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EXHIBIT 25
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM T-1
STATEMENT OF ELIGIBILITY AND QUALIFICATION UNDER THE TRUST
INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS
TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A
TRUSTEE PURSUANT TO SECTION 305(b)(2)_________
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U.S. TRUST COMPANY OF TEXAS, N.A.
(Exact name of trustee as specified in its charter)
75-2353745
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
2001 Ross Ave, Suite 2700 75201
Dallas, Texas (Zip Code)
(Address of trustee's
principal executive offices)
Compliance Officer
U.S. Trust Company of Texas, N.A.
2001 Ross Ave, Suite 2700
Dallas, Texas 75201
(214) 754-1200
(Name, address and telephone number of agent for service)
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Source Media, Inc.
(Exact name of obligor as specified in its charter)
Delaware 13-3700438
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
5400 LBJ Freeway, Suite 680
Dallas, Texas 75240
(Address of principal executive offices) (Zip Code)
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12% Senior Secured Notes Due 2004, Series A
(Title of indenture securities)
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GENERAL
1. General Information.
Furnish the following information as to the Trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
Federal Reserve Bank of Dallas (11th District),
Dallas, Texas (Board of Governors of the
Federal Reserve System)
Federal Deposit Insurance Corporation, Dallas, Texas
The Office of the Comptroller of the Currency,
Dallas, Texas
(b) Whether it is authorized to exercise corporate trust powers.
The Trustee is authorized to exercise corporate trust powers.
2. Affiliations with Obligor and Underwriters.
If the obligor or any underwriter for the obligor is an affiliate of
the Trustee, describe each such affiliation.
None.
3. Voting Securities of the Trustee.
Furnish the following information as to each class of voting
securities of the Trustee:
As of December 9, 1997
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Col A. Col B.
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Title of Class Amount Outstanding
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Capital Stock - par value $100 per share 5,000 shares
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4. Trusteeships under Other Indentures.
Not Applicable
5. Interlocking Directorates and Similar Relationships with the Obligor
or Underwriters.
Not Applicable
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6. Voting Securities of the Trustee Owned by the Obligor or its
Officials.
Not Applicable
7. Voting Securities of the Trustee Owned by Underwriters or their
Officials.
Not Applicable
8. Securities of the Obligor Owned or Held by the Trustee.
Not Applicable
9. Securities of Underwriters Owned or Held by the Trustee.
Not Applicable
10. Ownership or Holdings by the Trustee of Voting Securities of Certain
Affiliates or Security Holders of the Obligor.
Not Applicable
11. Ownership or Holdings by the Trustee of any Securities of a Person
Owning 50 Percent or More of the Voting Securities of the Obligor.
Not Applicable
12. Indebtedness of the Obligor to the Trustee.
Not Applicable
13. Defaults by the Obligor.
Not Applicable
14. Affiliations with the Underwriters.
Not Applicable
15. Foreign Trustee.
Not Applicable
16. List of Exhibits.
T-1.1 - A copy of the Articles of Association of U.S. Trust Company
of Texas, N.A.. incorporated herein by reference to Exhibit
T-1.1 filed with Form T-1 Statement, Registration No.
22-21897.
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16. (con't.)
T-1.2 - A copy of the certificate of authority of the Trustee to
commence business; incorporated herein by reference to
Exhibit T-1.2 filed with Form T-1 Statement, Registration
No. 22-21897.
T-1.3 - A copy of the authorization of the Trustee to exercise
corporate trust powers; incorporated herein by reference to
Exhibit T-1.3 filed with Form T-1 Statement, Registration
No. 22-21897.
T-1.4 - A copy of the By-laws of the U.S. Trust Company of Texas,
N.A.. as amended to date; incorporated herein by reference
to Exhibit T-1.4 filed with Form T-1 Statement,
Registration No. 22-21897.
T-1.6 - The consent of the Trustee required by Section 321(b) of
the Trust Indenture Act of 1939.
T-1.7 - A copy of the latest report of condition of the Trustee
published pursuant to law or the requirements of its
supervising or examining authority.
NOTE
As of December 9, 1997, the Trustee had 5,000 shares of Capital Stock
outstanding, all of which are owned by U.S. T.L.P.O. Corp. As of December 9,
1997, U.S. T.L.P.O. Corp. had 35 shares of Capital Stock outstanding, all of
which are owned by U.S. Trust Corporation. U.S. Trust Corporation had
outstanding 9,301,074 shares of $5 par value Common Stock as of December 9,
1997.
The term "Trustee" in Items 2, 5, 6, 7, 8, 9, 10 and 11 refers to each of U.S.
Trust Company of Texas, N.A., U.S. T.L.P.O. Corp. and U.S. Trust Corporation.
In as much as this Form T-1 is filed prior to the ascertainment by the Trustee
of all the facts on which to base responsive answers to Items 2, 5, 6, 7, 9, 10
and 11, the answers to said Items are based upon incomplete information. Items
2, 5, 6, 7, 9, 10 and 11 may, however, be considered correct unless amended by
an amendment to this Form T-1.
In answering any items in this Statement of Eligibility and Qualification which
relates to matters peculiarly within the knowledge of the obligors or their
directors or officers, or an underwriter for the obligors, the Trustee has
relied upon information furnished to it by the obligors and will rely on
information to be furnished by the obligors or such underwriter, and the
Trustee disclaims responsibility for the accuracy or completeness of such
information.
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SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the Trustee,
U.S Trust Company of Texas, N.A., a national banking association organized
under the laws of the United States of America, has duly caused this statement
of eligibility and qualification to be signed on its behalf by the undersigned,
thereunto duly authorized, all in the City of Dallas, and State of Texas on the
9th day of December, 1997.
U.S. Trust Company
of Texas, N.A., Trustee
By: /s/ BILL BARBER
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William Barber
Vice President
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Exhibit T-1.6
CONSENT OF TRUSTEE
Pursuant to the requirements of Section 321(b) of the Trust Indenture Act of
1939 as amended in connection with the proposed issue of Source Media, Inc.,
12% Senior Secured Notes Due 2004, Series A, we hereby consent that reports of
examination by Federal, State, Territorial or District authorities may be
furnished by such authorities to the Securities and Exchange Commission upon
request therefore.
