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EXHIBIT 4.35
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AMENDED AND RESTATED DECLARATION OF TRUST
NIPSCO Capital Trust I
Dated as of February 16, 1999
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CROSS REFERENCE TABLE*
Section of Trust
Indenture Act of Section of
1939, as amended Agreement
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310(a)................................................................6.3
310(b).....................................................6.3(c); 6.3(d)
310(c).......................................................Inapplicable
311(a).............................................................2.2(b)
311(b).............................................................2.2(b)
311(c).......................................................Inapplicable
312(a).............................................................2.2(a)
312(b).............................................................2.2(b)
312(c).......................................................Inapplicable
313(a)................................................................2.3
313(b)................................................................2.3
313(c)................................................................2.3
313(d)................................................................2.3
314(a)................................................................2.4
314(b).......................................................Inapplicable
314(c)................................................................2.5
314(d).......................................................Inapplicable
314(e)................................................................2.5
314(f).......................................................Inapplicable
315(a)....................................................3.9(b); 3.10(a)
315(b).............................................................2.7(a)
315(c).............................................................3.9(a)
315(d).............................................................3.9(b)
316(a)................................................2.6; 7.5(b); 7.6(c)
316(b).......................................................Inapplicable
316(c).......................................................Inapplicable
317(a)...............................................................3.16
317(b).......................................................Inapplicable
318(a).............................................................2.1(c)
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* This Cross-Reference Table does not constitute part of the Agreement and
shall not have any bearing upon the interpretation of any of its terms or
provisions.
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TABLE OF CONTENTS
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ARTICLE 1: INTERPRETATION AND DEFINITIONS....................................1
SECTION 1.1 Interpretation and Definitions...................1
Affiliate .................................................2
Applicable Ownership Interest...............................3
Applicable Principal Amount.................................3
Authorized Officer..........................................3
Beneficial Owner............................................3
Business Day................................................3
Business Trust Act..........................................3
Cash Settlement.............................................3
Certificate.................................................3
Closing Date................................................3
Code .................................................3
Collateral Agent............................................4
Commission .................................................4
Common Security.............................................4
Common Security Certificate.................................4
"Corporate PIES" ...........................................4
Corporate Trust Office......................................4
Covered Person..............................................4
Debentures .................................................4
Debenture Issuer............................................4
Debenture Issuer Indemnified Person.........................4
Depositary .................................................4
Depositary Participant......................................4
Direct Action...............................................4
Distribution................................................4
Exchange Act................................................5
Exchange Notice.............................................5
Failed Remarketing..........................................5
Fiduciary Indemnified Person................................5
Fiscal Year.................................................5
Global Security.............................................5
Guarantee .................................................5
Holder .................................................5
Indemnified Person..........................................5
Indenture .................................................5
Indenture Event of Default..................................5
Indenture Trustee...........................................5
Investment Company..........................................5
Investment Company Act......................................6
Legal Action................................................6
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Liquidation.................................................6
Liquidation Distribution....................................6
List of Holders.............................................6
Majority in Liquidation Amount..............................6
"Moody's" .................................................6
New York Stock Exchange.....................................6
Officers' Certificate.......................................6
Paying Agent................................................7
Payment Amount..............................................7
Person .................................................7
Pledge Agreement............................................7
Preferred Security..........................................7
Preferred Security Certificate..............................7
Primary Treasury Dealer.....................................7
Property Account............................................7
Property Trustee............................................7
Pro Rata .................................................7
Purchase Contract Agent.....................................7
Purchase Contract Agreement.................................7
Purchase Contract Settlement Date...........................7
Quorum .................................................7
Quotation Agent.............................................7
Redemption Amount...........................................8
Redemption Notice...........................................8
Redemption Price............................................8
Regular Trustee.............................................8
Remarketing.................................................8
"Remarketed Securities".....................................8
Remarketing Date............................................8
Reset Rate .................................................8
Responsible Officer.........................................8
Rule 3a-5 .................................................8
"S&P" .................................................8
Securities .................................................8
Securities Act..............................................9
Sponsor .................................................9
Successor Delaware Trustee..................................9
Successor Entity............................................9
Successor Property Trustee..................................9
Successor Security..........................................9
Supermajority...............................................9
Tax Event .................................................9
Tax Event Redemption........................................9
Tax Event Redemption Date...................................9
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10% in Liquidation Amount...................................9
Termination Event..........................................10
Treasury Portfolio.........................................10
Treasury Portfolio.........................................10
Treasury Regulations.......................................10
Treasury Securities........................................10
Trust ................................................10
Trust Enforcement Event....................................10
Trust Indenture Act........................................11
Trustee ................................................11
"Two-Year Benchmark Treasury Rate".........................11
ARTICLE 2: TRUST INDENTURE ACT..............................................11
SECTION 2.1 Trust Indenture Act; Application......................11
SECTION 2.2 Lists of Holders of the Securities....................12
SECTION 2.3 Reports by the Property Trustee.......................12
SECTION 2.4 Periodic Reports to the Property Trustee..............12
SECTION 2.5 Evidence of Compliance with Conditions Precedent......12
SECTION 2.6 Trust Enforcement Events; Waiver......................12
SECTION 2.7 Trust Enforcement Event; Notice.......................14
ARTICLE 3: ORGANIZATION.....................................................14
SECTION 3.1 Name and Organization.................................14
SECTION 3.2 Office................................................14
SECTION 3.3 Purpose...............................................14
SECTION 3.4 Authority.............................................15
SECTION 3.5 Title to Property of the Trust........................15
SECTION 3.6 Powers and Duties of the Regular Trustees.............15
SECTION 3.7 Prohibition of Actions by the Trust and the Trustees..17
SECTION 3.8 Powers and Duties of the Property Trustee.............18
SECTION 3.9 Certain Duties and Responsibilities of the Property
Trustee...............................................19
SECTION 3.10 Certain Rights of Property Trustee....................21
SECTION 3.11 Delaware Trustee......................................23
SECTION 3.12 Execution of Documents................................23
SECTION 3.13 Not Responsible for Recitals or Issuance of
Securities............................................23
SECTION 3.14 Duration of Trust.....................................23
SECTION 3.15 Mergers...............................................23
SECTION 3.16 Property Trustee May File Proofs of Claim.............25
ARTICLE 4: THE SPONSOR......................................................26
SECTION 4.1 Responsibilities of the Sponsor.................26
SECTION 4.2 Indemnification and Expenses of the Trustees....26
ARTICLE 5: THE HOLDERS OF THE COMMON SECURITIES.............................27
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SECTION 5.1 Debenture Issuer's Purchase of the Common Securities..27
SECTION 5.2 Covenants of the Debenture Issuer.....................27
ARTICLE 6: THE TRUSTEES.....................................................27
SECTION 6.1 Number of Trustees....................................27
SECTION 6.2 Delaware Trustee; Eligibility.........................28
SECTION 6.3 Property Trustee; Eligibility.........................28
SECTION 6.4 Qualifications of the Regular Trustees Generally......29
SECTION 6.5 Initial Regular Trustees..............................29
SECTION 6.6 Appointment, Removal and Resignation of the Trustees..29
SECTION 6.7 Vacancies among Trustees..............................30
SECTION 6.8 Effect of Vacancies...................................30
SECTION 6.9 Meetings..............................................31
SECTION 6.10 Delegation of Power by the Regular Trustees...........31
SECTION 6.11 Merger, Consolidation, Conversion or
Succession to Business................................31
ARTICLE 7: TERMS OF THE SECURITIES..........................................32
SECTION 7.1 General Provisions Regarding the Securities...........32
SECTION 7.2 Distributions.........................................34
SECTION 7.3 Redemption of Securities..............................35
SECTION 7.4 Redemption Procedures.................................36
SECTION 7.5 Voting Rights of the Preferred Securities.............37
SECTION 7.6 Voting Rights of the Common Securities................39
SECTION 7.7 Place of Payment......................................40
SECTION 7.8 Listing...............................................40
SECTION 7.9 Transfer of the Securities............................40
SECTION 7.10 Mutilated, Destroyed, Lost or Stolen Certificates.....41
SECTION 7.11 Deemed Holders........................................41
SECTION 7.12 Global Securities.....................................41
SECTION 7.13 Remarketing...........................................43
ARTICLE 8: DISSOLUTION AND TERMINATION OF THE TRUST.........................46
SECTION 8.1 Dissolution and Termination of the Trust..............46
SECTION 8.2 Liquidation Distribution Upon
Dissolution of the Trust..............................46
ARTICLE 9: LIMITATION OF LIABILITY OF HOLDERS OF THE SECURITIES, THE
DELAWARE TRUSTEE AND OTHERS.........................................47
SECTION 9.1 Liability.............................................47
SECTION 9.2 Exculpation...........................................48
SECTION 9.3 Fiduciary Duty........................................48
SECTION 9.4 Indemnification.......................................49
SECTION 9.5 Outside Businesses....................................51
ARTICLE 10: ACCOUNTING......................................................52
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SECTION 10.1 Fiscal Year...........................................52
SECTION 10.2 Certain Accounting Matters............................52
SECTION 10.3 Banking...............................................52
SECTION 10.4 Withholding...........................................53
ARTICLE 11: AMENDMENTS AND MEETINGS........................................ 53
SECTION 11.1 Amendments............................................53
SECTION 11.2 Meetings of the Holders of the Securities;
Action by Written Consent.............................55
ARTICLE 12: REPRESENTATIONS OF THE PROPERTY TRUSTEE AND THE
DELAWARE TRUSTEE...................................... .............56
SECTION 12.1 Representations and Warranties
of the Property Trustee..56
SECTION 12.2 Representations and Warranties
of the Delaware Trustee...............................57
ARTICLE 13: MISCELLANEOUS...................................................57
SECTION 13.1 Notices...............................................57
SECTION 13.2 Governing Law.........................................58
SECTION 13.3 Intention of the Parties..............................59
SECTION 13.4 Headings..............................................59
SECTION 13.5 Successors and Assigns................................59
SECTION 13.6 Partial Enforceability................................59
SECTION 13.7 Counterparts..........................................59
EXHIBITS
Exhibit A Form of Preferred Security Certificate
Exhibit B Form of Common Security Certificate
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AMENDED AND RESTATED DECLARATION OF TRUST
THIS AMENDED AND RESTATED DECLARATION OF TRUST ("Declaration"), dated as of
February 16, 1999, by and among NIPSCO Capital Markets, Inc., an Indiana
corporation, as Sponsor, Stephen P. Adik, Francis P. Girot, Jr. and Arthur A.
Paquin, as the initial Regular Trustees, The Chase Manhattan Bank, as the
initial Property Trustee, and Chase Manhattan Bank Delaware, as the initial
Delaware Trustee, not in their individual capacities but solely as Trustees, and
the Holders, from time to time, of the Securities representing undivided
beneficial ownership interests in the assets of the Trust to be issued pursuant
to this Declaration.
WHEREAS, the Trustees and the Sponsor established NIPSCO Capital Trust I
(the "Trust"), a business trust under the Business Trust Act, pursuant to a
Declaration of Trust dated as of December 17, 1998 (the "Original Declaration")
and a Certificate of Trust (the "Certificate of Trust") filed with the Secretary
of State of the State of Delaware on December 17, 1998; and
WHEREAS, the sole purpose of the Trust shall be to sell and issue certain
securities representing undivided beneficial ownership interests in the assets
of the Trust, to invest the proceeds from such sales in the Debentures issued by
the Debenture Issuer and to engage in only those activities necessary or
incidental thereto; and
WHEREAS, the parties hereto, by this Declaration, amend and restate each
and every term and provision of the Original Declaration.
NOW, THEREFORE, it being the intention of the parties hereto to continue
the Trust as a business trust under the Business Trust Act and that this
Declaration constitute the governing instrument of such business trust, the
Trustees hereby declare that all assets contributed to the Trust be held in
trust for the benefit of the Holders, from time to time, of the Securities
representing undivided beneficial ownership interests in the assets of the Trust
issued hereunder, subject to the provisions of this Declaration.
ARTICLE 1: INTERPRETATION AND DEFINITIONS
SECTION 1.1 Interpretation and Definitions. Unless the context otherwise
requires:
(a) capitalized terms used in this Declaration but not defined in the
preamble above shall have the meanings assigned to them in this Section 1.1;
(b) a term defined anywhere in this Declaration shall have the same
meaning throughout;
(c) all references to "the Declaration" or "this Declaration" shall be
to this Declaration as modified, supplemented or amended from time to time;
(d) all references in this Declaration to Articles, Sections, Recitals
and Exhibits shall be to Articles and Sections of, or Recitals and Exhibits to,
this Declaration unless otherwise specified;
(e) unless otherwise defined in this Declaration, a term defined in
the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"), shall
have the same meaning when used in this Declaration; and
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(f) a reference to the singular shall include the plural and vice
versa, and a reference to any masculine form of a term shall include the
feminine form of a term, as applicable.
(g) the following terms shall have the following meanings:
"Affiliate" of any specified Person shall mean 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 shall mean 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" shall have meanings correlative to
the foregoing.
"Applicable Margin" shall mean the spread determined as set forth
below, based on the prevailing rating of the Remarketed Securities in effect at
the close of business on the Business Day immediately preceding the date of a
Failed Remarketing:
Prevailing Rating Spread
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AA/ "Aa" ................................... 3.00%
A/ "a" ..................................... 4.00%
BBB/ "Baa" ................................. 5.00%
Below BBB/ "Baa" ........................... 7.00%
For purposes of this definition, the "prevailing rating" of the Remarketed
Securities shall be:
(i) AA/ "Aa" if the Remarketed Securities have a credit rating of
AA- or better by S&P and "Aa3" or better by Moody's or the equivalent
of such ratings by such agencies or a substitute rating agency or
substitute rating agencies selected by the Remarketing Agent;
(ii) if not under clause (i) above, then A/ "a" if the Remarketed
Securities have a credit rating of A- or better by S&P and "A3" or
better by Moody's or the equivalent of such ratings by such agencies
or a substitute rating agency or substitute rating agencies selected
by the Remarketing Agent;
(iii) if not under clauses (i) or (ii) above, then BBB/ "Baa" if
the Remarketed Securities have a credit rating of BBB- or better by
S&P and "Baa3" or better by Moody's or the equivalent of such ratings
by such agencies or a substitute rating agency or substitute rating
agencies selected by the Remarketing Agent; or
(iv) if not under clauses (i) - (iii) above, then Below BBB/
"Baa."
Notwithstanding the foregoing, (A) if (i) the credit rating of the Remarketed
Securities by S&P shall be on the "Credit Watch" of S&P with a designation of
"negative implications" or "developing," or (ii) the credit rating of the
Remarketed Securities by Moody's shall be on the "Corporate Credit Watch List"
of Moody's with a designation of "downgrade" or "uncertain," or, in each case,
on any successor list of S&P or Moody's with a comparable designation, the
prevailing ratings of the Remarketed Securities shall be deemed to be
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within a range one full level lower in the above table than those actually
assigned to the Remarketed Securities by Moody's and S&P and (B) if the
Remarketed Securities are rated by only one rating agency on or before the
Remarketing Date, the prevailing rating shall at all times be determined without
reference to the rating of any other rating agency; provided that if no such
rating agency shall have in effect a rating for the Remarketed Securities and
the Remarketing Agent is unable to identify a substitute rating agency or rating
agencies, the prevailing rating shall be Below BBB/ "baa."
"Applicable Ownership Interest" shall mean, with respect to a
Corporate PIES and the U.S. treasury securities in the Treasury Portfolio, (A) a
1/20, or 5%, undivided beneficial ownership interest in a $1,000 face amount of
a principal or interest strip in a U.S. treasury security included in the
Treasury Portfolio that matures on or prior to February 18, 2003 and (B) for
each scheduled interest payment date on the Debentures after the Tax Event
Redemption Date, a 1/20, or 5%, undivided beneficial ownership interest in a
$1,000 face amount of such U.S. treasury security that is a principal or
interest strip maturing on such date.
"Applicable Principal Amount" shall mean either (A) if the Tax Event
Redemption Date occurs prior to the Purchase Contract Settlement Date, the
aggregate principal amount of the Debentures corresponding to the aggregate
stated liquidation amount of the Preferred Securities that are components of the
Corporate PIES on the Tax Event Redemption Date or (B) if the Tax Event
Redemption Date occurs on or after the Purchase Contract Settlement Date, the
aggregate principal amount of the Debentures corresponding to the aggregate
stated liquidation amount of the Preferred Securities outstanding on such Tax
Event Redemption Date.
"Authorized Officer" of a Person shall mean any Person that is
authorized to bind such Person.
"Beneficial Owner" shall mean, with respect to a Global Security, a
Person who is the beneficial owner of such book-entry interest as reflected on
the books of the Depositary or on the books of a Person maintaining an account
with such Depositary (directly as a Depositary Participant or as an indirect
participant, in each case in accordance with the rules of such Depositary).
"Business Day" shall mean any day other than a Saturday or Sunday or a
day on which banking institutions in New York City are authorized or required by
law or executive order to remain closed or a day on which the principal office
of the Indenture Trustee or the Property Trustee is closed for business.
"Business Trust Act" shall mean Chapter 38 of Title 12 of the Delaware
Code, 12 Del. Code Section 3801 et seq., as it may be amended from time to time,
or any successor legislation.
"Cash Settlement" shall have the meaning specified in the Purchase
Contract Agreement.
"Certificate" shall mean a Common Security Certificate or a Preferred
Security Certificate.
"Closing Date" shall mean the date on which the Preferred Securities
are first issued and sold.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, or any successor legislation. A reference to a specific section of
the Code refers not only to such specific section but also to any corresponding
provision of any federal tax statute enacted after the date of this Declaration,
as such specific section or corresponding provision is in effect on the date of
application of the provisions of this Declaration containing such reference.
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"Collateral Agent" shall mean The First National Bank of Chicago, in
its capacity as collateral agent under the Pledge Agreement, until a successor
is appointed thereunder, and thereafter shall mean such successor collateral
agent.
"Commission" shall mean the Securities and Exchange Commission.
"Common Security" shall have the meaning specified in Section 7.1.
"Common Security Certificate" shall mean a definitive certificate in
fully registered form representing a Common Security, substantially in the form
of Exhibit B hereto.
"Corporate PIES" shall mean a stock purchase unit consisting of (A) a
stock purchase contract under which (i) the holder of the unit will purchase
from Industries, for $50.00 in cash, a certain number of common shares of
Industries and (ii) Industries will pay such holder contract adjustment payments
and (B) beneficial ownership of a Preferred Security or Debenture, or in certain
circumstances following the occurrence of a Tax Event, the appropriate
Applicable Ownership Interest of the Treasury Portfolio.
"Corporate Trust Office" shall mean the principal office of the
Property Trustee at which, at any particular time, its corporate trust business
shall be administered, which office at the date hereof is located at 450 West
33rd Street, 15th Floor, New York, New York 10001.
"Covered Person" shall mean (A) any officer, director, shareholder,
partner, member, representative, employee or agent of (i) the Trust or (ii) the
Trust's Affiliates and (B) any Holder.
"Debentures" shall mean the series of debentures to be issued by the
Debenture Issuer under the Indenture and to be purchased by the Trust and held
by the Property Trustee.
"Debenture Issuer" shall mean NIPSCO Capital Markets, Inc., an Indiana
corporation, in its capacity as issuer of the Debentures under the Indenture.
"Debenture Issuer Indemnified Person" shall mean (A) any Regular
Trustee, (B) any Affiliate of any Regular Trustee, (C) any officers, directors,
shareholders, members, partners, employees, representatives or agents of any
Regular Trustee or any Affiliate thereof or (D) any officer, employee or agent
of the Trust or its Affiliates.
"Depositary" shall mean, with respect to Preferred Securities issuable
in whole or in part in the form of one or more Global Securities, a clearing
agency registered under the Exchange Act that is designated to act as depositary
for such Preferred Securities, and initially shall be The Depository Trust
Company.
"Depositary Participant" shall mean a member of, or participant in,
the Depositary.
"Direct Action" shall have the meaning specified in Section 3.8(e).
"Distribution" shall mean a distribution payable to the Holders in
accordance with Section 7.2.
"Exchange Act" shall mean the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time, and the
rules and regulations promulgated thereunder.
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"Exchange Notice" shall have the meaning specified in Section 8.2(c).
"Failed Remarketing" shall have the meaning specified in Section
7.13(h).
"Fiduciary Indemnified Person" shall have the meaning set forth in
Section 9.4(b).
"Fiscal Year" shall have the meaning specified in Section 10.1.
"Global Security" shall mean a global Preferred Security Certificate
registered in the name of a Depositary or its nominee.
"Guarantee" shall mean the Guarantee Agreement, dated as of February
16, 1999, of the Sponsor in respect of the Securities.
