as the case may be, to
the Property Trustee. Such report, notice, demand or other communication to or
upon a Holder or the Depositor shall be deemed to have been given when received
in person, within one (1) Business Day following delivery by overnight courier,
when telecopied with receipt confirmed, or within three (3) Business Days
following delivery by mail, 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.
(b) Any notice, demand or other communication that by any provision of
this Trust Agreement is required or permitted to be given or served to or upon
the Property Trustee, the Delaware Trustee, the Administrative Trustees or the
Trust shall be given in writing by deposit thereof, first-class postage prepaid,
in the U.S. mail, personal delivery or facsimile transmission, addressed to such
Person as follows: (i) with respect to the Property Trustee to JPMorgan Chase
Bank, 600 Travis, 50th Floor, Houston, Texas 77002, Attention: Institutional
Trust Services -- UICI Capital Trust I, facsimile no. (713) 216-2101, (ii) with
respect to the Delaware Trustee, to Chase Manhattan Bank USA, National
Association, 500 Stanton Christiana Road 3/OPS 4, Building 4 (3rd Floor),
Newark, Delaware 19713, Attention: Institutional Trust Services -- UICI Capital
Trust I, facsimile no. (302) 552-6280; (iii) with respect to the Administrative
Trustees, to them at the address above for notices to the Depositor, marked
"Attention: Administrative Trustees of UICI Capital Trust I", and (iv) with
respect to the Trust, to its principal executive office specified in Section
2.2, with a copy to the Property Trustee. Such notice, demand or other
communication to or upon the Trust, the Property Trustee or the Administrative
Trustees shall be deemed to have been sufficiently given or made only upon
actual receipt of the writing by the Trust, the Property Trustee or the
Administrative Trustees.
SECTION 10.9. Agreement Not to Petition.
Each of the Trustees and the Depositor agree for the benefit of the
Holders that, until at least one year and one day after the Trust has been
terminated in accordance with Article IX, they shall not file, or join in the
filing of, a petition against the Trust under any Bankruptcy Law or otherwise
join in the commencement of any proceeding against the Trust under any
59
Bankruptcy Law. If the Depositor takes action in violation of this Section 10.9,
the Property Trustee agrees, for the benefit of Holders, that at the expense of
the Depositor, it shall file an answer with the applicable bankruptcy court or
otherwise properly contest the filing of such petition by the Depositor against
the Trust or the commencement of such action and raise the defense that the
Depositor has agreed in writing not to take such action and should be estopped
and precluded therefrom and such other defenses, if any, as counsel for the
Property Trustee or the Trust may assert.
SECTION 10.10. Counterparts. This instrument may be executed in any number
of counterparts, each of which so executed shall be deemed to be an original,
but all such counterparts shall together constitute but one and the same
instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this Amended and
Restated Trust Agreement as of the day and year first above written.
UICI,
as Depositor
By: /s/ William J. Gedwed
------------------------
Name: William J. Gedwed
Title: President and Chief Executive
Officer
JPMORGAN CHASE BANK, not in its CHASE MANHATTAN BANK USA, NATIONAL
individual capacity but solely as ASSOCIATION, as Delaware Trustee
Property Trustee
By: [ILLIGIBLE] By: /s/ Blane P. Ledger
------------------- -------------------------------
Name: Name: Blane P. Ledger
Title: Title: Assistant Vice President
/s/ William J. Gedwed /s/ Mark D. Hauptman
- ----------------------- ----------------------
Administrative Trustee Administrative Trustee
Name: William J. Gedwed Name: Mark D. Hauptman
/s/ Glenn W. Reed
- ----------------------
Administrative Trustee
Name: Glenn W. Reed
AMENDED AND RESTATED TRUST AGREEMENT