U.S. Trust Company of Texas, N.A.
By: /s/ BILL BARBER
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William Barber
Vice President
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Federal Financial Institutions Examination Council
Board of Governors of the Federal Reserve System
OMB Number: 7100-0036
Federal Deposit Insurance Corporation
OMB Number: 3064-0052
Office of the Comptroller of the Currency
OMB Number: 1557-0081
Expires March 31, 2000
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(LOGO)
Please Refer to Page i,
(1)
Table of Contents, for
the required disclosure
of estimated burden
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CONSOLIDATED REPORTS OF CONDITION AND INCOME FOR A BANK WITH DOMESTIC OFFICES
ONLY AND TOTAL ASSETS OF LESS THAN $100 MILLION - - FFIEC 034
REPORT AT THE CLOSE OF BUSINESS September 30,1997
This report is required by law: 12 U.S.C. Section 324 (State member banks); 12
U.S. c. Section 1817 (State nonmember banks); and 12 U.S. C. Section 161
(National banks).
(970331)
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(RCRI 9999)
This report form is to be filed by banks with domestic offices only. Banks
with branches and consolidated subsidiaries in U.S. territories and
possessions, Edge or Agreement subsidiaries, foreign branches, consolidated
foreign subsidiaries, or International Banking Facilities must file FFIEC 031.
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NOTE: The Reports of Condition and Income must be signed by an authorized
officer and the Report of Condition must be attested to by not less than two
directors (trustees) for State nonmember banks and three directors for State
member and National Banks.
I, Alfred B. Childs, SVP & Cashier
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Name and Title of Officer Authorized to Sign Report
of the named bank do hereby declare that these Reports of Condition and Income
(including the supporting schedules) have been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and are
true to the best of my knowledge and belief.
/s/ Alfred B. Childs
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Signature of Officer Authorized to Sign Report
10/15/97
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Date of Signature
The Reports of Condition and Income are to be prepared in accordance with
Federal regulatory authority instructions. NOTE: these instructions may in
some cases differ from generally accepted accounting principles.
We, the undersigned directors (trustees), attest to the correctness of this
Report of Condition (including the supporting schedules) and declare that it
has been examined by us and to the best of our knowledge and belief has been
prepared in conformance with the instructions issued by the appropriate Federal
regulatory authority and is true and correct.
/s/ Stuart M. Pearman
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Director (Trustee)
/s/ J.T. Moore
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Director (Trustee)
/s/ Peter J. Denker
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Director (Trustee)
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FOR BANKS SUBMITTING HARD COPY REPORT FORMS:
STATE MEMBER BANKS: Return the original and one copy to the appropriate
Federal Reserve District Bank.
STATE NONMEMBER BANKS: Return the original only in the special return address
envelope provided. If express mail is used in lieu of the special return
address envelope, return the original only to the FDIC, c/o Quality Data
Systems, 2127 Espey Court, Suite 204, Crofton, MD 21114.
NATIONAL BANKS: Return the original only in the special return address
envelope provided. If express mail is used in lieu of the special return
address envelope, return the original only to the FDIC, c/o Quality Data
Systems, 2127 Espey Court, Suite 204, Crofton, MD 21114.
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FDIC Certificate Number ____________
(RCRI 9050)
09-30-97
Banks should affix the address label in this space.
U. S. Trust Company of Texas, National Association
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Legal Title of Bank (TEXT 9010)
2001 Ross Avenue, Suite 2700
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City (TEXT 9130)
Dallas, TX 75201
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State Abbrev. (TEXT 9200) ZIP Code (TEXT 9220)
Board of Governors of the Federal Reserve System, Federal Deposit Insurance
Corporation, Office of the Comptroller of the Currency
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U.S. TRUST COMPANY OF TEXAS, N.A. Call Date: 09/30/97 State #: 6797 FFIEC 034
2100 ROSS AVENUE, SUITE 2700 Vendor ID: D Cert #: 33217 Page RC-2
DALLAS, TX 75201 Transit #: 11101765
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CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS FOR JUNE 30,1997
All schedules are to be reported in thousands of dollars. Unless otherwise indicated,
report the amount outstanding as of the last business day of the quarter.
SCHEDULE RC - BALANCE SHEET
C100
Dollar Amounts in Thousands
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ASSETS
1. Cash and balances due from depository institutions: RCON
----
a. Noninterest-bearing balances and currency and coin (1,2) 0081 882 1.a
---------------- ------ -------
b. Interest bearing balances (3) 0071 916 1.b
------------------------------------------- ------ -------
2. Securities:
a. Held-to-maturity securities (from Schedule RC-B, column A) 1754 0 2.a
-------------- ------ -------
b. Available-for-sale securities (from Schedule RC-B, column D) 1773 128,787 2.b
------------ ------ -------
3. Federal funds sold (4) and securities purchased under agreements to resell: 1350 6,000 3
4. Loans and lease financing receivables: RCON
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a. Loans and leases, net of unearned income (from Schedule RC-C) 2122 12,545 4.a
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b. LESS: Allowance for loan and lease losses 3123 200 4.b
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c. LESS: Allocated transfer risk reserve 3128 0 4.c
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d. Loans and leases, net of unearned income, allowance, and reserve RCON
----
(item 4.a minus 4.b and 4.c) 2125 12,345 4.d
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5. Trading assets 3545 0 5.
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6. Premises and fixed assets (including capitalized leases) 2145 694 6.
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7. Other real estate owned (from Schedule RC-M) 2150 0 7.
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8. Investments in unconsolidated subsidiaries and associated companies
(from Schedule RC-M) 2130 0 8.
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9. Customers' liability to this bank on acceptances outstanding 2155 0 9.
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10. Intangible assets (from Schedule RC-M) 2143 0 10.