"Holder" shall mean any holder of Preferred Securities or Common
Securities, as registered on the books and records of the Trust, such holder
being a beneficial owner within the meaning of the Business Trust Act, provided
that in determining whether the Holders of the requisite liquidation amount of
Preferred Securities have voted on any matter provided for in this Declaration,
then for the purpose of such determination only (and not for any other purpose
hereunder), if the Preferred Securities remain in the form of one or more Global
Securities and if the Depositary that is the holder of such Global Securities
has sent an omnibus proxy to the Depositary Participants to whose accounts the
Preferred Securities are credited on the record date, the term "Holders" shall
mean such Depositary Participants acting at the direction of the Beneficial
Owners.
"Indemnified Person" shall mean a Debenture Issuer Indemnified Person
or a Fiduciary Indemnified Person.
"Indenture" shall mean the Indenture, dated as of February 14, 1997,
among the Debenture Issuer, Industries and the Indenture Trustee, as amended and
supplemented (including the provisions of the Trust Indenture Act that are
deemed incorporated therein), pursuant to which the Debentures are to be issued.
"Indenture Event of Default" shall have the meaning given to the term
"Event of Default" in the Indenture.
"Indenture Trustee" shall mean The Chase Manhattan Bank, in its
capacity as trustee under the Indenture, until a successor is appointed
thereunder, and thereafter shall mean such successor trustee.
"Industries" shall mean NIPSCO Industries, Inc., an Indiana
corporation, the parent of the Debenture Issuer and an Affiliate of the Trust.
"Investment Company" shall mean an investment company as defined in
the Investment Company Act and the regulations promulgated thereunder.
"Investment Company Act" shall mean the Investment Company Act of
1940, as amended from time to time, or any successor legislation.
"Legal Action" shall have the meaning specified in Section 3.6(f).
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"Liquidation" shall have the meaning specified in Section 8.2(a).
"Liquidation Distribution" shall have the meaning specified in Section
8.2(b).
"List of Holders" shall have the meaning specified in Section 2.2(a).
"Majority in Liquidation Amount" shall mean, except as provided in the
terms of the Preferred Securities or by the Trust Indenture Act, Holders of
outstanding Securities, voting together as a single class, or, as the context
may require, Holders of outstanding Preferred Securities or Holders of
outstanding Common Securities voting separately as a class, who are the record
owners of more than 50% of the aggregate liquidation amount (including the
stated amount that would be paid on redemption, liquidation or otherwise, plus
accumulated and unpaid Distributions to the date upon which the voting
percentages are determined) of all outstanding Securities or all outstanding
Securities of the relevant class, as the case may be.
"Moody's" shall mean Moody's Investors Service, Inc.
"New York Stock Exchange" shall mean the New York Stock Exchange, Inc.
or any successor thereto.
"Officers' Certificate" shall mean, when delivered by the Trust, a
certificate signed by a majority of the Regular Trustees of the Trust and, when
delivered by the Sponsor, a certificate signed by (A) the Chairman of the Board,
the President or a Vice President of the Sponsor and (B) the Treasurer, an
Assistant Treasurer or the Secretary of the Sponsor. Any Officers' Certificate
delivered with respect to compliance with a condition or covenant provided for
in this Declaration shall include, where applicable:
(i) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the definitions
relating thereto;
(ii) a brief statement of the nature and scope of the examination
or investigation undertaken by each officer in rendering the Officers'
Certificate;
(iii) a statement that each such officer has made such
examination or investigation as, in such officer's opinion, is
necessary to enable such officer to express an informed opinion as to
whether or not such covenant or condition has been complied with; and
(iv) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied with.
"Over-allotment Option" shall mean any over-allotment option contained
in an underwriting agreement pursuant to which the Preferred Securities or the
Corporate PIES are sold.
"Paying Agent" shall have the meaning specified in Section 3.8(h).
"Payment Amount" shall have the meaning specified in Section 7.2(c).
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"Person" shall mean a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Pledge Agreement" shall mean the Pledge Agreement dated as of
February 16, 1999 among Industries, the Collateral Agent, The First National
Bank of Chicago, as Securities Intermediary, and the Purchase Contract Agent.
"Preferred Security" shall have the meaning specified in Section 7.1.
"Preferred Security Certificate" shall mean a definitive certificate
in fully registered form representing a Preferred Security, substantially in the
form of Exhibit A.
"Primary Treasury Dealer" shall mean a primary U.S. government
securities dealer in New York City.
"Property Account" shall mean a segregated non-interest bearing trust
account maintained with a banking institution, the rating on whose long-term
unsecured indebtedness is at least equal to the rating assigned to the Preferred
Securities by a "nationally recognized statistical rating organization" within
the meaning of Rule 436(g)(2) under the Securities Act.
"Property Trustee" shall mean the Trustee meeting the eligibility
requirements set forth in Section 6.3.
"Pro Rata" shall mean pro rata to each Holder according to the
aggregate liquidation amount of the Securities held by such Holder in relation
to the aggregate liquidation amount of all Securities outstanding.
"Purchase Contract Agent" shall mean The Chase Manhattan Bank, in its
capacity as purchase contract agent under the Purchase Contract Agreement, until
a successor is appointed thereunder, and thereafter shall mean such successor
purchase contract agent.
"Purchase Contract Agreement" shall mean the Purchase Contract
Agreement dated as of February 16, 1999 between Industries and The Chase
Manhattan Bank, as Purchase Contract Agent.
"Purchase Contract Settlement Date" shall mean February 19, 2003.
"Quorum" shall mean a majority of the Regular Trustees or, if there
are only two Regular Trustees, both of them.
"Quotation Agent" shall mean (A) Lehman Brothers Inc. and any
respective successor, provided that if Lehman Brothers Inc. or any respective
successor ceases to be a Primary Treasury Dealer, the Sponsor
shall substitute another Primary Treasury Dealer therefor or (B) any other
Primary Treasury Dealer selected by the Sponsor.
"Redemption Amount" shall mean, for each Debenture, the product of the
principal amount of such Debenture and a fraction, the numerator of which shall
be the Treasury Portfolio Purchase Price and the denominator of which shall be
the Applicable Principal Amount, as calculated by the Debenture Issuer.
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"Redemption Notice" shall have the meaning specified in Section
7.4(a).
"Redemption Price" shall mean the amount for which the Securities will
be redeemed, which amount will equal the lesser of (i) the redemption price paid
by the Debenture Issuer to repay or redeem, in whole or in part, the Debentures
held by the Trust plus an amount equal to accumulated and unpaid Distributions
on such Securities through the date of their redemption or (ii) the amount
received by the Trust in respect of the Debentures so repaid or redeemed.
"Regular Trustee" shall mean any Trustee other than the Property
Trustee and the Delaware Trustee.
"Remarketing" shall mean the operation of the procedures for
remarketing specified in Section 7.13.
"Remarketed Securities" shall mean (A) so long as the Trust has not
been liquidated, the Preferred Securities or (B) if the Trust has been
liquidated, the Debentures.
"Remarketing Agent" shall mean Lehman Brothers Inc. or any successor
remarketing agent selected by the Sponsor.
"Remarketing Agreement" shall mean the Remarketing Agreement dated as
of February 16, 1999 among Industries, the Debenture Issuer, the Trust and the
Remarketing Agent.
"Remarketing Date" shall mean the third Business Day preceding the
Purchase Contract Settlement Date.
"Reset Rate" shall mean the distribution rate per annum that results
from the Remarketing pursuant to Section 7.13.
"Responsible Officer" shall mean, with respect to the Property
Trustee, any officer with direct responsibility for the administration of this
Declaration and also shall mean, with respect to a particular corporate trust
matter, any other officer to whom such matter is referred due to that officer's
knowledge of and familiarity with the particular subject.
"Rule 3a-5" shall mean Rule 3a-5 under the Investment Company Act or
any successor rule thereunder.
"S&P" shall mean Standard & Poor's Ratings Services, a division of
McGraw-Hill Corporation.
"Securities" shall mean the Common Securities and the Preferred
Securities.
"Securities Act" shall mean the Securities Act of 1933, as amended
from time to time, or any successor legislation.
"662/3% in Liquidation Amount" shall mean Holders of outstanding
Securities, voting together as a single class, or, as the context may require,
Holders of outstanding Preferred Securities or Holders of outstanding Common
Securities voting separately as a class, who are the record owners of 662/3% or
more of the aggregate liquidation amount (including the stated amount that would
be paid on redemption,
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liquidation or otherwise, plus accumulated and unpaid Distributions to the date
upon which the voting percentages are determined) of all outstanding Securities
or all outstanding Securities of the relevant class, as the case may be.
"Sponsor" shall mean NIPSCO Capital Markets, Inc., an Indiana
corporation, or any successor entity in a merger, consolidation, conversion,
amalgamation or replacement by or conveyance, transfer or lease of its
properties substantially as an entirety, in its capacity as sponsor of the
Trust.
"Successor Delaware Trustee" shall have the meaning specified in
Section 6.6(b).
"Successor Entity" shall have the meaning specified in Section
3.15(b)(i).
"Successor Property Trustee" shall have the meaning specified in
Section 6.6(b).
"Successor Security" shall have the meaning specified in Section
3.15(b)(i)(B).
"Supermajority" shall have the meaning specified in Section
2.6(a)(ii).
"Tax Event" shall mean the receipt by the Sponsor and the Trust of an
opinion of counsel, rendered by a law firm having a recognized national tax
practice, to the effect that, as a result of any amendment to, change in or
announced proposed change in the laws (or any regulations thereunder) of the
United States or any political subdivision or taxing authority thereof or
therein, or as a result of any official administrative decision, pronouncement,
judicial decision or action interpreting or applying such laws or regulations,
which amendment or change is effective or which proposed change, pronouncement,
action or decision is announced on or after the Closing Date, there is more than
an insubstantial risk that (A) the Trust is, or within 90 days of the date of
such opinion will be, subject to United States federal income tax with respect
to income received or accumulated on the Debentures, (B) interest payable by the
Debenture Issuer on the Debentures is not, or within 90 days of the date of such
opinion will not be, deductible by the Debenture Issuer, in whole or in part,
for United States federal income tax purposes, or (C) the Trust is, or within 90
days of the date of such opinion will be, subject to more than a de minimis
amount of other taxes, duties or other governmental charges.
"Tax Event Redemption" shall mean that a Tax Event has occurred and is
continuing and the Debentures have been called for redemption pursuant to the
Indenture.
"Tax Event Redemption Date" shall mean the date of the Tax Event
Redemption specified by the Debenture Issuer.
"10% in Liquidation Amount" shall mean, except as provided in the
terms of the Preferred Securities or by the Trust Indenture Act, Holder(s) of
outstanding Securities, voting together as a single class, or, as the context
may require, Holders of outstanding Preferred Securities or Holders of
outstanding Common Securities, voting separately as a class, who are the record
owners of 10% or more of the aggregate liquidation amount (including the stated
amount that would be paid on redemption, liquidation or otherwise, plus
accumulated and unpaid Distributions to the date upon which the voting
percentages are determined) of all outstanding Securities, or all outstanding
Securities of the relevant class, as the case may be.
"Termination Event" shall have the meaning set forth in Section 1.1 of
the Purchase Contract Agreement.
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"Treasury PIES" shall mean a stock purchase unit resulting from the
substitution, with respect to a Corporate PIES, of a 1/20 undivided beneficial
interest in a Treasury Security for the Preferred Security, Debenture or
appropriate Applicable Ownership Interest of the Treasury Portfolio, as
applicable, component of a Corporate PIES.
"Treasury Portfolio" shall mean, with respect to the Applicable
Principal Amount of Debentures, (A) if the Tax Event Redemption Date occurs
prior to the Purchase Contract Settlement Date, a portfolio of zero-coupon U.S.
treasury securities consisting of (i) principal or interest strips of U.S.
treasury securities that mature on or prior to the Purchase Contract Settlement
Date in an aggregate amount equal to the Applicable Principal Amount and (ii)
with respect to each scheduled interest payment date on the Debentures that
occurs after the Tax Event Redemption Date, principal or interest strips of U.S.
treasury securities that mature on or prior to such date in an aggregate amount
equal to the aggregate interest payment that would have been due on the
Applicable Principal Amount of the Debentures on such date and (B) if the Tax
Event Redemption Date occurs on or after the Purchase Contract Settlement Date,
a portfolio of zero-coupon U.S. treasury securities consisting of (i) principal
or interest strips of U.S. treasury securities that mature on or prior to
February 18, 2005 in an aggregate amount equal to the Applicable Principal
Amount and (ii) with respect to each scheduled interest payment date on the
Debentures that occurs after the Tax Event Redemption Date, principal or
interest strips of such U.S. treasury securities that mature on or prior to such
date in an aggregate amount equal to the aggregate interest payment that would
have been due on the Applicable Principal Amount of the Debentures on such date.
"Treasury Portfolio Purchase Price" shall mean the lowest aggregate
price quoted by a Primary Treasury Dealer to the Quotation Agent on the third
Business Day preceding the Tax Event Redemption Date for the purchase of the
Treasury Portfolio for settlement on the Tax Event Redemption Date.
"Treasury Regulations" shall mean the income tax regulations,
including temporary and proposed regulations, promulgated under the Code by the
United States Department of the Treasury, as such regulations may be amended
from time to time (including corresponding provisions of succeeding
regulations).
"Treasury Securities" shall mean zero-coupon U.S. Treasury Securities
(CUSIP Number 912820BF3) that are the principal strip of the 6.25% U.S. Treasury
Securities that mature on or prior to February 18, 2003.
"Trust" shall have the meaning specified in the Recitals hereto.
"Trust Enforcement Event" in respect of the Securities shall mean that
an Indenture Event of Default has occurred and is continuing in respect of the
Debentures.
"Trust Indenture Act" shall mean the Trust Indenture Act of 1939, as
amended from time to time, or any successor legislation.
"Trustee" or "Trustees" shall mean each Person that has signed this
Declaration as a trustee, so long as such Person continues in office in
accordance with the terms hereof, and all other Persons that from time to time
may be duly appointed, qualified and serving as Trustees in accordance with the
provisions hereof, and references herein to a Trustee or the Trustees shall
refer to such Person or Persons solely in their capacity as trustees hereunder.
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"Two-Year Benchmark Treasury Rate" shall mean direct obligations of
the United States (which may be obligations traded on a when-issued basis only)
having a maturity comparable to the remaining term to maturity of the Remarketed
Securities, as agreed upon by Industries and the Remarketing Agent. The rate for
the Two-Year Benchmark Treasury will be the bid side rate displayed at 10:00
A.M., New York City time, on the third Business Day immediately preceding the
Purchase Contract Settlement Date in the Telerate system (or if the Telerate
system is (A) no longer available on the third Business Day immediately
preceding the Purchase Contract Settlement Date or (B) in the opinion of the
Remarketing Agent (after consultation with Industries) no longer an appropriate
system from which to obtain such rate, such other nationally recognized
quotation system as, in the opinion of the Remarketing Agent (after consultation
with Industries) is appropriate). If such rate is not so displayed, the rate for
the Two-Year Benchmark Treasury shall be, as calculated by the Remarketing
Agent, the yield to maturity for the Two-Year Benchmark Treasury, expressed as a
bond equivalent on the basis of a year of 365 or 366 days, as applicable, and
applied on a daily basis, and computed by taking the arithmetic mean of the
secondary market bid rates, as of 10:30 A.M., New York City time, on the third
Business Day immediately preceding the Purchase Contract Settlement Date of
three leading United States government securities dealers selected by the
Remarketing Agent (after consultation with Industries) (which may include the
Remarketing Agent or an affiliate thereof).
ARTICLE 2: TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application.
(a) This Declaration is subject to the provisions of the Trust
Indenture Act that are required to be part of this Declaration and, to the
extent applicable, shall be governed by such provisions.
(b) The Property Trustee shall be the only Trustee that is a trustee
for the purposes of the Trust Indenture Act.
(c) If and to the extent that any provision of this Declaration
conflicts with the duties imposed by Sections 310 to 317, inclusive, of the
Trust Indenture Act, such imposed duties of the Trust Indenture Act shall
control.
(d) The application of the Trust Indenture Act to this Declaration
shall not affect the Trust's classification as a grantor trust for United States
federal income tax purposes and shall not affect the nature of the Securities as
equity securities representing undivided beneficial ownership interests in the
assets of the Trust.
SECTION 2.2 Lists of Holders of the Securities.
(a) Each of the Sponsor and the Regular Trustees on behalf of the
Trust shall provide the Property Trustee a list of the names and addresses of
the Holders of the Securities in such form as the Property Trustee may
reasonably require ("List of Holders") (i) as of the record date relating to the
payment of any Distribution, at least one Business Day prior to the date for
payment of such Distribution, except while the Preferred Securities are
represented by one or more Global Securities, and (ii) at any other time, within
30 days of receipt by the Trust of a written request from the Property Trustee
for a List of Holders as of a date no more than 15 days before such List of
Holders is provided to the Property Trustee. If at any time the List of Holders
does not differ from the most recent List of Holders provided to the Property
Trustee by the Sponsor and the Regular Trustees on behalf of the Trust, then
neither the Sponsor nor the Regular Trustees shall be obligated to deliver such
List of Holders. The Property Trustee shall preserve, in as current a form
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as is reasonably practicable, all information contained in Lists of Holders
provided to it or that it receives in its capacity as Paying Agent (if acting in
such capacity); provided that the Property Trustee may destroy any List of
Holders previously provided to it on receipt of a new List of Holders.
(b) The Property Trustee shall comply with its obligations under, and
shall be entitled to the benefits of, Sections 311(a), 311(b) and 312(b) of the
Trust Indenture Act.
SECTION 2.3 Reports by the Property Trustee.
Within 60 days after May 15 of each year (commencing with the year of
the first anniversary of the issuance of the Preferred Securities), the Property
Trustee shall provide to the Holders of the Preferred Securities such reports as
are required by Section 313 of the Trust Indenture Act, if any, in the form and
in the manner provided by Section 313 of the Trust Indenture Act. The Property
Trustee also shall comply with the requirements of Section 313(d) of the Trust
Indenture Act.
SECTION 2.4 Periodic Reports to the Property Trustee.
Each of the Sponsor and the Regular Trustees on behalf of the Trust
shall provide to the Property Trustee such documents, reports and information as
required by Section 314 of the Trust Indenture Act (if any) and the compliance
certificate required by Section 314 of the Trust Indenture Act in the form, in
the manner and at the times required by Section 314 of the Trust Indenture Act.
SECTION 2.5 Evidence of Compliance with Conditions Precedent.
Each of the Sponsor and the Regular Trustees on behalf of the Trust
shall provide to the Property Trustee such evidence of compliance with any
conditions precedent, if any, provided for in this Declaration that relate to
any of the matters set forth in Section 314(c) of the Trust Indenture Act. Any
certificate or opinion required to be given by an officer pursuant to Section
314(c)(1) may be given in the form of an Officers' Certificate.
SECTION 2.6 Trust Enforcement Events; Waiver.
(a) The Holders of a Majority in Liquidation Amount of the Preferred
Securities may waive, by vote or written consent, on behalf of the Holders of
all of the Preferred Securities, any past Trust Enforcement Event in respect of
the Preferred Securities and its consequences, provided that if the underlying
Indenture Event of Default:
(i) is not waivable under the Indenture, then the Trust
Enforcement Event under this Declaration also shall not be waivable;
and
(ii) requires the vote or consent of the holders of greater than
a majority in principal amount of the Debentures (a "Supermajority")
to be waived under the Indenture, the related Trust Enforcement Event
under this Declaration only may be waived by the vote or written
consent of the Holders of at least the same Supermajority in aggregate
stated liquidation amount of the Preferred Securities outstanding.
The foregoing provisions of this Section 2.6(a) shall be in lieu of
Section 316(a)(1)(B) of the Trust Indenture Act, and Section 316(a)(1)(B) of the
Trust Indenture Act is hereby expressly excluded from this
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Declaration and the Securities, as permitted by the Trust Indenture Act. Upon
such waiver, any such Trust Enforcement Event in respect of the Preferred
Securities shall be deemed to have been cured for every purpose of this
Declaration and the Preferred Securities, but no such waiver shall extend to any
subsequent or other Trust Enforcement Event with respect to the Preferred
Securities or impair any right consequent thereon. Any waiver by the Holders of
the Preferred Securities of a Trust Enforcement Event with respect to the
Preferred Securities also shall be deemed to constitute a waiver by the Holders
of the Common Securities of any such Trust Enforcement Event with respect to the
Common Securities for all purposes of this Declaration without any further act,
vote or consent of the Holders of the Common Securities.
(b) The Holders of a Majority in Liquidation Amount of the Common
Securities may waive, by vote or written consent, any past Trust Enforcement
Event in respect of the Common Securities and its consequences, provided that if
the underlying Indenture Event of Default is not waivable under the Indenture,
then, except where the Holders of the Common Securities are deemed to have
waived such Trust Enforcement as provided below in this Section 2.6(b), the
related Trust Enforcement Event under this Declaration also shall not be
waivable. The Holders of the Common Securities shall be deemed to have waived
any and all Trust Enforcement Events in respect of the Common Securities and the
consequences thereof until all Trust Enforcement Events in respect of the
Preferred Securities shall have been cured, waived or otherwise eliminated.
Until all Trust Enforcement Events in respect of the Preferred Securities shall
have been so cured, waived or otherwise eliminated, the Property Trustee shall
be deemed to be acting solely on behalf of the Holders of the Preferred
Securities, and only the Holders of the Preferred Securities shall have the
right to direct the Property Trustee. The foregoing provisions of this Section
2.6(b) shall be in lieu of Sections 316(a)(1)(A) and 316(a)(1)(B) of the Trust
Indenture Act, and Sections 316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture
Act are hereby expressly excluded from this Declaration and the Securities, as
permitted by the Trust Indenture Act. Subject to the foregoing provisions of
this Section 2.6(b), upon such cure, waiver or other elimination, any Trust
Enforcement Event in respect of the Common Securities shall be deemed to have
been cured for every purpose of this Declaration and the Common Securities, but
no such waiver shall extend to any subsequent or other Trust Enforcement Event
with respect to the Common Securities or impair any right consequent thereon.
(c) A waiver of an Indenture Event of Default under the Indenture by
the Property Trustee at the direction of the Holders of the Preferred Securities
shall constitute a waiver of the corresponding Trust Enforcement Event under
this Declaration. Any such waiver by the Holders of the Preferred Securities
also shall be deemed to constitute a waiver by the Holders of the Common
Securities of any such Trust Enforcement Event with respect to the Common
Securities for all purposes of this Declaration without any further act, vote or
consent of the Holders of the Common Securities. The foregoing provisions of
this Section 2.6(c) shall be in lieu of Section 316(a)(1)(B) of the Trust
Indenture Act, and Section 316(a)(1)(B) of the Trust Indenture Act is hereby
expressly excluded from this Declaration and the Securities, as permitted by the
Trust Indenture Act.
SECTION 2.7 Trust Enforcement Event; Notice.
(a) Within 90 days after the occurrence of a Trust Enforcement Event
actually known to a Responsible Officer of the Property Trustee, the Property
Trustee shall transmit by mail, first class postage prepaid, to the Holders of
the Securities, notice of such Trust Enforcement Event, unless such Trust
Enforcement Event has been cured before the giving of such notice; provided
that, except for a default in the payment of principal of (or premium, if any)
or interest on any of the Debentures, the Property Trustee shall be protected in
withholding such notice if and so long as a Responsible Officer of the Property
Trustee in good faith determines that the withholding of such notice is in the
interests of the Holders of the Securities.
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(b) The Property Trustee shall not be deemed to have knowledge of any
Trust Enforcement Event except for:
(i) a default under Sections 501(1) and 501(2) of the Indenture;
or
(ii) any default as to which the Property Trustee shall have
received written notice or of which a Responsible Officer of the
Property Trustee charged with the administration of this Declaration
shall have actual knowledge.
ARTICLE 3: ORGANIZATION
SECTION 3.1 Name and Organization.
The Trust hereby continued is named "NIPSCO Capital Trust I," as such
name may be modified from time to time by the Regular Trustees following written
notice to the Holders of the Securities. The Trust's activities may be conducted
under the name of the Trust or any other name deemed advisable by the Regular
Trustees.
SECTION 3.2 Office.
The address of the principal office of the Trust is in care of NIPSCO
Capital Markets, Inc., 801 East 86th Avenue, Merrillville, Indiana 46410. On ten
Business Days' written notice to the Holders of the Securities, the Regular
Trustees may designate another principal office.
SECTION 3.3 Purpose.
The exclusive purposes and functions of the Trust are (a) to issue and
sell the Securities, (b) to use the gross proceeds from such sale to acquire the
Debentures and (c) except as otherwise limited herein, to engage in only those
other activities necessary or incidental thereto. The Trust shall not borrow
money, issue debt or reinvest proceeds derived from investments, pledge any of
its assets or otherwise undertake (or permit to be undertaken) any activity that
would cause the Trust not to be classified as a grantor trust for United States
federal income tax purposes.
By the acceptance of this Trust, none of the Trustees, the Sponsor,
the Holders of the Preferred Securities or the Common Securities or the
Beneficial Owners of the Preferred Securities will take any position that is
contrary to the classification of the Trust as a grantor trust for United States
federal income tax purposes.
SECTION 3.4 Authority.
(a) Subject to the limitations provided in this Declaration and to the
specific duties of the Property Trustee, the Regular Trustees shall have
exclusive authority to carry out the purposes of the Trust. Any action taken by
the Regular Trustees in accordance with their powers shall constitute the act of
and shall serve to bind the Trust, and any action taken by the Property Trustee
in accordance with its powers shall constitute the act of and shall serve to
bind the Trust. In dealing with the Trustees acting on behalf of the Trust, no
Person shall be required to inquire into the authority of the Trustees to bind
the Trust. Persons
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dealing with the Trust are entitled to rely conclusively on the power and
authority of the Trustees as set forth in this Declaration.
(b) Except as expressly set forth in this Declaration and except if a
meeting of the Regular Trustees is called with respect to any matter over which
the Regular Trustees have power to act, any power of the Regular Trustees may be
exercised by or with the consent of any one such Regular Trustee.
(c) Unless otherwise determined by the Regular Trustees, and except as
otherwise required by the Business Trust Act or applicable law, any Regular
Trustee may delegate to any other natural person over the age of 21, by power of
attorney consistent with applicable law, his or her power for the purposes of
signing any documents that the Regular Trustees have power and authority to
cause the Trust to execute pursuant to Section 3.6.
SECTION 3.5 Title to Property of the Trust.
Except as provided in Section 3.8 with respect to the Debentures and
the Property Account or as otherwise provided in this Declaration, legal title
to all assets of the Trust shall be vested in the Trust. The Holders of the
Securities shall not have legal title to any part of the assets of the Trust but
shall have undivided beneficial ownership interests in the assets of the Trust.
SECTION 3.6 Powers and Duties of the Regular Trustees.
The Regular Trustees shall have the exclusive power, duty and
authority to cause the Trust to engage in the following activities:
(a) to establish the terms and forms of the Securities in the manner
specified in Section 7.1 and to issue and sell the Securities in accordance with
this Declaration; provided that the Trust may issue no more than one series of
Preferred Securities and no more than one series of Common Securities; and
provided further that there shall be no interests in the Trust other than the
Securities, and the issuance of the Securities shall be limited to a one-time,
simultaneous issuance of both Preferred Securities and Common Securities on the
Closing Date, subject to the issuance of additional Securities pursuant to the
exercise of any Over-allotment Option;
(b) to acquire the Debentures with the proceeds of the sale of the
Securities; provided that the Regular Trustees shall cause legal title to the
Debentures to be held of record in the name of the Property Trustee for the
benefit of the Holders of the Securities;
(c) to give the Sponsor and the Property Trustee prompt written notice
of the occurrence of a Tax Event; provided that the Regular Trustees shall
consult with the Sponsor and the Property Trustee before taking or refraining
from taking any action in relation to any such Tax Event;
(d) to establish a record date with respect to all actions to be taken
hereunder that require a record date to be established, including and with
respect to, for the purposes of Section 316(c) of the Trust Indenture Act,
Distributions, voting rights, redemptions and exchanges, and to issue relevant
notices to the Holders of the Securities as to such actions and applicable
record dates;
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(e) to take all actions and perform such duties as may be required of
the Regular Trustees pursuant to the terms of this Declaration and the
Securities;
(f) to bring or defend, pay, collect, compromise, arbitrate, resort to
legal action or otherwise adjust claims or demands of or against the Trust
("Legal Action"), unless pursuant to Section 3.8(e), the Property Trustee has
the exclusive power to bring such Legal Action;
(g) to employ or otherwise engage employees and agents (who may be
designated as officers with titles) and managers, contractors, advisors and
consultants to conduct only those services that the Regular Trustees have
authority to conduct directly, and to pay reasonable compensation for such
services;
(h) to cause the Trust to comply with the Trust's obligations under
the Trust Indenture Act;
(i) to give to the Property Trustee the certificate required by
Section 314(a)(4) of the Trust Indenture Act, which certificate may be executed
by any Regular Trustee;
(j) to incur expenses that are necessary or incidental to carry out
any of the purposes of the Trust;
(k) to act as, or appoint another Person to act as, registrar and
transfer agent for the Securities;
(l) to take all action that may be necessary or appropriate for the
preservation and continuation of the Trust's valid existence, rights, franchises
and privileges as a statutory business trust under the laws of the State of
Delaware and of each other jurisdiction in which such existence is necessary to
protect the limited liability of the Holders of the Securities or to enable the
Trust to effect the purposes for which it was created;
(m) to take any action not inconsistent with applicable law that the
Regular Trustees determine in their discretion to be necessary or desirable in
carrying out the purposes and functions of the Trust as set forth in Section 3.3
or the activities of the Trust as set forth in this Section 3.6, including:
(i) causing the Trust not to be deemed to be an Investment
Company required to be registered under the Investment Company Act;
(ii) causing the Trust to be classified as a grantor trust for
United States federal income tax purposes; and
(iii) cooperating with the Debenture Issuer to ensure that the
Debentures will be treated as indebtedness of the Debenture Issuer for
United States federal income tax purposes.
(n) to take all action necessary to cause all applicable tax returns
and tax information reports that are required to be filed with respect to the
Trust to be duly prepared and filed; and
(o) to execute all documents or instruments, perform all duties and
powers, and do all things for and on behalf of the Trust in all matters
necessary or incidental to the foregoing.
The Regular Trustees shall exercise the powers set forth in this
Section 3.6 in a manner that is consistent with the purposes and functions of
the Trust set out in Section 3.3, and the Regular Trustees shall have no power
to, and shall not, take any action that is inconsistent with the purposes and
functions of the Trust set forth in Section 3.3.
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Subject to this Section 3.6, the Regular Trustees shall have none of
the powers or the authority of the Property Trustee set forth in Section 3.8.
Any expenses incurred by the Regular Trustees pursuant to this Section
3.6 shall be reimbursed by the Debenture Issuer.
SECTION 3.7 Prohibition of Actions by the Trust and the Trustees.
(a) The Trust shall not, and the Trustees (including the Property
Trustee) shall cause the Trust not to, engage in any activity other than as
required or authorized by this Declaration. In particular, the Trust shall not
and the Trustees (including the Property Trustee) shall cause the Trust not to:
(i) invest any proceeds received by the Trust in connection with
its ownership of the Debentures, but shall cause the Trust to
distribute all such proceeds to the Holders of the Securities pursuant
to the terms of this Declaration and of the Securities;
(ii) acquire any assets other than as expressly provided herein;
(iii) possess property for any purpose other than a Trust
purpose;
(iv) make any loans or incur any indebtedness;
(v) possess any power or otherwise act in such a way as to vary
the Trust's assets;
(vi) possess any power or otherwise act in such a way as to vary
the terms of the Securities in any way whatsoever (except to the
extent expressly authorized in this Declaration or by the terms of the
Securities);
(vii) issue any securities or other evidences of beneficial
ownership of, or beneficial interest in, the Trust other than the
Securities;
(viii) other than as provided in this Declaration or by the terms
of the Securities, (A) direct the time, method and place of exercising
any trust or power conferred upon the Indenture Trustee with respect
to the Debentures, (B) waive any past default that is waivable under
the Indenture, (C) exercise any right to rescind or annul any
declaration that the principal of all the Debentures shall be due and
payable or (D) consent to any amendment, modification or termination
of the Indenture or the Debentures where such consent is required,
unless the Trust has received an opinion of counsel to the effect that
such modification will not cause more than an insubstantial risk that
the Trust will not be classified as a grantor trust for United States
federal income tax purposes;
(ix) take any action inconsistent with the status of the Trust as
a grantor trust for United States federal income tax purposes; or
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(x) revoke any action previously authorized or approved by vote
of the Holders of the Preferred Securities.
SECTION 3.8 Powers and Duties of the Property Trustee.
(a) The legal title to the Debentures shall be owned by and held of
record in the name of the Property Trustee in trust for the benefit of the Trust
and the Holders of the Securities. The right, title and interest of the Property
Trustee to the Debentures shall vest automatically in each Person that hereafter
may be appointed as Property Trustee in accordance with Section 6.6. Such
vesting and cessation of title shall be effective whether or not conveyancing
documents with regard to the Debentures have been executed and delivered.
(b) The Property Trustee shall not transfer its right, title and
interest in the Debentures to the Regular Trustees nor to the Delaware Trustee
(if the Property Trustee does not also act as Delaware Trustee).
(c) The Property Trustee shall:
(i) establish and maintain the Property Account in the name of
and under the exclusive control of the Property Trustee on behalf of
the Holders of the Securities and, upon the receipt of payments of
funds made in respect of the Debentures, deposit such funds into the
Property Account and make payments to the Holders of the Securities
from the Property Account in accordance with Section 7.2 (funds in the
Property Account to be held uninvested until disbursed in accordance
with this Declaration);
(ii) engage in such ministerial activities as shall be necessary
or appropriate to effect the redemption of the Securities to the
extent the Debentures are redeemed or mature; and
(iii) upon written direction by the Sponsor to dissolve the
Trust, to engage in such ministerial activities as shall be necessary
or appropriate to effect the distribution of the Debentures to the
Holders of the Securities in exchange for the Securities.
(d) The Property Trustee shall take all actions and perform such
duties as may be specifically required of the Property Trustee pursuant to the
terms of this Declaration and the Securities.
(e) The Property Trustee shall take any Legal Action that arises out
of or in connection with (i) a Trust Enforcement Event of which a Responsible
Officer of the Property Trustee has actual knowledge or (ii) the Property
Trustee's duties and obligations under this Declaration or the Trust Indenture
Act; provided that if a Trust Enforcement Event has occurred and is continuing
and such event is attributable to the failure of the Debenture Issuer to pay
interest or principal on the Debentures on the date such interest or principal
is otherwise payable (or in the case of redemption, on the redemption date),
then a Holder of Preferred Securities may institute a proceeding directly
against the Debenture Issuer to enforce payment to such Holder of the principal
or interest on Debentures having an aggregate principal amount equal to the
aggregate liquidation amount of the Preferred Securities of such Holder (a
"Direct Action").
(f) The Property Trustee shall continue to serve as a Trustee until
either:
(i) the Trust has been completely liquidated and the proceeds of
the liquidation have been distributed to the Holders of the Securities
pursuant to the terms of the Securities; or
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(ii) a Successor Property Trustee has been appointed and has
accepted that appointment in accordance with Section 6.6.
(g) The Property Trustee shall have the legal power to exercise all of
the rights, powers and privileges of a holder of Debentures under the Indenture
and, if a Trust Enforcement Event actually known to a Responsible Officer of the
Property Trustee occurs and is continuing, the Property Trustee shall enforce,
for the benefit of the Holders of the Securities, its rights as holder of the
Debentures subject to the rights of the Holders of the Securities pursuant to
the terms of the Securities.
(h) The Property Trustee may authorize one or more Persons (each, a
"Paying Agent") to pay Distributions, redemption payments or liquidation
payments on behalf of the Trust with respect to all Securities, and any such
Paying Agent shall comply with Section 317(b) of the Trust Indenture Act. Any
Paying Agent may be removed by the Property Trustee at any time, and a successor
Paying Agent or additional Paying Agents may be appointed at any time by the
Property Trustee.
(i) Subject to this Section 3.8, the Property Trustee shall have none
of the duties, liabilities, powers or the authority of the Regular Trustees set
forth in Section 3.6.
The Property Trustee shall exercise the powers set forth in this
Section 3.8 in a manner that is consistent with the purposes and functions of
the Trust set out in Section 3.3, and the Property Trustee shall have no power
to, and shall not, take any action that is inconsistent with the purposes and
functions of the Trust set out in Section 3.3.
SECTION 3.9 Certain Duties and Responsibilities of the Property Trustee.
(a) The Property Trustee, before the occurrence of any Trust
Enforcement Event and after the cure or waiver of all Trust Enforcement Events
that may have occurred, shall undertake to perform only such duties as are
specifically set forth in this Declaration, and no implied covenants shall be
read into this Declaration against the Property Trustee. If a Trust Enforcement
Event has occurred (that has not been cured or waived pursuant to Section 2.6)
of which a Responsible Officer of the Property Trustee has actual knowledge, the
Property Trustee shall exercise such of the rights and powers vested in it by
this Declaration and shall 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 his or her own affairs.
(b) No provision of this Declaration shall be construed to relieve the
Property Trustee from liability for its own negligent action, its own negligent
failure to act or its own willful misconduct, except that:
(i) prior to the occurrence of a Trust Enforcement Event and
after the cure or waiver of all such Trust Enforcement Events that may
have occurred:
(A) the duties and obligations of the Property Trustee shall
be determined solely by the express provisions of this
Declaration, and the Property Trustee shall not be liable except
for the performance of such duties and obligations as are
specifically set forth in this Declaration, and no implied
covenants or obligations shall be read into this Declaration
against the Property Trustee; and
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(B) in the absence of bad faith on the part of the Property
Trustee, the Property Trustee may conclusively rely, as to the
truth of the statements and the correctness of the opinions
expressed therein, upon any certificates or opinions furnished to
the Property Trustee and conforming to the requirements of this
Declaration; but in the case of any such certificates or opinions
that by any provision hereof are specifically required to be
furnished to the Property Trustee, the Property Trustee shall be
under a duty to examine such certificates or opinions to
determine whether or not they conform to the requirements of this
Declaration;
(ii) the Property Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer of the Property
Trustee, unless it has been proven that the Property Trustee was
negligent in ascertaining the pertinent facts;
(iii) the Property Trustee shall not be liable with respect to
any action taken or omitted to be taken by it without negligence, in
good faith in accordance with the direction of the Holders of not less
than a Majority in Liquidation Amount of the Securities relating to
the time, method and place of conducting any proceeding for any remedy
available to the Property Trustee, or exercising any trust or power
conferred upon the Property Trustee under this Declaration;
(iv) no provision of this Declaration shall require the Property
Trustee to expend or risk its own funds or otherwise incur personal
financial liability in the performance of any of its duties or in the
exercise of any of its rights or powers, if it has reasonable grounds
for believing that the repayment of such funds or liability is not
reasonably assured to it under the terms of this Declaration or
indemnity reasonably satisfactory to the Property Trustee against such
risk or liability is not reasonably assured to it;
(v) the Property Trustee's sole duty with respect to the custody,
safe-keeping and physical preservation of the Debentures and the
Property Account shall be to deal with such property in a similar
manner as the Property Trustee deals with similar property for its own
account, subject to the protections and limitations on liability
afforded to the Property Trustee under this Declaration and the Trust
Indenture Act;
(vi) the Property Trustee shall have no duty or liability for or
with respect to the value, genuineness, existence or sufficiency of
the Debentures or the payment of any taxes or assessments levied
thereon or in connection therewith;
(vii) the Property Trustee shall not be liable for any interest
on any money received by it except as it otherwise may agree with the
Sponsor, and money held by the Property Trustee need not be segregated
from other funds held by it except in relation to the Property Account
maintained by the Property Trustee pursuant to Section 3.8(c)(i) and
except to the extent otherwise required by law; and
(viii) the Property Trustee shall not be responsible for
monitoring the compliance by the Regular Trustees or the Sponsor with
their respective duties under this Declaration, nor shall the Property
Trustee be liable for any default or misconduct of the Regular
Trustees or the Sponsor.
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SECTION 3.10 Certain Rights of Property Trustee.
(a) Subject to the provisions of Section 3.9:
(i) The Property Trustee may conclusively rely and shall be fully
protected in acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document believed by it to be genuine
and to have been signed, sent or presented by the proper party or
parties.
(ii) Any direction or act of the Sponsor contemplated by this
Declaration shall be sufficiently evidenced by an Officers'
Certificate.
(iii) Whenever in the administration of this Declaration, the
Property Trustee shall deem it desirable that a matter be proved or
established before taking, suffering or omitting any action hereunder,
the Property Trustee (unless other evidence is herein specifically
prescribed) may request, in the absence of bad faith on its part, and
conclusively rely upon an Officers' Certificate which, upon receipt of
such request, shall be promptly delivered by the Sponsor.
(iv) The Property Trustee shall have no duty to see to any
recording, filing or registration of any instrument (including any
financing or continuation statement or any filing under tax or
securities laws) or any rerecording, refiling or registration thereof.
(v) The Property Trustee may consult with counsel of its choice
or other experts, and the advice or opinion of such counsel and
experts with respect to legal matters or advice within the scope of
such experts' area of expertise shall be full and complete
authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in accordance with such
advice or opinion. Such counsel may be counsel to the Sponsor or any
of its Affiliates and may include any of its employees. The Property
Trustee shall have the right at any time to seek instructions
concerning the administration of this Declaration from any court of
competent jurisdiction.