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11. Other assets (from Schedule RC-F) 2160 2,070 11.
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12. a. Total assets (sum of items 1 through 11) 2170 151,694 12.a
-------------------------------- ------ -------
b. Losses deferred pursuant to U.S.C. 1823(j) 0306 0 12.b
-------------------------------- ------ -------
c. Total assets and losses deferred pursuant to 12 U.S.C. 1823(j)
(sum of items 12.a and 12.b) 0307 151,694 12.c
--------------------------------------- ------ -------
(1) Includes cash items in process of collection and unposed debits.
(2) The amount reported in this item must be greater than or equal to the sum of Schedule RC-M, items 3.a and 3.b.
(3) Includes time certificates of deposit not held for trading.
(4) Report 'term federal funds sold' in Schedule RC, item 4.a, 'Loans and leases, net of unearned income,' and in Schedule
RC-C, part 1.
(5) Report securities purchased under agreements to resell that involve the receipt of immediately available funds and
mature in one business day or roll over under a continuing contract in Schedule RC, item 3.a, 'Federal funds sold.'
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U.S. TRUST COMPANY OF TEXAS, N.A. Call Date: 06/30/97 State #: 6797 FFIEC 034
2100 ROSS AVENUE, SUITE 2700 Vendor ID: D Cert #: 33217 Page RC-2
DALLAS, TX 75201 Transit #: 11101765
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SCHEDULE RC - CONTINUED
Dollar Amounts in Thousands
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LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of RCON
----
columns A and C from Schedule RC-E) RCON 2200 116,013 13.a
------------------------------------ ----
(1) Noninterest-bearing (1) 6631 8,660 13.a.1
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(2) Interest-bearing 6636 107,353
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b. In foreign offices, Edge and Agreement subsidiaries, and IBFs
(1) Noninterest-bearing
---------------------------------------------
(2) Interest-bearing
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14. Federal funds purchased(2) and securities sold under agreements to RCON 0 14
repurchase: ----
2800
15. a. Demand notes issued to the U.S. Treasury 2840 0 15.a
------------------------------- ------ -------
b. Trading liabilities 3548 0 15.b
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16. Other borrowed money:
A. WITH A REMAINING MATURITY OF ONE YEAR OR LESS 2332 7,000 16.a
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B. WITH A REMAINING MATURITY OF MORE THAN ONE YEAR THROUGH THREE YEARS A547 1,000 16.b
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C. WITH A REMAINING MATURITY OF MORE THAN THREE YEARS A548 3,000 16.c
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17. Not applicable
18. Bank's liability on acceptances executed and outstanding 2920 0 18.
-------------------- ------ -------
19. Subordinated notes and debentures 3200 0 19.
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20. Other liabilities (from Schedule RC-G) 2930 1,990 20.
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21. Total liabilities (sum of items 13 through 20) 2948 129,003 21.
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22. Not applicable
EQUITY CAPITAL
RCON 7,000 23.
----
23. Perpetual preferred stock and related surplus 3838
------------------------------- ------ -------
24. Common stock 3230 500 24.
---------------------------------------------------------------- ------ ------
25. Surplus (exclude all surplus related to preferred stock) 3839 8,384 25.
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26. a. Undivided profits and capital reserves 3632 6,512 26.a
---------------------------------- ------ ------
b. Net unrealized holding gains (losses) on available-for-sale
securities 8434 295 26.b
------------------------------------------------------------- ------ ------
27. Cumulative foreign currency translation adjustments
-------------------------
28. a. Total equity capital (sum of items 23 through 27) 3210 22,691 28.a
----------------------- ------ ------
b. Losses deferred pursuant to 12 U.S.C. 1823(j) 0306 0 28.b
--------------------------- ------ ------
c. Total equity capital and losses deferred pursuant to 12 U.S.C. 1823(j)
(sum of items 28.a and 28.b) 3559 22,691 28.c
------------------------------------------ ------ ------
29. Total liabilities, limited-life preferred stock, equity capital,
and losses deferred pursuant to 12 U.S.C. 1823(j) (sum of items
21, 22, and 28.c) 2257 151,694 29.
---------------------------------------------------------- ------ ------
MEMORANDUM
TO BE REPORTED ONLY WITH THE MARCH REPORT OF CONDITION.
1. Indicate in the box at the right the number of the statement below that best describes the most
comprehensive level of auditing work performed for the bank by independent external auditors as RCON
of any date during 1995 ----
----------------------------------------------------------------------- 6724 N/A M.1
1 = Independent audit of the bank conducted in accordance 4 = Directors' examination of the bank performed by other
with generally accepted auditing standards by certified external auditors (may be required by state chartering
public accounting firm which submits a report on the bank authority)
2 = Independent audit of the bank's parent holding company 5 = Review of the bank's financial statements by external
conducted in accordance with generally accepted auditing auditors
standards by a certified public accounting firm which 6 = Compilation of the bank's financial statements by
submits a report on the consolidated holding company (but external auditors
not on the bank separately) 7 = Other audit procedures (excluding tax preparation
3 = Directors' examination of the bank conducted in accordance work)
with generally accepted auditing standards by a certified 8 = No external audit work
public accounting firm (may be required by state chartering
authority)
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
(2) Report "term federal funds purchased" in Schedule RC, item 16, 'Other
borrowed money.'
(3) Report securities sold under agreements to repurchase that involve the
receipt of immediately available funds and mature in one business day or
roll over under a continuing contract in Schedule RC, item 14.a, 'Federal
funds purchased.'
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COMPTROLLER OF THE CURRENCY
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TREASURY DEPARTMENT [TREASURY DEPARTMENT LOGO] OF THE UNITED STATES
- ------------------- --------------------
WASHINGTON, D.C.
Whereas, satisfactory evidence has been presented to the Comptroller of
the Currency that U.S. Trust Company of Texas, National Association located in
Rowlett, State of Texas has complied with all provisions of the statutes of the
United States required to be complied with before being authorized to commence
the business of banking as a National Banking Association;
Now, therefore, I hereby certify that the above-named association is
authorized to commence the business of banking as a National Banking
Association.