(vi) The Property Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Declaration
at the request or direction of any Holder of Securities, unless such
Holder of Securities has provided to the Property Trustee security and
indemnity, reasonably satisfactory to the Property Trustee, against
the costs, expenses (including attorneys' fees and expenses and the
expenses of the Property Trustee's agents, nominees or custodians) and
liabilities that might be incurred by it in complying with such
request or direction, including such reasonable advances as may be
requested by the Property Trustee; provided that nothing contained in
this Section 3.10(a) shall be taken to relieve the Property Trustee,
upon the occurrence of an Indenture Event of Default, of its
obligation to exercise the rights and powers vested in it by this
Declaration.
(vii) The Property Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Property Trustee, in
its discretion, may make such further inquiry or investigation into
such facts or matters as it sees fit.
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(viii) The Property Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by
or through agents, custodians, nominees or attorneys, and the Property
Trustee shall not be responsible for any misconduct or negligence on
the part of any agent or attorney appointed with due care by it
hereunder.
(ix) Any action taken by the Property Trustee or its agents
hereunder shall bind the Trust and the Holders of the Securities, and
the signature of the Property Trustee or its agents alone shall be
sufficient and effective to perform any such action, and no third
party shall be required to inquire as to the authority of the Property
Trustee to so act or as to its compliance with any of the terms and
provisions of this Declaration, both of which shall be evidenced
conclusively by the Property Trustee's or its agent's taking such
action.
(x) Whenever in the administration of this Declaration the
Property Trustee shall deem it desirable to receive instructions with
respect to enforcing any remedy or right or taking any other action
hereunder, the Property Trustee (A) may request instructions from the
Holders of the Securities, which instructions only may be given by the
Holders of the same proportion in liquidation amount of the Securities
as would be entitled to direct the Property Trustee under the terms of
the Securities in respect of such remedy, right or action, (B) may
refrain from enforcing such remedy or right or taking such other
action until such instructions are received and (C) shall be protected
in conclusively relying on or acting in accordance with such
instructions.
(xi) Except as otherwise expressly provided by this Declaration,
the Property Trustee shall not be under any obligation to take any
action that is discretionary under the provisions of this Declaration.
(xii) The Property Trustee shall not be liable for any action
taken, suffered or omitted to be taken by it without negligence, in
good faith and reasonably believed by it to be authorized or within
the discretion, rights or powers conferred upon it by this
Declaration.
(b) No provision of this Declaration shall be deemed to impose any
duty or obligation on the Property Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it, in any
jurisdiction in which it shall be illegal, or in which the Property Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts, or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Property Trustee
shall be construed to be a duty.
SECTION 3.11 Delaware Trustee.
Notwithstanding any other provision of this Declaration other than
Section 6.2, the Delaware Trustee shall not be entitled to exercise any powers
of, nor shall the Delaware Trustee have any of the duties and responsibilities
of, the Regular Trustees or the Property Trustee described in this Declaration.
Except as set forth in Section 6.2, the Delaware Trustee shall be a Trustee for
the sole and limited purpose of fulfilling the requirements of Section 3807 of
the Business Trust Act.
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SECTION 3.12 Execution of Documents.
Except as otherwise required by the Business Trust Act or applicable
law, any Regular Trustee is authorized to execute on behalf of the Trust any
documents that the Regular Trustees have the power and authority to execute
pursuant to Section 3.6.
SECTION 3.13 Not Responsible for Recitals or Issuance of Securities.
The recitals contained in this Declaration and the Securities shall be
taken as the statements of the Sponsor, and the Trustees do not assume any
responsibility for their correctness. The Trustees make no representations as to
the value or condition of the property of the Trust or any part thereof. The
Trustees make no representations as to the validity or sufficiency of this
Declaration, the Securities, the Debentures or the Indenture.
SECTION 3.14 Duration of Trust.
The Trust shall exist until dissolved pursuant to the provisions of
Article 8 hereof.
SECTION 3.15 Mergers.
(a) The Trust may not consolidate with, convert into, amalgamate or
merge with or into, be replaced by or convey, transfer or lease its properties
and assets substantially as an entirety to any corporation or other body, except
as described in Section 3.15(b) and (c).
(b) At the request of the Sponsor and with the consent of the Regular
Trustees or, if there are more than two, a majority of the Regular Trustees and
without the consent of the Holders of the Preferred Securities, the Delaware
Trustee or the Property Trustee, the Trust may consolidate with, convert into,
amalgamate or merge with or into, be replaced by or convey, transfer or lease
its properties substantially as an entirety to a trust organized as such under
the laws of any state; provided that:
(i) if the Trust is not the successor entity, such successor
entity (the "Successor Entity") either:
(A) expressly assumes all of the obligations of the Trust
with respect to the Securities; or
(B) substitutes for the Securities other securities having
substantially the same terms as the Securities (the "Successor
Securities"), so long as such Successor Securities rank the same
as the Securities with respect to Distributions and payments upon
liquidation, redemption and otherwise;
(ii) the Debenture Issuer expressly appoints a trustee of such
Successor Entity that possesses the same powers and duties as the
Property Trustee as the holder of the Debentures;
(iii) the Preferred Securities or any Successor Securities are
or, upon notification of issuance will be, listed on any national
securities exchange or with any other or organization on which the
Preferred Securities are then listed or quoted;
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(iv) such consolidation, conversion, amalgamation, merger,
replacement, conveyance, transfer or lease does not cause the
Preferred Securities (including any Successor Securities) to be
downgraded by any nationally recognized statistical rating
organization;
(v) such consolidation, conversion, amalgamation, merger,
replacement, conveyance, transfer or lease does not adversely affect
the rights, preferences and privileges of the Holders of the Preferred
Securities (including any Successor Securities) in any material
respect;
(vi) such Successor Entity has a purpose substantially identical
to that of the Trust;
(vii) prior to such consolidation, conversion, amalgamation,
merger, replacement, conveyance, transfer or lease, the Sponsor has
received an opinion of independent counsel to the Trust experienced in
such matters to the effect that:
(A) such consolidation, conversion, amalgamation, merger,
replacement, conveyance, transfer or lease does not adversely
affect the rights, preferences and privileges of the Holders of
the Securities (including any Successor Securities) in any
material respect;
(B) following such consolidation, conversion, amalgamation,
merger, 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
(C) following such consolidation, conversion, amalgamation
or merger, replacement, conveyance, transfer or lease, the Trust
(or such Successor Entity) will continue to be classified as a
grantor trust for United States federal income tax purposes;
(viii) the Sponsor or any permitted successor or assignee owns
all of the Common Securities and guarantees the obligations of such
Successor Entity under the Successor Securities, at least to the
extent provided by the Guarantee; and
(ix) such Successor Entity expressly assumes all of the
obligations of the Trust.
(c) Notwithstanding Section 3.15(b), the Trust shall not, except with
the consent of Holders of 100% in aggregate liquidation amount of the
Securities, consolidate with, convert into, amalgamate or merge with or into, be
replaced by or convey, transfer or lease its properties and assets substantially
as an entirety to, any other entity or permit any other entity to consolidate
with, amalgamate, merge with or into, or replace it, if such consolidation,
conversion, amalgamation, merger, replacement, conveyance, transfer or lease
would cause the Trust or any Successor Entity to be classified as other than a
grantor trust for United States federal income tax purposes or would cause each
Holder of Securities not to be treated as owning an undivided beneficial
ownership interest in the Debentures.
SECTION 3.16 Property Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
similar judicial proceeding relative to the Trust or any other obligor upon the
Securities or the property of the Trust or of such other obligor or their
creditors, the Property Trustee (irrespective of whether any Distributions on
the Securities are then due and payable as therein expressed or by declaration
or otherwise and irrespective of whether the Property Trustee has made
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any demand on the Trust for the payment of any past due Distributions) shall be
entitled and empowered, to the fullest extent permitted by law, by intervention
in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount of any
Distributions owing and unpaid in respect of the Securities (or, if the
Securities are original issue discount securities, such portion of the
liquidation amount as may be specified in the terms of such securities) and to
file such other papers or documents as may be necessary or advisable in order to
have the claims of the Property Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Property Trustee, its
agents and counsel) and of the Holders of the Securities allowed in such
judicial proceeding; and
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder of Securities to make such payments to the Property Trustee and, in
the event the Property Trustee consents to the making of such payments directly
to the Holders, to pay to the Property Trustee any amount due it for the
reasonable compensation, expenses, disbursements and advances of the Property
Trustee, its agents and counsel, and any other amounts due the Property Trustee.
Nothing herein contained shall be deemed to authorize the Property
Trustee to authorize or consent to or accept or adopt, on behalf of any Holder
of Securities, any plan of reorganization, arrangement, adjustment or
compensation affecting the Securities or the rights of any Holder thereof or to
authorize the Property Trustee to vote in respect of the claim of any Holder of
Securities in any such proceeding.
ARTICLE 4: THE SPONSOR
SECTION 4.1 Responsibilities of the Sponsor.
In connection with the sale and issuance of the Preferred Securities,
the Sponsor shall have the exclusive right and responsibility to engage in the
following activities:
(a) to prepare, execute and file with the Commission, on behalf of the
Trust, a registration statement on Form S-3 in relation to the Preferred
Securities, including any amendments or supplements thereto, and to take any
other action relating to the registration and sale of the Preferred Securities
under federal and state securities laws;
(b) if necessary, to determine the states in which to take appropriate
action to qualify or register for sale all or part of the Corporate PIES and to
do any and all such acts, other than actions that must be taken by the Trust,
and advise the Trust of actions it must take; to prepare, execute and file, on
behalf of the Trust, any documents it deems necessary or advisable in order to
comply with the applicable laws of any such states; and to prepare, execute and
file, on behalf of the Trust, any such documents or take any acts determined by
it to be necessary in order to qualify or register all or part of the Corporate
PIES in any state in which it has determined to qualify or register such
Corporate PIES for sale;
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(c) if necessary, to prepare, execute and file on behalf of the Trust,
an application to the New York Stock Exchange or any other national stock
exchange or the Nasdaq National Market for listing upon notice of issuance of
any Preferred Securities;
(d) if necessary, to prepare, execute and file with the Commission, on
behalf of the Trust, a registration statement on Form 8-A relating to the
registration of the Preferred Securities under Section 12(b) of the Exchange
Act, including any amendments thereto; and
(e) to negotiate the terms of, and execute and enter into, an
underwriting agreement providing for the sale of the Corporate PIES and a
remarketing agreement providing for the Remarketing.
SECTION 4.2 Indemnification and Expenses of the Trustees.
The Sponsor, in its capacity as Debenture Issuer, agrees to indemnify
the Property Trustee and the Delaware Trustee for, and to hold each of them
harmless against, any loss, liability or expense incurred without negligence or
bad faith on the part of the Property Trustee or the Delaware Trustee, as the
case may be, arising out of or in connection with the acceptance or
administration of the trust or trusts hereunder, including the costs and
expenses of defending either of them against any claim or liability in
connection with the exercise or performance of any of their respective powers or
duties hereunder. The provisions of this Section 4.2 shall survive the
resignation or removal of the Delaware Trustee or the Property Trustee and the
termination of this Declaration.
ARTICLE 5: THE HOLDERS OF THE COMMON SECURITIES
SECTION 5.1 Debenture Issuer's Purchase of the Common Securities.
On the Closing Date, the Debenture Issuer shall purchase all of the
Common Securities issued by the Trust, in an aggregate liquidation amount equal
to at least three percent of the total capital of the Trust, at such time as the
Preferred Securities are sold and issued. If any additional Securities are
issued pursuant to the exercise of any Over-allotment Option, then the Debenture
Issuer shall purchase, on the date of such issuance, an additional number of
Common Securities such that the aggregate liquidation amount of the Common
Securities to be held by the Debenture Issuer, upon such issuance and purchase,
will equal at least three percent of the total capital of the Trust.
The aggregate stated liquidation amount of the Common Securities
outstanding at any time shall not be less than three percent of the total
capital of the Trust.
SECTION 5.2 Covenants of the Debenture Issuer.
For so long as the Preferred Securities remain outstanding, the
Debenture Issuer shall covenant:
(a) to maintain, directly or indirectly, 100% ownership of the Common
Securities;
(b) to cause the Trust to remain a statutory business trust and not to
voluntarily dissolve, wind up, liquidate or be terminated, except as permitted
by this Declaration;
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(c) to use its commercially reasonable efforts to ensure that the
Trust will not be an Investment Company required to be registered under the
Investment Company Act; and
(d) not to take any action that would be reasonably likely to cause
the Trust to be classified as an association or a publicly traded partnership
taxable as a corporation for United States federal income tax purposes.
ARTICLE 6: THE TRUSTEES
SECTION 6.1 Number of Trustees.
The number of Trustees initially shall be five, and:
(a) at any time before the issuance of any Securities, the Sponsor may
increase or decrease the number of Trustees by written instrument; and
(b) after the issuance of any Securities, the number of Trustees may
be increased or decreased by vote of the Holders of a Majority in Liquidation
Amount of the Common Securities at a meeting of the Holders of the Common
Securities or by written consent in lieu of such meeting; provided that the
number of Trustees shall be at least three; and provided further that: (i) the
Delaware Trustee, in the case of a natural person, shall be a person who is a
resident of the State of Delaware or, if not a natural person, shall be an
entity that has its principal place of business in the State of Delaware and
otherwise meets the requirements of applicable law; (ii) at least one Regular
Trustee shall be an employee or officer of, or shall be affiliated with, the
Sponsor; and (iii) one Trustee shall be the Property Trustee, which, for as long
as this Declaration is required to qualify as an indenture under the Trust
Indenture Act, shall meet the requirements of applicable law, provided that the
Property Trustee also may serve as Delaware Trustee if it meets the applicable
requirements.
SECTION 6.2 Delaware Trustee; Eligibility.
If required by the Business Trust Act, one Trustee (the "Delaware
Trustee") shall be:
(a) a natural person who is a resident of the State of Delaware; or
(b) if not a natural person, an entity that has its principal place of
business in the State of Delaware and otherwise meets the requirements of
applicable law, provided that if the Property Trustee has its principal place of
business in the State of Delaware and otherwise meets the requirements of
applicable law, then the Property Trustee also shall be the Delaware Trustee and
Section 3.11 shall have no application.
SECTION 6.3 Property Trustee; Eligibility.
(a) There shall be at all times one Trustee (which may be the Delaware
Trustee) that shall act as Property Trustee. The Property Trustee shall:
(i) not be an Affiliate of the Sponsor; and
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(ii) be a corporation organized and doing business under the laws
of the United States of America or any state or territory thereof or
of the District of Columbia, or a corporation or other Person
permitted by the Commission to act as an institutional trustee under
the Trust Indenture Act, authorized under such laws to exercise
corporate trust powers, having a combined capital and surplus of at
least 50 million U.S. dollars ($50,000,000) and subject to supervision
or examination by federal, state, territorial or District of Columbia
authority. If such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of the supervising or
examining authority referred to above, then for the purposes of this
Section 6.3(a)(ii), the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published.
(b) If at any time the Property Trustee shall cease to be eligible to
so act under Section 6.3(a), the Property Trustee immediately shall resign in
the manner and with the effect set forth in Section 6.6(c).
(c) If the Property Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture Act, the
Property Trustee and the Holders of the Common Securities (as if it were the
obligor referred to in Section 310(b) of the Trust Indenture Act) shall comply
in all respects with the provisions of Section 310(b) of the Trust Indenture
Act.
(d) The Guarantee shall be deemed to be specifically described in this
Declaration for purposes of clause (i) of the first proviso contained in Section
310(b) of the Trust Indenture Act.
SECTION 6.4 Qualifications of the Regular Trustees Generally.
Each Regular Trustee shall be either a natural person who is at least
21 years of age or a legal entity that shall act through one or more Authorized
Officers.
SECTION 6.5 Initial Regular Trustees.
The initial Regular Trustees shall be Stephen P. Adik, Francis P.
Girot, Jr. and Arthur A. Paquin, the business address of all of whom is in care
of NIPSCO Capital Markets, Inc., 801 East 86th Avenue, Merrillville, Indiana
46410.
SECTION 6.6 Appointment, Removal and Resignation of the Trustees.
(a) Subject to Section 6.6(b), the Trustees may be appointed or
removed without cause at any time:
(i) until the issuance of any Securities, by written instrument
executed by the Sponsor; and
(ii) after the issuance of any Securities, by a vote of the
Holders of a Majority in Liquidation Amount of the Common Securities
at a meeting of the Holders of the Common Securities or by written
consent in lieu of such meeting.
(b) The Property Trustee shall not be removed in accordance with
Section 6.6(a) until a successor Trustee possessing the qualifications to act as
Property Trustee under Section 6.3(a) (a "Successor Property Trustee") has been
appointed and has accepted such appointment by written instrument executed by
such Successor Property Trustee and delivered to the Regular Trustees and the
Sponsor. The Delaware
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Trustee shall not be removed in accordance with Section 6.6(a) until a successor
Trustee possessing the qualifications to act as Delaware Trustee under Sections
6.2 and 6.4 (a "Successor Delaware Trustee") has been appointed and has accepted
such appointment by written instrument executed by such Successor Delaware
Trustee and delivered to the Regular Trustees and the Sponsor.
(c) A Trustee appointed to office shall hold office until a successor
has been appointed, until death or dissolution or until removal or resignation.
Any Trustee may resign from office (without need for prior or subsequent
accounting) by written instrument executed by such Trustee and delivered to the
Sponsor and the other Trustees, which resignation shall take effect upon such
delivery or upon such later date as is specified therein; provided that:
(i) no such resignation of the Property Trustee shall be
effective:
(A) until a Successor Property Trustee has been appointed
and has accepted such appointment by written instrument executed
by such Successor Property Trustee and delivered to the Regular
Trustees, the Sponsor and the resigning Property Trustee; or
(B) until the assets of the Trust have been completely
liquidated and the proceeds thereof distributed to the Holders of
the Securities; and
(ii) no such resignation of the Delaware Trustee shall be
effective until a Successor Delaware Trustee has been appointed and
has accepted such appointment by written instrument executed by such
Successor Delaware Trustee and delivered to the Regular Trustees, the
Sponsor and the resigning Delaware Trustee.
(d) The Holders of the Common Securities shall use their best efforts
to promptly appoint a Successor Property Trustee or Successor Delaware Trustee,
as the case may be, if the Property Trustee or the Delaware Trustee delivers an
instrument of resignation in accordance with this Section 6.6.
(e) If no Successor Property Trustee or Successor Delaware Trustee, as
the case may be, has been appointed and accepted appointment as provided in this
Section 6.6 within 60 days after delivery of an instrument of resignation or
removal, the resigning or removed Property Trustee or Delaware Trustee, as
applicable, may petition any court of competent jurisdiction for appointment of
a Successor Property Trustee or Successor Delaware Trustee, as applicable. Such
court may thereupon, after prescribing such notice, if any, as it may deem
proper, appoint a Successor Property Trustee or Successor Delaware Trustee, as
the case may be.
(f) No Property Trustee or Delaware Trustee shall be liable for the
acts or omissions to act of any Successor Property Trustee or Successor Delaware
Trustee, as the case may be.
SECTION 6.7 Vacancies among Trustees.
If a Trustee ceases to hold office for any reason and the number of
Trustees is not reduced pursuant to Section 6.1, or if the number of Trustees is
increased pursuant to Section 6.1, a vacancy shall occur. A resolution
certifying the existence of such vacancy by the Regular Trustees or, if there
are more than two, a majority of the Regular Trustees shall be conclusive
evidence of the existence of such vacancy. The vacancy shall be filled with a
Trustee appointed in accordance with Section 6.6.
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SECTION 6.8 Effect of Vacancies.
The death, resignation, retirement, removal, bankruptcy, dissolution,
liquidation, incompetence or incapacity to perform the duties of a Trustee shall
not operate to annul, dissolve or terminate the Trust nor to terminate this
Declaration. Whenever a vacancy in the number of Regular Trustees shall occur,
until such vacancy is filled by the appointment of a Regular Trustee in
accordance with Section 6.6, the Regular Trustees in office, regardless of their
number, shall have all the powers granted to the Regular Trustees and shall
discharge all the duties imposed upon the Regular Trustees by this Declaration.
SECTION 6.9 Meetings.
If there is more than one Regular Trustee, meetings of the Regular
Trustees shall be held from time to time upon the call of any Regular Trustee.
Regular meetings of the Regular Trustees may be held at a time and place fixed
by resolution of the Regular Trustees. Notice of any in-person meetings of the
Regular Trustees shall be hand delivered or otherwise delivered in writing
(including by facsimile, with a hard copy by overnight courier) not less than 48
hours before such meeting. Notice of any telephonic meetings of the Regular
Trustees shall be hand delivered or otherwise delivered in writing (including by
facsimile, with a hard copy by overnight courier) not less than 24 hours before
a meeting. Notices shall contain a brief statement of the time, place and
anticipated purposes of the meeting. The presence (whether in person or by
telephone) of a Regular Trustee at a meeting shall constitute a waiver of notice
of such meeting except where a Regular Trustee attends a meeting for the express
purpose of objecting to the transaction of any activity on the ground that the
meeting has not been lawfully called or convened. Unless provided otherwise in
this Declaration, any action of the Regular Trustees may be taken at a meeting
by vote of a majority of the Regular Trustees present (whether in person or by
telephone) and eligible to vote with respect to such matter, provided a Quorum
is present, or without a meeting by the unanimous written consent of the Regular
Trustees. In the event there is only one Regular Trustee, any and all action of
such Regular Trustee shall be evidenced by a written consent of such Regular
Trustee.
SECTION 6.10 Delegation of Power by the Regular Trustees.
(a) Any Regular Trustee may delegate to any natural person over the
age of 21, by power of attorney consistent with applicable law, his, her or its
power for the purpose of executing any documents contemplated in Section 3.6.
(b) The Regular Trustees shall have the power to delegate from time to
time to such of their number or to officers of the Trust the doing of such
things and the execution of such instruments either in the name of the Trust or
the names of the Regular Trustees or otherwise as the Regular Trustees may deem
expedient, to the extent such delegation is not prohibited by applicable law or
contrary to the provisions of the Trust, as set forth herein.
SECTION 6.11 Merger, Consolidation, Conversion or Succession to Business.
Any entity into which the Property Trustee, the Delaware Trustee or
any Regular Trustee that is not a natural person may be merged or converted or
with which such Trustee may be consolidated, or any entity resulting from any
merger, conversion or consolidation to which such Trustee is a party, or any
entity 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 entity otherwise is qualified and eligible
under this Article.
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ARTICLE 7: TERMS OF THE SECURITIES
SECTION 7.1 General Provisions Regarding the Securities.
(a) The Regular Trustees shall issue, on behalf of the Trust, one
class of preferred securities representing undivided beneficial ownership
interests in the assets of the Trust and one class of common securities
representing undivided beneficial ownership interests in the assets of the
Trust.
(i) The Preferred Securities of the Trust shall have an aggregate
stated liquidation amount with respect to the assets of the Trust of
three hundred million dollars ($300,000,000) (subject to increase to
not more than three hundred forty-five million dollars ($345,000,000)
in the event of the exercise of any Over-allotment Option) and a
stated liquidation amount with respect to the assets of the Trust of
$50 per Preferred Security. The Preferred Securities are hereby
designated for identification purposes only as the Preferred
Securities. The Preferred Security Certificates shall be substantially
in the form of Exhibit A hereto, with such changes and additions
thereto or deletions therefrom as may be required by ordinary usage,
custom or practice.
(ii) The Common Securities of the Trust shall have an aggregate
liquidation amount with respect to the assets of the Trust of nine
million two hundred seventy-eight thousand four hundred dollars
($9,278,400) (subject to increase to not more than ten million seven
hundred thousand dollars ($10,700,000) in the event of the exercise of
any Over-allotment Option) and a liquidation amount with respect to
the assets of the Trust of $50 per Common Security. The Common
Securities are hereby designated for identification purposes only as
the Common Securities (the "Common Securities"). The Common Security
Certificates shall be substantially in the form of Exhibit B hereto,
with such changes and additions thereto or deletions therefrom as may
be required by ordinary usage, custom or practice.
(b) Payment of Distributions on, and any payment of the Redemption
Price upon a redemption of, the Preferred Securities and the Common Securities,
as applicable, shall be made Pro Rata based on the liquidation amount of such
Preferred Securities and Common Securities; provided that if, on any date on
which payment of a Distribution or the Redemption Price is to be made, an
Indenture Event of Default has occurred and is continuing, then such payment
shall not be made on any of the Common Securities, and no other payment on
account of the redemption, liquidation or other acquisition of such Common
Securities shall be made, until all accumulated and unpaid Distributions, or
payments of the Redemption Price, as the case may be, on all of the outstanding
Preferred Securities for which Distributions are to be paid or that have been
called for redemption, as the case may be, are fully paid. All funds available
to the Property Trustee shall first be applied to the payment in full in cash of
all Distributions on, or the Redemption Price of, the Preferred Securities then
due and payable.
(c) The consideration received by the Trust for the issuance of the
Securities shall constitute a contribution to the capital of the Trust and shall
not constitute a loan to the Trust.
(d) Upon issuance of the Securities as provided in this Declaration,
the Securities so issued shall be validly issued, fully paid and non-assessable
beneficial ownership interests in the assets of the Trust.
(e) Every Person, by virtue of having become a Holder of Securities or
a Beneficial Owner of Preferred Securities in accordance with the terms of this
Declaration, shall be deemed to have expressly
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assented and agreed to the terms of, and shall be bound by, this Declaration,
the Guarantee, the Indenture and the Debentures.
(f) The Holders of the Securities shall not have any preemptive or
similar rights.
(g) The Certificates shall be signed on behalf of the Trust by a
Regular Trustee. Such signature shall be the manual or facsimile signature of
any present or any future Regular Trustee. If a Regular Trustee of the Trust who
has signed any of the Certificates ceases to be a Regular Trustee before such
signed Certificates have been delivered by the Trust, such Certificates
nevertheless may be delivered as though the Person who signed such Certificates
had not ceased to be a Regular Trustee. Any Certificate may be signed on behalf
of the Trust by such Persons who, at the actual date of execution of such
Certificate, shall be the Regular Trustees of the Trust, although at the date of
the execution and delivery of this Declaration any such Person was not such a
Regular Trustee. Certificates shall be printed, lithographed or engraved or may
be produced in any other manner as is reasonably acceptable to the Regular
Trustees, as evidenced by their execution thereof, and may have such letters,
numbers or other marks of identification or designation and such legends or
endorsements as the Regular Trustees may deem appropriate, or as may be required
to comply with any law or with any rule or regulation of any stock exchange on
which the Securities may be listed, or to conform to usage.
A Preferred Security Certificate 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 such Preferred
Security Certificate has been authenticated under this Declaration.
Upon a written order of the Trust signed by one Regular Trustee, the
Property Trustee shall authenticate the Preferred Security Certificates for
original issue. The aggregate number of Preferred Securities outstanding at any
time shall not exceed the aggregate stated liquidation amount set forth in
Section 7.1(a)(i).
The Property Trustee may appoint an authenticating agent acceptable to
the Trust to authenticate Certificates. An authenticating agent may authenticate
Certificates whenever the Property Trustee may do so. Each reference in this
Declaration to authentication by the Property Trustee shall include
authentication by such agent. An authenticating agent shall have the same rights
as the Property Trustee to deal with the Sponsor or an Affiliate of the Sponsor.
(h) Unless otherwise specified in the terms of the Preferred
Securities, the Preferred Securities Certificates, upon original issuance
(including Preferred Securities, if any, issued pursuant to the exercise of any
Over-allotment Option), shall be issued as Global Securities in the form of one
or more fully registered global Preferred Security Certificates (each a "Global
Certificate"), to be delivered to The Depository Trust Company, the initial
Depositary, by or on behalf of the Trust. Such Global Certificates initially
shall be registered on the books and records of the Trust in the name of "Cede &
Co.," the nominee of the initial Depositary. No Beneficial Owner of Preferred
Securities shall receive a definitive Preferred Security Certificate
representing such Beneficial Owner's interest in such Global Certificates,
except as provided in Section 7.12. Unless and until definitive, fully
registered Preferred Security Certificates have been issued to the Beneficial
Owners of Preferred Securities pursuant to Section 7.12,
(i) the provisions of this Section 7.1(h) shall be in full force
and effect;
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(ii) the Trust and the Trustees shall be entitled to deal with
the Depositary for all purposes of this Declaration (including the
payment of Distributions on the Global Certificates and receiving
approvals, votes or consents thereunder) as the Holder of the
Preferred Securities and the sole of holder of the Global Certificates
and, except as set forth herein or in Rule 3a-7 (if the Trust is
excluded from the definition of an Investment Company solely by reason
of Rule 3a-7) with respect to the Property Trustee, shall have no
obligation to the Beneficial Owners of the Preferred Securities;
(iii) to the extent that the provisions of this Section 7.1(h)
conflict with any other provisions of this Declaration, the provisions
of this Section 7.1(h) shall control; and
(iv) the rights of the Beneficial Owners of the Preferred
Securities shall be exercised only through the Depositary and shall be
limited to those established by law and agreements between such
Beneficial Owners and the Depositary and/or the Depositary
Participants. The Depositary shall make book-entry transfers among
Depositary Participants and receive and transmit Distributions on the
Global Certificates to such Depositary Participants; provided that
solely for the purposes of determining whether the Holders of the
requisite amount of Preferred Securities have voted on any matter
provided for in this Declaration, so long as definitive Preferred
Security Certificates have not been issued, the Trustees may rely
conclusively on, and shall be protected in relying on, any written
instrument (including a proxy) delivered to the Trustees by the
Depositary setting forth the votes of the Beneficial Owners of the
Preferred Securities or assigning the right to vote on any matter to
any other Persons either in whole or in part.
Whenever a notice or other communication to the Holder of the
Preferred Securities is required to be given under this Declaration, unless and
until definitive Preferred Security Certificates have been issued pursuant to
Section 7.1, the Trustees shall deliver all such notices and communications
specified herein to be given to the Holders of the Preferred Securities to the
Depositary, and, with respect to any Preferred Security Certificate registered
in the name of a Depositary or the nominee of a Depositary, the Trustees may
conclusively rely on, and shall be protected in relying on, any written
instrument (including a proxy) delivered to the Trustees by the Depositary
setting forth the votes of the Beneficial Owners of the Preferred Securities or
assigning the right to vote on any matter or any other Persons either in whole
or in part.
SECTION 7.2 Distributions.
(a) Holders of the Securities shall be entitled to receive
Distributions that shall accumulate and be payable at the rate per annum of
5.90% of the stated liquidation amount of $50 per Security until February 19,
2003, and at the Reset Rate thereafter. The amount of Distributions payable for
any period shall be computed (i) for any full quarterly distribution period, on
the basis of a 360-day year of twelve 30-day months and (ii) for any period
shorter than a full quarterly distribution period, on the basis of a 30-day
month and, for any period of less than one month, on the basis of the actual
number of days elapsed per 30-day month. Subject to Section 7.1(b),
Distributions shall be made on the Securities on a Pro Rata basis. Distributions
on the Securities shall accumulate from the date of original issue, shall be
cumulative and shall be payable quarterly, in arrears, on February 19, May 19,
August 19 and November 19 of each year, commencing May 19, 1999, when, as and if
available for payment, by the Property Trustee, except as otherwise described
below. Distributions shall be payable only to the extent that payments are made
to the Trust in respect of the Debentures held by the Property Trustee and to
the extent that the Trust has funds available for the payment of such
Distributions in the Property Account.
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(b) Distributions not paid on the scheduled payment date shall
accumulate and compound quarterly at the rate of 5.90% per annum through and
including February 18, 2003, and at the Reset Rate thereafter ("Compounded
Distributions"). "Distributions" shall mean ordinary cumulative distributions
together with any Compounded Distributions.
(c) If and to the extent that the Debenture Issuer makes a payment of
principal of and any premium or interest on the Debentures held by the Property
Trustee (the amount of any such payment being a "Payment Amount"), the Property
Trustee shall and is directed, to the extent funds are available for that
purpose, to make a distribution of the Payment Amount to the Holders of the
Securities, on a Pro Rata basis, subject to Section 7.1(b).
(d) Distributions on the Securities shall be payable to the Holders
thereof as they appear on the register of the Trust as of the close of business
on the relevant record dates. If the Preferred Securities are represented by one
or more Global Securities, the relevant record dates shall be the close of
business on the Business Day preceding each Distribution payment date, unless a
different regular record date is established or provided for the corresponding
interest payment date on the Debentures. The relevant record dates for the
Common Securities shall be the same as for the Preferred Securities. If the
Preferred Securities are not represented by one or more Global Securities, the
relevant record dates for the Preferred Securities shall be the fifteenth
Business Day prior to the Distribution payment dates, or such other dates as may
be selected by the Regular Trustees. At all times, the Distribution payment
dates shall correspond to the interest payment dates on the Debentures.
Distributions payable on any Securities that are not punctually paid on any
Distribution payment date, as a result of the Debenture Issuer having failed to
make a payment on the Debentures, shall cease to be payable to the Person in
whose name such Securities are registered on the relevant record date, and such
defaulted Distribution instead shall be payable to the Person in whose name such
Securities are registered on the special record date or other specified date
determined in accordance with the Indenture for payment of the corresponding
defaulted interest on the Debentures. If any date on which a Distribution is
payable on the Securities is not a Business Day, then payment of the
Distribution payable on such date shall be made on the next day that is a
Business Day (and without any interest or other payment in respect of any such
delay), except that if such Business Day is in the next calendar year, such
payment shall be made on the preceding Business Day, with the same force and
effect as if made on such payment date.
(e) In the event that there is any money or other property held by or
for the Trust that is not accounted for hereunder, such property shall be
distributed Pro Rata among the Holders of the Securities, subject to Section
7.1(b).
SECTION 7.3 Redemption of Securities.
Upon the repayment or redemption, in whole or in part, of the
Debentures held by the Trust, whether at the stated maturity of the Debentures
or upon earlier redemption as provided in the Indenture, the proceeds from such
repayment or redemption shall be simultaneously applied Pro Rata (subject to
Section 7.1(b)) to redeem, at the Redemption Price, Securities having an
aggregate liquidation amount equal to the aggregate principal amount of the
Debentures so repaid or redeemed. Holders of the Securities shall be given not
less than 30 nor more than 60 days notice of such redemption in accordance with
Section 7.4.
SECTION 7.4 Redemption Procedures.
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(a) Notice of any redemption of the Securities (a "Redemption
Notice"), which notice shall be irrevocable, shall be given by the Trust by mail
to each Holder of Securities to be redeemed at least 30 but no more than 60 days
before the date fixed for redemption thereof, which shall be the date fixed for
redemption of the Debentures. For purposes of the calculation of the date of
redemption and the dates on which notices are given pursuant to this Section
7.4(a), a Redemption Notice shall be deemed to be given on the day such notice
is first mailed by first-class mail, postage prepaid, to the Holders of the
Securities. Each Redemption Notice shall be addressed to the Holders of the
Securities at the address of each such Holder appearing in the register of the
Trust. No defect in the Redemption Notice or in the mailing of either thereof
with respect to any Holder shall affect the validity of the redemption
proceedings with respect to any other Holder.
(b) Subject to the Trust's fulfillment of the notice requirements set
forth in Section 7.4(a), if Securities are to be redeemed, then (provided that
the Debenture Issuer has paid the Property Trustee a sufficient amount of cash
in connection with the related repayment or redemption of the Debentures) (i)
with respect to the Preferred Securities represented by one or more Global
Securities, by 12:00 noon, New York City time, on the redemption date, the
Property Trustee will deposit irrevocably with the Depositary or its nominee
funds sufficient to pay the applicable Redemption Price, and, subject to Section
7.4(c), the Property Trustee shall give the Depositary irrevocable instructions
and authority to pay the Redemption Price to the Beneficial Owners of the
Preferred Securities, and (ii) with respect to Securities not represented by one
or more Global Securities, subject to Section 7.4(c), the Property Trustee shall
pay the applicable Redemption Price to the Holders of such Securities by check
mailed to the address of each Holder appearing on the register of the Trust on
the redemption date. If any date fixed for redemption of Securities is not a
Business Day, then payment of the Redemption Price payable on such date shall be
made on the next Business Day (without any interest thereon), except that if
such Business Day falls in the next calendar year, such payment shall be made on
the preceding Business Day, in each case with the same force and effect as if
made on such date fixed for redemption. If payment of the Redemption Price in
respect of any Securities is improperly withheld or refused and not paid either
by the Trust or by the Sponsor as guarantor pursuant to the Guarantee, then
Distributions on such Securities shall continue to accumulate at the then
applicable rate, from the original redemption date to the actual date of
payment, in which case the actual payment date shall be the date fixed for
redemption for purposes of calculating the Redemption Price. For these purposes,
the applicable Redemption Price shall not include Distributions that are being
paid to Holders of Securities who were Holders of Securities on a relevant
record date. If a Redemption Notice has been given and funds have been deposited
or paid as required, then immediately prior to the close of business on the date
of such deposit or payment, Distributions will cease to accumulate on the
Securities called for redemption, and all rights of Holders of such Securities
so called for redemption shall cease, except the right of the Holders of such
Securities to receive the Redemption Price, but without interest on such
Redemption Price, and from and after the date fixed for redemption, such
Securities will cease to be outstanding.
(c) If any Preferred Securities to be redeemed shall then be pledged
pursuant to the Pledge Agreement, the applicable Redemption Price for such
Preferred Securities shall be credited to the collateral account maintained by
the Collateral Agent on or prior to 12:30 p.m., New York City time, and applied
by the Securities Intermediary in accordance with Section 5.8 of the Pledge
Agreement.
(d) Neither the Regular Trustees nor the Trust shall be required to
register or cause to be registered the transfer of any Securities that have been
called for redemption, except for the unredeemed portion of any Securities being
redeemed in part.
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(e) Subject to the foregoing and applicable law (including, without
limitation, United States federal securities laws), the Debenture Issuer or its
Affiliates may purchase, at any time and from time to time, outstanding
Preferred Securities by tender, in the open market or by private agreement.
SECTION 7.5 Voting Rights of the Preferred Securities.
(a) Except as provided under this Section 7.5 and Section 11.1 and as
otherwise required by the Business Trust Act, the Trust Indenture Act and other
applicable law, the Holders of the Preferred Securities shall have no voting
rights.
(b) Subject to the requirement of the Property Trustee obtaining a tax
opinion in certain circumstances set forth in Section 7.5(d), the Holders of a
Majority in Liquidation Amount of the Preferred Securities, voting separately as
a class, shall have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the Property Trustee, or to direct
the exercise of any trust or power conferred upon the Property Trustee under
this Declaration, including the right to direct the Property Trustee, as Holder
of the Debentures, to (i) exercise the remedies available to it under the
Indenture, (ii) consent to any amendment or modification of the Indenture or the
Debentures where such consent is required or (iii) waive any past default and
its consequences that are waivable under Section 513 of the Indenture; provided
that if an Indenture Event of Default has occurred and is continuing, then the
Holders of at least 25% of the aggregate stated liquidation amount of the
Preferred Securities may direct the Property Trustee to declare the principal of
and interest on the Debentures due and payable; and provided further that where
a consent or action under the Indenture would require the consent or act of the
Holders of a Supermajority of the aggregate principal amount of Debentures
affected thereby, the Property Trustee may give such consent or take such action
only at the direction of the Holders of at least the same Supermajority in
aggregate stated liquidation amount of the Preferred Securities.
(c) If the Property Trustee fails to enforce its rights under the
Debentures after a Holder of Preferred Securities has made a written request,
such Holder of Preferred Securities may institute, to the fullest extent
permitted by law, a legal proceeding directly against the Debenture Issuer to
enforce the Property Trustee's rights under the Indenture without first
instituting any legal proceeding against the Property Trustee or any other
Person. In addition, if a Trust Enforcement Event has occurred and is continuing
and such event is attributable to the failure of the Debenture Issuer to make
any interest, principal or other required payments when due under the Indenture,
then a Holder of Preferred Securities may institute a Direct Action against the
Debenture Issuer on or after the respective due date specified in the
Debentures.
(d) The Property Trustee shall notify all Holders of the Preferred
Securities of any notice of any Indenture Event of Default received from the
Debenture Issuer with respect to the Debentures. Such notice shall state that
such Indenture Event of Default also constitutes a Trust Enforcement Event.
Except with respect to directing the time, method and place of conducting a
proceeding for a remedy, the Property Trustee shall be under no obligation to
take any of the actions described in clauses (i) and (ii) of Section 7.5(b),
unless the Property Trustee has obtained an opinion of independent tax counsel
to the effect that the Trust will not fail to be classified as a grantor trust
for United States federal income tax purposes as a result of such action, and
that each Holder of Preferred Securities shall be treated as owning an undivided
beneficial ownership interest in the Debentures.
(e) If the consent of the Property Trustee, as the Holder of the
Debentures, is required under the Indenture with respect to any amendment or
modification of the Indenture, the Property Trustee shall request the direction
of the Holders of the Securities with respect to such amendment or modification
and shall vote
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with respect to such amendment or modification as directed by a Majority in
Liquidation Amount of the Securities voting together as a single class; provided
that where a consent under the Indenture would require the consent of the
Holders of a Supermajority of the aggregate principal amount of the Debentures,
the Property Trustee may give such consent only at the direction of the Holders
of at least the same Supermajority in aggregate stated liquidation amount of the
Securities. The Property Trustee shall not take any such action in accordance
with the directions of the Holders of the Securities unless the Property Trustee
has obtained an opinion of independent tax counsel to the effect that the Trust
will not fail to be classified as a grantor trust for United States federal
income tax purposes as a result of such action, and that each Holder of
Preferred Securities will be treated as owning an undivided beneficial ownership
interest in the Debentures.
(f) A waiver of an Indenture Event of Default with respect to the
Debentures shall constitute a waiver of the corresponding Trust Enforcement
Event.