In testimony whereof, witness my signature and seal of
office this 7th day of December 1990
Charter No. 18782 /s/ [ILLEGIBLE]
Comptroller of the Currency
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Exhibit T-1.3
[Comptroller of the Currency Logo]
TRUST PERMIT
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Comptroller of the Currency
Administrator of National Banks
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Southwestern District
1600 Lincoln Plaza
500 N. Akard
Dallas, Texas 75201-3394
WHEREAS, - U.S. Trust Company of Texas, National Association, located in Dallas,
Texas, being a national banking association, organized under the statutes of the
United States, has made application for authority to act as fiduciary;
AND WHEREAS, applicable provision of the statutes of the United States authorize
the grant of such authority;
NOW THEREFORE, I certify that the said association is authorized to act in all
fiduciary capacities permitted by such statutes.
IN TESTIMONY WHEREOF, witness my
signature and seal of the Office
this Sixth day of August, 1991.
/s/ EDWARD M. GRAVES
--------------------------------
Edward M. Graves
Director for Analysis
CHARTER NUMBER 18782
[Comptroller of the Currency Seal]
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Exhibit A
Articles of Association
of
U.S. Trust Company of Texas, National Association
For the purpose of organizing an association to perform any lawful activities
of national banks, the undersigned to enter into the following articles of
association:
FIRST: The title of this association shall be U.S. Trust Company of Texas,
National Association.
SECOND: The main office of the association shall be in Dallas, County of
Dallas, State of Texas. The general business of the association shall be
conducted at its main office and its branches.
THIRD: The board of directors of this association shall consist of not less
than five nor more than twenty-five persons, the exact number to be fixed and
determined from time to time by resolution of a majority of the full board of
directors or by resolution of a majority of the shareholders at any annual or
special meeting thereof. Each director shall own common or preferred stock of
the association with an aggregate par value of not less than $1,000, or common
or preferred stock of a bank holding company owning the association with an
aggregate par, fair market or equity value of not less than $1,000, as of
either (i) the date of purchase, (ii) the date the person became a director or
(iii) the date of that person's most recent election to the board of directors,
whichever is greater. Any combination of common or preferred stock of the
association or such holding company may be used.
Any vacancy in the board of directors may be filled by action of a majority of
the remaining directors may not increase the number of directors between
meetings of shareholders to a number which: (1) exceeds by more than two the
number of directors last elected by shareholders where the number was 15 or
less; and (2) exceeds by more than four the number of directors last elected by
shareholders where the number was 16 or more, but in no event shall the number
of directors exceed 25.
Terms of directors, including directors selected to fill vacancies, shall
expire at the next regular meeting of shareholders at which directors are
elected, unless the directors resign or are removed from office.
Despite the expiration of a director's term, the director shall continue to
serve until his or her successor is elected and qualifies or until there is a
decrease in the number of directors and his or her position is eliminated.
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Honorary or advisory members of the board of directors, without voting power or
power of final decision in matters concerning the business of the association,
may be appointed by resolution of a majority of the full board of directors, or
by resolution of shareholders at any annual or special meeting. Honorary or
advisory directors shall not be counted for purposes of determining the number
of directors of the association or the presence of a quorum in connection with
any board action, and shall not be required to own qualifying shares.
FOURTH: There shall be an annual meeting of the shareholders to elect
directors and transact whatever other business may be brought before the
meeting. It shall be held at the main office or any other convenient place the
board of directors may designate, on the day of each year specified therefore
in the bylaws, or if that day falls on a legal holiday in the State in which
the association is located, on the next following banking day. If no election
is held on the day fixed, or in event of a legal holiday, an election may be
held on any subsequent day within 60 days of the day fixed, to be designated by
the board of directors, or, if the directors fail to fix the day, by
shareholders representing two-thirds of the shares issued and outstanding. In
all cases at least 10 days advance notice of the meeting shall be given to the
shareholders by first class mail.
In all elections of directors, the number of votes each common shareholder may
cast will be determined by multiplying the number of shares he or she owns by
the number of directors to be elected. Those votes may be cumulated and cast
for a single candidate or may be distributed among two or more candidates in
the manner selected by the shareholder. On all other questions, each common
shareholder shall be entitled to one vote for each share of stock held by him
or her.
Nominations for election to the board of directors may be made by the board of
directors or by any stockholder of any outstanding class of capital stock of
the association entitled to vote for election of directors. Nominations other
than those made by or on behalf of the existing management shall be made in
writing and be delivered or mailed to the president of the association and to
the Comptroller of the Currency, Washington, D.C., not less than 14 days nor
more than 50 days prior to any meeting of shareholders called for the election
of directors; provided, however, that if less than 21 days notice of the
meeting is given to shareholders, such nominations shall be mailed or delivered
to the president of the association and to the Comptroller of the Currency not
later than the close of business on the seventh day following the day on which
the notice of meeting was mailed. Such notification shall contain the
following information to the extent known to the notifying shareholder.
(1) The name and address of each proposed nominee.
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(2) The principal occupation of each proposed nominee.
(3) The total number of shares of capital stock of the association that
will be voted for each proposed nominee.
(4) The name and residence address of the notifying shareholder.
(5) The number of shares of capital stock of the association owned by the
notifying shareholder.
Nominations not made in accordance herewith may, in his/her decision, be
disregarded by the chairperson of the meeting, and the vote tellers may
disregard all votes cast for each such nominee. No bylaw may unreasonably
restrict the nomination of directors by shareholders.
A director may resign at any time by delivering written notice to the board of
directors, its chairperson, or to the association, which resignation shall be
effective when the notice is delivered unless the notice specifies a later
effective date.
A director may be removed by shareholders at a meeting called to remove him or
her, when notice of the meeting stating that the purpose or one of the purposes
is to remove him or her is provided, if there is a failure to fulfill one of
the affirmative requirements for qualification, or for cause, provided, however,
that a director may not be removed if the number of votes sufficient to elect
him or her under cumulative voting is voted against his or her removal.