(g) Any required approval or direction of the Holders of the Preferred
Securities may be given at a separate meeting of the Holders of the Preferred
Securities convened for such purpose, at a meeting of all of the Holders of the
Securities or pursuant to written consent. The Regular Trustees shall cause a
notice of any meeting at which Holders of the Preferred Securities are entitled
to vote to be mailed to each Holder of record of Preferred Securities. Each such
notice shall include a statement setting forth: (i) the date of such meeting;
(ii) a description of any resolution proposed for adoption at such meeting on
which such Holders are entitled to vote; and (iii) instructions for the delivery
of proxies.
(h) No vote or consent of the Holders of the Preferred Securities
shall be required for the Trust to redeem and cancel the Preferred Securities or
distribute the Debentures in accordance with this Declaration and the terms of
the Securities.
(i) Notwithstanding that the Holders of the Preferred Securities are
entitled to vote or consent under any of the circumstances described above, any
of the Preferred Securities that are owned at such time by the Debenture Issuer,
the Trustees or any entity directly or indirectly controlled by, or under direct
or indirect common control with, the Debenture Issuer or any Trustee shall not
be entitled to vote or consent and shall be treated, for purposes of such vote
or consent, as if such Preferred Securities were not outstanding.
(j) Except as provided under Section 7.5(k), the Holders of the
Preferred Securities shall have no rights to appoint or remove the Trustees, who
may be appointed, removed or replaced solely by the Holders of the Common
Securities.
(k) If an Indenture Event of Default has occurred and is continuing,
the Property Trustee and the Delaware Trustee may be removed and replaced by a
Majority in Liquidation Amount of the Preferred Securities.
SECTION 7.6 Voting Rights of the Common Securities.
(a) Except as provided in Section 6.1(b), this Section 7.6 and Section 11.1
and as otherwise required by the Business Trust Act, the Trust Indenture Act or
other applicable law, the Holders of the Common Securities shall have no voting
rights.
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(b) Subject to Section 7.5(k), the Holders of the Common Securities
shall be entitled to vote to appoint, remove or replace any Trustee or to
increase or decrease the number of Trustees in accordance with Article 6.
(c) Subject to Section 2.6 and only after all Trust Enforcement Events
with respect to the Preferred Securities have been cured, waived or otherwise
eliminated and subject to the requirement of the Property Trustee obtaining a
tax opinion in certain circumstances set forth in this paragraph (c), the
Holders of the Common Securities shall have the right to direct the time, method
and place of conducting any proceeding for any remedy available to the Property
Trustee, or to direct the exercise of any trust or power conferred upon the
Property Trustee under this Declaration, including the right to direct the
Property Trustee, as the holder of the Debentures, to (i) exercise the remedies
available to it under the Indenture, (ii) consent to any amendment or
modification of the Indenture or the Debentures where such consent is required
or (iii) waive any past default and its consequences that are waivable under
Section 513 of the Indenture; provided that where a consent or action under the
Indenture would require the consent or act of the Holders of a Supermajority of
the aggregate principal amount of Debentures affected thereby, only the Holders
of at least the same Supermajority of the aggregate stated liquidation amount of
the Common Securities may direct the Property Trustee to give such consent or
take such action. Except with respect to directing the time, method and place of
conducting a proceeding for a remedy, the Property Trustee shall be under no
obligation to take any of the actions described in clauses (i) and (ii) of
Section 7.6(c) unless the Property Trustee has obtained an opinion of
independent tax counsel to the effect that the Trust will not fail to be
classified as a grantor trust for United States federal income tax purposes as a
result of such action, and each Holder will be treated as owning an undivided
beneficial ownership interest in the Debentures.
(d) If the Property Trustee fails to enforce its rights under the
Debentures after the Holders of the Common Securities have made a written
request pursuant to Section 7.6(c), the Holders of the Common Securities may
institute, to the fullest extent permitted by law, a legal proceeding directly
against the Debenture Issuer to enforce the Property Trustee's rights under the
Debentures without first instituting any legal proceeding against the Property
Trustee or any other Person.
(e) A waiver of an Indenture Event of Default with respect to the
Debentures shall constitute a waiver of the corresponding Trust Enforcement
Event.
(f) Any required approval or direction of the Holders of the Common
Securities may be given at a separate meeting of the Holders of the Common
Securities convened for such purpose, at a meeting of all of the Holders of the
Securities or pursuant to written consent. The Regular Trustees shall cause a
notice of any meeting at which the Holders of the Common Securities are entitled
to vote to be mailed to the Holders of the Common Securities. Such notice shall
include a statement setting forth: (i) the date of such meeting; (ii) a
description of any resolution proposed for adoption at such meeting on which the
Holders of the Common Securities are entitled to vote; and (iii) instructions
for the delivery of proxies.
(g) No vote or consent of the Holders of the Common Securities shall
be required for the Trust to redeem and cancel the Common Securities or to
distribute the Debentures in accordance with this Declaration and the terms of
the Securities.
SECTION 7.7 Place of Payment.
If any Preferred Securities are not represented by one or more Global
Securities, the Trust shall maintain in the Borough of Manhattan, New York City,
State of New York, an office or agency where the
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Preferred Securities may be presented for payment. If the Trust fails to appoint
or maintain a different office or agency, such place of payment shall be the
Corporate Trust Office. The Regular Trustees shall give prompt written notice to
the Property Trustee and the Holders of any change in the location of such
office or agency.
SECTION 7.8 Listing.
The Sponsor shall use its best efforts to cause the Preferred
Securities to be listed on the New York Stock Exchange.
SECTION 7.9 Transfer of the Securities.
(a) The Preferred Securities initially shall be, and from time to time
may be, pledged, pursuant to the terms of the Pledge Agreement, as collateral to
secure the obligations of the holders of the Corporate PIES to purchase common
shares of Industries in accordance with the terms of the Purchase Contract
Agreement.
(b) The Preferred Securities may be transferred, in whole or in part,
only in accordance with the terms and conditions set forth in this Declaration
and the Preferred Securities. To the fullest extent permitted by law, any
transfer or purported transfer of any Preferred Security not made in accordance
with this Declaration shall be null and void.
(c) Subject to this Section 7.9 and Section 7.12, the Preferred
Securities shall be freely transferable.
(d) The Trust shall cause to be kept at the Corporate Trust Office a
register in which, subject to such reasonable regulations as it may prescribe,
the Trust shall provide for the registration of Preferred Securities and of
transfers of Preferred Securities. The Property Trustee is hereby appointed
"Security Registrar" for the purpose of registering Preferred Securities and
transfers of Preferred Securities as herein provided.
(e) Upon surrender for registration of transfer of any Preferred
Securities at an office or agency of the Trust designated for such purpose, a
Regular Trustee shall execute, and the Property Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Preferred Securities of any authorized denominations and of a like aggregate
principal amount.
(f) At the option of the Holder, Preferred Securities may be exchanged
for other Preferred Securities of any authorized denominations and of a like
aggregate principal amount, upon surrender of the Preferred Securities to be
exchanged at such office or agency. Whenever any Preferred Securities are so
surrendered for exchange, a Regular Trustee shall execute, and the Property
Trustee shall authenticate and deliver, the Preferred Securities that the Holder
making the exchange is entitled to receive.
(g) If so required by the Property Trustee, every Preferred Security
presented or surrendered for registration of transfer or for exchange shall be
duly endorsed, or accompanied by a duly executed written instrument of transfer
in form satisfactory to the Property Trustee and the Security Registrar, by the
Holder thereof or his attorney duly authorized in writing.
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(h) No service charge shall be made for any registration of transfer
or exchange of Preferred Securities, but the Trust may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of Preferred
Securities.
(i) The Common Securities shall not be transferable except as provided
in the Indenture.
SECTION 7.10 Mutilated, Destroyed, Lost or Stolen Certificates.
If:
(a) any mutilated Certificates are surrendered to the Regular
Trustees, or if the Regular Trustees receive evidence to their satisfaction of
the destruction, loss or theft of any Certificate; and
(b) there shall be delivered to the Regular Trustees such security or
indemnity as may be required by them to keep each of the Sponsor and the Trust
harmless, then, in the absence of notice that such Certificate has been acquired
by a bona fide purchaser, any Regular Trustee shall execute and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Certificate, a new Certificate of like denomination. In connection with the
issuance of any new Certificate under this Section 7.10, the Regular Trustees
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection therewith. Any duplicate
Certificate issued pursuant to this Section 7.10 shall constitute conclusive
evidence of an ownership interest in the relevant Securities, as if originally
issued, whether or not the lost, stolen or destroyed Certificate is found at any
time.
SECTION 7.11 Deemed Holders.
The Trustees may treat the Person in whose name any Securities are
registered on the register of the Trust as the sole holder of such Securities
for purposes of receiving Distributions and for all other purposes whatsoever.
Accordingly, the Trustees shall not be bound to recognize any equitable or other
claim to or interest in the Securities represented on the part of any Person,
whether or not the Trust has actual or other notice thereof.
SECTION 7.12 Global Securities.
(a) The Preferred Securities initially shall be issued in the form of
one or more Global Securities. A Regular Trustee shall execute, and the Property
Trustee shall authenticate and deliver, one or more Global Securities that (i)
shall represent and be denominated in an amount equal to the aggregate stated
liquidation amount of all of the Preferred Securities to be issued in the form
of Global Securities and not yet canceled, (ii) shall be registered in the name
of the Depositary for the Preferred Securities or the nominee of such Depositary
and (iii) shall be delivered by the Property Trustee to such Depositary or
pursuant to such Depositary's instructions. Global Securities shall bear a
legend substantially to the following effect:
"This Preferred Security is a Global Security within the meaning of
the Declaration hereinafter referred to and is registered in the
name of The Depository Trust Company, a New York corporation (the
"Depositary"), or a nominee of the Depositary. This Preferred
Security is exchangeable for Preferred Securities registered in the
name of a person other than the Depositary or its nominee only in
the limited circumstances
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described in the Declaration, and no transfer of this Preferred
Security (other than a transfer of this Preferred Security as a
whole by the Depositary to a nominee of the Depositary or by a
nominee of the Depositary to the Depositary or another nominee of
the Depositary) may be registered except in limited
circumstances.
Unless this certificate is presented by an authorized
representative of the Depositary to NIPSCO Capital Trust I or its
agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or
such other name as requested by an authorized representative of
the Depositary (and any payment hereon is made to Cede & Co. or
to such other entity as is requested by an authorized
representative of the Depositary), and except as otherwise
provided in the Declaration, ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
since the registered owner hereof, Cede & Co., has an interest
herein."
(b) Preferred Securities not represented by a Global Security issued
in exchange for all or a part of a Global Security pursuant to this Section 7.12
shall be registered in such names and in such authorized denominations as the
Depositary, pursuant to instructions from its direct or indirect participants or
otherwise, shall instruct the Property Trustee. Upon execution and
authentication, the Property Trustee shall deliver any Preferred Securities not
represented by a Global Security to the Persons in whose names such definitive
Preferred Securities are so registered.
(c) At such time as all interests in Global Securities have been
redeemed, repurchased or canceled, such Global Securities shall be canceled,
upon receipt thereof, by the Property Trustee in accordance with standing
procedures of the Depositary. At any time prior to such cancellation, if any
interest in a Global Security is exchanged for Preferred Securities not
represented by a Global Security, redeemed, canceled or transferred to a
transferee who receives Preferred Securities not represented by a Global
Security, or if any Preferred Security not represented by a Global Security is
exchanged or transferred for part of a Global Security, then, in accordance with
the standing procedures of the Depositary, the aggregate stated liquidation
amount of such Global Security shall be reduced or increased, as the case may
be, and an endorsement shall be made on such Global Security by the Property
Trustee to reflect such reduction or increase.
(d) The Trust and the Property Trustee, as the authorized
representative of the Holders of the Preferred Securities, may deal with the
Depositary for all purposes of this Declaration, including the making of
payments due on the Preferred Securities and exercising the rights of Holders of
the Preferred Securities hereunder. The rights of any Beneficial Owners shall be
limited to those established by law and agreements between such owners and
Depository Participants; provided that no such agreement shall give to any
Person any rights against the Trust or the Property Trustee without the written
consent of the parties so affected. Multiple requests and directions from and
votes of the Depositary as the Holder of the Preferred Securities represented by
Global Securities with respect to any particular matter shall not be deemed
inconsistent to the extent they do not represent an amount of Preferred
Securities in excess of those held in the name of the Depositary or its nominee.
(e) If at any time the Depositary notifies the Trust that it is
unwilling or unable to continue as Depositary for the Preferred Securities or if
at any time the Depositary no longer is eligible to serve as Depositary, the
Regular Trustees shall appoint a successor Depositary with respect to the
Preferred Securities. If a successor Depositary is not appointed by the Trust
within 90 days after the Trust receives
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such notice or becomes aware of such ineligibility, the Trust's election that
the Preferred Securities be represented by one or more Global Securities shall
no longer be effective, and a Regular Trustee shall execute, and the Property
Trustee will authenticate and deliver, Preferred Securities in definitive
registered form, in any authorized denominations, in an aggregate stated
liquidation amount equal to the aggregate stated liquidation amount of the
Global Securities representing the Preferred Securities, in exchange for such
Global Securities.
(f) The Regular Trustees at any time and in its sole discretion may
determine that the Preferred Securities issued in the form of one or more Global
Securities shall no longer be represented by Global Securities. In such event a
Regular Trustee on behalf of the Trust shall execute, and the Property Trustee
shall authenticate and deliver, Preferred Securities in definitive registered
form, in any authorized denominations, in an aggregate stated liquidation amount
equal to the aggregate stated liquidation amount of the Global Securities
representing the Preferred Securities, in exchange for such Global Securities.
(g) Notwithstanding any other provisions of this Declaration (other
than the provisions set forth in Section 7.9), Global Securities may not be
transferred as a whole except by the Depositary to a nominee of the Depositary
or by a nominee of the Depositary to the Depositary or another nominee of the
Depositary or by the Depositary or any such nominee to a successor Depositary or
a nominee of such successor Depositary.
(h) Interests of Beneficial Owners may be transferred or exchanged for
Preferred Securities not represented by a Global Security, and Preferred
Securities not represented by a Global Security may be transferred or exchanged
for a Global Security or Securities, in accordance with rules of the Depositary
and the provisions of Section 7.9.
SECTION 7.13 Remarketing.
(a) The Debenture Issuer shall request, not later than 15 nor more
than 30 calendar days prior to the Remarketing Date, that the Depositary notify
the Holders of the Preferred Securities and the holders of Corporate PIES of the
Remarketing and of the procedures that must be followed if a Holder of Corporate
PIES wishes to make a Cash Settlement.
(b) Not later than 5:00 P.M., New York City time, on the seventh
Business Day preceding the Purchase Contract Settlement Date, each Holder of
Preferred Securities may elect to have the Preferred Securities held by such
Holder remarketed in the Remarketing. Under Section 5.4 of the Purchase Contract
Agreement, holders of Corporate PIES that do not give notice of their intention
to make a Cash Settlement of the Purchase Contract component of their Corporate
PIES prior to such time in the manner specified in such Section, or that give
such notice but fail to deliver cash prior to 11:00 A.M., New York City time, on
or prior to the fifth Business Day preceding the Purchase Contract Settlement
Date, shall be deemed to have consented to the disposition of the Preferred
Securities component of their Corporate PIES in the Remarketing. Holders of the
Preferred Securities that are not a component of Corporate PIES wishing to have
their Preferred Securities remarketed shall give to the Purchase Contract Agent
notice of their election prior to 11:00 A.M., New York City time on such fifth
Business Day. Any such notice shall be irrevocable and may not be conditioned
upon the level at which the Reset Rate is established in the Remarketing.
Promptly after 11:00 A.M., New York City time, on such fifth Business Day, the
Purchase Contract Agent, based on the notices received by it prior to such time
(including notices from the Purchase Contract Agent as to Purchase Contracts for
which Cash Settlement has been elected and cash received), shall notify the
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Trust, the Sponsor and the Remarketing Agent of the number of Preferred
Securities to be tendered for purchase in the Remarketing.
(c) If any Holder of Preferred Securities does not give a notice of
its intention to make a Cash Settlement or gives such notice but fails to
deliver cash as described in Section 7.13(b), or gives a notice of election to
have Preferred Securities that are not a component of Corporate PIES remarketed,
then the Preferred Securities of such Holder shall be deemed tendered for
purchase in the Remarketing, notwithstanding any failure by such Holder to
deliver or properly deliver such Preferred Securities to the Remarketing Agent
for purchase.
(d) The right of each Holder to have Preferred Securities tendered for
purchase shall be limited to the extent that (i) the Remarketing Agent conducts
a remarketing pursuant to the terms of the Remarketing Agreement, (ii) the
Preferred Securities tendered have not been called for redemption, (iii) the
Remarketing Agent is able to find a purchaser or purchasers for the tendered
Preferred Securities and (iv) such purchaser or purchasers deliver the purchase
price therefor to the Remarketing Agent.
(e) On the Remarketing Date, the Remarketing Agent shall use
commercially reasonable efforts to remarket, at a price equal to 100% of the
aggregate stated liquidation amount thereof, the Preferred Securities tendered
or deemed tendered for purchase.
(f) If, as a result of the efforts described in 7.13(e), the
Remarketing Agent determines that it will be able to remarket all of the
Preferred Securities tendered or deemed tendered for purchase at a price of 100%
of the aggregate stated liquidation amount of such Preferred Securities prior to
4:00 P.M., New York City time, on the Remarketing Date, the Remarketing Agent
shall determine the Reset Rate, which shall be the rate per annum (rounded to
the nearest one-thousandth (0.001) of one percent per annum) that the
Remarketing Agent determines, in its sole judgment, to be the lowest rate per
annum that will enable it to remarket all of the Preferred Securities tendered
or deemed tendered for Remarketing.
(g) If none of the Holders of the Preferred Securities or the holders
of the Corporate PIES elects to have Preferred Securities remarketed in the
Remarketing, the Reset Rate shall be the rate determined by the Remarketing
Agent, in its sole discretion, as the rate that would have been established had
a Remarketing been held on the Remarketing Date.
(h) If, by 4:00 P.M., New York City time, on the Remarketing Date, the
Remarketing Agent is unable to remarket all of the Preferred Securities tendered
or deemed tendered for purchase, a "Failed Remarketing" shall be deemed to have
occurred and the Remarketing Agent shall so advise by telephone the Depositary,
the Property Trustee, the Debenture Trustee, the Trust and the Sponsor. In the
event of a Failed Remarketing, the Reset Rate shall equal the Two-Year Benchmark
Treasury Rate plus the Applicable Margin.
(i) By approximately 4:30 P.M., New York City time, on the Remarketing
Date, provided that there has not been a Failed Remarketing, the Remarketing
Agent shall advise, by telephone (i) the Depositary, the Property Trustee, the
Debenture Trustee, the Trust and the Sponsor of the Reset Rate determined in the
Remarketing and the number of Preferred Securities sold in the Remarketing, (ii)
each purchaser (or the Depositary Participant thereof) of the Reset Rate and the
number of Preferred Securities such purchaser is to purchase and (iii) each
purchaser to give instructions to its Depositary Participant to pay the purchase
price on the Purchase Contract Settlement Date in same day funds against
delivery of the Preferred Securities purchased through the facilities of the
Depositary.
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(j) In accordance with the Depositary's normal procedures, on the
Purchase Contract Settlement Date, the transactions described above with respect
to each Preferred Security tendered for purchase and sold in the Remarketing
shall be executed through the Depositary, and the accounts of the respective
Depositary Participants shall be debited and credited and such Preferred
Securities delivered by book-entry as necessary to effect purchases and sales of
such Preferred Securities. The Depositary shall make payment in accordance with
its normal procedures.
(k) If any Holder of the Preferred Securities selling Preferred
Securities in the Remarketing fails to deliver such Preferred Securities, the
Depositary Participant of such selling holder and of any other Person that was
to have purchased Preferred Securities in the Remarketing may deliver to any
such other Person a number of Preferred Securities that is less than the number
of Preferred Securities that otherwise was to be purchased by such Person. In
such event, the number of Preferred Securities to be so delivered shall be
determined by such Depositary Participant, and delivery of such lesser number of
Preferred Securities shall constitute good delivery.
(l) The Remarketing Agent is not obligated to purchase any Preferred
Securities that otherwise would remain unsold in the Remarketing. Neither the
Trust, any Trustee, the Sponsor nor the Remarketing Agent shall be obligated in
any case to provide funds to make payment upon tender of the Preferred
Securities for Remarketing.
(m) Under the Remarketing Agreement, the Sponsor, in its capacity as
Debenture Issuer, shall be liable for, and shall pay, any and all costs and
expenses incurred in connection with the Remarketing, and the Trust shall not
have any liabilities for such costs and expenses.
(n) The tender and settlement procedures set in this Section 7.13,
including provisions for payment by purchasers of the Preferred Securities in
the Remarketing, shall be subject to modification to the extent required by the
Depositary or if the book-entry system is no longer available for the Preferred
Securities at the time of the Remarketing, to facilitate the tendering and
remarketing of the Preferred Securities in certificated form. In addition, the
Remarketing Agent may modify the settlement procedures set forth herein in order
to facilitate the settlement process.
ARTICLE 8: DISSOLUTION AND TERMINATION OF THE TRUST
SECTION 8.1 Dissolution and Termination of the Trust.
(a) The Trust shall dissolve upon the earliest of:
(i) the bankruptcy of the Debenture Issuer, the Sponsor or
Industries;
(ii) the filing of a certificate of dissolution or its equivalent
with respect to the Sponsor; the receipt by the Trust of the consent
of the Holders of at least a Majority in Liquidation Amount of the
Securities to dissolve the Trust and file a certificate of
cancellation with respect to the Trust; or the revocation of the
Sponsor's charter and the expiration of 90 days after the date of
revocation without a reinstatement thereof;
(iii) the entry of a decree of judicial dissolution of the
Sponsor or the Trust;
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(iv) the time when all of the Securities shall have been called
for redemption and the amounts then due shall have been paid to the
Holders of the Securities;
(v) upon the direction of the Sponsor, in its sole discretion, by
notice to the Property Trustee to distribute the Debentures to the
Holders of the Securities in exchange for all of the Securities;
provided that the Sponsor has provided to the Property Trustee an
opinion of counsel that the distribution of the Debentures will not be
taxable to the Holders of the Preferred Securities for United States
federal income tax purposes; or
(vi) the time when all of the Regular Trustees and the Sponsor
have consented to dissolution of the Trust, provided such action is
taken before the issuance of any Securities.
(b) As soon as is practicable after the occurrence of an event
referred to in Section 8.1(a) and upon completion of the winding up and
liquidation of the Trust, the Trustees shall terminate the Trust by executing
and filing a certificate of cancellation with the Secretary of State of the
State of Delaware.
(c) The provisions of Section 4.2 and Article 9 shall survive the
termination of the Trust.
SECTION 8.2 Liquidation Distribution Upon Dissolution of the Trust.
(a) In the event of any voluntary or involuntary liquidation,
dissolution or winding-up of the Trust pursuant to Section 8.1(a)(i), (ii),
(iii) or (v) (each a "Liquidation"), the Holders of the Securities on the date
of the Liquidation shall be entitled to receive, out of the assets of the Trust
available for distribution to the Holders of the Securities after satisfaction
of the Trust's liabilities to creditors, if any, Debentures in an aggregate
principal amount equal to the aggregate stated liquidation amount of, with an
interest rate identical to the distribution rate of, and accrued and unpaid
interest equal to accumulated and unpaid Distributions on, such Securities in
exchange for such Securities; provided if any Preferred Securities shall then be
pledged pursuant to the Pledge Agreement, the Debentures to be distributed with
respect to such Preferred Securities will be transfered to the collateral
account maintained by the Collateral Agent.
(b) If, notwithstanding the other provisions of this Section 8.2,
distribution of the Debentures in the manner provided herein is determined by
the Property Trustee not to be practical, the assets of the Trust 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, the Holders will be
entitled to receive out of the assets of the Trust available for distribution to
the Holders, after satisfaction of liabilities to creditors of the Trust as
provided by applicable law, an amount equal to the stated liquidation amount of
$50 per Security plus accumulated and unpaid Distributions thereon to the date
of payment (such amount being the "Liquidation Distribution"). If, upon any such
Liquidation, the Liquidation Distribution can be paid only in part because the
Trust has insufficient assets available to pay the aggregate Liquidation
Distribution in full, then the amounts payable directly by the Trust on the
Securities shall be paid on a Pro Rata basis, provided that if an Indenture
Event of Default has occurred and is continuing, then the Preferred Securities
shall have a preference over the Common Securities with regard to the
Liquidation Distribution.
(c) Notice of any distribution of Debentures in exchange for the
Securities (an "Exchange Notice"), which notice shall be irrevocable, shall be
given by the Regular Trustees on behalf of the Trust by mail to each Holder of
Securities at least 30 but no more than 60 days before the date fixed for such
distribution. For purposes of the calculation of the date of distribution and
the dates on which notices are given pursuant to this Section 8.2(c), an
Exchange Notice shall be deemed to be given on the day such notice
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is first mailed by first-class mail, postage prepaid, to the Holders of the
Securities. Each Exchange Notice shall be addressed to the Holders of the
Securities at the address of each such Holder appearing in the register of the
Trust. No defect in the Exchange Notice or in the mailing of either thereof with
respect to any Holder shall affect the validity of the distribution proceedings
with respect to any other Holder.
(d) After the date fixed for any distribution of Debentures upon
dissolution of the Trust, (i) the Securities no longer shall be deemed to be
outstanding and (ii) the Certificates shall be deemed to represent the
Debentures in a principal amount equal to the stated liquidation amount of the
Securities, bearing accrued and unpaid interest in an amount equal to the
accumulated and unpaid Distributions on the Securities, until such Certificates
are presented to the Regular Trustees or agent for transfer or reissuance.
ARTICLE 9: LIMITATION OF LIABILITY OF
HOLDERS OF THE SECURITIES, THE DELAWARE TRUSTEE AND OTHERS
SECTION 9.1 Liability.
(a) Except as expressly set forth in this Declaration, the Guarantee
and the terms of the Securities, the Sponsor:
(i) shall not be personally liable for the return of any portion
of the capital contributions (or any return thereon) of the Holders of
the Securities that will be made solely from assets of the Trust; and
(ii) shall not be required to pay to the Trust or to any Holder
of the Securities any deficit, upon dissolution of the Trust or
otherwise.
(b) Pursuant to Section 3803(a) of the Business Trust Act, the
Holders of the Common Securities shall be entitled to the same limitation of
personal liability extended to stockholders of private corporations for profit
organized under the General Corporation Law of the State of Delaware; provided
that the Holders of the Common Securities shall be liable for all of the debts
and obligations of the Trust (other than with respect to the Securities) to the
extent such debts and obligations are not satisfied out of the Trust's assets.
(c) Pursuant to Section 3803(a) of the Business Trust Act, the
Holders of the Preferred Securities shall be entitled to the same limitation of
personal liability extended to stockholders of private corporations for profit
organized under the General Corporation Law of the State of Delaware.
SECTION 9.2 Exculpation.
(a) No Indemnified Person shall be liable, responsible or accountable
in damages or otherwise to the Trust or to any Covered Person for any loss,
damage or claim incurred by reason of any act or omission performed or omitted
by such Indemnified Person in good faith on behalf of the Trust and in a manner
that such Indemnified Person reasonably believed to be within the scope of the
authority conferred on such Indemnified Person by this Declaration or by law,
except that an Indemnified Person shall be liable for any such loss, damage or
claim incurred by reason of such Indemnified Person's gross negligence (or, in
the case of the Property Trustee, negligence) or willful misconduct with respect
to such acts or omissions.
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(b) Each Indemnified Person shall be fully protected in relying in
good faith upon the records of the Trust and upon such information, opinions,
reports or statements presented to the Trust by any Person as to matters such
Indemnified Person reasonably believes to be within such other Person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Trust, including information, opinions, reports or
statements as to the value and amount of the assets, liabilities, profits,
losses or any other facts pertinent to the existence and amount of assets from
which distributions to Holders of the Securities might properly be paid.
SECTION 9.3 Fiduciary Duty.
(a) To the extent that, at law or in equity, an Indemnified Person
has duties (including fiduciary duties) and liabilities relating thereto to the
Trust or to any other Covered Person, an Indemnified Person acting under this
Declaration shall not be liable to the Trust or to any other Covered Person for
its good faith reliance on the provisions of this Declaration. The provisions of
this Declaration, to the extent that they restrict the duties and liabilities of
an Indemnified Person otherwise existing at law or in equity (other than the
duties imposed on the Property Trustee under the Trust Indenture Act), are
agreed by the parties hereto to replace such other duties and liabilities of
such Indemnified Person.
(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises between a
Covered Person and an Indemnified Person; or
(ii) whenever this Declaration or any other agreement
contemplated herein or therein provides that an Indemnified Person
shall act in a manner that is, or provides terms that are, fair and
reasonable to the Trust or any Holder of Securities,
the Indemnified Person shall resolve such conflict of interest, take such action
or provide such terms, considering in each case the relative interest of each
party (including its own interest) to such conflict, agreement, transaction or
situation and the benefits and burdens relating to such interests, any customary
or accepted industry practices and any applicable generally accepted accounting
practices or principles. In the absence of bad faith by the Indemnified Person,
the resolution, action or term so made, taken or provided by the Indemnified
Person shall not constitute a breach of this Declaration or any other agreement
contemplated herein or of any duty or obligation of the Indemnified Person at
law or in equity or otherwise.
(c) Whenever in this Declaration an Indemnified Person is permitted
or required to make a decision:
(i) in its "discretion" or under a grant of similar authority,
the Indemnified Person shall be entitled to consider such interests
and factors as it desires, including its own interests, and shall have
no duty or obligation to give any consideration to any interest of or
factors affecting the Trust or any other Person; or
(ii) in its "good faith" or under another express standard, the
Indemnified Person shall act under such express standard and shall not
be subject to any other or different standard imposed by this
Declaration or by applicable law.
SECTION 9.4 Indemnification.
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(a) (i) Pursuant to the Indenture, the Debenture Issuer shall
indemnify, to the full extent permitted by law, any Debenture Issuer
Indemnified Person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the Trust), by reason of
the fact that he or she is or was a Debenture Issuer Indemnified
Person against expenses (including attorney fees), judgments, fines
and amounts paid in settlement actually and reasonably incurred by him
in connection with such action, suit or proceeding if he or she acted
in good faith and in a manner that he or she reasonably believed to be
in or not opposed to the best interests of the Trust and, with respect
to any criminal action or proceeding, had no reasonable cause to
believe his or her conduct was unlawful. The termination of any
action, suit or proceeding by judgment, order, settlement, conviction
or upon a plea of nolo contendere or its equivalent shall not, of
itself, create a presumption that the Debenture Issuer Indemnified
Person did not act in good faith and in a manner that he or she
reasonably believed to be in or not opposed to the best interests of
the Trust and, with respect to any criminal action or proceeding, had
reasonable cause to believe that his conduct was unlawful.
(ii) Pursuant to the Indenture, the Debenture Issuer shall
indemnify, to the full extent permitted by law, any Debenture Issuer
Indemnified Person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action or suit by or in
the right of the Trust to procure a judgment in its favor by reason of
the fact that he or she is or was a Debenture Issuer Indemnified
Person against expenses (including attorneys' fees) actually and
reasonably incurred by him or her in connection with the defense or
settlement of such action or suit if he or she acted in good faith and
in a manner he or she reasonably believed to be in or not opposed to
the best interests of the Trust and except that no such
indemnification shall be made in respect of any claim, issue or matter
as to which such Debenture Issuer Indemnified Person was adjudged to
be liable to the Trust, unless and only to the extent that the Court
of Chancery of Delaware or the court in which such action or suit was
brought determines upon application that, despite the adjudication of
liability but in view of all the circumstances of the case, such
person is fairly and reasonably entitled to indemnity for such
expenses that such Court of Chancery or such other court shall deem
proper.
(iii) Any indemnification under paragraphs (i) and (ii) of this
Section 9.4(a) (unless ordered by a court) shall be made by the
Debenture Issuer only as authorized in the specific case upon a
determination that indemnification of the Debenture Issuer Indemnified
Person is proper in the circumstances because he or she has met the
applicable standard of conduct set forth in paragraphs (i) and (ii).
Such determination shall be made (A) by a majority vote of a quorum of
the Regular Trustees who were not parties to such action, suit or
proceeding, (B) if such a quorum is not obtainable, or, even if
obtainable, if a quorum of disinterested Regular Trustees so directs,
by independent legal counsel in a written opinion, or (C) by the
Holders of the Common Securities.
(iv) Expenses (including attorneys' fees) incurred by a Debenture
Issuer Indemnified Person in defending a civil, criminal,
administrative or investigative action, suit or proceeding referred to
in paragraphs (i) and (ii) of this Section 9.4(a) shall be paid by the
Debenture Issuer in advance of the final disposition of such action,
suit or proceeding upon receipt of an undertaking by or on behalf of
such Debenture Issuer Indemnified Person to repay such amount if it
shall ultimately be determined that he or she is not entitled to be
indemnified by the Debenture Issuer as authorized in this Section
9.4(a). Notwithstanding the foregoing, no advance
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shall be made by the Debenture Issuer if a determination is reasonably
and promptly made (A) by a majority vote of a quorum of disinterested
Regular Trustees, (B) if such a quorum is not obtainable, or, even if
obtainable, if a quorum of disinterested Regular Trustees so directs,
by independent legal counsel in a written opinion or (C) the Holders
of the Common Securities, that, based upon the facts known to the
Regular Trustees, counsel or the Holders of the Common Securities at
the time such determination is made, such Debenture Issuer Indemnified
Person acted in bad faith or in a manner that such Person did not
believe to be in or not opposed to the best interests of the Trust,
or, with respect to any criminal proceeding, that such Debenture
Issuer Indemnified Person believed or had reasonable cause to believe
his or her conduct was unlawful. In no event shall any advance be made
in instances where the Regular Trustees, independent legal counsel or
the Holders of the Common Securities reasonably determine that such
Person deliberately breached his or her duty to the Trust or to the
Holders of the Securities.
(v) The indemnification and advancement of expenses provided by,
or granted pursuant to, the other paragraphs of this Section 9.4(a)
shall not be deemed exclusive of any other rights to which those
seeking indemnification and advancement of expenses may be entitled
under any agreement, vote of stockholders or disinterested directors
of the Debenture Issuer or the Holders of the Preferred Securities or
otherwise, both as to action in an official capacity and as to action
in another capacity while holding such office. All rights to
indemnification under this Section 9.4(a) shall be deemed to be
provided by a contract between the Debenture Issuer and each Debenture
Issuer Indemnified Person who serves in such capacity at any time
while this Section 9.4(a) is in effect. Any repeal or modification of
this Section 9.4(a) shall not affect any rights or obligations then
existing.
(vi) The Debenture Issuer or the Trust may purchase and maintain
insurance on behalf of any Person who is or was a Debenture Issuer
Indemnified Person against any liability asserted against him or her
and incurred by him or her in any such capacity, or arising out of his
or her status as such, whether or not the Debenture Issuer would have
the power to indemnify him or her against such liability under the
provisions of this Section 9.4(a).
(vii) For purposes of this Section 9.4(a), references to "the
Trust" shall include, in addition to the resulting or surviving
entity, any constituent entity (including any constituent of a
constituent) absorbed in a consolidation or merger, so that any Person
who is or was a director, trustee, officer or employee of such
constituent entity, or is or was serving at the request of such
constituent entity as a director, trustee, officer, employee or agent
of another entity, shall stand in the same position under the
provisions of this Section 9.4(a) with respect to the resulting or
surviving entity as he or she would have had with respect to such
constituent entity if its separate existence had continued.
(viii) The indemnification and advancement of expenses provided
by, or granted pursuant to, this Section 9.4(a) shall continue, unless
otherwise provided when authorized or ratified, as to a Person who has
ceased to be a Debenture Issuer Indemnified Person and shall inure to
the benefit of the heirs, executors and administrators of such a
Person. The obligation to indemnify as set forth in this Section
9.4(a) shall survive the resignation or removal of the Delaware
Trustee or the Property Trustee or the termination of this
Declaration.
(b) Pursuant to the Indenture, the Debenture Issuer agrees to
indemnify, to the fullest extent permitted by law, the (i) Property Trustee,
(ii) the Delaware Trustee, (iii) any Affiliate of the Property
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Trustee or the Delaware Trustee and (iv) any officers, directors, shareholders,
members, partners, employees, representatives, custodians, nominees or agents of
the Property Trustee and the Delaware Trustee (each of the Persons in (i)
through (iv) being referred to as a "Fiduciary Indemnified Person") for, and to
hold each Fiduciary Indemnified Person harmless against, any loss, liability or
expense incurred without gross negligence (or, in the case of the Property
Trustee, negligence) or bad faith on its part, arising out of or in connection
with the acceptance or administration of the trust or trusts hereunder,
including the costs and expenses (including reasonable legal fees and expenses)
of defending itself against or investigating any claim or liability in
connection with the exercise or performance of any of its powers or duties
hereunder. The obligation to indemnify as set forth in this Section 9.4(b) shall
survive the satisfaction and discharge of this Declaration.
SECTION 9.5 Outside Businesses.
Any Covered Person, the Sponsor, the Delaware Trustee and the Property
Trustee (subject to Section 6.3(c)) may engage in or possess an interest in
other business ventures of any nature or description, independently or with
others, similar or dissimilar to the activities of the Trust, and the Trust and
the Holders of the Securities shall have no rights by virtue of this Declaration
in and to such independent ventures or the income or profits derived therefrom,
and the pursuit of any such venture, even if competitive with the activities of
the Trust, shall not be deemed wrongful or improper. Each Covered Person, the
Sponsor, the Delaware Trustee and the Property Trustee shall not be obligated to
present any particular investment or other opportunity to the Trust even if such
opportunity is of a character that, if presented to the Trust, could be taken by
the Trust, and any Covered Person, the Sponsor, the Delaware Trustee and the
Property Trustee shall have the right to take for its own account (individually
or as a partner or fiduciary) or to recommend to others any such particular
investment or other opportunity. Any Covered Person, the Delaware Trustee and
the Property Trustee may engage or be interested in any financial or other
transaction with the Sponsor or any Affiliate of the Sponsor, or may act as
depositary for, trustee or agent for, or act on any committee or body of holders
of, securities or other obligations of the Sponsor or its Affiliates.
ARTICLE 10: ACCOUNTING
SECTION 10.1 Fiscal Year.
The fiscal year ("Fiscal Year") of the Trust shall be the calendar
year, or such other year as is required by the Code.
SECTION 10.2 Certain Accounting Matters.
(a) At all times during the existence of the Trust, the Regular
Trustees shall keep, or shall cause to be kept, full books of account, records
and supporting documents, which shall reflect in reasonable detail each
transaction of the Trust. The books of account shall be maintained on the
accrual method of accounting, in accordance with generally accepted accounting
principles, consistently applied. The Trust shall use the accrual method of
accounting for United States federal income tax purposes. The books of account
and the records of the Trust shall be examined by and reported upon as of the
end of each Fiscal Year of the Trust by a firm of independent certified public
accountants selected by the Regular Trustees.
(b) The Regular Trustees shall cause to be prepared and delivered to
each Holder of Securities, within 90 days after the end of each Fiscal Year of
the Trust, annual financial statements of the Trust,
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including a balance sheet of the Trust as of the end of such Fiscal Year, and
the related statements of income or loss.
(c) The Regular Trustees shall cause to be duly prepared and
delivered to each Holder of Securities an annual United States federal income
tax information statement, required by the Code, containing such information
with regard to the Securities held by each Holder as is required by the Code and
the Treasury Regulations. Notwithstanding any right under the Code to deliver
any such statement at a later date, the Regular Trustees shall endeavor to
deliver all such statements within 30 days after the end of each Fiscal Year of
the Trust.
(d) The Regular Trustees shall cause to be duly prepared and filed
with the appropriate taxing authority an annual United States federal income tax
return, on Form 1041 or such other form required by United States federal income
tax law, and any other annual income tax returns required to be filed on behalf
of the Trust with any state or local taxing authority.
SECTION 10.3 Banking.
The Trust shall maintain one or more bank accounts in the name and for
the sole benefit of the Trust; provided that all payments of funds in respect of
the Debentures held by the Property Trustee shall be made directly to the
Property Account and no other funds of the Trust shall be deposited in the
Property Account. The sole signatories for such accounts shall be designated by
the Regular Trustees; provided that the Property Trustee shall designate the
signatories for the Property Account.
SECTION 10.4 Withholding.
The Trust and the Regular Trustees shall comply with all withholding
requirements under United States federal, state and local law. The Regular
Trustees shall request, and the Holders of the Securities shall provide to the
Trust, such forms or certificates as are necessary to establish an exemption
from withholding with respect to each Holder of Securities and any
representations and forms as shall reasonably be requested by the Regular
Trustees to assist them in determining the extent of, and in fulfilling, the
Trust's withholding obligations. The Regular Trustees shall file required forms
with applicable jurisdictions and, unless an exemption from withholding is
properly established by a Holder of Securities, shall remit amounts withheld
with respect to such Holder to applicable jurisdictions. To the extent that the
Trust is required to withhold and pay over any amounts to any authority with
respect to distributions or allocations to any Holder of Securities, the amount
withheld shall be deemed to be a distribution in the amount of the withholding
to such Holder. In the event of any claimed over withholding, a Holder shall be
limited to an action against the applicable jurisdiction. If the amount required
to be withheld was not withheld from actual Distributions made, the Trust may
reduce subsequent Distributions by the amount of such withholding.
ARTICLE 11: AMENDMENTS AND MEETINGS
SECTION 11.1 Amendments.