FIFTH: The authorized amount of capital stock of this association shall be
5,000 shares of common stock of the par value of One Hundred Dollars ($100)
each; but said capital stock may be increased or decreased from time to time,
according to the provisions of the laws of the United States.
No holder of shares of the capital stock of any class of the association shall
have any preemptive or preferential right of subscription to any shares of any
class of stock of the association, whether nor or hereafter authorized, or to
any obligations convertible into stock of the association, issued, or sold, nor
any right of subscription to any thereof other than such, if any, as the board
of directors, in its discretion may from time to time determine and at such
price as the board of directors may from time to time fix.
Unless otherwise specified in the articles of association or required by law,
(1) all matters requiring shareholder action, including amendments to the
articles of association must be approved by shareholders owning a majority
voting interest in the
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outstanding voting stock, and (2) each shareholder shall be entitled to one
vote per share.
Unless otherwise specified in the articles of association or required by law,
all shares of voting stock shall be voted together as a class, on any matters
requiring shareholder approval. If a proposed amendment would affect two or
more classes or series in the same or a substantially similar way, all the
classes or series so affected, must vote together as a single voting group on
the proposed amendment.
Shares of the same class or series may be issued as a dividend on a pro rata
basis and without consideration. Shares of another class or series may be
issued as a share dividend in respect of a class or series of stock if approved
by a majority of the votes entitled to be cast by the class or series to be
issued unless there are no outstanding shares of the class or series to be
issued. Unless otherwise provided by the board of directors, the record date
for determining shareholders entitled to a share dividend shall be the date the
board of directors authorizes the share dividend.
Unless otherwise provided in the bylaws, the record date for determining
shareholders entitled to notice of and to vote at any meeting is the close of
business on the day before the first notice is mailed or otherwise sent to the
shareholders, provided that in no event may a record date be more than 70 days
before the meeting.
If a shareholder is entitled to fractional shares pursuant to preemptive
rights, a stock dividend, consolidation or merger, reverse stock split or
otherwise, the association may (a) issue fractional shares, or (b) in lieu of
the issuance of fractional shares, issue script or warrants entitling the
holder to receive a full share upon surrendering enough script or warrants to
equal a full share, (c) if there is an established and active market in the
association's stock, make reasonable arrangements to provide the shareholder
with an opportunity to realize a fair price through sale of the fraction, or
purchase of the additional fraction required for a full share, (d) remit the
cash equivalent of the fraction to the shareholder, or (e) sell full shares
representing all the fractions at public auction or to the highest bidder after
having solicited and received sealed bids from at least three licensed stock
brokers, and distribute the proceeds pro rata to shareholders who otherwise
would be entitled to the fractional shares. The holder of a fractional share
is entitled to exercise the rights for shareholder, including the right to
vote, to receive dividends, and to participate in the assets of the association
upon liquidation, in proportion to the fractional interest. The holder of
script or warrants is not entitled to any of these rights unless the script or
warrants explicitly provide for such rights. The script or warrants may
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be subject to such additional conditions as (1) that the script or warrants
will become void if not exchanged for full shares before a specified date, and
(2) that the shares for which the script or warrants are exchangeable may be
sold at the option of the association and the proceeds paid to scriptholders.
The association, at any time and from time to time, may authorize and issue
debt obligations, whether or not subordinated, without the approval of the
shareholders. Obligations classified as debt, whether or not subordinated,
which may be issued by the association without the approval of shareholders, do
not carry voting rights on any issue, including an increase or decrease in the
aggregate number of the securities, or the exchange or reclassification of all
or part of securities into securities of another class or series.
SIXTH: The board of directors shall appoint one of its members president of
this association, and one of its members chairperson of the board and shall
have the power to appoint one or more vice presidents, a secretary who shall
keep minutes of the directors' and shareholders' meetings and be responsible
for authenticating the records of the association, and such other officers and
employees as may be required to transact the business of this association. A
duly appointed officer may appoint one or more officers or assistant officers
if authorized by the board of directors in accordance with the bylaws.
The board of directors shall have the power to:
(1) Define the duties of the officers, employees and agents of the
association.
(2) Delegate the performance of its duties, but not the responsibility for
its duties, to the officers, employees, and agents of the association.
(3) Fix the compensation and enter into employment contracts with its
officers and employees upon reasonable terms and conditions consistent
with applicable law.
(4) Dismiss officers and employees.
(5) Require bonds from officers and employees and to fix the penalty
thereof.
(6) Ratify written policies authorized by the association's management or
committees of the board.
(7) Regulate the manner in which any increase or decrease of the capital
of the association shall be made, provided that nothing herein shall
restrict the power of shareholders to increase or decrease the capital
of the association in
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accordance with law, and nothing shall raise or lower from two-thirds
the percentage required for shareholder approval to increase or reduce
the capital.
(8) Manage and administer the business and affairs of the association.
(9) Adopt initial bylaws, not inconsistent with law or the articles of
association, for managing the business and regulating the affairs of
the association.
(10) Amend or repeal bylaws, except to the extent that the articles of
association reserve this power in whole or in part to shareholders.
(11) Make contracts.
(12) Generally to perform all acts that are legal for a board of directors
to perform.
SEVENTH: The board of directors shall have the power to change the location
of the main office to any other place within the limits of Dallas, Texas,
without the approval of the shareholders, and shall have the power to establish
or change the location of any branch or branches of the association to any
other location permitted under applicable law, without the approval of the
shareholders, subject to approval by the Office of the Comptroller of the
Currency.
EIGHTH: The corporate existence of this association shall continue until
terminated according to the laws of the United States.
NINTH: The board of directors of this association, or any one or more
shareholders owning, in the aggregate, not less than five percent of the stock
of this association, may call a special meeting of shareholders at any time.