(a) Except as otherwise provided in this Declaration or by any
applicable terms of the Securities, this Declaration may be amended only by a
written instrument approved and executed by (i) the Sponsor and (ii) the Regular
Trustees (or, if there are more than two Regular Trustees, a majority of the
Regular Trustees) and (iii) the Property Trustee (if the amendment affects the
rights, powers, duties, obligations or immunities
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of the Property Trustee) and (iv) the Delaware Trustee (if the amendment affects
the rights, powers, duties, obligations or immunities of the Delaware Trustee).
(b) No amendment shall be made, and any such purported amendment
shall be void and ineffective:
(i) unless, in the case of any proposed amendment, the Property
Trustee first has received an Officers' Certificate from each of the
Trust and the Sponsor that such amendment is permitted by, and
conforms to, the terms of this Declaration (including the terms of the
Securities);
(ii) unless, in the case of any proposed amendment that affects
the rights, powers, duties, obligations or immunities of the Property
Trustee, the Property Trustee first has received:
(A) an Officers' Certificate from each of the Trust and the
Sponsor that such amendment is permitted by, and conforms to, the
terms of this Declaration (including the terms of the
Securities); and
(B) an opinion of counsel (which may be counsel to the
Sponsor or the Trust) that such amendment is permitted by, and
conforms to, the terms of this Declaration (including the terms
of the Securities); and
(iii) to the extent the result of such amendment would be to:
(A) cause the Trust to be classified other than as a grantor
trust for United States federal income tax purposes;
(B) reduce or otherwise adversely affect the powers of the
Property Trustee in contravention of the Trust Indenture Act; or
(C) cause the Trust to be deemed to be an Investment Company
required to be registered under the Investment Company Act.
(c) At such time after the Trust has issued any Securities that
remain outstanding, (i) any amendment that would (A) adversely affect the
powers, preferences or special rights of the Securities, whether by way of
amendment to this Declaration or otherwise or (B) result in the dissolution,
winding-up or termination of the Trust other than pursuant to the terms of this
Declaration shall not be effective except with the approval of the Holders of at
least a 662/3% in Liquidation Amount of the Securities; provided that if any
amendment or proposal referred to in clause (A) above would adversely affect
only the Preferred Securities or the Common Securities, then only the Holders of
the affected class will be entitled to vote on such amendment or proposal, and
such amendment or proposal shall not be effective except with the approval of a
662/3% in Liquidation Amount of the Holders of the class of Securities affected
thereby; and (ii) any amendment that would (A) change the amount or timing of
any distribution of the Securities or otherwise adversely affect the amount of
any distribution required to be made in respect of the Securities as of a
specified date or (B) restrict the right of a Holder of Securities to institute
suit for the enforcement of any such payment on or after such date shall not be
effective except with the approval of each Holder of Securities affected
thereby.
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(d) This Section 11.1 shall not be amended without the consent of all
of the Holders of the Securities.
(e) Article 4 shall not be amended without the consent of the Holders
of a Majority in Liquidation Amount of the Common Securities.
(f) The rights of the Holders of the Common Securities under Article
5 to increase or decrease the number of, and appoint and remove, Trustees shall
not be amended without the consent of the Holders of a Majority in Liquidation
Amount of the Common Securities.
(g) Notwithstanding Section 11.1(c), this Declaration may be amended
without the consent of the Holders of the Securities, provided that such
amendment does not have a material adverse effect on the rights, preferences or
privileges of the Holders of the Securities:
(i) to cure any ambiguity;
(ii) to correct or supplement any provision in this Declaration
that may be defective or inconsistent with any other provision of this
Declaration;
(iii) to add to the covenants, restrictions or obligations of the
Sponsor;
(iv) to conform to any change in Rule 3a-5 or written change in
interpretation or application of Rule 3a-5 by any legislative body,
court, government agency or regulatory authority;
(v) to modify, eliminate and add to any provision of this
Declaration to ensure that the Trust will be classified as a grantor
trust for United States federal income tax purposes at all times that
any Securities are outstanding or to ensure that the Trust will not be
required to register as an Investment Company under the Investment
Company Act; provided that such modification, elimination or addition
would not adversely affect in any material respect the rights,
privileges or preferences of any Holder of Securities; or
(vi) to facilitate the tendering, remarketing and settlement of
the Preferred Securities as contemplated by Section 7.13(n).
SECTION 11.2 Meetings of the Holders of the Securities; Action by Written
Consent.
(a) Meetings of the Holders of any class of Securities may be called
at any time by the Regular Trustees to consider and act on any matter on which
Holders of such class of Securities are entitled to act under the terms of this
Declaration, the terms of the Securities or the rules of any stock exchange on
which the Preferred Securities are listed or admitted for trading. The Regular
Trustees shall call a meeting of the Holders of such class if directed to do so
by the Holders of at least 10% in Liquidation Amount of such class of
Securities. Such direction shall be given by delivering to the Regular Trustees
a writing stating that the signing Holders of the Securities wish to call a
meeting and indicating the general or specific purpose for which the meeting is
to be called. The Holder or Holders of the Securities calling a meeting shall
specify in writing the Securities held by such Holder or Holders, and only those
Securities specified shall be counted for purposes of determining whether the
required percentage set forth in the second sentence of this paragraph has been
met.
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(b) Except to the extent otherwise provided in the terms of the
Securities, the following provisions shall apply to meetings of the Holders of
the Securities:
(i) Notice of any such meeting shall be given to all the Holders
of the Securities having a right to vote thereat at least seven days
and not more than 60 days before the date of such meeting. Whenever a
vote, consent or approval of the Holders of the Securities is
permitted or required under this Declaration or the rules of any stock
exchange on which the Preferred Securities are listed or admitted for
trading, such vote, consent or approval may be given at a meeting of
the Holders of the Securities. Any action that may be taken at a
meeting of the Holders of the Securities may be taken without a
meeting and without prior notice if a consent in writing setting forth
the action so taken is signed by the Holders of the Securities owning
not less than the minimum amount of Securities in liquidation amount
that would be necessary to authorize or take such action at a meeting
at which all Holders of the Securities having a right to vote thereon
were present and voting. Prompt notice of the taking of action without
a meeting shall be given to the Holders of the Securities entitled to
vote who have not consented in writing. The Regular Trustees may
specify that any written ballot submitted to the Holders of the
Securities for the purpose of taking any action without a meeting
shall be returned to the Trust within the time specified by the
Regular Trustees.
(ii) Each Holder of the Securities may authorize any Person to
act for it by proxy on any or all matters in which such Holder is
entitled to participate, including waiving notice of any meeting, or
voting or participating at a meeting. No proxy shall be valid after
the expiration of 11 months from the date thereof unless otherwise
provided in the proxy. Every proxy shall be revocable at the pleasure
of the Holder of Securities executing such proxy. Except as otherwise
provided herein, all matters relating to the giving, voting or
validity of proxies shall be governed by the General Corporation Law
of the State of Delaware relating to proxies, and judicial
interpretations thereunder, as if the Trust were a Delaware
corporation and the Holders of the Securities were stockholders of a
Delaware corporation.
(iii) Each meeting of the Holders of the Securities shall be
conducted by the Regular Trustees or by such other Person that the
Regular Trustees may designate.
(iv) Unless the Business Trust Act, this Declaration, the terms
of the Securities, the Trust Indenture Act or the listing rules of any
stock exchange on which the Preferred Securities are then listed for
trading otherwise provides, the Regular Trustees, in their sole
discretion, shall establish all other provisions relating to meetings
of Holders of the Securities, including notice of the time, place or
purpose of any meeting at which any matter is to be voted on by any
Holders of the Securities, waiver of any such notice, action by
consent without a meeting, the establishment of a record date, quorum
requirements, voting in person or by proxy or any other matter with
respect to the exercise of any such right to vote.
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ARTICLE 12: REPRESENTATIONS OF THE PROPERTY TRUSTEE
AND THE DELAWARE TRUSTEE
SECTION 12.1 Representations and Warranties of the Property Trustee.
The initial Property Trustee represents and warrants to the Trust and
to the Sponsor at the date of this Declaration, and each Successor Property
Trustee represents and warrants to the Trust and the Sponsor at the time of such
Successor Property Trustee's acceptance of its appointment as Property Trustee,
that:
(a) the Property Trustee is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation or organization, with trust power and authority to execute and
deliver, and to carry out and perform its obligations under the terms of, this
Declaration;
(b) the Property Trustee satisfies the requirements set forth in
Section 6.3(a);
(c) the execution, delivery and performance by the Property Trustee
of this Declaration have been duly authorized by all necessary corporate action
on the part of the Property Trustee; this Declaration has been duly executed and
delivered by the Property Trustee, and it constitutes a legal, valid and binding
obligation of the Property Trustee, enforceable against it in accordance with
its terms, subject to applicable bankruptcy, reorganization, moratorium,
insolvency and other similar laws affecting creditors' rights generally and to
general principles of equity and the discretion of the court (regardless of
whether the enforcement of such remedies is considered in a proceeding in equity
or at law);
(d) the execution, delivery and performance of this Declaration by
the Property Trustee do not conflict with, nor constitute a breach of, the
articles of association or incorporation, as the case may be, or the by-laws (or
other similar organizational documents) of the Property Trustee; and
(e) no consent, approval or authorization of, or registration with
or notice to, any state or federal banking authority is required for the
execution, delivery or performance by the Property Trustee of this Declaration.
SECTION 12.2 Representations and Warranties of the Delaware Trustee.
The initial Delaware Trustee represents and warrants to the Trust and
to the Sponsor at the date of this Declaration, and each Successor Delaware
Trustee represents and warrants to the Trust and the Sponsor at the time of such
Successor Delaware Trustee's acceptance of its appointment as Delaware Trustee,
that:
(a) the Delaware Trustee satisfies the requirements set forth in
Section 6.2 and has the power and authority to execute and deliver, and to carry
out and perform its obligations under the terms of, this Declaration and, if it
is not a natural person, is a corporation duly organized, validly existing and
in good standing under the laws of its jurisdiction of incorporation or
organization;
(b) the Delaware Trustee has been authorized to perform its
obligations under the Certificate of Trust and this Declaration; and this
Declaration constitutes a legal, valid and binding obligation of the Delaware
Trustee under Delaware law, enforceable against it in accordance with its terms,
subject to applicable bankruptcy, reorganization, moratorium, insolvency and
other similar laws affecting creditors'
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rights generally and to general principles of equity and the discretion of the
court (regardless of whether the enforcement of such remedies is considered in a
proceeding in equity or at law); and
(c) no consent, approval or authorization of, or registration with or
notice to, any state or federal banking authority is required for the execution,
delivery or performance by the Delaware Trustee of this Declaration.
ARTICLE 13: MISCELLANEOUS
SECTION 13.1 Notices.
All notices provided for in this Declaration shall be in writing, duly
signed by the party giving such notice, and shall be delivered, telecopied or
mailed by registered or certified mail, as follows:
(a) if given to the Trust, in care of the Regular Trustees at the
Trust's mailing address set forth below (or such other address as the Trust may
give notice of to the Property Trustee, the Delaware Trustee and the Holders of
the Securities):
c/o NIPSCO Capital Markets, Inc.
801 East 86th Avenue
Merrillville, Indiana 46410
Attention: Francis P. Girot, Jr.
Telecopy No: (219) 853-5352
(b) if given to the Delaware Trustee, at the mailing address set
forth below (or such other address as the Delaware Trustee may give notice of to
the Regular Trustees, the Property Trustee and the Holders of the Securities):
Chase Manhattan Bank Delaware
1201 Market Street
Wilmington, Delaware 19801
Attention: Corporate Trust Administration
Telecopy No: (302) 984-4903
(c) if given to the Property Trustee, at its Corporate Trust Office
(or such other address as the Property Trustee may give notice of to the Regular
Trustees, the Delaware Trustee and the Holders of the Securities);
(d) if given to the Holders of the Common Securities, at the mailing
address of the Sponsor set forth below (or such other address as the Holders of
the Common Securities may give notice of to the Property Trustee, the Delaware
Trustee and the Trust):
c/o NIPSCO Capital Markets, Inc.
801 East 86th Avenue
Merrillville, Indiana 46410
Attention: Francis P. Girot, Jr.
Telecopy No: (219) 853-5352
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(e) if given to any Holder of Preferred Securities, at such Holder's
address as set forth in the register of the Trust.
All such notices shall be deemed to have been given when received in person,
telecopied with receipt confirmed or mailed by first class mail, postage
prepaid, except that if a notice or other document is refused delivery or cannot
be delivered because of a changed address of which no notice was given, such
notice or other document shall be deemed to have been delivered on the date of
such refusal or inability to deliver.
SECTION 13.2 Governing Law.
This Declaration and the rights of the parties hereunder shall be
governed by and interpreted in accordance with the laws of the State of
Delaware, without regard to principles of conflicts of laws.
SECTION 13.3 Intention of the Parties.
It is the intention of the parties hereto that the Trust be classified
for United States federal income tax purposes as a grantor trust. The provisions
of this Declaration shall be interpreted in a manner consistent with such
classification.
SECTION 13.4 Headings.
The headings contained in this Declaration are inserted for
convenience of reference only and do not affect the interpretation of this
Declaration or any provision hereof.
SECTION 13.5 Successors and Assigns.
Whenever in this Declaration any of the parties hereto is named or
referred to, the successors and assigns of such party shall be deemed to be
included, and all covenants and agreements in this Declaration by the Sponsor
and the Trustees shall bind and inure to the benefit of their respective
successors and assigns, whether so expressed.
SECTION 13.6 Partial Enforceability.
If any provision of this Declaration or the application of such
provision to any Person or circumstance is held invalid, the remainder of this
Declaration, or the application of such provision to persons or circumstances
other than those to which it is held invalid, shall not be affected thereby.
SECTION 13.7 Counterparts.
This Declaration may contain more than one counterpart of the
signature page, and this Declaration may be executed by the affixing of the
signature of each of the Trustees to one of such counterpart signature pages.
All such counterpart signature pages shall be read as though one, and they shall
have the same force and effect as though all of the signers had signed a single
signature page.
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IN WITNESS WHEREOF, the undersigned have caused these presents to be
executed as of the day and year first above written.
NIPSCO CAPITAL MARKETS, INC.,
as Sponsor, Debenture Issuer and Common
Securities Holder
By: /s/ Stephen P. Adik
---------------------------------------
Stephen P. Adik
President
THE CHASE MANHATTAN BANK,
as Property Trustee
By: /s/ R. Lorenzen
---------------------------------------
R. Lorenzen
Senior Trust Officer
CHASE MANHATTAN BANK DELAWARE,
as Delaware Trustee
By: /s/ John J. Cashin
---------------------------------------
John J. Cashin
Vice-President
/s/ Stephen P. Adik
--------------------------------------------
STEPHEN P. ADIK, as Regular Trustee
/s/ Francis P. Girot, Jr.
--------------------------------------------
FRANCIS P. GIROT, JR., as Regular Trustee
/s/ Arthur A. Paquin
--------------------------------------------
ARTHUR A. PAQUIN, as Regular Trustee
[AMENDED AND RESTATED DECLARATION OF TRUST SIGNATURE PAGE]
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EXHIBIT A
[IF THE PREFERRED SECURITY IS TO BE A GLOBAL SECURITY, INSERT THE
FOLLOWING: THIS PREFERRED SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF
THE DECLARATION HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE "DEPOSITARY"), OR A
NOMINEE OF THE DEPOSITARY. THIS PREFERRED SECURITY IS EXCHANGEABLE FOR PREFERRED
SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS
NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE DECLARATION, AND NO
TRANSFER OF THIS PREFERRED SECURITY (OTHER THAN A TRANSFER OF THIS PREFERRED
SECURITY AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A
NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY) MAY BE REGISTERED, EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS PREFERRED SECURITY CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY PREFERRED SECURITY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
REGISTERED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), AND EXCEPT AS OTHERWISE PROVIDED
IN THE DECLARATION, ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, SINCE THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.]
CERTIFICATE NO. ______ NUMBER OF PREFERRED SECURITIES: _____
CUSIP NO. 654639 20 2
CERTIFICATE EVIDENCING PREFERRED SECURITIES
OF
NIPSCO CAPITAL TRUST I
PREFERRED SECURITIES
(LIQUIDATION AMOUNT $50 PER PREFERRED SECURITY)
NIPSCO Capital Trust I, a statutory business trust created under the
laws of the State of Delaware (the "Trust"), hereby certifies that __________
(the "Holder") is the registered owner of ________ preferred securities of the
Trust representing an undivided beneficial ownership interest in the assets of
the Trust designated the Preferred Securities (liquidation amount $50 per
Preferred Security) (the "Preferred Securities"). The Preferred Securities are
transferable on the register of the Trust, in person or by a duly authorized
attorney, upon surrender of this certificate duly endorsed and in proper form
for transfer as provided in the Declaration (as defined below). The designation,
rights, privileges, restrictions, preferences and other terms and provisions of
the Preferred Securities represented hereby are issued and shall in all respects
be subject to the provisions of the Amended and Restated Declaration of Trust of
the Trust, dated as of February 16, 1999 (as the same may be amended from time
to time (the "Declaration"), among NIPSCO Capital Markets, Inc., as Sponsor,
Stephen P. Adik, Francis P. Girot, Jr. and Arthur A. Paquin, as Regular
Trustees, The Chase Manhattan Bank, as Property Trustee, Chase Manhattan Bank
Delaware, as Delaware Trustee, and the holders from time to time of undivided
beneficial ownership interests in the assets of the Trust. Capitalized terms
used herein but not defined shall have the meaning given them in the
Declaration. The Holder is entitled to the benefits of the Guarantee Agreement,
dated as of February 16, 1999, of NIPSCO Capital Markets, Inc., in respect of
the Preferred Securities. The Sponsor will provide a copy of the Declaration,
the Guarantee and the Indenture (as defined in the Declaration) to a Holder
without charge upon written request to the Sponsor at its principal place of
business.
67
Upon receipt of this certificate, the Holder is bound by the terms of
the Declaration and is entitled to the benefits thereunder.
By acceptance, the Holder agrees to treat, for United States federal
income tax purposes, the Debentures as indebtedness and the Preferred Securities
as evidence of undivided indirect beneficial ownership interests in the
Debentures.
IN WITNESS WHEREOF, the Trust has executed this certificate this _____
day of ___________, 1999.
NIPSCO CAPITAL TRUST I
By:
-----------------------------
Regular Trustee
2
68
This is one of the Securities referred to in the within-mentioned
Declaration.
THE CHASE MANHATTAN BANK
By:
-----------------------------
Senior Trust Officer
3
69
THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT AS PROVIDED IN
THE DECLARATION (AS DEFINED BELOW)
CERTIFICATE NO. 1 NUMBER OF COMMON SECURITIES: 214,000
CERTIFICATE EVIDENCING COMMON SECURITIES
OF
NIPSCO CAPITAL TRUST I
COMMON SECURITIES
(LIQUIDATION AMOUNT $50 PER COMMON SECURITY)
NIPSCO Capital Trust I, a statutory business trust created under the
laws of the State of Delaware (the "Trust"), hereby certifies that NIPSCO
CAPITAL MARKETS, INC. (the "Holder") is the registered owner of 214,000 common
securities of the Trust representing an undivided beneficial ownership interest
in the assets of the Trust designated the Common Securities (liquidation amount
$50 per Common Security) (the "Common Securities"). Except as provided in the
Declaration (as defined below), the Common Securities are not transferable, and
any attempted transfer thereof shall be void. The designation, rights,
privileges, restrictions, preferences and other terms and provisions of the
Common Securities represented hereby are issued and shall in all respects be
subject to the provisions of the Amended and Restated Declaration of Trust of
the Trust, dated as of February 16, 1999 (as the same may be amended from time
to time, the "Declaration"), among NIPSCO Capital Markets, Inc., as Sponsor,
Stephen P. Adik, Francis P. Girot and Arthur A. Paquin, as Regular Trustees, The
Chase Manhattan Bank, as Property Trustee, Chase Manhattan Bank Delaware, as
Delaware Trustee, and the holders, from time to time, of undivided beneficial
ownership interests in the assets of the Trust. The Holder is entitled to the
benefits of the Guarantee Agreement, dated as of February 16, 1999, of NIPSCO
Capital Markets, Inc., in respect of the Common Securities. The Sponsor will
provide a copy of the Declaration, the Guarantee and the Indenture (as defined
in the Declaration) to the Holder without charge upon written request to the
Sponsor at its principal place of business.
Upon receipt of this certificate, the Holder is bound by the terms of
the Declaration and is entitled to the benefits thereunder.
By acceptance, the Holder agrees to treat, for United States federal
income tax purposes, the Debentures as indebtedness and the Common Securities as
evidence of an undivided indirect beneficial ownership interest in the
Debentures.
70
IN WITNESS WHEREOF, the Trust has executed this certificate this ____
day of ____________, 1999.
NIPSCO CAPITAL TRUST I
By:
-----------------------------
Regular Trustee
2
71
This is one of the Securities referred to in the within-mentioned
Declaration.
THE CHASE MANHATTAN BANK
By:
-----------------------------
Senior Trust Officer
3