Unless otherwise provided by the bylaws or the laws of the United States, or
waived by shareholders, a notice of the time, place, and purpose of every
annual and special meeting of the shareholders shall be given by first-class
mail, postage prepaid, mailed at least 10, and no more than 60, days prior to
the date of the meeting to each shareholder of record at his/her address as
shown upon the books of this association. Unless otherwise provided by the
bylaws, any action requiring approval of shareholders must be effected at duly
called annual or special meeting.
TENTH: An director of the association or such director's heirs, executors,
or administrators may be indemnified or reimbursed by the association for
reasonable expenses actually incurred in connection with claims made against
such director to the extent
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allowed by applicable law, including 12 CFR 7.5217, and regulatory and public
policy.
ELEVENTH: these articles of association may be amended at any regular or
special meeting of the shareholders by the affirmative vote of the holders of a
majority of the stock of this association, unless the vote of the holders of a
greater amount of stock is required by law, and in that case by the vote of the
holders of such greater amount. The association's board of directors may
propose one or more amendments to the articles of association for submission to
the shareholders.
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BY-LAWS
U.S. TRUST COMPANY OF TEXAS, N.A.
ARTICLE I
MEETING OF SHAREHOLDERS
Section 1.1. Annual Meeting. The regular annual meeting of the
shareholders for the election of directors and the transaction of whatever
business may properly come before the meeting, shall be held at such time,
within six months after the close of the Corporation's fiscal year, and place as
the Board of Directors may designate. Notice of such meeting shall be mailed,
postage prepaid, at least ten days prior to the date thereof, addressed to each
shareholder at his address appearing on the books of the Corporation. If, from
any cause, an election of directors is not made on the said day, the Board of
Directors shall order the election to be held on some subsequent day, as soon
thereafter as practicable, according to the provisions of law; and notice
thereof shall be given in the manner herein provided for the annual meeting.
Section 1.2. Special Meetings. Except as otherwise specifically provided
by statute, special meeting of the shareholders may be called for any purpose
at any time by the Board of Directors or by any one or more shareholders
owning, in the aggregate, not less than ten (10) percent of the stock of the
Corporation. Every such special meeting, unless otherwise provided by law,
shall be called by mailing, postage prepaid, not less than ten days prior to
the date fixed for such meeting, to each stockholder at his address appearing
on the books of the Corporation, a notice stating the purpose of the meeting.
Section 1.3. Nomination for Director. Nominations for election to the
Board of Directors may be made by the Board of Directors or by any stockholder
of any outstanding class of capital stock of the Corporation entitled to vote
for the election of directors.
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Section 1.4. Proxies. Shareholders may vote at any meeting of the
shareholders by proxies duly authorized in writing, but no officer or employee
of this Corporation shall act as proxy. Proxies shall be valid only for one
meeting, to be specified therein, and any adjournments of such meeting.
Proxies shall be dated and shall be filed with the records of the meeting.
Section 1.5. Quorum. A majority of the outstanding capital stock,
represented in person or by proxy, shall constitute a quorum at any meeting of
shareholders, unless otherwise provided by law; but less than a quorum may
adjourn any meeting, from time to time, and the meeting may be held, as
adjourned, without further notice. A majority of the votes cast shall decide
every question or matter submitted to the shareholders at any meeting, unless
otherwise provided by law. Shareholders may participate in said meeting by
means of a conference telephone or similar communications equipment allowing all
persons participating in the meeting to hear each other at the same time.
Participation by such means shall constitute presence at a meeting.
Section 1.6. Action Without a Meeting. Any action required by law, these
By-laws, or the Articles of Incorporation of the Corporation to be taken at any
annual or special meeting of shareholders of the Corporation, or any action
which may be taken at any annual or special meeting of such shareholders, may be
taken without a meeting, without prior notice and without a vote, if a consent
in writing, setting forth the action so taken, shall be signed by the holders
of all outstanding stock entitled to vote thereon.
ARTICLE II
Directors
Section 2.1. Board of Directors. The Board of Directors shall have the
power to manage and administer the business and affairs of the Corporation.
Except as expressly limited by law, all corporate powers of the Corporation
shall be vested in and may be exercised by said Board of Directors.
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Section 2.2. Numbers. The Board of Directors shall consist of not less
than five nor more than twenty-five persons, the exact number within such
minimum and maximum limits to be fixed and determined from time to time by
resolution of a majority of the full Board of Directors or by resolution of the
shareholders at any meeting thereof; provided, however, that a majority of the
full Board of Directors may not increase the number of directors to a number
which exceeds by more than two the number of directors last elected by
shareholders.
Section 2.3. Organization Meeting. The Secretary, upon receiving the
result of any election, shall notify the directors-elect of their election and
of the time at which they are required to meet at the Main Office of the
corporation for the purpose of filing their affidavits accepting such
directorship, as required by law, organizing the new Board of Directors and
electing and appointing officers of the Corporation for the succeeding year.
Such meeting shall be held on the day of the election or as soon thereafter as
practicable, and, in any event, within thirty days thereof. If, at the time
fixed for such meeting, there shall not be a quorum present, the directors
present may adjourn the meeting, from time to time, until a quorum is obtained.
Section 2.4. Regular meetings. At least one regular meeting of the
Board of Directors shall be held in the months of January, February, March,
April, May, June, July, September, October and November upon notice. Written
notice of the time and place of such regular meetings of the Board of Directors
shall be given to each Director by either personal delivery, telegram,
facsimile transmission, or any other form of electronic communication, unless
prohibited by law, at least two (2) days before the meeting or by notice
mailed to the Director at least five (5) days before each meeting. One or more
representatives designated by the sole shareholder shall receive prior notice
of, and an invitation to attend, any meeting of the Board of Directors.
Section 2.5. Special Meetings. Special meetings of the Board of
Directors may be called by the President of the Corporation, or at the request
of two or more directors. Each member of the Board of Directors shall be given
notice stating the time and place, by telegram, letter, facsimile transmission
or other electronic communication, or in person, of each such special meeting
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Section 2.6. Quorum. A majority of the directors shall constitute a quorum
at any meeting, except when otherwise provided by law; but a lesser number may
adjourn any meeting from time to time, and the meeting may be held, as
adjourned, without further notice. Members of the Board of Directors or any
committee thereof may participate in a meeting of such Board or committee by
means of a conference telephone or similar communications equipment allowing all
persons participating in the meeting to hear each other at the same time.
Participation by such means shall constitute presence in person at a meeting.
Section 2.7. Vacancies. When any vacancy occurs among the directors, the
remaining members of the Board of Directors, in accordance with the laws of the
State of Texas, may appoint a director to fill such vacancy at any regular
meeting of the Board of Directors, or at a special meeting for that purpose.
Section 2.8. Action Without a Meeting. Any action required to be taken at a
meeting of the Board of Directors of the Corporation, or any action which may be
taken at a meeting of the Board of Directors or a committee thereof, may be
taken without a meeting if a consent in writing, setting forth the action so to
be taken, signed by all of the directors, or all the members of the committee,
as the case may be, is filed in the minutes of the proceedings of the Board of
Directors or of the committee. Such consent shall have the same effect as a
unanimous vote.
ARTICLE III
Committees of the Board
Section 3.1. Examining Committee. The Board of Directors shall annually
appoint a committee of two or more directors, which shall, at least once during
each calendar year and within fifteen months of the last such examination make
suitable examinations of the affairs of the Corporation, or cause suitable
examinations to be made by examiners responsible only to the Board of Directors,
to ascertain whether the Corporation is in sound financial condition, whether
internal controls and procedures are being maintained, and shall recommend to
the Board of Directors such changes in the manner of conducting the affairs of
the Corporation as shall be deemed advisable. Such reports shall state the
results of such examinations in writing to the Board of Directors at the next
regular meeting thereafter.
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Section 3.2. Executive Committee. There shall be an Executive Committee
composed of two or more directors which shall have and may exercise all the
authority of the Board of Directors when the Board of Directors is not in
session, except that such committee shall not have the authority to:
(a) approve or recommend to shareholders actions or proposals
required by law to be approved by shareholders,
(b) designate candidates for the office of director, for purposes of
proxy solicitation or otherwise,
(c) fill vacancies on the Board of Directors or any committee
thereof,
(d) amend the By-Laws, or
(e) authorize or approve the issuance or sale of, or any contract to
issue or sell, shares, except that the Board of Directors, having provided
general authorization for the issuance or sale of shares, or any contract
therefore, may, pursuant to a general formula or method specified by the
Board of Directors, by resolution or by adoption of a stock option or
other plan, authorize the Executive Committee to fix the terms of any
contract for the sale of the shares and to fix the terms upon which such
share may be issued or sold; provided however that the Executive Committee
shall secure the consent or approval of U.S. Trust Corporation on behalf
of the sole shareholder of the Corporation evidenced by (i) a resolution
of its Board of Directors or (ii) written approval of its Chairman or
President to such action.
The Executive Committee shall keep minutes of its meetings, and such
minutes shall be submitted at the next regular meeting of the Board of
Directors at which a quorum is present, and any action taken by the Board of
Directors which respect thereto shall be entered in the minutes of the Board of
Directors.
The Executive Committee shall meet at least once in each calendar month in
which a regular meeting of the Board of Directors is not scheduled.
ARTICLE V
Officers and Employees
Section 4.1. Chairman of the Board. The Board of Directors shall appoint
one of its members to be Chairman of the Board of Directors to serve at the
pleasure of the Board of Directors. Such person shall preside at all meetings
of the Board of Directors. The Chairman of the Board of Directors shall
supervise the carrying out of the policies adopted or approved by the Board of
Directors; shall have general executive powers, as well as the specific powers
conferred by these By-Laws; shall also have and may exercise such further
powers and duties as from time to time may be conferred upon or assigned by the
Board of Directors.
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Section 4.2. President. The Board of Directors shall appoint one of its
members to be President of the Corporation. In the absence of the Chairman, the
President shall preside at any meeting of the Board of Directors. The President
shall have general executive powers, and shall have and may exercise any and
all other powers and duties pertaining by law, regulation or practice to the
Office of President, or imposed by these By-Laws. The President shall also have
and may exercise such further powers and duties as from time to time may be
conferred or assigned by the Board of Directors.
Section 4.3. Vice President. The Board of Directors may appoint one or
more Vice Presidents. Each Vice President shall have such powers and duties as
may be assigned by the Board of Directors. One Vice President shall be
designated by the Board of Directors, in the absence of the President, to
perform all the duties of the President.
Section 4.4. Secretary. The Board of Directors shall appoint a Secretary,
Cashier, or other designated officer who shall be Secretary of the Board of
Directors and of the Corporation, and shall keep accurate minutes of all
meetings. The Secretary shall attend to the giving of all notices required by
these By-Laws to be given; shall be custodian of the corporate seal, records,
documents and papers of the Corporation; shall provide for the keeping of
proper records of all transactions of the Corporation; shall have and may
exercise any and all other powers and duties pertaining by law, regulation or
practice, to the Offices of Secretary or Cashier, or imposed by these By-Laws;
and shall also perform such other duties as may be assigned from time to time
by the Board of Directors.
Section 4.5. Other Officers. The Board of Directors may appoint one or
more Assistant Vice Presidents, one or more Trust Officers, one or more
Assistant Secretaries, one or more Assistant Cashiers, one or more Managers and
Assistant Managers of Branches and such other officers and attorneys which from
time to time may appear to the Board of Directors to be required or desirable
to transact the business of the Corporation. Such officers shall respectively
exercise such powers and perform such duties as pertain to their several
offices, or as may be conferred upon, or assigned to them by the Board of
Directors, the Chairman of the Board of Directors, or the President.
Section 4.6. Tenure of Office. The President and all other officers shall
hold office for the current year for which the Board of Directors was elected,
unless they shall resign, become disqualified, or be removed; and any vacancy
occurring in the Office of the President shall be filled promptly by the Board
of Directors.
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ARTICLE V
Trust Department
Section 5.1. Trust Department. There shall be a department of the
Corporation known as the Trust Department which shall perform the fiduciary
responsibilities of the Corporation.
Section 5.2. Trust Officer. There shall be a Trust Officer of this
Corporation whose duties shall be to manage, supervise and direct all the
activities of the Trust Department. Such person shall do or cause to be done
all things necessary or proper in carrying on the business of the Trust
Department in accordance with provisions of law and applicable regulations; and
shall act pursuant to opinions of counsel where such opinion is deemed
necessary. Opinions of counsel shall be retained on file in connection with all
important matters pertaining to fiduciary activities. The Trust Officer shall
be responsible for all assets and documents held by the Corporation in
connection with fiduciary matters.
The Board of Directors may appoint such other officers of the Trust
Department as it may deem necessary, with such duties as may be assigned.
Section 5.3. Trust Investment Committee. There shall be a Trust
Investment Committee of this Corporation composed of two or more members, who
shall be capable and experienced officers or directors of the Corporation. All
investments of funds held in a fiduciary capacity shall be made, retained or
disposed of only with the approval of the Trust Investment Committee, and the
Committee shall keep minutes of all its meetings, showing the disposition of
all matters it considers and passes upon. The Committee shall, promptly after
the acceptance of an account for which the Corporation has investment
responsibilities, review the assets thereof, to determine the advisability of
retaining or disposing of such assets. The Committee shall conduct a similar
review at least once during each calendar year thereafter.
The Trust Investment Committee or any sub-committee thereof shall additionally
exercise the Department's fiduciary authority over matters such as
discretionary distributions, account overdrafts, acceptance of new accounts,
closing of accounts, exceptions or changes to the published fee schedules, and
all other matters which require a high degree of corporate discretion.
A report of all investment reviews and other Committee actions shall be
noted in the minutes of the Committee.
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Section 5.4. Trust Department Files. There shall be maintained in
the Trust Department files containing all fiduciary records necessary to assure
that its fiduciary responsibilities have been properly undertaken and
discharged.
Section 5.5. Trust Investments. Funds held in a fiduciary capacity
shall be invested in accordance with the instrument establishing the fiduciary
relationship and permissible by law.
ARTICLE VI
Stock and Stock Certificates
Section 6.1. Transfers. Shares of stock shall be transferable on
the books of the Corporation, and a transfer book shall be kept in which all
transfers of stock shall be recorded. Every person becoming a shareholder by
such transfer shall, in proportion to his shares, succeed to all rights of the
prior holder of such shares.
Section 6.2. Stock Certificates. Certificates of stock shall bear
the signature of the Chairman (which may be engraved, printed, or impressed),
and shall be signed manually or by facsimile process by the Secretary,
Assistant Secretary, Cashier, Assistant Cashier, or any other officer appointed
by the Board of Directors for that purpose, to be known as an Authorized
Officer, and the seal of the Corporation shall be engraven thereon. Each
certificate shall recite on its face that the stock represented thereby is
transferable only upon the books of the Corporation properly endorsed.
ARTICLE VII
Corporate Seal
Section 7.1 The President, the Cashier, the Secretary or any
Assistant Cashier or Assistant Secretary, or other officer thereunto designated
by the Board of Directors, shall have the authority to affix the corporate seal
to any document requiring such seal, and to attest the same. Such seal shall be
substantially in the following form:
( Impression )
( of )
( Seal )
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ARTICLE VIII
Miscellaneous Provisions
Section 8.1. Fiscal Year. The Fiscal Year of the Corporation shall
be the calendar year.
Section 8.2. Execution of Instruments. All agreements, indentures,
mortgages, deeds, conveyances, transfers, certificates, declarations, receipts,
discharges, releases, satisfactions, settlements, petitions, schedules,
accounts, affidavits, bonds, undertakings, proxies and other instruments or
documents may be signed, executed, acknowledged, verified, delivered or
accepted on behalf of the Corporation by the Chairman of the Board, or the
President, or any Vice President, or the Secretary, or the Cashier, or, if in
connection with exercise of fiduciary powers of the Corporation, by any of
said officers or by any Trust Officer. Any such instruments may also be
executed, acknowledged, verified, delivered or accepted on behalf of the
Corporation in such other manner and by such other officers or agents as the
Board of Directors may from time to time direct. The provisions of this Section
8.2 are supplementary to any other provision of these By-laws.
Section 8.3. Records. The Articles of Incorporation, the By-laws and
the proceedings of all meetings of the shareholders, the Board of Directors,
and standing committees of the Board shall be recorded in appropriate minute
books provided for the purpose. The minutes of each meeting shall be signed by
the Secretary, Cashier or other Officer appointed to act as Secretary of the
meeting.
ARTICLE IX
By-laws
Section 9.1. Inspection. A copy of the By-laws, with all amendments
thereto, shall at all times be kept in a convenient place at the Main Office of
the Corporation, and shall be open for inspection to all shareholders, during
business hours.
Section 9.2. Amendments. The By-laws may be amended, altered, or
repealed, at any regular or special meeting of the Board of Directors, by a
vote of a majority of the total number of the Directors.
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ARTICLE X
Idemnification
Section 10.1. Idemnified Person. To the extent permitted and in the
manner prescribed by law, the Corporation shall indemnify any person
("indemnified person") made or threatened to be made a party to any action,
suit or proceeding, whether civil or criminal, by reason of the fact that he,
his testator or intestate, is or was a director, advisory board member or
officer of the Corporation or served any other corporation of any type or kind,
domestic or foreign, or any partnership, joint venture, trust, employee benefit
plan or other enterprise in any capacity at the request of the Corporation,
against judgements, fines, amounts paid in settlement and reasonable expenses
(which the Corporation may advance), including attorney's fees, actually and
necessarily incurred as a result of such action, suit or proceeding, or any
appeal therein. The foregoing right of indemnification shall not be exclusive
of any other right to which any such person may be entitled but shall not apply
in the event of misconduct or gross negligence of the proposed indemnified
person.
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